US Dollar flirting with highs near 100.80

The US Dollar Index – which measures the buck vs. a basket of its main rivals – is extending its weekly gains to the area of 100.80, leaving exposed Wednesday’s tops just below the critical 101.00 handle.

US Dollar bid post-Payrolls

The index has quickly bounced off daily highs near 100.40 after US Non-farm Payrolls have disappointed market participants during March, showing the US economy created ‘just’ 98 K jobs, vs. 180K initially estimated. The jobless rate, however, unexpectedly ticked lower to 4.5% and wage inflation was in line with forecasts.

Yields in the US money markets have initially plummeted to fresh lows although they quickly rebounded and continue to sustain the buck’s upside for the time being.

Speaking about reversion, odds for a June rate hike by the Federal Reserve tumbled soon after the jobs report, although it quickly returned to levels pre-NFP above 60%, all fuelling the bounce of DXY.

US Dollar relevant levels

The index is gaining 0.12% at 100.73 and a break above 100.99 (high Apr.5) would aim for 101.10 (100-day sma) and then 101.50 (78.6% Fibo of he March sell-off). On the other hand, the initial support is located at 99.50 (low Mar.29) followed by 98.92 (low Mar.28) and finally 98.67 (low Mar.27).