US retail sales disappoints dollar bulls

<p>The dollar is trading above the weekly lows in early European trading following a disappointing US retail sales report yesterday afternoon. In contrast to the […]</p>

The dollar is trading above the weekly lows in early European trading following a disappointing US retail sales report yesterday afternoon. In contrast to the US labour report on Friday, the retail sales data revealed a below consensus headline but a stronger revised component. Although some analysts suggested that further upward revisions could be seen moving forward into Q2, the consensus fears a deeper slowdown in the US which will inevitably delay the timing of a rate hike by the Federal Reserve. CFTC data still suggests the EUR/USD short trade is overly crowded with a staggering $26.5 billion of dollar shorts remaining against the single currency.

The pound continues its politically-inspired rally as the jobs data revealed that unemployment continued to fall, as wage growth accelerated at its fasted pace since 2007. The rally brushed off the BoE’s inflation report that downgraded GDP projects, although these are now more in line with the market consensus .

The NZD continued to oppose market rate cut expectations as the inflation sentiment seems to defy a downturn. Retails sales for New Zealand revealed a contrasting picture to that of the US with a rise to a record 2.7% for the quarter against of 1.6%.

The data releases are very second tier today with only PPI and the jobless claims from the US.

 

 

EUR/USD
Support
 1.1285-1.1130-1.1070 | Resistance 1.1450-1.1530-1.1700

 

 

USD/JPY
Support 
118.60-118.20-117.50 | Resistance 119.60-120.30-120.85

 

 

GBP/USD
Support 1.5580-1.5450-1.5290 | Resistance 1.5795-1.5875-1.5980

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