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US Dollar: Bearish Sentiment Extreme Points to Further USD Gains?

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The US Dollar finally showed signs of a noteworthy recovery and potential bottom against the Euro and other major currencies on a clearly eventful week of trading. Better-than-expected Non Farm Payrolls results and a relatively steady stream of positive economic surprises led many over-zealous analysts to declare that the economic crisis is over, but we believe such claims are very largely overblown. Non-Farm Payrolls fell significantly less than expected in May and at the slowest rate in eight months, but some perspective is clearly in order.