Dollar Index gains momentum and rises to test Friday’s highs

The US dollar strengthened during the American session and reached fresh daily highs against most of it rivals. The Dollar Index reached 93.35 and remains above 93.30, testing Friday’s highs at 93.35/40. 

Greenback also rose versus commodity currencies and particularly the Loonie amid a decline in crude oil price. The WTI barrel fell under $48 from levels on top of $49 to the lowest in almost three weeks. 

WTI headed for a test of the key $47.80 level?

Equity prices in Wall Street are consulting important gains, unaffected by the recent move in the USD, neither by the slide in crude oil. The Dow Jones is up 0.67% and the Nasdaq gains 1.34%. 

The rally of the USD took place during the release of an interview of William C. Dudley with AP. According to the President of the New York Fed, the central bank hasn’t made any decision about when to begin the balance sheet normalization process. Regarding growth expectations, he said: “My outlook for the economy hasn't changed materially since the beginning of the year. Continue to look for growths around 2%, slightly above trend, growth sufficient to continue to tighten the labor market”.

Fed's Dudley: Still sees US growth at 2%

DXY Levels to watch 

The Dollar Index is up 0.40%, enough to erase Friday’s losses. To the upside, it faces a strong immediate resistance around 93.35/40 (Aug 11 / 20-day moving average), a close above could add momentum for a test of last week highs at 93.75. 

To the downside, support levels might lie at 93.05, 92.80 (last week low) and 92.50 (Aug 3 low).