Dollar Index drops to lowest since December 2014

• US dollar drops sharply across the board and becomes the worst performer. 
• DXY tumbles to the lowest in three years. 

The US dollar accelerated to the downside during the American session and fell to the lowest level in years against the pound and extended losses versus the euro and the yen. It is even falling against commodity currencies. The US Dollar Index (spot) is moving toward 90.00. It trades at 90.10, at the lowest since December 2014. 

The greenback is falling amid a recovery in US bonds and following the release of the Richmond Fed’s Manufacturing Survey that dropped more than expected. The index fell from 20 to 14, below the 19 of market consensus. The Index suffered the biggest 2-month decline since 2006. That helped to weaken further the US Dollar. 

Equity markets in the US are posting modest gains. The Dow Jones is up 0.05%. Gold jumped almost $10 from the lows and is moving closer to $1340. Crude oil is also benefiting from the weak dollar and rose above $64.20 a barrel (WTI). 

Dollar Index Technical Levels

DXY rose peaked earlier at 90.60 but then move to the downside. It bottomed at 90.05 and is trading near the lows, under pressure. 

To the upside, immediate resistance might be seen at 90.30, 90.60 (Jan 23 high) and 90.80 (Jan 16 & 18 high). On the downside, below the 90.00 barrier support levels could be located at 89.60, 89.00 (psychological) and 88.70.