US Dollar Index recovers and rises back to daily highs, above 97.00

The greenback fell on Monday against most of it competitors but the Dollar Index was modestly higher, boosted by a rally of USD/JPY and marginal gains against European currencies. The DXY was up 0.2%, hovering near daily highs, after being able to recover from losses.  

On a low volume day, the index peaked at 97.10 but then turned sharply lower after the release of the US durable goods order and the National Activity Index from the Chicago Fed.  New orders dropped 1.1% in May, against 0.6% of estimates, while the Activity Index dropped to -0.26. 

Details of May Durable Goods Orders Disappoint

Data to be release on Tuesday included the S&P/Case-Shiller Home Price Index and the Richmond Fed Manufacturing Index. Also, Janet Yellen will speak in London, while many central bankers will appear at an event of the European Central Bank (Draghi, Poloz, Carney and Kuroda). 

Equity prices on Wall Street were mixed on Monday. The Dow Jones was up 0.18% while the Nasdaq was falling 0.24%. In the bond market, yield headed lower. The 10-year fell to 2.12%, the lowest in a week. USD/JPY rallied despite the moves in the bond market. 

Levels to watch 

To the upside the immediate resistance is seen around 97.10 (daily high), followed by 97.30 and 97.45/50 (last week high). On the downside, immediate support might be located a t96.95 (20-hour moving average), 96.75 (daily low) and 96.55.