Signs of a modest technical failure on the charts combined with ongoing moderation of international economic slowing fears would seem to leave the path of least resistance in the Dollar pointing downward. With somewhat disappointing US scheduled data seen earlier this week and expectations for a noted contraction in US CPI figures later this morning, the bear camp in the Dollar looks to get some help from scheduled data flows. In fact, expectations for a modest rise in initial claims might add to the bearish economic differential tilt but the failure to hold above 94.00 in the March Dollar index could spark a fresh wave of technically related selling in the Dollar. In order to turn the tide away from the bear camp, probably requires a rally and trade back above 95.00 following the US data window this morning.
Technical Outlook: A bearish signal was triggered on a crossover down in the daily stochastics. Declining momentum studies in the neutral zone will tend to reinforce lower price action. The market back below the 18-day moving average suggests the intermediate-term trend could be turning down. The gap lower on the day session chart is bearish and puts the market on the defensive. The close below the 1st swing support could weigh on the market. The next downside objective is now at 93.97. The next area of resistance is around 94.39 and 94.59, while 1st support hits today at 94.09 and below there at 93.97.