US Dollar mixed ahead of NFP

The US Dollar index, which gauges the greenback against a basket of currencies is about to end higher for the second day in a row, as it recovers from 1-month lows. The rise in the index was boosted by a rally of the US dollar against European currencies (particularly the pound).

Commodity currencies climbed versus the US dollar, with the Loonie and the Aussei hitting the highest level in weeks. Emerging market currencies were little change from yesterday’s closing price.

Volatility in the forex market remained low on Thursday, excluding pound crosses, ahead of the release of the US employment report on Friday. NFP are expected to show a gain of 170K. On Thursday economic data showed a decline in factory order in June of 1.5%. “On balance, this report suggests that the headwinds on the factory sector, such as sluggish global growth and still-low commodity prices, continue to weigh on manufacturers”, said analyst from Wells Fargo.

Levels to watch

The DXY peaked today at 95.83, the highest level since last Friday and then pulled back toward 95.50. It  is about to end the day hovering around 95.60. Immediate resistance is seen around 95.85 and then 96.15. To the downside, 95.20 has become again a relevant technical support followed by 94.90 (Aug 2 low) and 94.25 (June 6 & 21 high).