The greenback firmed up yesterday following a solid US data and a dovish ECB monetary policy. Better-than-expected data could put the Fed under pressure to avoid being very dovish in their upcoming FOMC meeting. The ECB despite hinting a rate cut and further stimulus, the market was anticipating a more aggressive policy, which made equities to sell-off in the short-term but recovered again during Asian session. The yield on the 10-year Treasury note recovered further by hitting 2.10% during the day. Today’s US GDP numbers will be decisive for the bulls as it could be the gateway to break higher and retest a major resistance level 109 – 109.20.
The US Dollar broke above 108.30 and 108.60, until price found resistance at 108.75. The short-term outlook remains bullish as price could consolidate between 108.60 and 108.75 before resuming its bullish momentum towards 109 – 109.20. In case the bulls lost momentum and the bears pressured the price below 108.60, we could likely see a pullback towards 108.30.
Support: 108.60 / 108.30
Resistance: 108.75 / 109