The US Dollar was strong after last week’s hot NFP jobs report, which showed 288K jobs added in June, and the unemployment rate dipping from 6.3% to 6.1%. This rally could be short-lived. Let’s take a look at USD/JPY, EUR/USD and the USD Index.
The USD/JPY is retreating from last week’s high of 102.25. After breaking below 102, it is now in a key support area that should hold if the USD/JPY is to remain bullish in the very short-term, with June’s high of 102.80 in sight. The EUR/USD has already been bearish on the back of a soft euro. The strong NFP data helped the USD and pulled the pair below 1.36 last week, only to find support around 1.3575. It is starting this week at the crossroad. The US Dollar Index reflects USD-pairs trading at the crossroads. The index broke June’s falling trendline, but is consolidating awaiting confirmation of the breakout, or invalidation, which would bring the bearish correction back in play.
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