Dollar Hits 100.00 As Bond Sell-Off Continues

 

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Global equity markets bounced slightly at the end of a choppy trading week, as investors have digested a series of fresh hawkish messages from the Fed. As such, Wall Street indexes recovered marginally on Thursday following two bearish sessions.  

Asian equities traded mostly higher on Friday, and European stocks edged north as risk appetite has revived somewhat ahead of the weekend. US stock index futures are posting slight gains ahead of the opening bell. Still, as geopolitics stays in the market focus, the upside potential in equities remains limited, with global markets being on track for their first weekly loss in four. 

Meanwhile, the bond market sell-off continues these days. The US 10-year Treasury yields keep refreshing long-term highs, flirting with the 2.72% figure while two-year yields climbed back above 2.50% on Friday. 

Against this backdrop, the dollar extends the rally, retaining a solid bullish bias for the seventh session in a row. The USD index advanced to the 100.00 figure for the first time in nearly two years. As the greenback keeps the buying bias intact around this psychological level, it looks like the prices could test the May 2020 high at 100.55 in the near term.

The rallying dollar sent the euro to more than one-month lows around 1.0847 during the European session on Friday.

Should the 1.0844 zone give up, the 1.0800 psychological level could cap the pressure if the buck refrains from an even more aggressive rally amid overbought conditions. On the upside, the immediate target now arrives at 1.0900, followed by the 20-DMA, that comes just below the 1.1000 figure.