From Marc Chandler at Bannockburn Global Forex, January 6:
Overview: The US dollar extended yesterday's gains as the market adjusts positions ahead of the jobs data. Yesterday and today's price action looks to have strengthened the near-term technical outlook for the greenback. However, the intraday momentum indicators are stretched. This warns of the risk of a counter-intuitive move after the data, barring a significant surprise. Meanwhile, one of the Fed's leading hawkish voices, St. Louis Fed President Bullard seemed to soften his tone yesterday suggesting that 5.1% median dot for Fed funds would be sufficiently restrictive to curb price pressures. However, the less hawkish tone was offset by his suggestion that the restrictive zone should be reached as soon as possible, which seems consistent with our assessment that the market is under-estimating the chances of a 50 bp hike at the Jan 31-Feb 1 FOMC meeting.
Meanwhile, reports suggest Chinese officials are considering additional measures to help the property sector, where a crackdown on credit and leverage to developer hit sector that has been critical to Chinese growth and developments. The sector has been overwhelmed by excess capacity and reports suggesting that developers may be allowed to take on more leverage, with greater borrowing caps, and an extended period to reach the debt targets spurred gains in their equities today and helped underpin the yuan, allowing it to decouple from the weakness seen in other major currencies....
....MUCH MORE
The dollar is not stretched enough for our purposes. Although there appears to be a dollar shortage developing it is not developing fast enough to really shake things up. A return to DXY 114.75 would go a long way toward manifesting the master plan for world domination.
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DXY futures 105.23 up 0.40, last.
