Dollar remains on the front foot as we enter this event-heavy week

During the last session of the previous week trading was smooth and price action didn’t attract much interest especially since it was a day after the Thanksgiving holiday in the US and we knew that participation would be low. The major currencies remained close to their previous levels with the US Dollar being on the front foot against its peers but the gains were limited.

This week however we should expect far more volatility and price action across all instruments as we move into December and it’s high time to find out what the Fed has decided to do regarding their tightening agenda. The Non-Farm Payrolls report is scheduled for release on Friday but in the mean time we will have a host of reports and news from across the globe that can spur the majors in some serious price action starting with today’s German Retail Sales and Inflation levels.

Taking a look at the recent price action and starting with the Euro, we find the currency trading near its previous lows as on Friday the Single currency dropped below the 1.0600 level again. The 1.0570 lows have been limiting Euro’s outlook all week but as we move closer to the US-related events we should expect more bullish bias from the Dollar that could expose the Euro to fresh losses. As we have mentioned in our previous reports the 1.0520 is the target to the downside for the Euro.

The Cable is also on a bearish ride as the Euro however the currency pair has lost the support of the 1.5050 area on Friday and is now heading lower with the 1.5000 area appearing as the next stop. It will be a relatively quiet day for the Pound today as there are no important news pending for release however during the course of the week the release of the Manufacturing and Services PMI levels will offer critical insight on the progress of the domestic economy and will point the way for the Cable.