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US Dollar deflates near 96.20

FXStreet (Edinburgh) - The US Dollar Index, which gauges the greenback vs. its main competitors, has reverted the initial upside and is now giving away gains around 96.20.

US Dollar unmoved by US data

The upside momentum in the dollar seems to have found tough resistance in the 96.70 area, rejecting the bullish attempts and triggering the current correction lower to the 96.20 area.

Auspicious results from US Q2 GDP, Core PCE and the Reuters/Michigan index have failed to ignite a more durable rally in USD, while the speech by Fed’s J.Bullard passed largely unnoticed. Next of relevance for the dollar will be the speech by E.George.

St. Louis Fed President J.Bullard has acknowledged that US consumer prices remain low albeit not far from Fed’s target. In addition, he stressed that the recent no-hike has triggered uncertainties in the broader markets, adding that gradual rate hikes could help inflation to pick up and unemployment to tick lower.

US Dollar levels to consider

At the moment the index is gaining 0.27% at 96.25 with the next hurdle at 96.70 (high Sep.25) followed by 97.07 (high Aug.19) en route to 97.33 (high Aug.12). On the flip side, a break below 94.06 (low Sep.18) would aim for 93.72 (low Aug.26) and finally 93.25 (low Aug.25).

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