The Dollar continues to edge out the Euro as the preferred currency perhaps because US scheduleddata has edged out Euro zone data to leave the US with a slight macro-economic edge. US private payrolls weregenerally positive but were somewhat limiting because they failed to match initial expectations. However, positiveFactory Orders leaves the economic pendulum in favor of the Dollar bulls, especially with another US Fedmember overnight, reiterating talk of “rising interest rates in 2015”. Seeing a surprise decline in claims today,could be a big development for the Dollar, especially if a decline were to take that reading below the critical300,000 level. Prior to the claims release, the trade will be presented with a private layoff report, which isamplified by Friday’s Non-farm payroll report. With claims expected to rise, that might cause a slight retrenchmentin the Dollar to 80.30, but subsequent data should leave the Dollar in an upside breakout before the end of thisweek.
Technical Outlook: Momentum studies are declining, but have fallen to oversold levels. Themarket’s close below the 9-day moving average is an indication the short-term trend remains negative. Themarket’s close below the pivot swing number is a mildly negative setup. The next downside objective is now at79.10. With a reading under 30, the 9-day RSI is approaching oversold levels. The next area of resistance isaround 79.61 and 79.84, while 1st support hits today at 79.25 and below there at 79.10.