Monday trading is somewhat restrained, which is especially noticeable after Friday's volatility. As might be expected, US dollar continued to develop the upward momentum after the publication of strong data from the American statistics.
The data showed acceleration of positive trends in the US labor market, which of course influences investors' expectations regarding the continuation of the Fed’s current monetary policy aimed at more rate-hikes. Moreover, after the technical correction, USD dollar has unloaded the overbought conditions and is ready for the development of a new upward momentum. Today, USD dollar index returned up to 96.40. The next strong resistance level is around 96.60.
Today on Monday session, Friday's data will continue to have a major impact on the course of trading since no other important economic data is expected in the first half of the day. The European currency still loses much to the dollar, both in the dynamics of main economic indicators and in the policies of European Central Bank, so the dollar will probably maintain its dominant position.
We can expect some weakening of US currency by the end of the trading day, when the USA will release PMI data on non-manufacturing sector from ISM. Experts predict the indicator to fall from 61.6 points to 59.3, which in the short term may reduce the level of demand for the dollar.
However, the main event of the first half of this week will be the United States primary elections in congress. This will be important middle-term driver for USD dollar but we have written a lot about this in our previous articles.
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