• DXY reverses part of the recent pullback and regains 96.00.
• US yields remain within a consolidative theme on Thursday.
• ISM Non-Manufacturing PMI, weekly Claims next on tap later.

The greenback has managed to regain some composure and is attempting to move past the 96.00 barrier as measured by the US Dollar Index (DXY), on Thursday.

US Dollar Index now looks to data

The index has regained its smile and bounced off recent lows in the 95.80 region (February 2), as the strong upside momentum in the risk complex appears to be taking a breather.

Some cautiousness among investors appears to have emerged in light of the upcoming interest rate decisions by the Bank of England and the ECB, both due later in the European afternoon.

In the meantime, the absence of traction in US yields opens the door to the continuation of the range bound theme in the very near term at least, all against the backdrop of persistent repricing of the potential Fed’s rate path.

Later in the session, the usual Initial Claims are due seconded by the ISM Non-Manufacturing PMI and Factory Orders.

What to look for around USD

The dollar met some decent contention in the 95.80 region and now looks to be retaking the 96.00 barrier. Some reasons for the buck's strong correction include the improved mood in the risk-associated universe and dormant US yields (despite navigating the upper end of the recent range). The greenback's overall constructive outlook, however, is expected to remain unchanged for the time being on the back of higher yields, persistent elevated inflation, supportive Fedspeak and the solid pace of the US economic recovery.

Key events in the US this week:) Initial Jobless Claims, ISM Non-Manufacturing PMI, Factory Orders (Thursday) – Nonfarm Payrolls, Unemployment Rate (Friday).

Eminent issues on the back boiler: Fed’s rate path this year. US-China trade conflict under the Biden administration. Debt ceiling issues. Escalating geopolitical effervescence vs. Russia and China.

US Dollar Index relevant levels

Now, the index is gaining 0.14% at 96.12 and a break above 97.44 (2022 high Jan.28) would open the door to 97.80 (high Jun.30 2020) and finally 98.00 (round level). On the flip side, the next down barrier emerges at 95.80 (weekly low Feb.2) seconded by 95.41 (low Jan.20) and then 94.62 (2022 low Jan.14).