Markets

Dollar Seesaws and Tries to Stabilize

Pink line graph of market statistics

Market Drivers January 26, 2018

Dollar tries to stabilize

UK GDP beats

Nikkei -0.16% Dax -0.03%

Oil $65/bbl

Gold $1354/oz.

Bitcoin $10400

Europe and Asia:

GBP UK GDP 1.7% vs. 1.4%

North America

USD GDP 3.0% vs. 3.2%

CAD CPI -0.6% vs. -0.1%

After another week of drubbing, the dollar tried to stabilize on the last trading day of the week in volatile Asian and early London trade.

The greenback seesawed, first rising towards the 110.00 figure in Asia open session, only to give back most of the gains and trade near 109.00 by the US open. The EURUSD tried to pop 1.2500 again but found sellers ahead of the number and retreated to 1.2450 by midday London session.

In UK cable was propped up a bit by better than expected UK GDP data which printed at 1.5% vs. 1.4% eyed, but overall UK GDP grew at 1.8% in 2017 which is the slowest rate of growth in 5 years.

Looking ahead to US session the market will get the preliminary US GDP reading for Q4 and Canadian CPI. US GDP is expected to print at 3.0% versus 3.2% the period prior, but even a slight upside surprise could provide an excuse for short covering squeeze, as the greenback is grossly oversold and positioning is now highly skewed against the dollar.

Growth is the one variable that can save dollar bulls, as evidence of better than 3% rate of expansion is sure to make the Fed maintain its tightening course which is turn could bring flows back into the buck. For now, the 110.00 level in USDJPY remains key. If the market can close above that by end of the day, the buck will have likely put in a near-term bottom.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Boris Schlossberg

Mr. Schlossberg is a regular contributor to CNBC's Squawk Box and a commentator for CNBC Asia and CNBC Europe. His daily currency research is widely quoted by Reuters, Dow Jones and Agence France Presse newswires and appears in numerous newspapers worldwide. Mr. Schlossberg has written for SFO magazine, Active Trader and Technical Analysis of Stocks and Commodities. He is the author of Technical Analysis of the Currency Market and Millionaire Traders: How Everyday People Beat Wall Street at its Own Game, both of which are published by Wiley

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