The state-of-the-union address starts at 9pm EST and there are a few USD bulls in the market hoping that some of what is said will give the dollar a considerable boost. There isn’t much really good news in the market at the moment re the US economy and sentiment is generally bearish. Therefore the main ‘risk’ would seem to be for some USD gains after the speech; if he says nothing particularly inspiring then the USD will keep on going on its present track but if he announces something unexpectedly positive then the USD could go for a run.
How can USD bulls play this? Buying USD/JPY might work as Kampo is supposedly sitting on the bid in high 81’s; selling EUR/USD on the approach to 1.3740 technical resistance also has merit; or trading cable from the short-side although the levels there are not so well defined. (Selling AUD/USD or buying USD/CHF is too hard imho).