February is shaping up to be a strong month for the Greenback. Today’s session has extended weekly gains vs many of the forex majors. Key movers have been the EUR/USD (-0.59%), USD/JPY (+0.41%), and USD/CAD (+0.42%). The price movement in the USD/CAD is a bit counterintuitive due to WTI crude oil establishing a foothold at $56.00 per barrel. Thus far, the driver of a suddenly-bullish US dollar remains a mystery.
So, what are the underpinnings of February’s stronger Greenback? Well, one can point to this morning’s jobs figures as being positive:
Event Actual Projected Previous
Continuing Jobless Claims (Jan. 23) 4.592M 4.700M 4.771M
Initial Jobless Claims (Jan. 30) 779K 830K 847K
Jobless Claims 4-Week Average (Jan. 30) 848.25K NA 868K
This collection of statistics shows a marked improvement in the American job market, but remains nearly four times that of pre-COVID-19 levels. However, there appears to be a light at the end of the tunnel. Vaccines are being distributed and timelines for U.S. herd-immunity have been moved up to fall 2021. At this point, today’s shrinking jobless claims figures may be the beginning of a positive U.S. labour market trend.
The forex majors are fairly active today. For the EUR/USD, rates are trending south toward a key weekly support level.
USD Gains Ground On The Forex Majors
The EUR/USD is trending south, now challenging the 1.1950 area. At this point, it appears my long trade recommendation from Tuesday will go live. If you missed it, check it out here.
Here are the key levels to watch for the remainder of the week:
- Resistance(1): Weekly SMA, 1.2082
- Support(1): Bollinger MP, 1.1947
- Support(2): 62% Macro Wave Retracement, 1.1887
Overview: Sometimes, price does what it wants. And, the market is never wrong. Although today’s bullish performance from the USD vs the forex majors is perplexing, it is what it is. Our job as traders is to profit from the action, even if we don’t fully understand all of the “whys.” Hopefully, the EUR/USD buy recommendation will go live and give us a shot at racking a few pips.
Go to the news source: USD On The March Vs The Forex Majors