The dollar has extended its post-NFP drop at the start of this week, most notably against the pound which has lifted the British pound/U.S. dollar (GBP/USD) currency pair is back to a high so far of 1.3180. The euro/U.S. dollar (EUR/USD) currency pair and buck-denominated gold and silver were also higher at the time of this writing, although the Aussie/U.S. dollar (AUD/USD) currency pair and Canadian dollar/U.S. dollar (CAD/USD) currency pair were lower, suggesting the dollar’s weakness wasn’t widespread. As a reminder, U.S. employment fell by 33,000 in September as jobs in food services and drinking hubs were hit hard due to the impact of hurricanes Harvey and Irma. But it wasn’t all doom and gloom, as average hourly earnings grew more than expected, with the year-over-year rate climbing to 2.9% from 2.7% in the previous month. So, it remains to be seen whether the dollar weakness will gather any real momentum or the selling is just a blip. Unfortunately, the economic calendar looks rather quiet for the most part of this week, so it may take a while for the dollar to tip its hand.

U.S. CPI key data for the week on Friday…
Indeed, there’s very little on the agenda today, although we have had some data earlier from China and Europe. The September Chinese Caixin Services PMI came in at 50.6, down from 52.7 the previous month and below 53.1 expected. In Europe, German industrial production rose 2.6% in August, much higher than 0.9% expected, while the Eurozone Sentix Investor Confidence index also topped expectations as it printed 29.7 versus 28.6. There are holidays in the U.S. and Canada today, which means there won’t be any data from North America, although Wall Street is open for trading as usual. Tuesday will see the release of official manufacturing data from the UK, France and Italy. The FOMC’s last meeting minutes will be published on Wednesday, followed U.S. PPI and crude oil inventories a day later. Friday will likely be the most important day of the week in terms of data as we will have the latest U.S. CPI and retail sales, among a couple of other macro numbers, to look forward to. 

EUR/USD shows tentative bullish signs
The dollar’s uncertain fundamental direction is mirrored on the charts, chief among them being the EUR/USD. The world’s most heaviest traded pair has been trending lower ever since it failed to break through long-term resistance around the 1.2040/5 area in early September – previously this was a significant support level as it marked the low post the Eurozone debt crisis in July 2012. However, the sellers have struggled to exert strong enough pressure to caus