Weak job market signals kicked the DXY rally in the teeth.
AUD fell anyway on growth worries.
CNY up.
Gold is trying to base.
AI metals were mixed.
Miners popped.
EM too.
Junk is holding.
Bonds rallied after dodgy US jobs data.
Stocks are blowing the froth off.
Adding to a potential reversal in DXY, it could break the 200DMA. Citi.
The dollar index failed to break the 200d MA yesterday despite positive data.
The post FOMC rally may be stalling, suggesting a break for dollar bulls.
Global FX Strategy would not chase this USD just yet, and look for 1/3 catalysts to materialize.
The 200d MA held in both DXY(100.30) and BBDXYIndex yesterday – despite the rally in US yields and solid data.
Our trader Sandeep Paul notes an important level like that will take 3-5 attempts before it breaks, DXYis now rich relative to interest rate differentials and we have seen decent leveraged participation.
The technical picture is by no means bearish for dollar though.
USDJPY remains within touching distance of 153.00-30support.After EURUSD broke supports in 1.1500-50 area, next support at 1.14 (July lows)
I don’t see the US jobs shock ending anytime soon, so remain constructive on an AUD trend higher.
But slow and painful is the way.
