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US Dollar Might Shine Again after the US Jobs Report

Today's jobs data from the US were surprisingly strong. The NFP blasted expectations of 214K with a 288K reading. The unemployment rate dropped to 6.1% from May's 6.3%. Most forecasts saw no change.

The US Dollar was already climbing ahead of the NFP. The ADP jobs report earlier this week gave the market anticipation that the NFP should be at least in-line with estimates. It came in just as strong as the ADP report suggested.

(USDX 4H chart, 7/3)

The USDX rallied after the US NFP report, and is put to challenge a falling trendline coming down from the June high around 81.0. If the index pushes above 80.40, it would clear the trendline, and the moving averages in the 4H chart. This would signal a bullish reversal in the 4H chart, and possible a bullish continuation in the daily chart.

(USDX Daily chart, 7/3)

The daily chart shows that the breakout first has 80.53 as a near-term target. Above that the 81 high on the month is in sight. The 2014-high at 81.38 would also be exposed if the USDX further confirms the breakout with ability to hold above 80 on the next dip.