Market news
22.08.2023, 07:07

USD Index extends the decline and challenges 103.00

  • The index moves lower and approaches 103.00.
  • US yields maintain the march north unabated.
  • Fedspeak, housing data will take centre stage later on Tuesday.

The greenback, in terms of the USD Index (DXY), grinds lower and puts the 103.00 region to the test on turnaround Tuesday.

USD Index looks at Fedspeak, Jackson Hole

The index grinds lower and flirts with the key 200-day SMA in the 103.20/15 band amidst further improvement in the risk complex during the first half of the week.

The so far weekly corrective move in the greenback also comes amidst the continuation of the upside momentum in US yields, where the short end revisits tops around the key 5.0% threshold and the 10-year benchmark navigates levels last seen in November 2007 past 4.30%.

In the meantime, market participants maintain a cautious trade ahead of the imminent Jackson Hole Symposium and Chief Powell’s speech (Thursday and Friday), where consensus expects his message to fall in line with the latest FOMC meeting on July 26.

In the US data space, Existing Home Sales for the month of July are due seconded by the August Richmond Fed Manufacturing Index and speeches by Richmond Fed T. Barkin (2024 voter, centrist), FOMC Governor M. Bowman (permanent voter, centrist), and Chicago Fed A. Goolsbee (voter, centrist).

What to look for around USD

The index appears to have entered a corrective phase after hitting new highs around 103.70 last week.

In the meantime, support for the dollar keeps coming from the good health of the US economy, which seems to have reignited the narrative around the tighter-for-longer stance from the Federal Reserve.

Furthermore, the idea that the dollar could face headwinds in response to the data-dependent stance from the Fed against the current backdrop of persistent disinflation and cooling of the labour market appears to be losing traction as of late.

Key events in the US this week: Existing Home Sales (Tuesday) – MBA Mortgage Applications, Flash Manufacturing/Services PMIs, New Home Sales (Wednesday) – Jackson Hole Symposium, Durable Goods Orders, Chicago Fed National Activity Index, Initial Jobless Claims (Thursday) - Jackson Hole Symposium, Final Michigan Consumer Sentiment, Chief Powell (Friday).

Eminent issues on the back boiler: Persistent debate over a soft or hard landing for the US economy. Incipient speculation of rate cuts in early 2024. Geopolitical effervescence vs. Russia and China.

USD Index relevant levels

Now, the index is down 0.18% at 103.13 and faces initial support at 102.30 (55-day SMA) followed by 101.74 (monthly low August 4) and then 100.55 (weekly low July 27). On the other hand, the breakout of 103.68 (monthly high August 18) would open the door to 104.69 (monthly high May 31) and finally 105.88 (2023 high March 8).

© 2000-2024. All rights reserved.

This site is managed by Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).

The information on this website is for informational purposes only and does not constitute any investment advice.

The company does not serve or provide services to customers who are residents of the US, Canada, Iran, The Democratic People's Republic of Korea, Yemen and FATF blacklisted countries.

AML Website Summary

Risk Disclosure

Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.

Privacy Policy

Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.

Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.

Feedback
Live Chat E-mail
Up
Choose your language / location
Click Subscribe to receive notifications about promotions and bonuses