US dollar is one of the weakest major currencies today, dropping against all G10 peers except for Japanese yen. US dollar is resuming slide following a brief upward correction earlier this week. Today's drop is interesting as it comes in spite of a strong pick-up in US yields. 10-year US Treasury yield is up almost 8 basis points today, on the way to book the biggest single-day jump since November 15, 2023. USD index (USDIDX) is heading for the second weekly drop in a row.
Taking a look at USDIDX at D1 interval, we can see that the index bounce off the support zone ranging between 103.35 mark and 50% retracement of the recent major upward move earlier this and tested resistance zone ranging above 38.2% retracement on Wednesday. However, bulls failed to break above it and index resumed slide. The aforementioned 103.35 support zone, which is also marked with 200-session moving average is being tested once again today. A break below it would push the index to the lowest levels since August 2023 and may pave the way for a deeper drop, with 101.90 area being the first potential target for sellers.
US dollar index and US bonds (light blue overlay, inverted). Source: xStation5
Daily summary: Weak US data drags markets down, precious metals under pressure again!
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