While finding moderate early pressure and remaining well below Friday’s 2-week high, subdued preholidaytrading conditions are helping the Dollar generally hold its ground above both its 50-day moving averageand its recent lows this morning. With the Fed’s tapering decision now out of the way, the Dollar’s “datadependency” will require that negative surprises from upcoming US economic numbers be few and far between.Friday’s sharp upward revision on 3rd quarter GDP clearly helped out the Dollar, but the lack of upside followthroughmay indicate that several weak post-tapering US data points had already taken their toll. The lack ofoverseas news flow, developing “risk on” vibe and thin end-of-year markets will place additional emphasis on thismorning’s Personal Income and Consumer Sentiment readings to lift the Dollar back into positive territory, but itmay take several sessions worth of “good” US numbers in order to lift prices above and beyond last Friday’s andthe early December highs. The Dollar should find support around the 80.55 level, and needs to see good US datato fully shake off this week’s early pressure. The Commitments of Traders Futures and Options report as ofDecember 17th for US Dollar showed Non-Commercial traders were net short 6,246 contracts, an increase of12,976 contracts which represents a change from a net long to net short position. The Commercial traders werenet long 2,737 contracts, an increase of 13,227 contracts which represents a change from a net short to net longposition. The Non-reportable traders were net long 3,509 contracts, a decrease of 251 contracts. NonCommercialand Non-reportable combined traders held a net short position of 2,737 contracts. These tradershave gone from a net long to a net short position.
Technical Outlook: Momentum studies are trending higher from mid-range, which should support amove higher if resistance levels are penetrated. The market’s short-term trend is positive on the close above the9-day moving average. The downside closing price reversal on the daily chart is somewhat negative. It is aslightly negative indicator that the close was lower than the pivot swing number. The near-term upside objective isat 81.19. The next area of resistance is around 80.94 and 81.19, while 1st support hits today at 80.50 and belowthere at 80.31.