Two major events for the US dollar will happen this week: the deadline for the US budget and non-farm payrolls. What outlook do analysts have for the greenback ahead of these events?
Today is the last day for the US politicians to agree on the budget and it looks like the talks remained at a deadlock. The Congress still has a disagreement on President Barack Obama’s healthcare law and it looks like the US government may face it first shutdown in 17 years. Such prospect has mixed impact on the US currency. On one hand, the danger of a government collapse makes the currency more appealing because of its role as a safe haven. On the other hand, safety of greenback is highly questionable in such conditions.
Non-farm payrolls will be another factor that will affect the US dollar this week. Analysts predicted 179,000 growth (the previous value was at 169,000). Reading above this mark will greatly increase chances for Octaper and, consequently, will boost the currency. By the same token, worse-than-expected result will send the greenback down.
There will be other important events this week, including several central banks’ meetings. Italy has its own political crisis and it should bolster the dollar. But the US government shutdown and non-farm payrolls will likely overshadow other news.
Experts, including DailyFX and Forex Crunch, were cautious ahead of the important events, issuing neutral (but with bullish bias) outlook for the dollar.
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Dollar Ahead of US Government Shutdown
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Euro is struggling today as Italian politics turn ugly. The 17-nation currency is mostly lower today, dropping against most of its counterparts. The currency that isn’t gaining against the euro right now is the US dollar, which is facing political issues of its own right now.
Daily chart: GBPUSD is trying to break the resistance level at 1.6146. Last week, the pair made a bullish rebound near support at the 1.6046 level. Now, this pair is forming a lower high pattern. If the pair manages to break that level, it is expected to rise to the level of 1.6235. On the other hand, if this pair makes a bearish rebound at current levels, it will be expected to fall back to support at the 1.6046 level. The MACD indicator is in extreme overbought zone and entering neutral territory. 
This week was mixed for the dollar as US politicians were debating about the issue of the budget and the debt ceiling, increasing demand for safer currencies, including the greenback, but hurting the appeal of the US currency at the same time.
