Forex Today – 16/01: US Dollar Reaches 1-Month High

   The US Dollar Index reached a 1-month high yesterday, as US treasury yields rose, and hawkish comments emanated from the ECB.

1. Over the past day, the US Dollar Index advanced to reach a new 1-month high following a period of consolidation. The Dollar made these same medium-term highs in the AUD/USD and NZD/USD currency pairs. This Dollar rise is accompanied by a rise in US treasury yields.
2. Most stock markets have moved lower over the past day.
3. In the Forex market, the US Dollar has been the strongest major currency since the Tokyo open today. The Australian Dollar has been the weakest, putting the AUD/USD currency pair into focus. There remains a valid long-term bullish trend in the EUR/USD currency pair but it will come into serious question if we get a daily close below $1.0900 at the end of today’s New York session.
4. Cocoa futures reached a new multi-year high price last Friday, which will keep trend traders interested in this commodity on the long side. It has been exhibiting a powerful bullish trend for more than a year now.
5. There will be an important data release today of Canadian CPI (inflation) data, which is expected to show a monthly contraction of 0.3%.
6. There will be additional data releases today of:
   • UK Claimant Count Change (unemployment claims)
   • US Empire State Manufacturing Index
   • The Governor of the Bank of England will be testifying before the UK Parliament