DXY consolidates losses but holds above 97.00

• US Dollar Index recovered some ground after testing levels under 97.00. 
• Greenback failed to strengthen despite higher US yields. 

The US Dollar Index is having the worst performance in two weeks. The greenback pulled back across the board amid an improvement in risk sentiment. US data failed to lift the dollar. 

US Dollar Index unable to break above 97.50 

The index continues to move on a corrective mode after reaching yesterday the highest level in four days around the 97.50 area. Today bottomed at 96.97and then rose back above 97.00. 

It moved sideways, between 97.00 and 97.20 during the US session. Economic data from the US had a limited impact on the currency market. The first report showed that private employment increased in March by 129K, the lowest in 18 months and below expectations. On Friday the NFP is due. The ISM non-manufacturing dropped to 56.1 (versus 58.0) while the Markit services was revised higher. The move to the upside in US yields was offset by also higher European yields. Economic reports from the EZ came in better-than-expected. 

The DXY managed to recover and rose back above 97.00. Near the end of the session trades at 97.10, down 0.23% for the day. The bullish tone lost momentum and a firm break below 97.00 would open the doors for an extension of the correction. To the upside, above 97.30 the DXY will likely gain strength and could potentially rise further for another approximation to the key 97.50/60 medium-term resistance.