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US Dollar price action rallies with several BRIC countries coming out in favor of the Greenback

The US Dollar (USD) keeps pushing higher as the US session is set to kick it off in New York, with the Greenback continuing its staggering turnaround from Tuesday. The 180-degree change in sentiment just hours after the US opening bell had rung was the sum of headlines on Tuesday. Fed officials are keeping their mouths firmly shut on rate cuts. The BRIC meeting on dedollarization has a few important countries speaking out in favor of keeping the US Dollar as a trade currency. Last but not least, some geopolitical tensions trigger Greenback favor during US trading hours.

All eyes are on the chunky data calendar this Wednesday with the S&P Purchase Managers Index (PMI). New homes sales to come out as well and could confirm the slowdown in the housing sector, which was the key takeaway from the existing home sale numbers on Tuesday. Watch out for more headline risks today as chipmaker Nvidia is due to deliver earnings, which could make or break the current risk-on sentiment in equity markets. The US Dollar is defying friend and foe after it rallied firmly in the US trading session, erasing all earlier gains. The US Dollar Index (DXY) was even briefly in distress during the European session when it broke below the important 200-day Simple Moving Average (SMA). In a skateboard, 180-degree flip, the DXY was able to eke out gains and even print a fresh two-month high at 103.71 and does not seem to stop again this Wednesday.

On the upside, 104.00 is the level to reach. The high of Friday at 103.68 is vital and needs to get a daily close above it in order for the DXY to eke out more monthly gains. Should this US Dollar strength persist for the last part of this year, May’s peak at 104.70 could become the reality again. On the downside, several floors are likely to prevent a steep decline in the DXY. The first one is the 200-day Simple Moving Average (SMA) at 103.18, which already broke Tuesday and Wednesday. Passing below the 103.00 figure, some room opens up for a further drop. However, around 102.38 both the 55-day and the 100-day SMAs await to catch any falling knives.