US Dollar Index clings to gains above 96.00
- DXY manages well to keep business above the 96.00 mark.
- US Retail Sales, Philly Fed index expanded above estimates.
- Business Inventories, NAHB Index, TIC Flows coming up next.
The US Dollar Index (DXY), which gauges the buck vs. a bundle of its main rivals, is trading on a positive note above the 96.00 mark following the opening bell in Wall St. on Thursday.
US Dollar Index looks to risk trends
The index is up for the first time after four daily pullbacks in a row on Thursday on the back of the resumption of some cautiousness among traders as well as profit-taking mood in the risk complex.
In the meantime, headlines from potential coronavirus vaccines, the economic recovery and trade/geopolitical concerns on the US-China front remain the key drivers of the markets’ sentiment, all via their impact on the broad risk appetite trends.
In the US data space, headline Retail Sales expanded at a monthly 7.5% in June and the Philly Fed manufacturing index also surprised to the upside to 24.1 for the current month (from June’s 27.5). in addition, Initial Claims showed 1,3 million Americans filed for unemployment insurance benefits during last week, a tad above expected.
Later in the docket, the NAHB index is due seconded by Business Inventories, TIC Flows and speeches by FOMC’s J.Williams and C.Evans.
What to look for around USD
The relentless advance of the COVID-19 pandemic in the US and across the world vs. news of a potential vaccine that could be developed before markets’ expectations plus the ongoing reopening of global economies are all driving the sentiment in the global markets and keep the dollar under pressure. On the constructive view of the dollar, bouts of risk aversion should support the investors’ preference for the greenback as a safe haven along with its status of global reserve currency and store of value.
US Dollar Index relevant levels
At the moment, the index is gaining 0.01% at 96.04 and a break above 97.80 (weekly high Jun.30) would aim for 97.87 (61.8% Fibo of the 2017-2018 drop) and finally 98.21 (200-day SMA). On the downside, the next support is located at 95.78 (low Jul.15) seconded by 95.72 (monthly low Jun.10) and then 94.65 (2020 low Mar.9).