Dollar continues to get checked back to start the week

The moves are relatively light but it continues from the slight drop in the dollar from yesterday. And that follows from the stronger gains at the end of last week for the greenback. As such, it is looking to be a case of the dollar getting checked back so far to start the new week. EUR/USD is up 0.2% to 1.0855 but continues to sit just under its 100-day moving average for now:

There are also some large option expiries at 1.0860-70 that are likely to limit any further gains. However, buyers are starting to contest a break above the 100-hour moving average of 1.0853 now. Push above that and the near-term bias switches to being more neutral. But the 100-day moving average at 1.0873 remains a key ceiling to watch in the bigger picture.

Elsewhere, USD/JPY is down slightly by 0.1% to 151.28 but trapped in a relatively narrow range under 25 pips today. Meanwhile, GBP/USD is up 0.2% to 1.2660 as it pushes back past its own 100-day moving average of 1.2636 currently. But there is some near-term resistance from the 100-hour moving average at 1.2667 next.

Besides that, USD/CAD is backing away from the 1.3600 mark to 1.3568 at the moment while AUD/USD is up 0.2% to 0.6550 on the day. The latter is testing its own 200-day moving average at 0.6550 as well as its 100 and 200-hour moving averages at 0.6548-55. Push above those levels and buyers will seize more control in trying to return to an upside bias.

The dollar’s slight weakness on the day comes as equities are slowly nudging higher during the session. S&P 500 futures are at the highs now, up 0.4% on the day.

This article was written by Justin Low at www.forexlive.com.