US Dollar drops to lows near 98.50

FXStreet (Edinburgh) - The greenback, tracked by the US Dollar Index, is losing ground across the board on Thursday, testing lows in the 98.60/50 band so far.

US Dollar in 2-week lows

The index collapsed to fresh 2-week lows in the mid-98.00s following a sharp rebound in crude oil prices, with the barrel of WTI up nearly 3% on prospects of a potential output cut by Russia and OPEC countries in order to alleviate the ongoing supply glut.

Collaborating with the downside, US Durable Goods Orders have missed expectations in December, contracting more than 5%, and Pending Home Sales rose a meager 0.1% MoM during the same period vs. forecasts for a 0.8% gain.

USD has lost further momentum since yesterday’s FOMC meeting, where the Committee has not only sounded more cautious than initially expected, but it has also casted a mantle of doubts over the possibility of a rate hike at the March meeting.

US Dollar significant levels

As of writing the US Dollar Index is losing 0.41% at 98.65 facing the next support at 98.01 (38.2% Fibo of 93.82-100.60) followed by 97.82 (20-week sma) and finally 96.45 (5-month uptrend). On the other hand, a break above 99.88 (high Jan.21) would aim for 100.00 (psychological level) and then 100.60 (2015 high Dec.3).