- DXY picks up steam after November payrolls.
- The US economy added fewer jobs than expected last month.
The dollar, in terms of the US dollar index (DXY), Gain some pace and retest the daily highs around 96.35 at the end of the week.
US Dollar Index Offered Following NFP Data
The index is now advancing for the third consecutive session on Friday and is looking to consolidate the bounce above 96.00 following the release of the November US labor market report.
In fact, US yields and the dollar rose despite the US economy adding “only” 210,000 jobs in November (down from an estimated 550,000), although the unemployment rate declined. and average hourly earnings surprised to the downside at 0.3% MoM and 4.8% YoY.
Meanwhile, the returns along the curve add to the gains seen in the second half of the week, with the 2-year yield flirting with the highs around 0.65%, the short end of the curve moving past the 1.45% and the long end is approaching 1.80%.
The dollar remains on track to close the sixth straight week with gains, always supported by the uptrend in US yields, auspicious results from US fundamentals, which in turn support the idea of ​​a strong recovery, a rebound in aversion to the risk from Omicron’s fears and lately from the aggressive turn in Powell’s testimony after he suggested the Fed will discuss adopting a faster rate of reduction at the December meeting, all pointing to a rate hike sometime time in mid-2022.
Technical levels
Now the index is gaining 0.10% to 96.35 and a break above 96.93 (November 24, 2021 high) would open the door to 97.00 (round level) and then 97.80 (June 30, 2020 high). On the other hand, the next downward barrier emerges at 95.51 (weekly low of November 30) followed by 94.96 (weekly low of November 15) and finally 94.44 (low of November 18).
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