US Dollar regains the bid tone, challenging 95.00
- DXY testing the key up barrier at 95.00.
- USD firmer post-US data.
- Next interim high at 95.15 (October 27).
The US Dollar Index (DXY) has shrugged off the initial bearish note and is now challenging the key resistance area in the 95.00 neighbourhood, or weekly tops.
US Dollar bid after data
The index gathered unexpected buying interest despite US non-farm payrolls missed expectations for the month of October and wage inflation remains unable to sustain the recent up trend. On the bright side, the jobless rate ticked lower to 4.1% from 4.2%.
However, and despite missing consensus today, the labour market remains pretty solid and gave no reasons to pour cold water over expectations of a rate hike in December.
Furthermore, subsequent and above-expectations results from factory orders and the key ISM non-manufacturing help the buck to regain the smile, pushing at the same time yields of the US 10-year reference to fresh tops above 2.36%.
In addition, the NY Fed’s GDP Nowcast model now sees Q4 GDP rising at an annualized 3.16%, while Atlanta Fed’s GDPNow tool forecasts Q4 GDP at 4.5% on a yearly basis.
US Dollar relevant levels
As of writing the index is gaining 0.24% at 94.96 and a breakout of 95.15 (high Oct.27) would open the door to 95.90 (38.2% Fibo of the 2017 drop) and then 96.73 (200-day sma). On the downside, the immediate support aligns at 94.44 (10-day sma) seconded by 94.42 (low Nov.2) and finally 94.03 (23.6% Fibo of the 2017 drop).