The US dollar has stabilized after the dramatic reaction to Bernanke's dovish spin. The key issue now is how move will be sustained. The dollar has already retraced a little more than a third of its dramatic fall.
Given the sharp moves, it would not be surprising to see many participants move to the sides lines awaiting clarification. Medium term investors may now simply wait to hear the Fed chairman at next week's semi-annual congressional testimony.
Retracement objectives of the sharp euro advance will likely be monitored. The euro has already met the minimum retracement near $!.3035. The 50% retracement is seen near $1.2980. The deeper 61.8% retracement comes in near $1.2930.
For sterling the similar retracement objectives are roughly $1.5050, $1.5005 and $1.4980. Sterling has also largely met the first retracement objective in the European morning.
The dollar has retraced roughly 38.2% of its sharp drop against the yen, which is found near JPY99.50. The 50% retracement is near JPY99.90 and the 61.8% retracement is found near JPY100.30.
Similar levels for the Australian dollar are found near $0.9205, $0.9175 and $0.9145. It too has seen a 38.2% retracement.
The greenback has recouped about 38.2% of its drop against the Canadian dollar by trading up to about CAD1.0425. The other retracement objectives are found near CAD1.0455 and CAD1.0490.
Thoughts on FX Price Action
Reviewed by Marc Chandler
on
July 11, 2013
Rating:
Reviewed by Marc Chandler
on
July 11, 2013
Rating:
