The Australian Dollar is under pressure overnight. A new main top has been formed at 1.0200, setting up a possible retracement to 1.0033 to .9993. Yesterday’s interest rate hike by China’s central bank is expected to slow down a heated up economy. This may lead to a slowdown in demand for Australian goods and services.
Euro Posts Closing Price Reversal Bottom; Appears Ready to Turn Trend
The EUR USD posted a closing price reversal bottom after positive comments from Greek officials encouraged weak shorts to lighten up their positions. After touching a new low for the year overnight, the EUR USD turned around as the lack of fresh selling pressure scared some of the weaker shorts out of the market.
This Week’s Forex Price Action Indicates Dollar is ready to Rally
The strong recovery in the U.S. Dollar late in the week and the inability to break it sharply lower could be a sign that a short-covering rally is imminent. Rumors the Fed may begin to raise interest rates earlier than expected, a poor U.K. economy and fear of intervention all helped boost the Dollar on Friday.