Another new low for the move overnight in the Dollar is a little surprising as the Dollar derived littlesupport from news of another Fed tapering move yesterday and the Dollar also failed to find buying interest offsome rather upbeat US economic views from the Fed. In fact, if one were to discard the US GDP result, US datahas probably been generally supportive of the Dollar. In looking ahead to an extremely active US scheduledreport slate today, one should come away with a positive economic view as claims are expected to decline,Personal Income and Spending are expected to rise, and ISM business Index readings are expected to improve.However, the trade will see a private layoff report early in the session and US auto sales later in the day andthose reports might show some weakness because of lingering cold and wet US weather. Therefore we can’targue against the downside tilt but we now think the bear camp in the Dollar is pushing the edge and the risk ofbeing short the Dollar is growing. In fact, we would suggest that the Dollar trade has priced in a weak non-farmpayroll tally already and a gain in excess of +180,000 might result in a sharp short covering rally on Fridaymorning.
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.