The U.S. dollar weakened against the other major currencies in the Asian session on Monday due to profit taking, as traders continued to cash in on the strong gains posted last week.
The currency strengthened last week following the Federal Reserve’s first interest rate hike in over nine years.
The Fed stressed then that any further rate hikes would be gradual, with the central bank’s focus on incoming data generating some anxiety.
Trading activity is likely to be relatively subdued this week, as many traders will be away from their desks ahead of the Christmas Day holiday on Friday.
Last Friday, the U.S. dollar showed mixed performance against its major rivals. While the U.S. dollar fell against the yen, it held steady against the euro, pound and Swiss franc.
In the Asian trading, the U.S. dollar fell to a 4-day low of 1.0883 against the euro, from Friday’s closing value of 1.0865. The greenback may test support near the 1.10 region.
The greenback dropped to 1.4919 against the pound, from last week’s closing value of 1.4886. On the downside, 1.52 is seen as the next support level for the greenback.
Against the yen and the Swiss franc, the greenback slid to a 6-day low of 121.04 and a 4-day low of 0.9907 from early highs of 121.38 and 0.9931, respectively. If the greenback extends its downtrend, it is likely to find support around 120.00 against the yen and 0.97 against the franc.
Against the New Zealand and the Canadian dollars, the greenback edged down to 0.6751 and 1.3928 from last week’s closing quotes of 0.6722 and 1.3958, respectively. The greenback is likely to find support around 0.68 against the kiwi and 1.37 against the loonie.
Meanwhile, the greenback edged up to 0.7155 against the Australian dollar, from Friday’s closing value of 0.7165. The next possible upside target for the greenback is seen around the 0.70 level.
Looking ahead, the Bank of Japan will publish its monthly economic report at 12:00 am ET.
The German PPI for November is due to be released in the pre-European session at 2:00 am ET.
At 10:00 am ET, Eurozone consumer sentiment index for December is slated for release.
The material has been provided by InstaForex Company – www.instaforex.com