I see this thread quite abandoned, and it is a bit disappointing considering what I’m about to talk about. Let me contribute with my 2 cents.
I’m quite a rookie with fundamentals but this is how I see it (a bit of a mix of technicals and fundamentals). USA inflation is at 0% (United States Inflation Rate | 1914-2015 | Data | Chart | Calendar) which is far from 2%, value considered by many economies as the ideal to contribute to an stable growth. Therefore any increase in the Interest Rate should be postpone. I’m not saying the Fed will go for a QE move but at least any hike in interest rate should be discarded. For that reason it makes little sense that the USD will get stronger due to a interest rate hike.
Last NF Payroll report was a bit disappointing, however it is to early to consider that as a sign, without waiting for at least another one. But if that is the case it would mean that the US could have reached a peak in employment.
Hedge funds might be aware of this and could start unwinding their USD positions. For example, last COT report shows that the number of shorts in EURUSD has decreased in regards the the previous week and if you have a look at the COT chart for that pair it seems to be forming a bottom.
At the same time values like Gold and Oil, that have negative correlation with the USD, seem to be changing trend, call it accumulation area, call it frying pan pattern, but there is a potential and noticeable at first glance change of direction.
Tying all the ends together it looks to me that USD is going to get weaker gradually. From the technical point of view, one key value to give more strength to all this theory is to break above 1.1050-1.11 level, as that would make a higher high after the higher low made on the 13th of this month (provided that the pair doesn’t turn down below that level).
It is not that I want USD to get weaker. I’m a trend follower and not a counter trend trader, but that is what all these points are telling me. Of course I might be wrong, like any other.