Dollar index improves and rises to 2-day highs near 106.30

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  • The index extends the recovery beyond the 106.00 barrier.
  • Rising US yields also reinforce the bullish momentum.
  • The atmosphere at the venture complex appears depressed on Friday.

The dollar index (DXY), which measures the dollar against a set of its main competitors, manages to advance beyond 106.00 by the end of the week.

USD Index recovers to 106.00 level and above

The dovish tone of the risk-linked galaxy lends some much-needed oxygen to the dollar and encourages a rather sharp bounce in the index from the 105.60 area recorded in the previous session.

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The corrective move in the dollar is also supported by rising US yields across the curve, which at the same time manage to regain some composure after post-session weakness.

What to keep in mind around the dollar

The dollar’s weekly leg down appears to have found some containment around 105.60 (24 Nov), triggering a subsequent slight bounce in line with some profit-taking in the risk-on space.

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Although the Fed’s hawkish speech keeps the pivot narrative in the freezer, upcoming results in US fundamentals will likely play a key role in determining the chances of a slower pace of the Fed normalization process. Fed in the short term.

technical levels

The index is now up 0.68% at 106.34 and faces immediate resistance at 107.99 (weekly high Nov. 21), followed by 109.15 (100-day SMA) and then 110.48 (55-day SMA). On the other hand, a break of 105.34 (15 Nov monthly low) would open the door to 105.32 (200-day SMA) and finally 104.63 (10 Aug monthly low).

Source: Fx Street

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