DXY: Paring back earlier gains – OCBC

US Dollar (USD) started the week on a softer footing as risk sentiments regain footing. DXY was last at 107.07, OCBC's FX analysts Frances Cheung and Christopher Wong note. 

Consolidation is likely on the day

"European leaders working with Ukraine on a plan to stop the fighting and better PMIs across the region including China, Taiwan, Indonesia and Thailand were some of those drivers." 

"Elsewhere, markets remain hopeful: 1/ on expectations that China will deliver support measures to boost domestic demand at its NPC/CPPCC meeting (start on Tue); 2/ Trump may delay tariff implementation timeline (again). The latter can prove 'noisy' for markets." 

"If the tariffs are imposed as scheduled, we may see risk-off sentiment returning and USD may jump in response. Daily momentum turned mild bullish but rise in RSI faltered. Consolidation likely. Resistance at 107.30 (21 DMA), 107.80 levels (23.6% fibo). Support at 106.80 (100 DMA), 106.35 (38.2% fibo retracement of Oct low to Jan high)."