The US dollar’s near-term trajectory is caught between labor-market fundamentals and a key technical resistance zone, with TD Cowen warning that the currency’s rebound may stall unless upcoming payrolls data exceed expectations.
TD Cowen said the dollar’s recovery from recent lows is not yet on solid ground. The firm argued that stronger nonfarm payrolls would signal economic resilience and could encourage the Federal Reserve to keep interest rates higher for longer, which typically supports the greenback. Conversely, a disappointing jobs report could lead markets to price in earlier rate cuts, putting renewed pressure on the dollar and potentially lowering US Treasury yields.
At the same time, the US Dollar Index is stalling at a technical confluence near 99.75, where the 100-period simple moving average aligns with the 38.2% Fibonacci retracement of the last major swing. A sustained break above this area could open a move toward 100.30, while rejection may trigger a test of support around 99.20, with the 99.00 psychological level also in focus. Momentum indicators such as the RSI are neutral, suggesting traders are waiting for a fresh catalyst.
The dollar’s recent bounce has been supported by sticky inflation and hawkish Fed expectations, but the inability to clear 99.75 reflects lingering uncertainty about global growth and possible rate cuts later in the year. For investors and businesses, the dollar’s path affects multinational earnings, commodity prices, and currency volatility. For crypto market participants, dollar strength and Federal Reserve rate expectations are important macro drivers, with Bitcoin and other risk assets often sensitive to shifts in global liquidity conditions.
