- The index continues to fall and revisits the 108.00 area.
- The Jackson Hole Symposium begins today.
- US GDP and weekly jobless claims in the spotlight.
The dollar gives up almost all of its weekly gains and falls back to the 108.00 area in the Dollar Index (DXY ) Thursday. Specifically, the index has touched a six-day low at 107.98
Dollar Index Seems Capped Near 2022 Highs
The index quickly fades small gains on Wednesday and refocuses on declines amid improving risk appetite on Thursday.
Indeed, the dollar is losing traction and correcting lower after being rejected from the cycle highs near 109.30 earlier in the week (Aug 23). The move comes amid marginal weakness in US yields as market participants prepare for the start of the Jackson Hole Symposium later in the day.
Meanwhile, investors are expected to closely watch Jerome Powell’s speech on Friday, against the backdrop of growing speculation of a 75 basis point rate hike at the Fed’s September meeting. As for the latter, CME Group’s FedWatch tool now sees the probability of this scenario at almost 60% (from 40% a week ago).
As for the US data, another revision to the GDP growth rate for the second quarter is expected, as well as jobless claims for the week ending August 20.
DXY Relevant levels
Now the index is retracing 0.44% at 108.13 and faces next support at 107.98 (weekly low Aug 25) seconded by 106.21 (55-day SMA) then 104.63 (monthly low Aug 10).
To the upside, a break above 109.29 (2022 high Jul 15) would target 109.77 (Sep 2002 monthly high) then 110.00 (round level).
Source: Fx Street
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