A bad month for the dollar ended on a modest (very modest) up note today as the greenback staged a recovery late in the European session but one that has moderated during a quiet US afternoon.
We had a bout of correlated dollar short-covering, gold long liquidation and equity profit-taking into the midday period but since that point we’ve pared back those gains.
It is too early to say that the dollar downtrend has ended but we at least had some two way action as well as some topping action in the AUD/USD today, so dollar bulls have something to look forward to for the first time in a while.
For EUR/USD, a close below the 1.3560 level is needed to ring alarm bells while the same can be said for 1.5700 in cable. A close below 0.9660/65 suggests AUD is on the midst of a correction.
