- DXY looks steady in the mid-93.00s region on Tuesday.
- Focus remains on US politics and the pandemic.
- Factory Orders, IBD/TIPP index, API’s report next in the docket.
The greenback, when tracked by the US Dollar Index (DXY), looks steady around the 93.50 area on turnaround Tuesday.
US Dollar Index looks to data, risk trends
The index managed to advance to the 94.00 neighbourhood at the beginning of the week, although the bullish intentions lacked follow through and motivated the index to return to the current mid-93.00s ahead of the opening bell in the Old Continent.
In the meantime, investors keep gauging the fast-spreading pandemic vs. the ongogin economic recovery, staying vigilant at the same time on the US political scenario, where an extra coronavirus-stimulus package remains in the centre of the debate between Democrats and Republicans.
Still on US politics, and with 90 days to the national elections, Democrat candidate Joe Biden is seen defeating current President Donald Trump.
Later in the US calendar, June’s Factory Orders are due seconded by the IBD/TIPP index and the weekly report on US crude oil supplies by the American Petroleum Institute (API).
What to look for around USD
The dollar managed to regain attention after bottoming out in levels last seen over two years ago in the 92.50 area during last week. Looking at the broader picture, investors keep the bearish stance on the currency unchanged against the usual backdrop of US-China jitters, the spread of the pandemic and the dovish message from the Fed. Also weighing on the buck, market participants seem to have shifted their preference for other safe havens instead of the greenback on occasional bouts of risk aversion. On another front, the speculative community remained well into the negative territory for yet another week, adding to the idea of a more serious bearish trend in the dollar.
US Dollar Index relevant levels
At the moment, the index is losing 0.04% at 93.47 and faces the next support at 92.55 (2020 low Jul.31) seconded by 91.80 (monthly low May 18) and finally 89.23 (monthly low April 2018). On the other hand, a break above 93.99 (weekly high Aug.3) would target 94.20 (38.2% Fibo of the 2017-2018 drop) en route to 96.03 (50% Fibo of the 2017-2018 drop).
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