DXY inter-markets: well supported at 100.70

The US Dollar Index – which tracks the greenback vs. its main competitors – has rapidly rebounded to the 101.50 area following the upbeat results from US ISM Manufacturing, although it still navigates within the red territory.

USD has come under renewed selling pressure during the second half of the week as the recent OPEC deal has given extra oxygen to the risk-associated universe. In addition, Dallas Fed Robert Kaplan said on Wednesday that a stronger Dollar remains a headwind for the US export sector.

However, the most likely rate hike by the Federal Reserve in December plus prospects of higher inflation expectations derived from a looser fiscal policy under a Trump administration keep fuelling the case for a stronger USD in the upcoming periods. Furthermore, the recent OPEC deal and the expected pick up in crude oil prices could surely add to that view.

Also collaborating with the underlying bullish tone in the Dollar, US yields keep outperforming their peers, with the 10-year benchmark navigating yearly tops above 2.4%.

All in all, the area at 100.70/60 has so far held pretty well the occasional pullbacks, and is expected to remain a tough support on the way south, although the USD’s positive stance remains intact while above the 7-month support line, currently around 96.10/15 and reinforced as well by the 200-day sma.