US Dollar Index rebounds from support

US Dollar Index rebounds from support
Written by:
John Adam
2nd July 2014
Updated: 5th March 2020

The most notable of the PMI releases on Tuesday was the UK Manufacturing PMI, which came in well at 57.5 vs 56.7 and triggered another leg higher for the pound. Chinese numbers were reasonably ballpark and the usual mix of strong German and weak Italian numbers were present.

The dollar barely flinched and was contained by the support from the previous day although looking at the charts it is easy to confuse some of the moves as dollar weakness. Of course, when looking at the market as a whole as with the USD% index, we can see that Euro and Yen weakness has cancelled out Aussie and Pound strength in US Dollar terms.
Also of great interest is the EUR% index’s failure to break the ECB highs with EURGBP selling strongly to push the pound higher but not EURUSD.

The day ended with AUD the leader and JPY the laggard, but truly abysmal Australian Trade Balance numbers quickly squashed the Aussie rally into the Asian session.
UK Construction PMI, Yellen and the ADP Employment Change events are the focus of Wednesday’s trading day.
If you have any questions or comments then feel free to tweet me @LFXMark
**USD% Index**

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Bouncing slightly as in the Asian session the dollar has failed to breach the support levels set out by the start of the week.This is mostly a function of the Euro’s failure to break ECB highs as a result of further strong cross pair volatility to weaken the Euro back to support. The recently broken support turned resistance showing EURUSD 1.3661 as the resistance level seems a good place to continue selling dollars now that we have started to bounce towards it. I am bearish USD% from nearby resistance
**USD% Index Resistance (EURUSD support): EURUSD 1.3661, 1.3631**
**USD% Index Support (EURUSD support): EURUSD 1.3692, 1.3724**
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