In retrospect, the Dollar has managed somewhat impressive gains on rather suspect economic data. Infact, the Dollar managed to rise off a US retail sales result that showed a +0.2% gain relative to expectations of+0.1% gain. Some might suggest that the Dollar is winning by default because of slack data from Europe andresidual uncertainty from China. Limiting the upside in the Dollar is somewhat positive data flow and expectationsfrom the German economy which overnight showed an expansion in household consumption of +0.9% in 2013. Itwould also seem like the market is generally content to shape US Fed dialogue into Dollar supportive news andtherefore the path of least resistance in the Dollar looks to remain up in the short term. With the Fed generallyseen to be set to err in favor of more tapering, even in the face of disjointed economic data, some of the flow intothe Dollar is the result of expectation of higher relative returns from the interest rate differential. The bulls have anedge and there might not be much in the way of resistance seen until the 81.27 level. The most important USscheduled report today will probably be the Empire State Manufacturing survey, but that report could be superceded by a much softer than expected US PPI report.
Technical Outlook: The cross over and close above the 40-day moving average indicates thelonger-term trend has turned up. Declining momentum studies in the neutral zone will tend to reinforce lower priceaction. The market now above the 18-day moving average suggests the intermediate-term trend has turned up.The daily closing price reversal up is a positive indicator that could support higher prices. The close over the pivotswing is a somewhat positive setup. The next downside objective is 80.46. The next area of resistance is around80.86 and 80.95, while 1st support hits today at 80.62 and below there at 80.46.