On Friday, the US dollar index pulled back from the session highs of about 98.26 to trade at about 97.87 after the latest US data. The DXY trades within a descending channel formation in the 60-minute chart.

The US dollar currency index has now fallen to trade a few levels below the 100-hour moving average line. As a result, the USDX is on the verge of entering the oversold 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 US unemployment rate for April remained unchanged from March at 4.3%, as expected. The US jobs data for the month fell to 115k, down from 185k in the previous month, beating the forecasted net employment change of 62k. 

On the other hand, the average hourly wage growth for the period fell short of the forecasted (MoM) change of 0.3%, with a change of 0.2%. The (YoY) equivalent also missed the estimated change of 3.8%, with a change of 3.6%.

Elsewhere, the preliminary Michigan Consumer Sentiment Index for May fell to 48.2, down from 49.8 in April, missing the forecasted reading of 49.5. The preliminary Michigan Consumer Expectations Index for the period improved to 48.5, up from 48.1. 

Earlier in the week, the initial jobless claims for last week increased to 200k, up from 190k in the preceding week, beating the forecasted claim count of 205k. The ADP employment change for April beat the expectation of 99k, with a change of 109k, up from the previous month’s equivalent of 61k.

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

Technically, the US dollar index trades within a descending channel formation in the 60-minute chart. The 14-hour RSI also supports a bearish bias as it edges closer to oversold conditions.

Therefore, the bears will look to extend the current declines towards 97.47 or lower to 97.11. On the other hand, the bulls will look to pounce on rebounds at about 98.26 or higher at 98.57.

The US Dollar Index Technical Analysis (the Daily Chart)

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

Therefore, the bears will look to stretch the current pullback towards 96.49 or lower to 94.99. On the other hand, the bulls will look to pounce on rebounds at about 99.30 or higher at 100.70.