DXY: Consolidation likely intra-day – OCBC

US Dollar slips modestly after ISM services data underwhelmed expectations. The Dollar Index (DXY) was last at 106.15, OCBC’s FX analysts Frances Cheung and Christopher Wong notes.

Daily momentum is mild bearish

“Focus is still on labour market related data, initial jobless claims tonight and more importantly, payrolls tomorrow. There is a good chance Nov NFP rebounds sharply after hurricanes and major strikes have likely distorted Oct NFP. Consensus is looking for +215k print. We caution that a lower print could see USD bears return.”

“Daily momentum is mild bearish though RSI is flat. Consolidation likely intra-day. Key support at 106.20 (21 DMA) if broken may see bearish momentum gather traction. Next support at 105.40 levels (38.2% fibo), 104.00/40 (50, 200 DMAs). Resistance at 106.50, 107.20.”