Forex today saw the greenback trade in a sideways manner against the basket of major currencies, having faded the spike to seven-week highs yesterday, tracking the drop in the treasury yields. The dollar index (DXY) was flat lined in Asia around 95.60. The index created a bearish pinbar yesterday, as it failed again to hold above 96.04 (50% Fib R of Jan 2017 high/Feb. 2018 low) and closed at 95.64. Further, the EUR/USD created a long-tailed doji candle yesterday and a close today above 1.1503 would confirm a bullish reversal. Meanwhile, the US 10-year treasury yield fell close to six basis points to 3.19 yesterday and traded at 3.21 percent in Asia. Clearly, the greenback is showing signs of topping. However, Chinese yuan – also an anchor currency – remained on the defensive in Asia. The People’s Bank of China (PBOC) set the CNY reference rate at 6.9072 – the weakest level since March 15, 2017 – and well above the Reuters’ estimate of 6.9009. As a result, the offshore yuan exchange rate or USD/CNH bounced off the ascending 5-day exponential moving average (EMA), bolstering the bullish setup and rose to a session high of 6.9261. Looking forward, the EUR/USD could rise toward 1.1550 (Oct. 5 high), if the Italian bond yields drop, signaling an easing concern about Italy’s fiscal health. Meanwhile, the GBP/USD pair is looking north, having witnessed a bull flag breakout on Oct. 5 and charted a bullish outside-day candle yesterday. The bullish case would strength if the UK GDP, manufacturing production and trade balance numbers beat paint a positive picture of the economy. However, the greenback may pick up a strong bid, invalidating the bullish setup in the EUR/USD and GBP/USD, if the yuan’s sell-off toward 7 per dollar gathers steam. Further, an above-forecast US producer price index (PPI) could boost treasury yields and the US dollar. Key headlines in Asia New Zealand’s Robertson: Prudent to run surpluses, pay down debt China’s yuan to trim losses on hopes trade risks will subside – Reuters Poll NZ: Retail spending on electronic cards increased 1.1% in September – ANZ Global debt is growing – IMF Fed’s Williams repeats expectation for further gradual rate hikes UK PPM May to force a Brexit compromise at home – The UK Times Trump to increase ethanol use in petrol to appease farmers, shuns oil producers – Reuters Economic data in Europe (GMT) 08:30 UK Aug GDP Estimate 08:30 UK Aug Industrial Output 08:30 UK Aug Manufacturing Output 08:30 UK Aug Goods Trade Balance Looking Ahead – Events, Auctions, Other Releases (GMT) 09:10 BoE’s Andy Haldane speaks at the Advisory, Conciliation and Arbitration Service Future of Work Conference in London 16:15 Fed Chicago’s Evans speaks on current economic conditions and monetary policy in Flint, Michigan 21:00 Fed Atlanta’s Bostic participates in a discussion at the National Association of Corporate Directors in Atlanta N/A Riksbank’s Ohlsson discusses current monetary policy and the economic situation in Gothenburg What’s brewing in the majors? EUR/USD Technical Analysis: EUR peeps above 1.15 after a long-tailed doji candle GBP/USD: Brexit revival sparking bullish correction ahead of UK GDP figures USD/JPY: slips below 113 handle, but needs lower lows in this descending channel FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next Japan: Solid core machinery orders in August – Nomura FX Street 4 years Forex today saw the greenback trade in a sideways manner against the basket of major currencies, having faded the spike to seven-week highs yesterday, tracking the drop in the treasury yields. The dollar index (DXY) was flat lined in Asia around 95.60. The index created a bearish pinbar yesterday, as it failed again to hold above 96.04 (50% Fib R of Jan 2017 high/Feb. 2018 low) and closed at 95.64. Further, the EUR/USD created a long-tailed doji candle yesterday and a close today above 1.1503 would confirm a bullish reversal. 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