Forex Price Action – US Dollar in Focus with CPI Being Released

USD/CAD Technical Analysis

The US Dollar is drifting a little higher against the Canadian Dollar, and I actually prefer to buy the US Dollar despite the fact that we’ve had a pretty significant pullback over the last couple of days. If we can break above the 1.3950 level after the CPI announcement, then I am more likely than not going to be a buyer of the Dollar against the Loonie. Any breakdown from here, I’ll have to reassess the entire situation. We have recently visited near the 50% Fibonacci retracement level of the entire move, but we have not broken down below it, so something to keep an eye on.

USD/CHF Technical Analysis

The US Dollar against the Swiss Franc, I like this one as well on pullbacks. But again, we get the CPI number that will have a major influence. I’d like to get involved again somewhere near the 0.8100 level if I get that opportunity. A break above the 0.8140 level is also a very bullish sign as far as I can see. And in that environment, I’d be a buyer as well. We get a very positive carry in this pair, so this is something that I’d be holding for beyond today. This is not just a short-term trade on that breakout.

GBP/USD Technical Analysis

The British Pound has broken above a resistance barrier from a couple of days ago, and it looks like it’s going to grind higher. This one’s a little bit different because the interest rates in the United Kingdom are elevated, and of course, it’s a completely different world than the Swiss Franc, for example. I like buying dips here. This is one of the few currencies that I am buying against the US Dollar comfortably.

That being said, we are in a state of flux, so the idea of the US Dollar being dominant may start to take a backseat. We’ll just see. CPI today will go a long way in determining which trajectory we take, but in general, I’m not looking to short this pair.