US Dollar Index struggles for direction near 96.30 ahead of US data

• The index exchanges gains with losses around 96.30.
• Yields of the US 10-year note met support near 2.50%.
• Advanced manufacturing/services PMIs, New Home Sales on the docket.

The greenback, in terms of the US Dollar Index (DXY), is alternating gains with losses at the end of the week around the 96.30 region.

US Dollar Index looks to data, trade

After bottoming out in the 95.80/75 region following the FOMC meeting on Wednesday, the index managed to regain some composure and retake the key barrier at 96.00 the figure and beyond.

In the meantime, markets’ appetite for riskier assets eased somewhat in past hours in response to increased uncertainty surrounding Brexit and after President Trump hinted at the likelihood that US-China trade dispute could linger for longer.

In the data space today, preliminary manufacturing/services PMIs gauges by Markit are due later in the day along with New Home Sales and the speech by Atlanta Fed R.Bostic (non voter, dovish).

What to look for around USD

The greenback left behind recent Fed-induced lows although it is expected to remain in centre stage while investors keep adjusting their views to the renewed dovish stance from the Fed. In light of the heightened patient stance from the Fed, traders will now scrutinize every piece of incoming data, particularly regarding the inflation performance. Fresh jitters from the US-China trade front could, however, put a floor to the buck’s decline in the near/medium term.

US Dollar Index relevant levels

At the moment, the pair is retreating 0.04% at 96.31 and a break below 95.74 (low Mar.20) would open the door for 95.16 (low Jan.31) and then 95.03 (2019 low Jan.10). On the upside, the next hurdle emerges at 96.58 (21-day SMA) seconded by 97.37 (high Feb.15) and finally 97.71 (2019 high Mar.7).