June Dollar: The question for the trade in the currency markets today is whether international geopolitical uncertainty from the UK situation is capable of drowning out US presidential difficulties. The early answer to that question is the dollar does have the chops to extend its recovery in the short term. However, the US scheduled data of late, declining odds of any progression on US pro-growth legislation and a soon to be confirmed dovish FED should stop the current rally in its tracks next week. US scheduled data today doesn’t look to play a major role in determining dollar pricing and we would look to downtrend channel resistance early next week up at 9797 as an overly optimistic upside target point. Closer in resistance is seen at 9728 but the lack of a negative reaction in the dollar to the testimony yesterday suggests that the Dollar has near term upside capacity.
Jun ’17 Dollar Index Daily
June Euro: The fear that BREXIT effort will be stalled is accentuated by the developments in the UK and that highlights the uncertainty facing the euro zone ahead. It also appears as if German and French trade news overnight leans bearish for the Euro currency moving forward. In the end, it goes without saying that quick progress won’t be seen on the British exit talks and that simply adds to the damage on the euro charts. With the dollar showing residual strength and the turn of events over the last 24 hours, we can’t rule out a sub 1.12 trade in the September Euro today or Monday.
Jun ’17 Euro Index Daily Chart