Another sharp range up extension in the Dollar leaves the Greenback in solid control of the currency trade. Concern of a Scottish split with the UK has added to the Dollar’s windfall strength this week but strong UKdata overnight has at least temporarily saved the Pound. While US scheduled data later today is mostly 3rd and4th tier, the trade will take some direction from a series of private chain store sales reports and from a privatequarterly Employment survey. However, with the cease-fire in the Ukraine seemingly holding together and thebenefit from the sharp rise in US Consumer Credit yesterday afternoon now baked into the cake already, we can’targue against a temporary back and fill chop in the Dollar today. With the Dollar since July 1st rising by 440 pointsand the Greenback picking up significant tail winds from the Ukraine crisis and from the Scottish independence,the Dollar is technically and fundamentally over extended.
Technical Outlook: The rally brought the market to a new contract high. Momentum studies aretrending higher but have entered overbought levels. A positive signal for trend short-term was given on a closeover the 9-bar moving average. The market’s close above the 2nd swing resistance number is a bullish indication.The next upside objective is 84.75. The 9-day RSI over 70 indicates the market is approaching overbought levels.The next area of resistance is around 84.57 and 84.75, while 1st support hits today at 84.02 and below there at83.64.