US Dollar bounces off lows, 97.00 back on the radar

The US Dollar Index – which tracks the buck vs. its main rivals – seems to have found dip buyers around daily lows and is now re-focusing on the key barrier at 97.00 the figure.

US Dollar weaker post-FOMC

The index failed to sustain yesterday’s bullish attempt to levels north of the 97.00 handle, ending the day in the negative territory after the FOMC minutes failed to meet expectations of a more hawkish tone.

In fact, despite the Committee signaled that further tightening should come ‘soon’ and the Fed is projecting to start reducing its balance sheet at some point by year-end, members apparently need further evidence that the slowdown seen during the January-March period was transitory.

In the meantime, DXY continues to gravitate in the area of multi-month lows around 96.80/97.00 for the time being, down for the second week in a row and losing nearly 7% since early January’s 14-year tops in the vicinity of  104.00 the figure.

Data wise today, Initial Claims is due seconded by Wholesale Inventories and the speech by FOMC’s L.Brainard (permanent voter, centrist).

US Dollar relevant levels

The index is losing 0.03% at 96.92 facing the next support at 96.70 (2017 low May 23) followed by 95.91 (low Nov.9 2016) and then 94.95 (low Sep.22 2016). On the other hand, a breakout of 97.32 (high May 24) would open the door to 97.97 (high May 18) and finally 98.34 (20-day sma).