Dollar Slides

The US dollar is getting hit as the market adjusts positions ahead of the FOMC meeting. It will not go unnoticed that US equities opened broadly higher and that this represents a continuation of the previous pattern that was called into question last Friday when the dollar rallied after the better than expected jobs data while stocks rallied. The euro is staging an outside up day. A move above $1.4215 now would likely signal near-term gains toward $1.4300. Sterling needs to rsie above the $1.6525 area to also post an outside up day, which will likely be seen as signaling the end of the 4-5 day correction. The dollar, however is gaining against the yen. It is re-establishing a foothold above JPY96, but stronger resistance is seen near JPY96.50. Part of the drama of today's move is that many short-term players had covered short dollar positions and now are being forced to re-enter them, chasing the market.