Calm before the storm?

This week started out with a bit of technical movement, as the US Dollar broke through mental support areas and made small gains after last week’s losses. Fundamentally the calendar was light, but fundies are waiting for Tuesday’s US releases of the Consumer Confidence Report, Existing and New Home Sales and Durable Goods Orders. The overall mood of the markets is ripe for a change – or at least movement – and today might have been the calm before the storm. The EUR/USD dropped 90 points to a low of 1.3540 before recovering to its current 1.3570 level throughout the rest of the day. The Dollar bulls posted strong against the low-yielding currencies in the early morning hours. From 1.2055 lows in the Asian session, the USD/CHF rallied 80 points before pulling back to a rising trendline recently seen around 1.2080. Quite the opposite in the USD/JPY pair, which dropped from solid 119 resistance to 118.25 on second-rate news, then rebounded right back to the upper resistance levels. Finally, GBP/USD – which had a stellar showing last week – is holding a broad congestion range centered on 2.0, waiting for any key news event from either side of the Atlantic before its next directional decision. XPRESSTRADE Analyst David Hilgeman