US Dollar Index weaker, loses the 93.00 mark
- 13th August 2020
- Posted by: Hakeem
- Category: FOREX LATEST NEWS DAILY
- DXY put the 93.00 support to the test on Thursday.
- Risk-on sentiment favours the selling bias in the dollar.
- US Initial Claims came in at 963K during last week.
The US Dollar Index (DXY), which tracks the greenback vs. a bundle of its main rivals, keeps losing ground and tests the sub-93.00 region in the wake of the opening bell in Wall St.
US Dollar Index offered on risk-on mood
The downside pressure remains well on the rise around the greenback in the second half of the week, forcing the index to breach the key support at 93.00 the figure and therefore paving the way for a potential deeper pullback.
The firm note in the risk complex coupled with rising uncertainty around another stimulus package (mainly aimed at households and small companies) have been encouraging outflows from the dollar and dragged DXY to new weekly lows.
In the docket, the always-relevant Initial Claims rose by 963K during last week, the first reading below the 1-million yardstick since late March. Despite the improvement in the weekly indicator, there are still nearly 15.5 million Americans living off insurance benefits.
Additional data saw Export Prices and Import Prices rising at a monthly 0.8% and 0.7%, respectively, during July.
What to look for around USD
The index stays on the defensive after being rejected once again from the 94.00 region earlier in the week. Looking at the broader picture, investors remain bearish on the dollar against the usual backdrop of a dovish Fed, the unabated advance of the pandemic and somewhat diminishing momentum in the economic recovery, whereas persistent US-China effervescence appears on the supportive side of the greenback. On another front, the speculative community remained well into the negative territory for yet another week, supporting the view that a serious bearish trend could be shaping up around the dollar.
US Dollar Index relevant levels
At the moment, the index is losing 0.46% at 92.98 and faces the next support at 92.52 (2020 low Aug.6) seconded by 91.80 (monthly low May 18) and finally 89.23 (monthly low April 2018). On the upside, a break above 93.99 (weekly high Aug.3) would aim for 94.20 (38.2% Fibo of the 2017-2018 drop) and then 96.03 (50% Fibo of the 2017-2018 drop).