On Monday July 10, the US dollar index (DXY) is trading up thanks to Friday’s payrolls report. At the time of writing this review, the DXY is at 96.15 against a session high of 96.20. The euro/dollar rate has slid to 1.1382. The price is still within Friday’s range of 1.1380 – 1.1440. If the rate breaks out of this range downwards, pressure on buyers will sharply increase. In this case, the single currency will fall against the dollar to 1.1330/35 in the space of 20 hours.
What’s the probability of falling to 1.1330 or lower? I reckon it’s about 80%. The euro/pound cross has found a support at 0.8633. As soon as sellers break this level, the euro/dollar pair will fall below 1.1380.
The pound/dollar rate has fallen to 1.2858. At the last look, it was trading at 1.2877. The short-term picture over the next 3-4 days gives off a bearish sentiment. In terms of immediate targets, we can look to 1.2802. Given that the economic calendar is bare for the evening, nothing is stopping the dollar from rising.
European statistics:
Germany’s trade balance in May came to +20.3 billion EUR (forecast: +20.3, previous reading: 19.8).
Germany’s current account for May came to 17.3 billion EUR (previous reading: 15.1).
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