Dollar gains ease a touch as risk sentiment stabilises for now
The greenback and yen are among the laggards as Asia carved the way for more stable risk sentiment to prevail so far today. US futures are also keeping the calm with Treasuries little changed ahead of European morning trade.
That said, this is still looking very much like a pause for breath for the dollar until we see signs that sellers are willing to put up a stronger defense this week.
In particular, I am looking at EUR/USD as it holds just above 1.1800 currently:
The figure level is key as stops will be lined up just below that and a break to the downside may trigger an accelerated decline and fuel further bids into the dollar.
There are large expiries sitting at that level today and the inability for the pair to touch 1.1800 at the lows yesterday and today suggests that barriers may be in play too.
As such, that makes EUR/USD a key pair to watch and 1.1800 one of the most important points in the FX market ahead of the weekend.
