On Friday, the US dollar index pulled back from the session highs of about 99.99 to trade at about 99.55 after the latest data. The DXY trades within a sideways channel formation in the 60-minute chart.

The dollar index has now plummeted to trade a few levels below the 100-hour moving average. As a result, the USDX dropped into the oversold levels of the 14-hour RSI before making a late rebound.

The US Dollar Index Fundamentals Overview

From a fundamental perspective, the US dollar currency index trades during a relatively busy period in the market. On Friday, the US nonfarm payrolls for July fell to -23k, down from the previous month’s equivalent of 20k, missing the forecasted figure of 80k. 

On the other hand, the unemployment rate for the month came in better than expected, at 4.1% versus a forecast of 4.2%, down from 4.2% in June. The average hourly wage growth for the period missed both the (MoM) and (YoY) forecasts of 0.3% and 3.5%, respectively, with changes of 0.1% and 3.2%. 

Earlier in the week, the US initial jobless claims for last week rose slightly to 199k, up from 198k, beating the forecasted claim count of 202k. The ISM Services PMI for July missed the expectation of 54.5, with a reading of 54.1, down from 54 in June. 

On the other hand, the S&P Global Composite PMI for the month outshone the forecast of 53.6, with a reading of 54.5, up from 53.6. Elsewhere, the APD employment change for July fell short of the forecasted change of 79k, with a change of 44k, down from the previous month’s equivalent of 95k.

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

Technically, the US dollar index trades within a sideways channel formation in the 60-minute chart. However, the 14-hour RSI has recently pulled back to move closer to oversold conditions.

Therefore, the bears will look to stretch the latest pullback towards 99.10 or lower to 98.62. On the other hand, the bulls will look to pounce on rebounds at about 99.99 or higher at 100.42.

The US Dollar Index Technical Analysis (the Daily Chart)

In the daily chart, the US dollar currency index trades within an ascending channel formation. However, the 14-day RSI has recently pulled back to avoid rallying into overbought conditions.

Therefore, the bears will look to stretch the current pullback towards 97.68 or lower to 95.63. On the other hand, the bulls will look to pounce on rebounds at about 101.64, or higher at 103.56.