US Dollar keeps gains near 99.70, FOMC on sight

The greenback – tracked by the US Dollar Index – is recovering part of the shine lost on Tuesday, currently posting moderate gains in the 99.70 region.

US Dollar attention to FOMC

The index has regained some buying interest today following yesterday’s deep pullback to the 99.40 area, levels last seen in mid-November.

President D.Trump continued to talk down the buck on Tuesday, this time helped by his trade advisor P.Navarro, who said that Germany is benefiting from a ‘grossly undervalued’ euro.

Comments from Trump added to previous attempts to push USD lower, as he recently hinted at the likeliness that China and Japan could be looking to boost their trade figures via devaluating its currencies (vs. the Dollar of course).

Looking ahead, the FOMC meeting appears as the only driver to prevent further USD selling, although there won’t be any update on the ‘dots plot’ or a press conference by Chair J.Yellen.

Further relevant US data will see the ISM Manufacturing and the employment report by ADP.

US Dollar relevant levels

The index is gaining 0.13% at 99.66 facing the next resistance at 100.50 (high Jan.31) ahead of 100.86 (20-day sma) and then 101.02 (high Jan.30). On the other hand, a breakdown of 99.40 (low Jan.31) would open the door to 98.92 (61.8% Fibo of the Nov-Jan. up move) and finally 96.94 (low Nov.4).