The Dollar extended gains in yesterday’s trading, supported by two points of US data – most notably Retail Sales. USD/JPY in particular maintained its rally above 136.00 and may now be looking towards the 200-day moving average at 137.04 after that.
In the broader markets, stocks fell while bond yields rose as markets rose on the prospect of a small Fed rate hike. However, the probability of a 25 basis point rate hike remains at only 18%, so that’s not saying much — at least for now.
So far, the majors have pulled back somewhat as the push and pull continues. US futures are marginally higher while Treasury yields are little changed with the 10-year yield slightly down by 2 basis points, currently at 3.528%.
The ranges between the dollar pairs still leave a lot to be desired, so we may get some extension in European trading later. But unless there is a more coherent theme in the broader markets, there may not be much direction in general again.