Dollar Index remains flat lined below 95.00, eyes NFP data

Dollar Index (DXY) keeps the weekly range of 94.40-95.00 as investors await US jobs data, which is expected to show the economy added 312K jobs in October.

At the time of writing, the DXY is trading flat around 94.70 levels.

Capping the upside this Friday is the flatter yield curve. The spread between the US 10-year yield and the 2-year yield fell to 73.67 basis points; the lowest level since 2007. A flatter yield curve is USD bearish.

Despite the weakness in the yields, the USD is resisting losses on the back of the tax reform reform news. Reuters report says, "republicans called for slashing the corporate tax rate to 20 percent from 35 percent, cutting tax rates on companies' foreign profits and on individuals and families, although Congressional passage of the legislation is far from certain".

Focus on US data

James Chen from Forex.com writes-

With lofty consensus expectations of over 300,000 jobs added in October, our target range is somewhat less aggressive at around 270,000-300,000, given the pre-NFP data inputs. Any result falling above this range is likely to give the US dollar a substantial boost, potentially helping to extend its recent recovery. An outcome falling within or around the range is unlikely to make much of an impact on the dollar. If the actual data falls well below our target range, however, the dollar could see a significant pullback after its recent rally.

> 320,000
Strongly Bullish

301,000-320,000
Moderately Bullish

270,000-300,000
Neutral

240,000-269,000
Moderately Bearish

< 240,000
Bearish