US Dollar trims gains, back near 98.60

The greenback, tracked by the US Dollar Index, has reverted the initial positive performance and has now returned to the 98.65/60 band.

US Dollar attention to data, Fedspeak

The index remains in multi-month highs at the beginning of the week, although the recent strong upside momentum seems to have lost some vigour following the opening bell in the Old Continent.

Increasing expectations of a move by the Federal Reserve by year-end continue to support the solid demand for the buck. In fact, according to CME Group’s FedWatch tool, the probability of a rate hike in December stays at 64%.

Adding to USD momentum, the latest CFTC report showed the build up in USD speculative longs have taken net longs to the highest level since December 2015 during the week ended on October 18.

On the data front, Markit’s advanced Manufacturing PMI and the Chicago Fed National Activity index are due. In addition, NY Fed W.Dudley (permanent voter, neutral), St. Louis Fed J.Bullard (voter, neutral), Chicago Fed C.Evans (2017 voter, dovish) and J.Powell (permanent voter, neutral) are all due to speak later.

US Dollar relevant levels

The index is losing 0.01% at 98.68 and a break below 97.47 (low Oct.12) would aim for 97.01 (20-day sma) and finally 95.82 (200-day sma). On the other hand, the initial hurdle aligns at 98.82 (high Oct.24) followed by 99.95 (high Jan.21) and then 100.60 (high Dec.3).