US Dollar Index finds support around 95.00 post-Payrolls

The index drops and tests 95.00 following July’s Payrolls.
DXY recedes from daily highs on PBoC headlines.
US July’s Non-farm Payrolls disappointed consensus at 157K.

Pablo Piovano FXStreet

The greenback, in terms of the US Dollar Index (DXY), has now reverted the initial positive mood and retreats towards the 95.00 neighbourhood, where it seems to have met decent contention.

US Dollar gives away gains on PBoC, NFP

The index quickly gave away the initial advance to the 95.40 and returned to the 95.00 area following headlines from the PBoC, which decided to adjust the reserve requirement on FX forward trading to 20%, as per news released by Bloomberg.

Furthermore, China announced retaliatory measures including differentiated tariffs on US products worth $60 billion.

The greenback is also deriving some downside pressure after the US economy created 157K jobs during last month, less than initially forecasted. Further data from the US labour market report showed Average Hourly Earnings expanded 0.3% inter-month and 2.7% on a yearly basis, both prints falling in line with prior consensus. In addition, the unemployment rate ticked lower to 3.9%.

Later in the day, the ISM Non-manufacturing is also due.

US Dollar relevant levels

As of writing the index is losing 0.08% at 95.10 facing the next down barrier at 94.69 (10-day sma) seconded by 94.45 (55-day sma) and finally 94.23 (low Jul.31). On the upside, a break above 95.38 (high May 29) would target 95.53 (high Jun.28) en route to 95.65 (2018 high Jul.19).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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