US Dollar weaker, challenges lows near 99.70

The greenback – tracked by the US Dollar Index – remains on the defensive ahead of the opening bell in Euroland, currently in session lows around 99.70.

US Dollar focus on data

After climbing to 1-year tops in the vicinity of 100.30 on Monday, the index is now facing some profit taking sentiment and receding to the 99.70/65 band ahead of US Retail Sales.

Market consensus expects sales to have expanded at a monthly 0.6% during October, while the NY Empire State Manufacturing index is seen improving to -2.5 for the current month. In addition, Boston Fed E.Rosengren (voter, dovish) and FOMC’s Vice Chairman S.Fischer (permanent voter, hawkish) are also due to speak.

In the meantime, the underlying bullish sentiment around the buck remains intact, always backed by rising expectations of a Fed’s rate hike next month, solid momentum in US yields and prospects of extra fiscal stimulus during Trump’s presidency.

Furthermore, speculative positioning is also lending support to the buck. Despite net longs have retreated to 3-week lows during the week ended on November 8, they keep the area of multi-month peaks according to the latest CFTC report.

US Dollar relevant levels

The index is losing 0.28% at 99.75 facing the next support at 99.20 (low Nov.14) followed by 98.39 (20-day sma) en route to 96.94 (low Nov.4). On the flip side, a break above of 100.24 (high Nov.14) would target 100.60 (high Dec.3 2015).