Seasonal economic data release may keep dollar index sluggish

The benchmark US dollar index seems to be in good shape although it is quite diluted by 1.1 percent in the last week due to the release of disappointing data from the nation which has checked the dollar's slope thereby adding to the apprehensions over the timing of rate hike which pressurized the currency.

Concerns over Greece defaulting on debts provided further support to the currency. US Dollar Index made a weekly low of 96.90 and closed at 97.11 on Friday. However, the release of positive corporate earnings created a buzz on the Wall Street.

Existing Home Sales for the month of March posted a fairly decent number as compared to recent months. Unemployment Claims for the week ending 23rd March increased to 295,000 as compared to 294,000 in previous week. PMI for the month of April decreased to 54.2 as compared to 55.7 in March. New Home Sales for the month of March decreased to 481,000 as compared to 543,000 in February. Core Durable Goods Orders for the month of March declined by 0.2 percent as compared to a fall of 0.6 percent in February.

Outlook:

The Index is probably to trade sideways in next several trading sessions as series data releases are coming up such as composite PMI, consumer confidence index, GDP annualized qoq are scheduled to be released in last week of this month. The market is eyeing on Federal Reserve meeting for further cues on Fed's plan to hike the interest rate. However, lack of cash-for-reform agreement between Greece and its international creditors as Athens lurches closer to bankruptcy thereby raising the prospect of Greece crashing out of the Euro will be supportive for the Greenback.

Technical watch:

Dollar Index Price curve is in convergence with RSI (14 days) and CCI indicators. The corresponding supports and resistances are seen at 96.00/95.00 and 98.50/100.00 respectively. Currently index is trading at 97.14 levels.