The US Dollar has fallen today erasing some gains that were added during the Asian and Euro trading sessions. The USD fell mostly against AUD and NZD after China data showed that the Chinese economy is continuing to grow at a fairly steady rate. US stocks rallied today for the third day in a row but that rally may be slowing, US indices gaining about +1% but fell after the close to about +0.5%. The fed beige book showed that most sectors of the economy are improving but that some policy members feel that the fed is not doing enough to help the economy. This may led to some speculation that the fed may slow it’s rate of tapering. Also the fact that the Bank of England is expected to be one of the next major banks to implement rate hikes is leading to GBP speculation and strength. GBP/USD double top still seems to be a possibility until recent highs are broken.
We continue to hold long USD trades for now vs GBP,NZD and JPY and expect to see the USD recover some of today’s late losses tomorrow.