What an amazing quarter it was for the dollar! Up until the very last days of June, the Greenback managed to dominate the charts. The U.S Dollar index closed Friday at 83.64, up from where it started the week at 83.65.
I think the dollar’s rally has been pretty darn impressive. It gained despite the downward revision to the Q1 2013 U.S. GDP. According to the third and final reading of the report, the U.S. economy only grew by 1.8% and not by 2.4% like the market had initially expected.
It would seem that investors don’t think that the revision would be enough to make Fed officials change their minds about tapering off quantitative easing. Consequently, this continued to give the Greenback a lot of support.
The upcoming week is going to be a busy one, especially since the U.S. non-farm payrolls (NFP) report will be coming out. It’ll be interesting to see what the actual results are and whether or not it will match the Fed’s forecasts. If it comes in worse than expected, all this tapering talk could reverse and lead to a massive decline in the Greenback.
Technically, it’s pretty clear that Cable is on a downtrend. The pair has been making “lower lows” and “lower highs.” Moreover, the pair is trading below the two major SMAs. That being said, I’m looking to go short on the pair once it gives me a good price. I’m thinking of jumping in short when price retraces back to the 100 SMA.
Look at USD/JPY go! I wanna get in on the rally so bad, but I’m not gonna rush it. I’ll look for an opportunity to buy the pair at a better price. I’m eyeing the area between 98.00 to 98.50 where the pair previously found resistance. If price finds support, I’ll probably jump in on a long.