The Dollar showed upside action yesterday ahead of the FOMC release but then gave ground as thenews was digested by the trade. However, the Dollar continues to hold above the 80.00 level perhaps because ofsomewhat slack Euro zone May Manufacturing readings. For the Dollar to continue to maintain above the 80.00level today, probably requires a better than expected result from US claims data later this morning. However,expectations call for a slight rise in claims back above the ultra-critical psychological level of 300,000 today. In ouropinion, the bull camp in the Dollar needs a decline in claims to a fresh new low for the move, in order to rekindlerespect for the US economy and provide some fresh bids for the Greenback above the 80.00 level. With theDollar currently trading roughly 30 ticks above last week’s lows, it probably needs positive data and positive USequities to remain above 80.00 into the end of this week.
Technical Outlook: Momentum studies are trending higher but have entered overbought levels. Themarket’s short-term trend is positive on the close above the 9-day moving average. The upside daily closing pricereversal gives the market a bullish tilt. With the close higher than the pivot swing number, the market is in aslightly bullish posture. The next upside target is 80.56. The next area of resistance is around 80.33 and 80.56,while 1st support hits today at 79.91 and below there at 79.71.