The USD starts the day a little firmer, off its lows but within yesterdays ranges. US CPI is the big data event of the day. Expect to see a print of 3.5% the highest for 10 years.
Stock markets have been rattled by this inflationary fear, despite the US Federal Reserve saying it is just temporary. US Bond Yields have been moving up since the dip after NFP. It could be a tricky day for Bonds and Stocks.
Sellers in the 1.2170/80 region have kept the EUR restricted to a fairly narrow range.
Dip buyers have been found at 1.2130/40, however it remains to be seen if they will still be there today ahead of the US CPI. It possible we will see a deeper pull back to support at 1.2100/1.2110.
The Key support for the EURUSD to hold remains at 1.2060. Below here opens up 1.2000 and possibly 1.1980/60.
Strong 108.40 support held again for the second time since the release of Fridays NFP, the JPY has been driven by factors other than USD strength or weakness, cross flows have had an big influence this week.
Resistance remains at 109.00/20 and may well be tested again should the USD continue to build on its early Asian trade strength.
The JPY could be one of the currencies most effected by move in US Bond yields today.
1.4160 has proved a strong area of resistance, so far this week pullbacks from resistance has found buyers around 1.4110.
However if the buyers in the 1.4100/10 area are cleared out, it is likely we see a deeper correction to 1.4070 and possible 1.4040.
A clear break of 1.4160 opens up the path to 1.4200/20.
analysis from point & figure charts provided by http://www.eightdragonscapital.com
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