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Sharp Sell-Off


Triangle Base Remains Intact


5-Year Auction Fares Better Than 2-Year Sale

DOLLAR: Month-end related dollar sales pressured yesterday, the DXY touched
pullback lows of 97.43 before settling around 97.50 at the close. With Japan,
China, Hong Kong & Singapore all closed volumes remained extremely light through
Asia with the index held to a narrow 4 pip range.
- Recovery efforts have so far remained shallow and keeps the downtrend in
check. Initial support is seen at 97.38/34 which represents the 21-dma & 38.2%
retracement of 95.74-98.33. Expect further support on approach to the 97 level
(97.04 - 50% fibo), ahead of channel base support & 100-dma at 96.93/67. Bulls
need to recover 98, before challenging the ytd highs at 98.33.
- Gold rallied above the 21-dma ($1285.09) to $1286.27 yesterday, but despite
the dollar sell-off failed to consolidate gains, giving a warning sign to bulls.
The yellow metal has since drifted back under $1280 with bears targeting a
downside break of the 50%/61.8% fibo of $1266.42-1288.72 at $1277.57/1274.94.
- WTI & Brent trade $0.30 lower at the European crossover.
- The FOMC rate decision is scheduled today at 1800GMT, other highlights from
ADP Employment (1215GMT) & ISM Mfg (1400GMT).