• The American dollar index is located above 106.50 after destitute PMI data in the USA.
• US Service Sector unexpectedly concludes contracts in February, weighing sentiment.
• Consumers are falling and inflation expectations raise, increasing the pressure to USD.

The American dollar index (DXY), which follows the results of the American dollar compared to the six main currencies, maintains slight profits on Friday, trading around 106.50. This slight revival is the disappointing PMI preliminary data, signaling that the US economy does not significantly exceed the euro area or other main economic blocks. The weaker printout of the service sector weighed market moods, although production profits provided some balance.

Daily Digest Market Movers: American Dollar has profits despite destitute PMI data

• PMI USA production for February expectations at 51.6, exceeding both 51.5 consensus and reading in January 51.2 in January.
• American services PMI falls into a spasm at 49.7, not reaching the forecast 53.0 and 52.9.
• The University of Michigan consumer sentiments index drops to 64.7, there is a lack of forecast 67.8 and earlier reading.
• 5 years of expectations of consumer inflation will raise to 3.5%, above 3.3% of consensus and previous reading.
• Markets continue monitoring tariff threats, with the potential growth of the horizon over the weekend. Anything that could cause fears related to the trade war between the US and China can relax USD losses.

DXY Technical perspectives: Recovery attempts as a trunk of momentum softens

The American dollar index regained some adhesion, floating around 106.50, because it tries to recover a 100-day straight movable average (SMA) to 106.60. Despite the gentle recovery, the technical indicators remain on the territory of the bear.

Both the relative strength indicator (RSI) and the average movable discrepancy (MacD) show signs of slight improvement, but remain in negative zones. The next level of resistance is almost 107.00, and the support rests at around 106.00. The decisive break below the threshold of 106.00 can confirm the bear perspective in a brief period.