US Dollar tumbles to YTD lows near 96.80

The US Dollar Index – which tracks the buck vs. its main rivals – gave away its initial gains and has now returned to sub-97.00 levels, where it remains under scrutiny.

USD met a bout of selling pressure following unusual comments from Chancellor A.Merkel, who hinted at the fact that the single currency is ‘too weak’. Merkel comments motivated USD-sellers to quickly step in, erasing earlier gains to the 97.30/35 band.

On the positioning front and according to Friday’s CFTC report, the greenback remains under pressure, as speculative net longs have retreated to the lowest level since early October 2016.

Event wise today in the US, speeches by FOMC’s L.Brainard (permanent voter, centist), Philly Fed P.Harker (voter, hawkish) and Minneapolis Fed N.Kashkari (voter, dovish) should keep the attention on the buck ahead of the publication of the FOMC minutes on Wednesday.

US Dollar relevant levels

The index is losing 0.15% at 96.85 facing the next support at 95.91 (low Nov.9 2016) followed by 94.95 (low Sep.22 2016) and finally 94.94 (low Sep.8 2016). On the flip side, a breakout of 97.25 (high May 22) would open the door to 97.97 (high May 18) and finally 98.62 (20-day sma).