AUD/USD: 0.8945EUR/USD: 1.3745The dollar was slightly higher today after the improved US retail sales, keeping the Euro a under some pressure, to finish the NY session near its lows. The retail sales rose 0.7% in November, above expectations for a 0.3% increase, and offset a worse than expected jobless claims of 368K (exp 320 K).
There is little data out today and another session of 1.37/1.38 would not surprise, although the momentum does hint at some more downside action.
If that is the case, then once the current 1.3740 support has been taken out, then look for a decline to the first Fibo support which arrives at 1.3690 (23.6% of 1.3294/1.3810). Should this fail to hold its ground, then 1.3675 will provide minor support, below which we would head back towards 1.3650 and potentially to Fridays spike low at 1.3617, where the next Fibo support also lies (38.2% of 1.3294/1.3810).
On the topside, 1.3800 is again going to be strong ahead of the important 1.3830 level. If/when this is taken out, which will not be easy given that it is also a major Fibo level (61.8% of 1.4940/1.2042), then look for advances on towards 1.3858 (Nov 2011 high), beyond which, the way appears open towards 1.4000, with not too much standing in between, although I don’t yet think we are ready for that.
Look for a day of 1.37/1.38 with a bias to the downside.
Economic data highlights will include:
EU Employment Change, US PPI
