US Dollar Index remains choppy above 97.00, Payrolls eyed

• The index struggles for direction near 97.20/30.
• US-China trade talks keep driving sentiment in global markets.
• US Non-farm Payrolls will be the big event later today.

The US Dollar Index (DXY), which tracks the greenback vs. a basket of its main rivals, is looking for direction at the end of the week, although managing well to keep the trade above the 97.00 handle.

US Dollar Index looks to jobs data

The index is prolonging the erratic performance so far this week amidst alternating trends in the risk appetite mood, all following the positive developments from the US-China trade negotiations.

In this regard, it is worth noting the President Trump reiterated on Thursday that despite a deal looks closer, there still are some unresolved issues gyrating around particular tariffs and the always-critical intellectual property protection theme.

While the greenback manages well to remain above the key 97.00 mark, yields of the key US 10-year note have rebounded from recent multi-month lows and are now approaching the 2.54% area.

Moving forward, the US monthly labour report will be the salient event later today, with consensus expecting the economy to have created 180K jobs during March.

What to look for around USD

DXY keeps tracking the broad risk appetite trends and particularly any headlines coming from the US-China trade developments. In addition, positive results in the US calendar have been also fuelling the upside in DXY to 97.00 and beyond, while market participants continue to adjust to the prospects of no hikes from the Fed this year and just one probable rate raise in 2020. Additionally, the buck’s safe haven appeal and widening rate differentials vs. its peers are also are also lending support to the move. From the political view, the debt ceiling, the border-wall funding and upcoming elections next year carry the potential to spark bouts of extra volatility around USD.

US Dollar Index relevant levels

At the moment, the pair is losing 0.03% at 97.26 and faces initial contention at 96.84 (21-day SMA) seconded by 96.57 (55-day SMA) and finally 95.74 (low Mar.20). On the upside, a breakout of 97.52 (high Apr.2) would expose 97.71 (2019 high Mar.7) and finally 97.87 (monthly high Jun.20 2017).