USD on the defensive around 89.00. Trump’s SOTU speech disappointed USD-bulls. ADP, Fed on sight later in the session.
The US Dollar Index (DXY), which gauges the greenback vs. its main competitors, remains in the negative territory so far today although it has managed to bounce off recent lows near 88.80.
US Dollar attention to US docket
The index is down for the second straight session on Wednesday, extending the consolidation theme in the 89.00 neighbourhood following the sharp sell off sparked in early December (DXY around 94.25).
President Trump’s SOTU speech on Tuesday failed to re-ignite some sentiment around the buck, while broader risk appetite trends continue to dominate the scenario in the global markets.
In the US data space, the ADP employment report for the month of January is due later ahead of the FOMC meeting. It is worth recalling that market expectations remain tilted towards a somewhat hawkish (at least not dovish) message from the Committee at today’s meeting.
US Dollar relevant levels
As of writing the index is retreating 0.24% at 88.97 and a break below 88.81 (low Jan.31) would open the door to 88.42 (2018 low Jan.25) and finally 87.64 (low Dec.16 2014). On the flip side, the next up barrier lines up at 90.70 (high Jan.22) followed by 90.98 (high Jan.18) and then 92.64 (high Jan.9).