While the US government shutdown and the lack of fresh economic data still casts a long shadow overthe market, the Dollar has been able to shake off early-week pressure to rally back towards a new monthly highthis morning. Fed Regional Presidents Pianalto and Plosser both made the case for near-term tapering with theircomments yesterday, which should make this afternoon’s release of the September 18th FOMC meetinginteresting reading to see how close a call it was for the Fed to continue their asset purchases. The choice ofJanet Yellen as next Fed Chairman may not have come as too much of a surprise to the market, but today’sannouncement in the midst of the current Washington budget battle has removed some uncertainty from themarket and in turn provided the Dollar with a significant boost this morning. It may difficult for the Dollar to put thelack of progress with resolving Washington budget discord fully behind it, but a flare-up of fresh overseas riskconcerns should help it to gain further ground during today’s trading session. The Dollar may rise up towards the80.54 level later today, but will need to see a close call on the Fed’s tapering/no tapering question as well asfurther signs of progress out of Washington in order to climb above the late September consolidation price zone.
Technical Outlook
USD (DEC): The stochastics indicators are rising from oversold levels, which is bullish andshould support higher prices. The market’s close below the 9-day moving average is an indication the short-termtrend remains negative. The daily closing price reversal up is a positive indicator that could support higher prices.It is a mildly bullish indicator that the market closed over the pivot swing number. The next upside target is 80.30.The next area of resistance is around 80.19 and 80.30, while 1st support hits today at 79.94 and below there at79.80.