US DOLLAR BOUNCES FROM SHORT-TERM SUPPORT

The US Dollar is showing a mild bounce from support this morning after Retail Sales figures for the month of February printed in a rather disappointing manner. The expectation was for a .3% gain, and the actual print was for a -.1% contraction. This comes on the heels of last month’s -.1% contraction (this was revised up from a prior release of -.3%) and December’s .1% gain. All in all, this continues to show a bit of weakness in the segment of the American economy that’s continued to drive in the post-Financial Collapse environment.

In the US Dollar, yesterday’s sell-off on the back of the inflation report released earlier in the morning continues to loom large, as that move pushed DXY back-below 90.00 and that theme of weakness largely continued throughout the US session and well-into Asia. A bit of support began to show in DXY around an area that has helped to hold the lows over the past few weeks; and this morning’s retail sales report is helping to bring that level back into play after a quick bounce in the European session.

On the data front – Friday brings U of M Consumer Sentiment numbers, and next week brings the Federal Reserve’s March rate decision, currently carrying an 88.8% chance of a 25 basis point hike.

US DOLLAR VIA ‘DXY’ FOUR-HOUR CHART

Chart prepared by James Stanley

EUR/USD IN AN AWKWARD SPOT AFTER RALLY FROM SUPPORT

The Euro is lower on the morning after a speech from ECB President, Mario Draghi, in which he said that the ECB needs to see more evidence that inflation is rising. A dovish tilt from the ECB and the head of the bank has become rather commonplace of recent. At the ECB’s rate decision earlier in the month, a hawkish clue in the statement was offset by a dovish Draghi during the presser, leading to a rip and dip scenario in the single currency around last week’s rate decision.