The US Dollar Index (DXY) is trading around the 99.50 region, experiencing a relative surge supported by rising US Treasury yields and hawkish Federal Reserve expectations, as well as elevated Oil prices that reinforce inflation concerns and support the Greenback [1][2]. The US Dollar was the strongest against the New Zealand Dollar, with a 0.71% gain, and also posted gains against other major currencies including the Euro (+0.26%), Pound (+0.40%), Yen (+0.37%), and Canadian Dollar (+0.28%) [1].
EUR/USD fell near the 1.1580 zone, pressured by weak Eurozone PMI data and near stagnation in services activity, which capped upside and highlighted slowing growth momentum in the bloc [1]. According to the second source, EUR/USD is trading around 1.1573, down nearly 0.35% on the day, reversing most of the previous day’s gains [2]. The Euro remains under pressure due to heightened geopolitical risks, particularly the US-Israel war with Iran, and rising Oil prices, which negatively impact the Eurozone economy as it is a net energy importer [2]. Even rising expectations of European Central Bank (ECB) rate hikes have failed to provide meaningful support to the Euro [2].
In contrast, the US Dollar continues to benefit from its status as a net oil exporter, increased global demand for the Greenback as Oil is priced in USD, and its role as a safe haven during periods of uncertainty [2]. Rising US Treasury yields have also contributed to the Dollar's strength, with markets fully pricing out Federal Reserve rate bets for this year [2].
From a technical perspective, EUR/USD maintains a mildly bearish bias below the 1.1600 mark, trading under the clustered 100- and 200-day Simple Moving Averages (SMAs) around 1.1670-1.1680, which reinforces a strong resistance zone [2]. Momentum indicators suggest selling pressure may be easing, with the Relative Strength Index (RSI) rebounding from near-oversold levels to around 45, and the MACD indicator turning slightly positive but remaining close to the zero line, indicating only tentative recovery interest within an overall soft backdrop [2]. Immediate resistance is seen near 1.1665, while immediate support lies at the recent swing low near 1.1410; a break below this could accelerate losses toward the 1.1265 region and further downside risk toward the 1.1200 psychological level [2].
West Texas Intermediate (WTI) Oil surged toward $92 per barrel, driven by escalating geopolitical tensions and supply risks linked to disruptions in key shipping routes, reinforcing inflation fears and becoming a key driver of global markets [1].
CONCLUSION
The US Dollar has strengthened significantly, driven by rising Oil prices, geopolitical tensions, and weak Eurozone PMI data, while EUR/USD remains under bearish pressure below 1.1600. Technical indicators suggest only tentative recovery interest for the Euro, with strong resistance and downside risks prevailing. Overall, market sentiment favors the US Dollar amid ongoing uncertainty and inflation concerns.