The US Dollar has experienced a rise for the fourth consecutive session, buoyed by favorable economic data and heightened geopolitical tensions in the Middle East. The DXY index recently reached 101.93, reflecting strong overall momentum.
Recent reports revealed that the ISM services sector showed encouraging results with improved prices and new orders, though employment figures indicated a decline, dipping into contraction. Market attention is now shifting towards upcoming US payroll data, with analysts anticipating an increase of approximately 150,000 jobs for the non-farm payrolls, compared to the previous figure of 142,000. Expectations also suggest that the unemployment rate and hourly earnings should remain stable at 4.2% and 3.8% year-over-year, respectively.
The possibility of stronger labor data could lead markets to reconsider their less hawkish outlook, supporting further gains in the USD. However, the recent corrections in the dollar’s value suggest that risks could play out in either direction. A disappointing jobs report might lead to a decrease in the dollar’s strength, potentially reversing its recent upward trajectory.
Additionally, daily momentum indicators remain positive although the relative strength index (RSI) shows signs of moderation. This could indicate a period of consolidation throughout the day. Key resistance levels are identified at 101.90—representing the 50-day moving average and a significant Fibonacci retracement level—and 102.50. Immediate support can be found at 101, highlighted by the 21-day moving average, and at 100.20, reflecting recent lows. The market remains watchful as these economic indicators unfold, shaping the future movements of the US Dollar.
