- The DXY Index drops below the 91.00 support at fresh 32-month lows.
- Lingering optimism in risk appetite weighs on the dollar.
- ISM’s initial jobless claims and non-manufacturing PMI stand out on today’s economic calendar.
The selling bias around the dollar gains an additional rhythm and drags the US dollar DXY index to new 32-month lows in the 90.85 / 80 region.
US Dollar DXY Index Looks Weak Ahead of Data
The DXY index is moving by levels last seen in April 2018, falling below the 91.00 level on Thursday, always supported by widespread improvement in risk appetite.
In fact, investors opt for assets with the highest perceived risk in the context of a growing optimism about the idea of a (global) vaccination campaign starting as early as the end of the year. In addition, the prospects for a strong rebound in economic activity and rumors of greater US stimulus contribute to the growing outflows of the dollar and other safe-haven assets.
Regarding the US data, today highlights the publication of the initial weekly unemployment claims and the ISM non-manufacturing PMI for November.
What can we expect around the USD?
The bearish stance around the US dollar accelerates and forces the DXY index to fall below key support at 91.00, levels last seen in April 2018. Improved risk appetite sentiment has been bolstered by a political scenario Clearer America combined with upbeat vaccine news and improved growth prospects. In addition, hopes for additional fiscal stimulus have resurfaced, which together with the Federal Reserve’s “lower rates longer” stance is seen as keeping the USD under additional pressure for now.
Relevant levels of the US dollar DXY index
At the time of writing, the DXY index is up 0.12% on the day, trading at 91.00. Immediate support is at 90.83 (December 3 low), followed by 89.22 (April 2018 low) and 88.94 (March 2018 low). On the other hand, a break above 92.80 (November 23 high), would open the door to 93.20 (November 11 high) and finally 9319 (100-day SMA).
.
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
