US dollar

The EURUSD remains supported by the hawkish comments, higher oil and a ho hum stock market. However, the pair is being contained for the time being by the 100 hour MA at 1.5884 and the 200 hour MA at 1.5824.

The markets are becoming quite volatile as the markets are digesting the news, comments by Bernanke and the current levels.   

The GBPUSD is approaching the high from Friday at 1.9957. However, directly above the level looms the 200 day moving average at 1.9967. This level will need to be broken on a closing basis to get the medium to longer term buyers involved.  The market will be watching this level closely in the near term.  Expect sellers against the level, but the potential exists for stops above it. 

NOTE, however, that the pair must close above it to confirm the move.

The stock market has lost its steam. EURUSD now moving through 1st resistance level at the 1.5888 level on the upside (SEE EARLIER POST).  Next level is 1.5904.  Should slow down here.

USDJPY has moved lower.  Market is moving back to focusing on the longer term problems.  Expect continued volatility. 

The US dollar is stronger this morning as the oil price comes off.  In the Eurozone the German inflation numbers from the various German states were higher than what was expected.  Rather than an inflation rate of 2.9%, the expectation is for a rise to 3.2%.  The price of liter of petrol in Germany in the past month has shot up 6% from 1.41 euros per liter to 1.50 euros.  Over the period the dollars relative strength is making the cost of oil that much more expensive as the oil is denominated in dollars and a rising dollar makes buying it in Europe, more expensive.  The relief in the oil price today will help however. 

The dollar has been under pressure as weaker economic numbers this morning, higher oil, higher commodities (Gold up $22) and even a rumor that non-farm payroll would be revised sharply lower (not confirmed), has attracted dollar bears. 

The EURUSD broke the wedge formation and the high for the week.  GBPUSD broke through the channel resistance (after testing the downside support).  USDJPY fell sharply as the JPY crossed came under some pressure.  USDCHF breaks sharply lower as well.

EURUSD broke through the support at 1.5407 area).  The markets key level is the 1.5345 level.  USDJPY above 100.00 and targets 100.65.  USDCHF back above 102.00.  This is the 38.2% retracement level but looks like there is room for further gains today (with a target of 102.75).

The dollar continues to be bid against the major currency pairs.  The EURUSD broke through 1.5300.  GBPUSD testing the key 2.0000 level. USDCHF up to 1.0350 area and USDJPY up to 1.0352.

The major crosses have stabalized at these levels.  GBPJPY is hanging below 207.15 but supported at 206.50 area.  EURJPY is capped at 158.30 and support at 157.75.  EURGBP 0.7635 to 0.7650.

USDJPY testing 21 hour MA at 113.15.  Having said that, the price has been above and below the moving average 5 times in the last day and a half, indicating a consolidation of the pair.  A break above the high at 113.58 or the low of 112.74 will be needed to determine the short term direction.

After the anxiety of the NFP, the markets have quieted down dramatically.  At 10:00 ET we get the Michigan Consumer Sentiment expected to be 75,0 versus 76.1 previous.  This is near a multi-year low.