- The DXY index reverses the recent drop and climbs back to the 92.40 region.
- The markets’ attention remains on the pandemic, the Fed and politics.
- The absence of US data releases leaves the focus on risk trends.
The US dollar DXY index, which measures the strength of the dollar against a basket of major currencies, regains some bullish traction during the European session on Friday and reaches daily highs around the region of 92.40.
DXY US Dollar Index Focuses Attention on Pandemic and Risk Trends
The DXY index manages to attract some buyers at the end of the week after six consecutive days with losses. The weekly downward movement of the dollar seems have found decent support in the 92.20 region, area that coincides with the 6-month support line.
Meanwhile, investors The progress of the coronavirus pandemic continues to focus attention in the US and the rest of the world.
There is no major economic release on the US calendar, leaving price action at the mercy of general trends in risk appetite.
What can we expect around the USD?
The recent drop in the DXY index stopped just above the 92.00 level, where decent support appears to have appeared. Meanwhile, the dollar remains focused on the post-election scenario in the United States and the prospects for the US economy under the Biden administration, while simultaneously monitoring the impact of the second wave of the pandemic on the economic recovery. On another front, the Federal Reserve’s “lower rates longer” stance is expected to continue to limit serious upside potential in the DXY index.
Relevant levels of the US dollar DXY index
At the time of writing, the DXY index is gaining 0.10% on the day, trading at 92.38. A breakout of 93.20 (November 11 high) would open the door to 93.62 (100-day SMA) and at 94.30 (November 4 high). On the other hand, immediate support is at 92.13 (November 9 low), followed by 91.92 (23.6% Fibonacci retracement from the 2017-2018 drop) and 91.80 (May 2018 low).
.
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.
