On Friday, the US dollar index pulled back from the session highs of about 97.19 to trade at about 96.88 after the latest US data. The DXY trades within a consolidative triangle formation in the 60-minute chart.

Friday’s pullback pushed the dollar currency index next to the 100-hour moving average line. However, the USDX still has room left to run before reaching the oversold levels of the 14-hour RSI.

The US Dollar Index Fundamentals Overview

From a fundamental perspective, the US dollar currency index trades during a relatively busy period in the US market. On Friday, the US consumer price index for January missed the expected (MoM) change of 0.3%, with a change of 0.2%. The (YoY) equivalent also fell short of 2.5%, with a change of 2.4%. On Thursday, the US initial jobless claims for the last week missed the expectation of 222k, with a claim count of 227k, down from the previous week’s equivalent of 232k. 

Earlier in the week, the US nonfarm payrolls for January came in stronger than expected, with 130k versus a forecast of 70k, up from 48k in December. The unemployment rate for the month also improved to 4.3%, down from 4.4%, beating the forecasted rate of 4.4%. On the other hand, the average hourly earnings for the period grew by 0.4% (MoM), beating the expectation of 0.3%. The (YoY) equivalent also exceeded the expectation of 3.6%, with a change of 3.7%. 

The Monthly budget statement for January missed the expectation of $-86.5 billion, with $-85 billion, up from the previous month’s equivalent of $-145 billion. 

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

Technically, the US dollar index trades within a consolidative triangle formation in the 60-minute chart. However, the 14-hour RSI has recently pulled back to avoid entering overbought conditions.

Therefore, the bears will look to stretch the latest pullback towards 96.52 or lower to 96.11. On the other hand, the bulls will look to pounce on profits at about 97.19 or higher at 97.58.

The US Dollar Index Technical Analysis (the Daily Chart)

In the daily chart, the US dollar index trades within a descending channel formation. However, the 14-day RSI still has some room left to run before retesting oversold conditions.

Therefore, the bears will look to extend the latest pullback towards 95.63 or lower to 94.23. On the other hand, the bulls will look to pounce on rebounds at about 98.00 or higher at 99.41.