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- The US Dollar (USD) surged, trading with gains above the 200-day SMA at 103.70 on Monday.
- Growing tensions between Israel and Hamas made investors seek refuge in the USD, pushing the Dollar Index (DXY) upward.
- This week, key US economic reports are on the horizon, including ISM Services PMI, ADP Employment Change, November Nonfarm Payrolls, and the Unemployment Rate.
With the US Dollar (USD) currently trading with gains, the DXY Index is showing a positive upward trend neatly tucked above 103.70. The USD’s upward trend appears driven by a sour market mood and rising bond yields. Market participants have their eyes set on key economic reports due this week, with the Nonfarm Payrolls, the Unemployment Rate, ADP Employment Change, and the ISM Services PMI updates scheduled for release. Overall, all reports are expected to show that job creation picked up in November, while the ISM Services PMI is seen accelerating regarding its last reading of October. US bond yields are edging higher, aligning with the Dollar’s uptick. The CME FedWatch Tool indicates no hikes are priced in for the upcoming December meeting, and markets speculate on rate cuts in mid-2024.
The indicators on the daily chart reflect a predominance of selling momentum for the US Dollar. The index position, below the 20 and 100-day SMAs, indicates that the bears are maintaining control. The Relative Strength Index (RSI) shows a positive slope but remains in negative territory, while the Moving Average Convergence Divergence (MACD) signifies decreasing red bars, adding further evidence of shrinking selling momentum.