US Dollar edges higher as data revisions boost sentiment

• Durable Goods revision and higher US Treasury yields propel Greenback which stands near two-year highs.
• Consumer Confidence dipped but the Dollar holds gains.
• Shutdown threat keeps investors cautious which might limit the upside.

The US Dollar Index, which measures the value of the USD against a basket of currencies, is off to a positive start on Monday after a sluggish morning session. Upward revisions from the preliminary November Durable Goods release are fueling a stronger Greenback, pushing the index near 107.90, just shy of its two-year high above 108.00.

Daily digest market movers: US Dollar continues rising ahead of Christmas

• Government shutdown risks grow as lawmakers fail to pass a stopgap bill. Though a short shutdown may have limited market impact, investors remain on alert for last-minute deals.
• Longer-term yields climb further, with 10-year Treasury rates nearing 4.60% and 30-year yields hitting 4.77%. The short end lags, steepening the yield curve.
• On the data front, the Chicago Fed National Activity Index from November improved to -0.12 from -0.40, hinting at a less negative overall economic picture.
• November Durable Goods preliminary data showed a -1.1% print, but the prior figure was revised up from 0.3% to 0.8%, boosting the USD. Excluding transportation, orders dipped 0.1%.
• Consumer Confidence for December fell to 104.7 from 111.7, partially offset by an upward revision for November to 112.8. Despite the decline, the Dollar remains bid into year's end.

DXY technical outlook: Indicators eye overbought territory

The Dollar Index has regained upward traction, with technical indicators pointing to renewed momentum. As the DXY inches closer to its two-year high, oscillators suggest the index is moving toward overbought levels. Nonetheless, the broader bullish bias remains intact as long as the price holds above the key support of 106.00. A sustained break above the latest peak could open the door to further gains, though thin holiday liquidity may lead to choppy price action in the near term.