USD breaking point for the Index is near around 102.00. The index’s upward momentum begins to wane on Friday (Today)
USD Key Considerations
On Friday, the index’s upward momentum falters.
Early in the European day, US yields look to be in defense mode.
Flash Consumer Sentiment is up next, followed by Fed’s Bowman.
In terms of the USD Index (DXY), the dollar on Friday fluctuates between gains and losses at the 102.00 area. Weekly tops.
USD Index examines statistics and aversion to risk
Due to a minor rebound in the risk-associated environment and waning risk aversion at the conclusion of the week. The US dollar’s index’s current sharp advance has been slightly muted at the 102.00 area.
Meanwhile, talk of a possible deadlock in the Fed‘s hike cycle after the event on June 14 is still rampant. This viewpoint was notably amplified by Wednesday’s lower-than-expected CPI readings. And it was subsequently partially supported by Thursday’s lower Producer Prices and rising weekly Claims.
The important US event on Friday will be the advanced Michigan Consumer Sentiment for the month of May. Which will be closely followed by M. Bowman’s speech at the FOMC.
What to watch out for about USD
In spite of modest risky asset recovery, the index maintains trading near weekly peaks at 102.000.
The latest suggestion is that the Fed would likely suspend its easing process in the near future. Which has caused the index to seem to be under negative pressure. That being stated, the health of important fundamentals (such as jobs and prices) will decide the future course of monetary policy.
The persisting disinflation, given the fact that consumer prices are still well over the goal, is the beginning of labor market cracks. The slowing in the economy, and the mounting unease surrounding the US financial industry all support a Fed standstill.
Important Technical Levels
The index is now lower by 0.08 percent at 101.98 and confronts support at 101.01 (the week’s bottom on April 26),. Followed by 100.78 (the 2023 bottom on April 14), and lastly 100.00 (the psychological threshold). However, an excursion over 102.15 (the previous week’s top on May 12) would lead to 102.40 (the preceding month’s peak on May 2). And ultimately 102.80 (the previous week’s top on April 10.
