Dollar on the ropes after shocking ADP miss
- USDInd is up 0.38% today, snapping a 7-day slide
- ADP jobs shock – first contraction in over two years
- All eyes on Non-farm Payrolls tomorrow
- June 26 gap-down confirms bearish wedge break
- Key potential levels: resistance at 97.476, 98.208, 99.452; support at 95.140, 94.640
ADP misses hard – dollar on shaky ground
This morning’s ADP print stunned markets: -33,000 jobs vs. a forecast of +99,000. It’s the first negative reading in over two years and couldn’t come at a worse time for the dollar.
The greenback briefly caught a bid but remains vulnerable. Sentiment is rattled, and the margin for error ahead of Friday's holiday is razor thin.
NFP: one number to rule the week
- Thursday, July 3 @ 12:30 GMT
- With ADP falling flat, tomorrow’s NFP is now make-or-break
- Consensus: 110K-120K
Risk: skewed heavily to the downside
Markets are bracing for a binary outcome. A second weak print could light the fuse on another leg down for the dollar.
Trade tensions on deck
Trump’s July 9 trade deadline isn’t front-and-center yet, but any unexpected noise could compound dollar pressure post-payrolls. One more thing for markets to worry about.
Technical picture: bearish momentum holds
The gap-down on June 26 (97.712 to 97.522) confirmed a breakdown below the falling wedge. This pattern, typically a bearish continuation signal, suggests the dollar may remain under pressure.
RSI bounced from oversold territory, but the index continues to trade below key resistance.
Levels to watch
USDInd bulls should pay attention to the following potential resistance levels
- 97.476 – former wedge support, now resistance
- 98.208 – 21-day Simple Moving Average
- 99.452 – 50-day SMA and top of the broken wedge
The Index bears on the other hand may take note of the following potential support levels
- 95.140 – February 4, 2022, swing low
- 94.640 – January 13, 2022, swing low
Conclusion
A shocking ADP miss, weak technical, and looming payroll data creates a fragile setup for the dollar. If NFP follows suit, the USDInd could accelerate to new lows. The bounce may be over before it truly began.