US Dollar Index Holding at 79.20
USD-JPY: 81.54.. EUR-USD: 1.3215
FOMC, BOJ, French Elections, PMI Data Next Week:
The US Dollar Index has floated along the 79.20 for the majority of the day Friday. The DXY came under selling pressure at the start of trade in Europe and continued to swoon until it hit 79.20. However the DXY has been able to hold that support level.
Next week the market attention will turn to the FOMC, as it holds a 2 day meeting. In addition to its communique (Wed 12:30 p) the US Fed will update its economic outlook (2.00 p) and Fed Chairman Ben Bernanke will hold a press conference (2:15 p) to discuss the statement and forecasts.
The EUR rallied to the 1.3220 level before running into resistance. The single currency has maintained a tight range throughout the course of the day (1.3200-1.3220). European markets will be buzzing when traders in the US come to work Monday morning as the French presidential elections results and the preliminary PMI data for the region will be Hot Topics.
The GBP is one of the strongest currencies on the day as investors factor in the likelihood that the BoE will not look to expand its asset purchase program. Better than expected economic data and high inflation are the primary factors behind these expectations. The pound continues to hold the 1.61 level as we approach the weekend.
The Yen is trading along its 50 sma (81.48) today. Markets are beginning to price in easing actions expected from the Bank of Japan next Friday so the yen will likely be under pressure during the course of next week. If the central bank surprises and decides not to take any further action that should cause shorts to cover and drive the Yen back to the 80 mark.
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.