US Dollar steadies after Fed, Trump comments and UK trade deal

• US Dollar Index recovers slightly but fails to break above 100.23 resistance.
• Trump announces a UK trade deal, but tariffs remain.
• Traders continue to digest Wednesday's Fed decision.

The US Dollar Index (DXY), which measures the value of the US Dollar against a basket of currencies, trades near 100.00 on Thursday, lifted modestly by upbeat US data and expectations of extended yield differentials. Markets initially cheered news of a US-UK trade deal, though enthusiasm faded as details confirmed tariffs would remain in place.

Daily digest market movers: US Dollar holds ground after muted UK deal

• US President Donald Trump announced a "major" trade deal with the United Kingdom, though key tariffs will remain at 10%, limiting market enthusiasm.
• Investors remain skeptical about progress on China tariffs as Trump shows no intent to ease 145% duties and China delays negotiations.
• Markets await this weekend's preliminary US-China trade discussions in Switzerland, but both sides are downplaying hopes for rapid breakthroughs.
• The July 9 deadline for the Trump administration's tariff review approaches with limited new trade agreements signed so far.
• US jobless claims fell to 228,000, beating market expectations and suggesting labor market strength.
• The Bank of England reduced its policy rate by 25 basis points to 4.25%, widening the interest rate gap versus the US and boosting USD demand.
• US Treasury yields remain supported with the 10-year note at 4.345%, ahead of a $39 billion auction and FOMC communication expected next week.
• Risk sentiment improved after equities rallied, with the Dow Jones up over 1.6% as hopes grew for more trade clarity.
• Gold surged to $3,400 per ounce as investors hedged against lingering trade tensions and muted USD upside despite central bank divergence.
• Trump hinted that more trade announcements could come in "weeks," but offered no timeline for actual agreement signings.
• Fed Chair Jerome Powell's next speech remains key, with the central bank expected to hold rates steady while inflation remains a concern.
• Markets continue to price in two Fed rate cuts by year-end with the first move projected in July, barring strong inflation surprises.
• Asian currencies remain firm as countries like Singapore and Malaysia tolerate stronger FX to ease trade frictions with the US.
  

US Dollar Index technical analysis: Not bullish yet

The US Dollar Index (DXY) trades around 100.00 with a modest 0.25% daily gain. Price action remains capped within the 99.61-100.21 range. The Relative Strength Index (RSI) at 45 and the Average Directional Index at 48 both signal neutral momentum. 

The Moving Average Convergence Divergence (MACD), however, flashes a buy, while the Ultimate Oscillator also trends neutral at 61.24. Mixed moving average signals highlight indecision: the 20-day Simple Moving Average (SMA) at 99.64 supports buyers, but the 100-day (105.17) and 200-day (104.33) SMAs continue to reflect broader bearish pressure. Key resistance is located at 100.23, 100.86 and 100.91; support lies at 99.83, 99.81 and 99.67.