Markets on Wednesday: Calm Before the Storm

It’s been a relatively quiet start to the week on all fronts so far. US equities appear to have moved into a consolidation phase this week, after all the recent action. While forex markets have been the best behaved of all.

However, all that might change as we head into some big data that will surely shape today’s trade, if not the rest of the weeks.

US CPI is the one that everyone’s watching. A good number here will see a sharp spike in the USD. I’m bullish on the USD in the short-term so I am preparing for upside pressure.

USD Weak on Tuesday

That said yesterday the USD sold-off a touch. Yesterday I wrote about how I felt the USD/JPY was getting ready to decline further. And sure enough, we broke out below both 108.50 and 108.00.

The DXY is really in no man’s land at the moment as we await the key CPI print today. Although, 89.60 is a weak support level.

Like I said I’m bullish on the USD and I will be a buyer if we start trending again or if we pull back in any meaningful way on the economic data today.