U.S. DOLLAR INDEX (DXU6)
The DX opened higher at 85.05 as traders believe the potential inflationary pressure from the 'hourly wage increase' in Friday's payroll report will put the Fed in position to raise rates at the Aug.8th meeting. Prices rose to a morning Hi of 85.27, before retracing to our initial Resistance level ov 85.02 as we begin the afternoon session. The DX maintained its level and bounced higher into the close of 85.16, up 52 tics. The close above the 9-day MA changes the s/t trend to 'positive' as momentum indicators firm, looking for follow-thru buying interest. Any lack of follow-thru buying interest should open the door for 'shorts' to re-establish positions. A higher open should find Resistance at 85.40 and 85.64, while an open below 85.03 may find Support at 84.79 and 84.42.

 
CANADIAN DOLLAR (CDU6)
The CD opened lower at .8912 as pressure from a stronger DX and weaker energy/metals complex sent prices to a morning Lo of .8899, before bouncing to a morning Hi of .8924. Prices drifted to .8911 as we approach the afternoon session. As the DX continued higher into the close, the CD drifted to a close of .8903, down 94 tics. The 'gap-lower' open and weak close ahead of the BoC Monetary Policy meeting today, sends a 'negative' message about increasing interest rates further in the near term. The close below the 9-day MA changes the s/t trend to 'negative' as momentum indicators weaken, as Target Support of .8880 on 6/23 could be in play. A lower open may find Support at .8893 and .8884, while an open above .8909 should find Resistance at .8918 and .8934.

 
BRITISH POUND (BPU6)
The BP opened lower at 1.8458, bounced to a morning Hi at our initial Support level of 1.8463 and stalled as the stronger DX and an increase in the unemployment roll sent prices to a morning Lo of 1.8395,before rebounding to 1.8455 as we enter the afternoon session. Prices sought lower levels against the DX and ended the day at 1.8437, down 106 tics. The s/t trend remains above the 9-day MA and maintains the 'positive' although weaker stance, as momentum indicators turn lower. The .382 Fib level of 1.8366 could come into play on further DX short-covering. A higher open should find Resistance at 1.8468 and 1.8500, while an open below 1.8432 may find Support at 1.8400 and 1.8364.

 
EURO-CURRENCY (ECU6)
The EC opened lower at 1.2815 and followed most other major foreign currencies lower as traders covered DX 'shorts' on the fear of Fed tightening. Prices retraced to a morning Lo of 1.2780, before rebounding to a morning Hi of 1.2822 as we enter the afternoon trading session. As the DX continued to see further short-covering into the close, the EC slid to a close of 1.2792, , down 85 tics. We will look to the DX for direction, since the ECB has set its goal to raise rates, based on solid economic data, unlike the DX. Any lack of follow-thru buying in the DX will attrack traders back to the EC. A lower open may find Support at 1.2774 and 1.2756, while an open above 1.2798 should find Resistance at 1.2816 and 1.2840.

 
JAPANESE YEN (JYU6)
The JY opened higher at .8876, hit a morning Hi of .8877 and slid to a morning Lo of .8837 as the DX rallied. Prices bounced to .8861 as we start afternoon trading. Traders took further profit/risk off the table as the DX added to gains towards the close. The s/t trend remains positive on the proposed 'rate increase' and stronger Yuan. Longs may want to tighten 'stops' or purchase a 'put' option until the 'sabre-rattling' subsides. A lower open may find Support at .8832 and .8814, while an open above .8854 should find Resistance at .8872 and .8894.