A quiet overnight session has left the Dollar with mild strength, but still within the lower portion of itsweekly trading range as the market prepares for critical events both at home and abroad. While US economicdata since the late October FOMC meeting has generally been positive, recent comments by Fed officialsindicates that it has not been enough to shift tapering expectations towards a December move. Today’s set of USdata could produce some fresh headwinds to contend with, particularly from an expected downward revision toGDP, so the Dollar may be looking for dovish post-ECB meeting comments as a near-term source of support.With Friday’s Non-Farm Payroll number already casting a long shadow over the market this week, however, theDollar’s upside may be limited at best during today’s session. The Dollar may climb up towards the 80.76 areawith good US data and dovish ECB post-meeting comments, but needs to get past tomorrow’s US jobs numbersbefore having any chance of retesting Monday’s highs for the move. The Commitments of Traders Futures andOptions report as of October 29th for US Dollar showed Non-Commercial traders were net long 1,086 contracts, adecrease of 1,564 contracts. The Commercial traders were net short 5,108 contracts, a decrease of 1,315contracts. The Non-reportable traders were net long 4,022 contracts, an increase of 249 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 5,108 contracts. This represents adecrease of 1,315 contracts in the net long position held by these traders.
Technical Outlook
USD (DEC): Daily stochastics have risen into overbought territory which will tend to supportreversal action if it occurs. The market’s close above the 9-day moving average suggests the short-term trendremains positive. The swing indicator gave a moderately negative reading with the close below the 1st supportnumber. The next upside target is 80.94. The next area of resistance is around 80.74 and 80.94, while 1st supporthits today at 80.40 and below there at 80.26.