Market Cap:
$267B
BTC Dominance:
69.24%
btc:
$10156.33
eth:
$190.47
xrp:
$0.27
Advertise
Forex

US dollar index moves to 98.00 and loses momentum

GKFX | Jul. 30, 2019
US dollar index moves to 98.00 and loses momentum

The greenback is sticking to the positive territory so far on Tuesday, managing well to keep the trade above the key 98.00 barrier when gauged by the US Dollar Index (DXY).

30 July 2019, GKFX – The index has posted gains in five out of the last six weeks, regaining the 98.00 handle and moving to fresh 2-month tops in levels closer to the 2019 peaks near 98.40.

DXY is now bouncing off the earlier test of the vicinity of 98.00 the figure after Core PCE rose 0.2% inter-month in June and 1.6% over the last twelve months, a tad below estimates albeit a little higher than May’s advance.

Additional data saw Personal Income and Personal Spending expanding in line with consensus at a monthly 0.4% and 0.3%, respectively; while house prices measured by the S&P/Case-Shiller Index rose at a non-seasonally-adjusted 2.4% YoY in May, also matching expectations.

Later in the day, the housing sector should remain in the limelight with the results from Pending Home Sales ahead of the key Consumer Confidence gauge by the Conference Board for the current month.

In the meantime, investors are shifting their attention to tomorrow’s FOMC event and the likely announcement of a 25 bps interest rate cut. It is worth recalling that the upside momentum in the greenback has been sustained by rising speculations of a less-dovish-than-expected tone from the Committee tomorrow, particularly on the back of auspicious Q2 GDP results and the solid health of the labour market.

What to look for around USD

Investors have already priced in a 25 bps interest rate cut this month, while a larger rate cut is now practically off the table following Friday’s GDP figures. Trade talks are back to the fore in light of this week’s meeting in China, also lending support to the pick up in the risk-on mood. The demand for the greenback, in the meantime, stays underpinned by its safe have appeal, the status of ‘global reserve currency’, solid US fundamentals and the broad-based shift to a more accommodative stance from the rest of the G-10 central banks.

US dollar index technical analysis

At the moment, the pair is up 0.03% at 98.09 and faces the next resistance at 98.21 (monthly high Jul.30) seconded by 98.33 (monthly high Apr.23) and finally 98.37 (2019 high May 23). On the flip side, a breakdown of 96.88 (200-day SMA) would open the door to 96.67 (low Jul.18) and then 96.46 (low Jun.7).

Disclaimer

This article was provided by analysts at GKFX. The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice. If such information is acted upon by you, then this should be solely at your discretion, and GKFX will not be held accountable in any way.

Disclaimer: The views and opinions expressed in this article are solely those of the author and do not reflect the official policy or position of AtoZ Markets.com, nor should they be attributed to AtoZMarkets.