The Dollar was able to find its footing after posting a new 1-week low during overnight trading, but still has some way to go in order to fully regain upside momentum. While the potential for military action in Syria has ramped up flight-to-safety concerns, particularly out of emerging market economies, the uncertainty over the start of Fed tapering has driven much of that potential safe-haven support over to the Yen and/or Swiss Franc this week. Yesterday’s Housing and Consumer Confidence readings were a step in the right direction, but the Dollar will likely need to string together several sessions worth of positive data results in order to become a first-choice safe-haven destination once again. As long as today’s Pending Home Sales numbers can avoid a sharp decline, however, the Dollar should be able to build upon this morning’s modest gains. The Dollar may climb up to the 81.55 level later today, but will have to wait for tomorrow’s top-tier US data before rising up towards a retest of last week’s highs.
Technical Outlook
USD (SEP): Momentum studies are rising from mid-range, which could accelerate a move higher if resistance levels are penetrated. The market’s close below the 9-day moving average is an indication the short-term trend remains negative. A negative signal was given by the outside day down. The market is in a bearish position with the close below the 2nd swing support number. The next upside objective is 81.75. The next area of resistance is around 81.41 and 81.75, while 1st support hits today at 80.95 and below there at 80.81.