USD Index remains consolidative around the 106.00 region

• The index fades Thursday’s uptick and remains near 106.50.
• US yields recede marginally following the recent recovery.
• Fedspeak, CB Leading Index, Existing Home Sales next on tap.

The greenback, in terms of the USD Index (DXY), returns to the negative territory following Thursday’s decent advance.

USD Index points to further consolidation in the near term

The index keeps the erratic performance so far this week and now gives away part of Thursday’s rebound to the area north of 107.00 the figure.

In the meantime, the lack of traction seems to have returned to the US money market following a firm bounce in yields in the previous session, all in response to hawkish comments from St. Louis Fed J.Bullard (voter, hawk).

On the latter, it is worth recalling that Bullard expects the minimum interest rate to be around 5.00%-5.25%, while he removed weigh from the recent lower-than-expected US inflation figures and motivated speculation of a Fed’s pivot to dwindle somewhat.

Later in the NA session, the CB Leading Index is due seconded by Existing Home Sales and the speech by Boston Fed S.Collins (voter, centrist).

What to look for around USD

Price action around the dollar remains mixed and relegates the index to keep navigating the area around 106.50, all amidst a broad-based consolidative theme.

In the meantime, the greenback is expected to remain under the microscope amidst persistent investors’ repricing of a probable slower pace of the Fed’s rate path in the upcoming months.

Key events in the US this week: CB Leading Index, Existing Home Sales (Friday).

Eminent issues on the back boiler: US midterm elections. Hard/soft/softish? landing of the US economy. Prospects for further rate hikes by the Federal Reserve vs. speculation of a recession in the next months. Fed’s pivot. Geopolitical effervescence vs. Russia and China. US-China persistent trade conflict.

USD Index relevant levels

Now, the index is retreating 0.16% at 106.51 and the breakdown of 105.34 (monthly low November 15) would open the door to 105.05 (200-day SMA) and finally 104.63 (monthly low August 10). On the other hand, the next up barrier aligns at 109.15 (100-day SMA) seconded by 110.76 (55-day SMA) and then 113.14 (monthly high November 3).