The Dollar was able to extend its current up move to new high ground during the overnight session, butwill need to get past several key US data points and this afternoon’s FOMC meeting results in order to hold itsground. A new set of Russian sanctions Tuesday afternoon brought an added measure of safe haven support tothe Dollar, although a lack of fresh news from Gaza and Ukraine will put more of the market’s attention on thecomparative advantage between US rate prospects and the Euro zone. The second quarter GDP reading shouldsee a vast improvement over the first quarter while the ADP Employment survey is expected to show anotherhealthy increase, so it may come down to post-FOMC Fed rhetoric for the most likely source of marketdisappointment. A run up to the 81.54 level may be in the cards with well-received US data, but the Dollar willhave little measure for error if the trend towards tighter Fed policy is not confirmed by the FOMC meeting resultslater this afternoon.
Technical Outlook: Daily stochastics have risen into overbought territory which will tend to supportreversal action if it occurs. The market’s short-term trend is positive on the close above the 9-day movingaverage. Since the close was above the 2nd swing resistance number, the market’s posture is bullish and couldsee more upside follow-through early in the session. The near-term upside objective is at 81.51. The 9-day RSIover 70 indicates the market is approaching overbought levels. The next area of resistance is around 81.44 and81.51, while 1st support hits today at 81.19 and below there at 81.01.