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  • The index loses further momentum and tests 96.30.
  • Riskier assets pick up pace in detriment of the buck.
  • US Philly Fed manufacturing gauge misses estimates in August.

The US Dollar Index (DXY), which measures the greenback vs. a basket of its main rivals, is accelerating the daily leg lower to the area of 96.30, or session lows.

US Dollar Index weaker on risk-on rebound

The index is now losing the grip following another bout of strength in the risk-associated complex, with gains in the Turkish Lira, the Chinese Yuan and the Russian Ruble remain in centre stage.

Adding to the buck’s downside pressure, the Philly Fed manufacturing index missed estimates for the current month, coming in at 11.9 vs. 21.9 forecasted and down from July’s 25.7.

Further US data saw Initial Claims at 212K WoW, Housing Starts coming in below expectations at 1.168 million units (or gaining 0.9%) and Building Permits at 1.311 million units, or expanding 1.5%.

US Dollar Index relevant levels

As of writing the index is down 0.31% at 96.42 and faces immediate contention at 95.78 (10-day SMA) seconded by 95.19 (21-day SMA) and finally 94.08 (low Jul.26). On the upside, a break above 96.98 (2018 high Aug.15) would open the door to 97.00 (psychological level) and then 97.87 (61.8% Fibo of the 2017-2018 drop).