U.S. DOLLAR ANALYSIS
- U.S. ISM Services (JAN) – ACT: 59.9;EST: 59.5.
- ECB slight hawkish pivot weighing down on DXY.
- Trendline support holding.
ISM SERVICES PMI HELPS FADING DOLLAR
Both ISM non-manufacturing and Markit services data prints beat estimates for the January 2022 period. Services data traditionally carries greater weight for the U.S. being the dominant sector relative to manufacturing. The important index releases barring the overall figure is the slight drop off in employment and prices respectively – a possible hint to a lower than expected NFP figure tomorrow? This being said, the headline figure remains well above expansionary territory (+50), leaving the current Fed outlook relatively unscathed.
ISM NON-MANUFACTURING PMI (JAN):
Source: DailyFX economic calendar
U.S. DOLLAR INDEX DAILY CHART
Chart prepared by Warren Venketas, IG
The DXY reacted positively after being pulled down post-ECB, pushing off the longer term trendline support (black) and 100-day EMA (yellow) respectively, but may fall once markets digest the aforementioned details. The index remains in a precarious position as markets flirt with the an extended move lower.
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