Concerns over a possible US military strike on Syria are once again starting to fade. Comments by Secretary of State Kerry that a Russian proposal where by Syria would give up its chemical weapons is meeting with general global acceptance. These comments are stabilizing fears of a military strike and allowing the Dollar to trade off of other fundamental data. As the FOMC meeting next week draws closer and the Syria issues fade, tapering by the Fed becomes front and center on traders’ minds. The rest of today’s trading should have a Dollar positive bias with a cautious overtone. Tonight’s speech by President Obama will hold back any big Dollar rally today. The only potential impacting news scheduled for the rest of today’s session is the Johnson Redbook which would have to be decidedly negative to move the Dollar lower.
Technical Outlook
USD (SEP): The close below the 40-day moving average is an indication the longer-term trend has turned down. A bearish signal was triggered on a crossover down in the daily stochastics. Momentum studies are trending lower from high levels which should accelerate a move lower on a break below the 1st swing support. The market’s short-term trend is negative as the close remains below the 9-day moving average. It is a slightly negative indicator that the close was lower than the pivot swing number. The next downside target is 81.27. The next area of resistance is around 82.14 and 82.55, while 1st support hits today at 81.50 and below there at 81.27.