The U.S. dollar index, or DXY (pronounced “Dixie”), a weighted geometric index of the value of the U.S. dollar relative to a basket of six major currencies, surged 0.93% on Wednesday to an intraday high of 96.555, after ADP, a private payroll processor, said that businesses added 237,000 jobs in June, more than the economists’ forecast for a gain of 220,000 jobs. 

The report is a measure of non-farm private sector employment of about 400,000 U.S. businesses which are clients of ADP. The U.S. Labor Department will release the June employment report on Thursday. Economists predict the U.S. economy added 233,000 new jobs last month.

The Institute for Supply Management (ISM) also said on Wednesday that its manufacturing index rose to 53.5% last month, from 52.8% in May, exceeding Wall Street's expectations of 53.2% rise. A reading over 50% indicates more companies are expanding. Their Employment index rose to 55.5% from 51.7% in May, reflecting growing employment levels from May at a faster rate, said the ISM.

The U.S. dollar also got support from the weak euro today as the EUR/USD exchange rate fell below the 1.106 dollars per euros support level. Greek Prime Minister Alexis Tsipras sent new surprise proposals in a letter to the EU, IMF and ECB after Greece missed the IMF debt payment. Dutch Finance Minister Jeroen Dijsselbloem, head of the eurogroup finance ministers, said later on Wednesday that the eurogroup rejected Greece's last ditch proposals. Germany also said that talks with Greece will not be possible until after the referendum called by Mr. Tsipras for Sunday. 

The argument that the euro will become stronger without Greece, may be put on hold for now if the Greeks decide to vote "Yes" to stay in the eurozone. Mr. Tsipras continues to grandstand on Greek TV, telling the Greek people that the eurozone partners are blackmailing Greece and to vote “No” on the bailout deal referendum on July 5. According to the latest opinion poll, about 60% of those asked believed Greece should remain part of the eurozone as capital controls begin to bite Greek citizens. 

From our technical viewpoint, the DXY index made a short-term bottom, at 93.30 on June 18, after the U.S. Department of Labor said that the core CPI for all items less food and energy rose by 1.7% in May, missing the forecast of 1.8%, on a year-on-year basis. The weak inflation data suggested that the Fed’s rate hike may be off the table for now. Since then, the DXY index has been on the rise along with the 10-year Treasury bond yields, as the Greek debt drama seems to have no end in sight.

The U.S. dollar index just broke out the 100-day SMA and 50% Fibonacci retracement level at 96.27. The index will most likely retest the 97.81 head resistance, if the June jobs report comes in better than expectations.