US Dollar Index Slides On Data

The US Dollar Index (DXY) which measures the performance of the US dollar against major currencies, has slid by 0.19%, settling at 96.04 during the New York trading session.

The market sentiment was positive as the Wall Street session closed, with major US shares finishing in the green territory recording gains between 0.60% and 1.13%.

In the US bond market, Treasury yields in the short-maturity of the curve fell with 2s, 5s, and 10s dropped between 1-3 basis points, ended respectively at 0.6544%, 1.2467%, and 1.482%, each. In the long-term of the curve 20s and 30s, gained between 1-1.5 basis points, sat at 1.9138% and 1.88%, respectively.

The US dollar was at the mercy of the US inflation data figures. On Friday, the Department of Labour reported that the Consumer Price Index for November on an annual basis rose to 6.8%, in line with estimations, and higher than October’s reading at 6.2%.

The Core CPI, which excludes food and energy, rose to 4.9%, as foreseen though more elevated than October’s 4.6%.

Later on the day, the University of Michigan Consumer Sentiment for December rose to 70.4 from 67.1 in November.

The US Dollar Index finished the week above the 96.00 figure for the second successive week. The DXY is in a crystal clear uptrend, and through the last couple of weeks, price action consolidated around the 95.50-96.50 range, forming an ascending triangle in an uptrend.

In the event of breaking to the upside of the formation, the ascending triangle target would be 98.00, but it would find some hurdles on the way up.

The first resistance would be 97.00, followed by June 30 high at 97.80, followed by the ascending triangle target at 98.00.