Talk of disappointing growth in China, a lower UK inflation outlook, slack growth in Europe, lower USdeficit readings and a possible showdown between Russian and Ukraine personnel along the Ukrainian borderwould seem to leave the Dollar in vogue. In fact, seeing a minor gain in US retail sales figures later today couldsimply add to the Dollar’s macro-economic edge. Given the setup, the odds of a fresh upside breakout in theDollar to the highest levels since last November, looks pretty strong. Just to add to the Dollar’s macro-economicand interest rate differential edge is news that Japan also posted some disappointing economic news regarding asoftening of sales in the wake of a prior tax hike. Up-trend channel support is seen at 81.50 but that supportchannel rises to 81.63 by this Friday.
Technical Outlook: Daily stochastics turning lower from overbought levels is bearish and will tend toreinforce a downside break especially if near term support is penetrated. The close above the 9-day movingaverage is a positive short-term indicator for trend. With the close higher than the pivot swing number, the marketis in a slightly bullish posture. The next downside objective is 81.39. The next area of resistance is around 81.66and 81.81, while 1st support hits today at 81.46 and below there at 81.39.