March Dollar: While the dollar index is showing initial weakness today, the action is probably the result of technical balancing and not a tampering of bullish attitudes toward the greenback. In fact, with the exception of a six year high in European services PMI readings the economic information from Asia was supportive of the dollar. It also goes without saying that a large portion of financial markets today expect to see hawkish dialogue and hints from the FED which could result in another upside breakout in the dollar. Initial support is seen at 1.0179 and a rise back above 1.0217 could ignite a fresh wave of buying.
March Euro: As mentioned already, the trade was presented with a six year high in European services PMI data early today and that appears to have provided a strong measure of support above the 1.0500 level. Unfortunately, for the bull camp in the euro short covering off this week’s wave down action could be quickly truncated by the prospect of another wave of rate hike hints from the US Fed. Downtrend channel resistance from the last months range is seen up at 1.0598 but that level shouldn’t be sustained.
March Yen: With negative chart action and weak than expected January household spending results from Japan overnight, the technical and fundamental path of least resistance in the Yen looks to be down today. The Yen might garner some minimal cushion from Bank of Japan suggesting that they will taper off purchases of super long debt instruments. Overhead resistance comes in at 88.00 zone today.