- Societe Generale (based on CNBC)
On Thursday, the Greenback retreated after Wednesday's climb. Although the decline was slightly weaker than anticipated, the Buck still negated previous gains. The pair tested the support line at 1.24, but settled even above the 55-day SMA (initial support). The US Dollar lost only 35 pips against the Loonie. The technical indicators are showing bearish signs on the daily timeframe, meaning that the US currency is likely to trip again. Immediate support rests at the 55-day SMA, but a fall to 1.24 also should not be ruled out.
Even more market participants are now long the US Dollar (70%). At the same time, the portion of orders to buy the currency against the Loonie increased, namely from 45 to 68%.