On Friday, the US dollar index extended Thursday’s rebound from about 99.59 to trade at about 100.13 after the latest data. The DXY also completed an upward breakout from a descending channel formation in the 60-minute chart.

The latest run of gains has now pushed the dollar currency index a few levels above the 100-hour moving average line. As a result, the USDX is on the verge of entering the overbought levels of the 14-hour RSI.

The US Dollar Index Fundamentals Overview

From a fundamental perspective, the US dollar index trades during a relatively busy period in the US market. On Friday, the Michigan Consumer Sentiment Index for March came in at 53.3, down from 55.5 in February and below the expected 54. The Michigan Consumer Expectations Index for the period also fell short of 54.1, with 51.7, down from the previous month’s equivalent of 54.1. 

On the other hand, the UoM 5-year consumer inflation expectation matched the expected rate of 3.2%, unchanged from February, while the UoM 1-year consumer inflation expectation for the month rose to 3.8%, up from 3.4%, and ahead of the forecast of 3.4%. On Thursday, the initial jobless claims for last week edged higher to 210k, up from 205k in the preceding week, as expected. 

Elsewhere, the preliminary S&P Global Manufacturing PMI for March outperformed the expectation of 51, with a reading of 52.4, up from 51.6 in February. On the other hand, the preliminary S&P Global Services PMI for the period fell short of 51.7, with a reading of 51.1, down from the previous month’s equivalent of 51.7.

The US Dollar Index Technical Analysis (the 60-min Chart)

Technically, the US dollar index recently completed an upward breakout from a descending channel formation in the 60-minute chart. The 14-hour RSI also supports a bullish bias as it edges closer to overbought conditions.

Therefore, the bulls will look to extend the current rebound towards 100.61 or higher to 101.09. On the other hand, the bears will look to pounce on pullbacks at about 99.59 or lower at 99.07.

The US Dollar Index Technical Analysis (the Daily Chart)

In the daily chart, the USDX trades within a descending channel formation. However, the 14-day RSI has recently bounced back to avoid falling into oversold conditions.

Therefore, the bulls will look to stretch the current rebound towards 101.99 or higher to 103.99.