US Dollar reverts the downside, 90.00 on sight

• The index bounces off lows, turns positive near 90.00.
• US 10-year yields manage to bounce off the 2.83% region.
• Chief Jerome Powell due to testify on Tuesday before Congress.

The US Dollar Index, which tracks the buck vs. a basket of its main competitors, is now staging a strong rebound and eyes once again the critical 90.00 milestone.

US Dollar focused on Powell

After bottoming out in session lows near 89.50, the index managed to attract some buying interest and is now trading at shouting distance from the psychological handle at 90.00 the figure.

The up move came in despite yields of the key US 10-year have sharply retreated to fresh 2-week lows in the 2.83% neighbourhood earlier, where are now looking to come back. It is worth mentioning that yields climbed to new multi-year peaks around 2.96% during last week.

In the US data space, January’s New Home Sales dropped to 593K units, or contracted at a monthly 7.8%, coming in below prior surveys. Later in the session, FOMC permanent voter R.Quarles is due to speak.

Earlier in the day, St. Louis Fed J.Bullard was sceptical on a breakout in US yields from current levels, while he expressed concerns over going too far too fast on rates.

US Dollar relevant levels

As of writing the index is up 0.02% at 89.94 facing the next hurdle at 90.23 (high Feb.22) seconded by 90.57 (high Feb.8) and then 91.00 (high Jan.18). On the other hand, a break below 89.52 (low Feb.26) would expose 88.44 (low Jan.26) and finally 88.26 (2018 low Feb.16).