The US dollar addresses the last decline on Friday

• The US dollar rises against all its counterparts in all fields.
• European Procurement Directors Index revealed a slowdown in commercial activity before the German elections on Sunday.
• The US dollar index (DXY) reflects its course and tries to return to 107.00.

The US dollar index (DXY), which tracks the performance of the US dollar (USD) against six main currencies, recovers from its last decline and trading a little below 107.00 at the time of writing this report on Friday. The US dollar regains some of its strength before issuing the initial of the USAII directors index (PMI) data for the United States for the month of February. European data issued earlier in the day has already revealed more slowdown in economic activity in Europe.

The US economy agenda finally provides some data versions that may affect the US dollar. The initial service manager of the Standard & Poor’s initials for the month of February is the main driver for this Friday. Expectations indicate a slight height to 53 against 52.9 in January reading. Michigan University will also issue consumer confidence index and inflation for the final reading of January.

Daily market engines: Does this matter?

• In the early European trading session, the initial Puritan Manager Index (PMI) data was issued for February in several European countries. What has emerged:
  • French Service Manager Indexes French HCob fell more to 44.5, exceeding the estimate of 48.9 and decreased from previous reading 48.2.
  • European Sector Procurement Managers Index decreased to 50.7, exceeding the estimate of 51.5 and less than previous reading 51.3.
  • The indicators of the German HCOB purchasing managers exceeded the estimates, although the services component came at 52.2, exceeding the estimate of 52.5 and less than the January 52.5 reading.
• At 14:45 GMT, the data of the initial purchasing managers will be released from Standard & Poor’s for the United States for the month of February:
  • The manufacturing sector is expected to rise to 51.5, coming from 51.2.
  • The service sector is expected to rise slightly to 53.0, coming from 52.9.
• Michigan University will issue its final reading for January 15:00 GMT:
  • The consumer confidence index is expected to remain stable at 67.8.
  • It is expected that the consumer inflation index will increase for 5 years constantly by 3.3%.
• The stocks rise, led by the Chinese semiconductor sector. Chinese technology shares have increased by three years, driven by optimism about the profits of the Ali Baba Group.
• The CME Fedwatch tool shows a 47.5% chance that interest rates remain unchanged at the current levels in June.
• The return on US Treasury bonds for 10 years is trading around 4.49%, lower than its highest level on Wednesday of 4.574%.

Technical analysis of the US dollar index: The US dollar does not care

The US dollar index (DXY) is able to restore some space after another weak performance this week. The euro (EUR) helps in this, with a partial recovery in the DXY index this Friday after some versions of the disappointing purchasing managers, especially from France. If the data of the Standard & Poor’s initial for the United States for the month of February, scheduled for this afternoon, shows some flexibility in the country’s activity, the DXY index may quickly return to 107.00.

On the upward side, the previous support at 107.35 is now strong resistance. Top, the simple moving average should be restored for 55 days at 107.96 before restoring 108.00.

On the descending side, 106.60 (simple moving average for 100 days) and 106.52 (the highest level on April 16, 2024) has worked as an alert for buyers to enter and pay the DXY index to rise again. Lessed, 105.89 (resistance in June 2024) will continue to represent the next strong support level. RSI in the daily chart has not yet touched the saturated saturation barrier. Therefore, the simple moving average for 200 days may be at 104.98 possible results if a strong catalyst appears.

US dollar index: daily chart