We doubt that the USD will take a new course in these times, i.e. down, as many market participants expect, because of rising inflation clouds hanging over the currency. True, the inflation danger is clearly there, based on an unprecedented monetary and fiscal expansion. But it is still unclear how the economic recovery will develop - the now overwhelming optimism as expressed in the stock market may well be dampened, and a very slow recovery of the economy with disappointments from time to time can well keep inflation under control for a while, giving the fiscal and monetary institutions time to correct their previous expansive policy.
While the dollar recovers somewhat today, its present selling tone cannot be overseen - based on the reasons explained above. In our view, it was only the heavily oversold situation of the currency that ignited some recovery moves, For today’s trading, we expect these recovery moves to continue, especilally in the GBP / USD and EUR / USD, as explained in detail below. Note the U.S. consumer confidence index for August, at 16:00 CET. A slight improvement is expected - anything bigger than that will have a dampening effect on the USD.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
The market is in a continued slowdown correction in this European morning and is currently trading at 1.4290. We see more correction to come today, after some recovery moves, down to a level of 1.4250.
GBP / USD
The Pound is hovering just above some important support lines against the dollar, right now around 1.6390. We don’t expect the support line of 1.6300 to be broken today, but to be touched in later trading.
USD / CHF
Against the Swiss franc, the dollar is keeping its low volatility, trading right now at 1.0605. We expect that level to hold more or less in today’s trading, with some weak recovery moves in further low volatility.
USD / JPY
After a weak Asian session, the dollar started a recovery move in early European trading and is currently priced at 94.30. We see that recovery move ending soon, with another downward testing of the 93.85 support level today.
While the dollar recovers somewhat today, its present selling tone cannot be overseen - based on the reasons explained above. In our view, it was only the heavily oversold situation of the currency that ignited some recovery moves, For today’s trading, we expect these recovery moves to continue, especilally in the GBP / USD and EUR / USD, as explained in detail below. Note the U.S. consumer confidence index for August, at 16:00 CET. A slight improvement is expected - anything bigger than that will have a dampening effect on the USD.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
The market is in a continued slowdown correction in this European morning and is currently trading at 1.4290. We see more correction to come today, after some recovery moves, down to a level of 1.4250.
GBP / USD
The Pound is hovering just above some important support lines against the dollar, right now around 1.6390. We don’t expect the support line of 1.6300 to be broken today, but to be touched in later trading.
USD / CHF
Against the Swiss franc, the dollar is keeping its low volatility, trading right now at 1.0605. We expect that level to hold more or less in today’s trading, with some weak recovery moves in further low volatility.
USD / JPY
After a weak Asian session, the dollar started a recovery move in early European trading and is currently priced at 94.30. We see that recovery move ending soon, with another downward testing of the 93.85 support level today.
