After finding strength at home from improved US data, it has been overseas pressure that has put theDollar back on the defensive coming into this morning’s trading. With mixed messages coming from Fed officialson the “taper/no taper” debate since last week’s FOMC meeting, the Dollar will need to see further evidence of animproving US economy before a December tapering move becomes more than a remote possibility. Safe-havensupport has yet to become a major source of support for the Dollar after last month’s Washington debacle, buttoday’s notable improvement in global risk sentiment is not doing it any favors. Today’s set of second-tier USnumbers should help to relieve this morning’s early pressure, but the Dollar may need to get past Friday’s criticalNon-Farm Payroll reading before it can make a large-scale extension to last week’s rally. The Dollar may bounceback towards the 80.74 level later this morning, and needs to continue avoiding negative US data results in orderto hold its ground in close proximity to the recent highs.
Technical Outlook
USD (DEC): A positive indicator was given with the upside crossover of the 9 and 18 barmoving average. Daily stochastics have risen into overbought territory which will tend to support reversal action ifit occurs. The market’s close above the 9-day moving average suggests the short-term trend remains positive.The daily closing price reversal up is a positive indicator that could support higher prices. The market has aslightly positive tilt with the close over the swing pivot. The next upside objective is 81.08. The next area ofresistance is around 80.95 and 81.08, while 1st support hits today at 80.64 and below there at 80.45.