- The DXY bullish movement slows down before Monday’s 92.80.
- US 10-year yields remain lateralized around 1.30%.
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The dollar alternates gains and losses near the 92.80 zone when measured by the US dollar index (DXY) on Monday.
The index navigates within a tight range amid month-end flows and consolidating returns, as market participants continue to adjust to Powell’s recent message at the Jackson Hole virtual event.
In fact, returns from the key US 10-year benchmark so far extend consolidation around the 1.30% level, down about 5 pips from the level it had before Powell issued a cautious statement on Friday.
The dollar is now expected to trade mostly in a tight range at least in the sessions leading up to the release of the non-farm payroll figures (Friday), which are now seen as critical for a potential QE phasing announcement at the meeting. September FOMC.
Technical levels
Now the index is gaining 0.06% to 92.73 and a break above 93.72 (Aug 20 high) would open the door to 94.00 (round level) and then 94.30 (Nov 4, 2020 monthly high). On the other hand, the next downward barrier is located at 92.59 (August 30 low) followed by 92.47 (August 13 low) and finally 91.78 (July 30 monthly low).
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