U.S. Dollar Index posts 3rd straight daily gain as jobless claim and manufacturing bolsters outlook
DXY is approaching 103.7
The U.S. Dollar Index (DXY) is on track for its third consecutive daily gain, pushing toward the 103.7 resistance level for the second time this week. After briefly edging above this level on Friday, March 21, the index marked a two-week-high, indicating a potential shift in momentum. However, price action remains contained within a tight range, as the dollar struggles to break out of the consolidation phase that has defined trading over the past two weeks.
The dollar’s recent strength follows key economic data releases that reinforced the resilience of the U.S. labor market and manufacturing sector. Initial jobless claims came in at 223K, slightly below the forecast of 224K and higher than the previous 220K. While the reading does not reflect a drastic shift, it highlights continued stability in employment conditions, which can support consumer spending and broader economic strength.
DXY price dynamics (Nov 2024 - March 2025). Source: TradingView.
Meanwhile, the Philadelphia Fed Manufacturing Index surprised to the upside, posting a reading of 12.5, well above the forecast of 8.8, though lower than the previous 18.1. The index remains in positive territory, suggesting that business conditions are still expanding in the region. This data bolstered the dollar as traders interpreted the figures as supportive of economic activity and, by extension, the Federal Reserve’s steady monetary policy stance.
U.S. dollar faces key breakout test at 103.7 amid fed policy speculation
From a technical perspective, the dollar index remains in a ranging phase, oscillating between key support and resistance levels. The daily RSI is rising but still in bearish territory, indicating that bullish momentum is not yet fully established. On the 4-hour chart, RSI is also trending higher within bullish territory, providing near-term support for a potential breakout. If the dollar index manages to clear the 103.7 resistance decisively, the next test will be the 100 EMA on the 4-hour chart at 104.10. A successful move beyond this level could open the door for further upside.
Overall, the dollar’s price action remains dependent on upcoming economic data and market sentiment regarding Federal Reserve policy. A successful move beyond 104.1 could open the door for further upside.
The U.S. Dollar Index recovered 0.57% to 103.6 after an initial drop on FOMC news. Price remained within its eight-day range, failing to break the 103.7 resistance.
