It appears the markets were in a funny mood to get the week underway. There was a clear risk-off feel, that was clear by the buying in the USD, JPY and to a lesser degree, the CHF. While the AUD and NZD slid away.
There are still headlines hovering around regarding trade wars, but I feel things are now moving into a place of equilibrium.
Like I mentioned yesterday, we have a funny week ahead. As US traders will have a shortened trading session on Tuesday ahead of the 4th of July. When that occurs we often see them take the entire day off and little happens. So I’m not expecting big things today.
Upon their return we will be straight into the FOMC minutes and the US unemployment, so I expect the week to end with a bang.
Later today we will also be getting a look at the RBA and their interest rate decision. No change is expected as the RBA is in no rush to move on rates. But I’ll have more of a preview later in the session.
USD Rallies
The USD resistance level at 95.00 is now back in focus as the buyers lifted prices on Monday. On Friday we saw a bit of a sell-off but that also coincided with the end of week/month and quarter. So we do get some unusual activity on those types of days.
95.50 now is the short-term top that we must crack. We’ve had two attempts, for two failures.
There is clearly an uptrend in place here and price continues to grind its way higher. I almost think it is starting to look like a triangle pattern, which is bullish.
If we can break out the next target becomes 96.20. While we do have some big data this week, I question how active traders will be. With the holiday it can make for a funny week. But if we get a really strong jobs report, there might be no stopping a rally.
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