Greenback Strengthens On Optimistic FOMC Minutes

The U.S. dollar ended the day higher against its counterparts as the minutes showed Federal Reserve officials were cautiously optimistic about the U.S. recovery with some indicating they would be open “at some point” to discussing adjustments to the pace of bond purchases. In other words, the taper talk could be on the table as early as next month which could bolster the greenback. The Fed next meets June 15-16.

GBP/USD: The cable slid below 1.4140 and is currently testing the 1.41 short-term support. Below 1.4070 we expect further losses towards 1.40 whereas on the upside, the 1.4170-level will be of particular interest. An upside break of 1.4170 could lead to another upward movement towards 1.4250 while in the opposite case, if that level remains unbroken, we could see the formation of a head-shoulders pattern, predicting steeper losses.

DAX: The index dropped below 15000 but the dip proved to be short-lived. As long as the DAX holds above the crucial 15000-mark we expect another run for higher targets at 15570 and maybe even 15800.