The dollar has held decent levels so far this week, with modest bids during trading hours. The main reason for this is likely to be the appreciation of the USD/JPY. However, yields on U.S. Treasuries remain fairly high relative to other countries, giving investors another reason not to rush away from the dollar just yet.
EUR/USD is currently down 0.3% to the 1.0840 level, close to testing the 200-day moving average once again.
EUR/USD daily chart
The key level (blue line) will help arrest yesterday’s decline and will be a big technical focus in the post-Fed reaction. A break below this would put sellers in control of the pair towards the next test of the 1.0800 mark. If this level holds, buyers are still clamoring for a reversal of last week’s decline.
Meanwhile, USD/JPY rose 0.5% to 151.55 and remains supported. GBP/USD fell 0.2% to 1.2695 following an initially more moderate reaction to soft UK CPI data. And USD/CAD once again returned near the 1.3600 mark, holding offers in overnight trading after Canadian CPI data softened.
Elsewhere, AUD/USD is down 0.2% to 0.6518 as sellers focus on the test of the 0.6500 mark in the post-RBA decline.
