Wholesale inflation and consumer inflation are coming up today and tomorrow and things are about to get hot in the forex space.

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🎢 Traders Pivot Out of Dollar

• The US dollar index DXY was treading carefully early Tuesday as forex speculators were shifting their focus to looming inflation data. The index, gauging the greenback’s valuation against six peer currencies, slipped from a two-year high of 110.16 to gyrate around the 109.50 mark.
• By the looks of it, currency traders rotated out of king dollar and into other major players after days and even weeks of dollar dominance.

💪 Buck Flexes Super Gains

• The American currency has been in an almost constant upside swing since October, adding a super-gain of 10% and silencing all the permabears and naysayers out there. It has also comfortably blasted above all three simple moving averages.
• The 50-day, 100-day, 200-day are now in the rearview, indicating that the bulls aren’t playing around. And with that, a pair of major inflation reports is coming to test the dollar’s might.

🤸‍♂️ Breakdown: Inflation Data

• On deck for today is the Producer Price Index. It will show whether producers and manufacturers raised their prices. Tomorrow is the bigger, more interesting update — the Consumer Price Index. It will show whether consumer prices went up in December. Analysts expect a tick up to 2.9% from last year.
• In other words, another price elevation after November’s 2.7% clip fanned concerns of the big bad inflation coming back to town.