US Dollar stays vulnerable, finds support near 93.20

• The index is now sidelined around session lows near 93.20.
• US 10-year yields ease from highs to the 2.97% neighbourhood.
• US Initial Claims came in at 222K, bettering initial estimates.

Tracked by the US Dollar Index (DXY), the greenback’s decline appears to have found a bottom in the 93.20 region on Thursday.

US Dollar weak on EUR recovery

The index has been losing ground since Monday, as a pick up in the risk-associated complex, easing concerns over the Italian political scenario and the recent market chatter regarding the likeliness that the ECB could discuss QE tapering as soon as next week have all lent support to EUR, therefore propelling EUR/USD to multi-day peaks beyond 1.1800 the figure.

Still around the buck, yields of the key US 10-year benchmark are now deflating from recent tops in the 2.99% area and re-testing the 2.97% zone.

Data wise in the US calendar, weekly Initial Claims rose 222K, bettering initial consensus and taking the 4-Week Average to 225.50K from 222.75K.

Looking ahead, the ECB story remains poised to be the exclusive driver for the global markets in the next days, putting the buck under further pressure at least until next Thursday, when the ECB will hold its meeting.

US Dollar relevant levels

As of writing the index is losing 0.26% at 93.38 and a breakdown of 93.21 (low Jun.7) would expose 93.12 (low May 13) and finally 92.80 (38.2% Fibo of the April-June up move). On the upside, the next hurdle emerges at 93.65 (21-day sma) followed by 94.02 (10-day sma) and finally 94.45 (high May 31).