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Dollar Marks Important Bullish Hold as Risk Trends Volatile, Unstable

Dollar Marks Important Bullish Hold as Risk Trends Volatile, Unstable

John Kicklighter, Chief Strategist

Talking Points:

• A retest of major former support has turned into an important technical floor for the USDollar

• The terrorist attacks in France over the weekend, generated new volatility but risk aversion didn't cascade

• Top event risk magnet for the next 24 hours is the GBPUSD with UK and US inflation data set for release

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The Dollar marked a convincing fundamental move this past session, but global equities' own drive comes on questionable grounds. Both assets reflect upon global investor sentiment - the Greenback traditionally as a haven and the shares as the preferred risk exposure of the standard portfolio. Both were therefore sensitive to the unnerving attacks in Paris, and whose opening moves no doubt reflected the uncertainty that followed. Yet, the Dollar held onto its progress where stocks - and other risk-oriented measures - quickly recovered lost ground. This reinforces the assessment that the Dollar is focused more on Fed rate forecasts and leaves a questionable medium-term view of intentions when it comes to speculative positioning. We look at both key themes as well as the important upcoming event risk that finds GBPUSD at the center of volatility concerns in today's Trading Video.

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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