The US Dollar Index (DXY) was modestly higher in thin trading conditions. Bearish hourly diverging studies limited a sustained move above 130-day moving average resistance. Meanwhile, only an hourly close below intraday support at 80.33 will question the short-term bullish tone.
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The Australian Dollar was the outperformer despite the slightly dovish RBA minutes. The Aussie continues to extend to multi-decade highs against the Pound and Euro. The AUD/USD looks to re-test a key Fibonacci retracement at 1.0031 (76.4% of the November relapse).
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The Euro was the weakest currency as debt concerns continue to linger despite supportive words by the Chinese government. The EUR/USD managed to rebound after re-testing 1.3085, the 50% retracement level of the June/November upmove. Bullish diverging hourly studies have provided support, but the pair will need to clear the 1.3190/1.3205 formerly supportive region to hint of a possible base.
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[STRATEGY UPDATE] LONG GBP/USD at 1.5449, targeting 1.5555 1st, stop-loss at 1.5394
