The greenback falls to fresh lows on the day
There's still no reprieve for the dollar this week as the greenback slides to fresh session lows in the European morning. EUR/USD is up to a high of 1.2143 and looks towards the 50.0 retracement level of the swing lower to start the year @ 1.2150:
Elsewhere, cable is trading to fresh highs since 2018 at 1.3854 as buyers start to take aim at 1.4000 in the bigger picture of things. Meanwhile, USD/JPY is down to 104.41 and nearing a test of its 100-day moving average currently.
Unfortunately for the dollar, there might not be much relief as we look towards the trading day ahead. Fed chair Powell is due to speak in US trading and is likely to reaffirm that the central bank will keep easy policy for a prolonged period of time.
With the Fed put in play and the technicals starting to turn against the greenback, things are shaping up rather poorly for the dollar after a resilient start to the year.
Suddenly, all the dollar calls in December are starting to look good again. I mean there's still the risk of a short squeeze in the short-term as per what we have seen but it appears that the market is also still convinced about the overall outlook for the dollar this year.
