Dollar continues to struggle in European morning trade

The dollar is down to the lows for the day currently

It’s all about the ebb and flow this week and as much as the dollar has run hot in the past few weeks, things just aren’t going the way for the greenback at the moment.

I made note of this earlier in saying that:

The dollar is losing some light ground going into European trading, as the lift from the US CPI data release yesterday was brief and the FOMC minutes mainly just reaffirmed market expectations of the taper plan going into year-end.The fact that the former didn’t really inspire the greenback and yields does say something to the price action we’re seeing in recent sessions so that is something to take note of as we look towards the latter stages of the week.

Treasury yields are looking lackadaisical once more with 10-year yields down 1 bps to 1.538% and 30-year yields down to 2.047% after having hovered around 2.07% at the start of European morning trade earlier.

That isn’t helping with dollar sentiment at the moment.

Adding to that is the shift in near-term technical levels earlier in the week for the likes of EUR/USD and GBP/USD as well. The former is even now up 0.5% to 1.3720 levels and testing the 61.8 retracement level of its recent swing lower:

GBP/USD D1 14-10

That’s the highest level for cable since 27 September as buyers are also starting to contest the swing region around 1.3720-50 currently.

Elsewhere, EUR/USD is up to 1.1620 as buyers look to keep above the 1.1600 level for now while USD/JPY has also surrendered early gains from 113.50 to 113.35.

Meanwhile, commodity currencies are the better performers with USD/CAD down 0.5% to 1.2376, AUD/USD up 0.5% to 0.7417 and challenging its 100-day moving average, and NZD/USD up 0.9% to 0.7021 and testing its own 100-day moving average too.

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