Skip to content

We want to clarify that IG International does not have an official Line account at this time. We have not established any official presence on Line messaging platform. Therefore, any accounts claiming to represent IG International on Line are unauthorized and should be considered as fake.
CFDs are complex instruments. 70% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.
CFDs are complex instruments. 70% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

DXY eyes US jobs data amid global economic ripples

The US dollar index finds itself in the spotlight as the market anticipates key labour market data releases, while simultaneously grappling with weaker-than-expected Chinese PMI and currency fluctuations.

Source: Bloomberg

It was a quiet overnight trading session with muted trading volumes in the FX space due to US Independence Day. The US dollar index, the DXY, closed marginally higher at 103.08 (+0.09%).

This morning, the USD edged higher again after China’s Caixin PMI Service and Composite PMI data came in weaker than expected. Following a better read on the Caixin Manufacturing PMI yesterday (50.5 vs 50.4 expected), both the Services (53.9 vs 56.5 expected) and the Composite PMI (52.5 vs 55.1 expected) have disappointed.

The soft PMI numbers are another indication that the Chinese economy is slipping towards a double-dip slowdown and that further stimulus measures are required to reverse the spiral.

Earlier this week, the Chinese currency, the CNY, gained four big figures (+0.75%) against the USD after tumbling -5.5% in the June quarter. Although the CNY is not part of the DXY, it directly influences other currencies in the DXY basket, including the JPY and the CAD, which are easing as I write.

Regarding domestic data that can impact the DXY in the near future, we are looking at three key labour market data points scheduled for release later this week.

What is expected from the JOLTS, ADP Employment Report and NFP?

ADP employment report

  • The ADP employment report will be released on Thursday, 06 July, at 10.15 pm AEST
  • The ADP report isn’t an exceptionally reliable guide to Non-Farm Payrolls
  • Nevertheless, the market expects a 240k rise in June, falling from 278k in May.

JOLTS job openings

  • JOLTS job openings are released on Friday, 07 July at 12.00 am AEST
  • The market is looking for JOLTS job openings to fall to 9,900k in May from a red-hot rise of 10,103k in April
  • Last month’s robust number confirms how tight the labour market still is. Unless some cooling is seen shortly, it will increase the pressure on the Fed to extend its tightening cycle.


  • Non-Farm Payrolls is scheduled for release on Friday night, 07 July, at 10.30 pm AEST
  • The market is looking for payrolls to rise by 225k in June, slowing from 339k in May
  • The unemployment rate is expected to ease to 3.6% in June from 3.7% in May
  • The participation rate is expected to remain unchanged at 62.6%
  • Average hourly earnings are expected to rise by 0.3% in June, allowing the annual rate to ease to 4.2% from 4.3%.

DXY technical analysis

During the first half of 2023, the US dollar index, the DXY, tested and held support at 101.00/80 on three separate occasions before bouncing to a high of 104.69 in late May.

While the downside has been well protected near 101.00/80, overhead resistance is firming above 104.00, via the 200-day moving average, currently at 104.73 and the downtrend resistance that connects the March 105.88 high with the May 104.69 high, coming in at 104.30ish.

Should the DXY move towards the range extremes mentioned above, we suspect that it will initially hold. Aware that if they were to break on a sustained basis, it would likely see a test of support at 97.00 on the downside or 106.00 on the topside.

DXY index daily chart

Source: TradingView
  • Source: TradingView. The figures stated are as of July 5, 2023. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.