US Dollar looks vulnerable around 89.20

• The selling bias around USD gathers further traction on Monday.
• DXY dropped to test the 89.20 region, multi-day lows.
• Upcoming Fedspeak, US-China trade war concerns to weigh on USD.

The US Dollar Index, which measures the buck vs. a basket of its main rival currencies, remains entrenched into the negative territory at the beginning of the week around the 89.20 region.

US Dollar attention to Fedspeak

The index has dropped to fresh 5-week lows in the 89.20 area, breaking below the key support near 89.40 and at the same time opening the door for a deeper breakout of the prevailing sideline theme.

Month/quarter-end flows keep weighing on the buck today, while a generalized optimism is bolstering today’s advance in the risk-associated universe, relegating US political uncertainty and jitters over a potential US-China trade war to a secondary role for the time being.

In the meantime, yields of the key US 10-year reference are navigating the area of daily highs around 2.84%, also propped up by the current bias towards the riskier assets.

On the data front, R.Quarles, NY Fed W.Dudley (permanent voter, centrist) and Cleveland Fed L.Mester (voter, hawkish) are due to speak later in the NA session amidst a vacuum of data releases.

US Dollar relevant levels

As of writing the index is down 0.32% at 89.23 facing the next support at 89.16 (low Mar.26) seconded by 89.07 (low Jan.26) and then 88.25 (2018 low Feb.16). On the other hand, a break above 89.85 (10-day sma) would aim for 90.44 (high Mar.20) and finally 90.57 (high Feb.8).