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

  • 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.

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.

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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