Dollar edges higher, while stocks still look heavy

If the index drops below that level, we could see a more significant decline, with the initial target at 14,830 EUR.

US equity futures are also falling toward their 200-day averages. So bulls need to start buying the dips or risk a more extensive correction. 

In the FX, the greenback was slightly higher heading into the London session, with the EURUSD pair testing the 1.16 threshold to the downside again, while the USDJPY pair was seen back above the 111 level.

From other news, OPEC+ decided to continue increasing output only gradually despite demand recovering as the Delta-variant Covid-19 wave eases. Global cases hit their lowest in nearly two months on Monday, according to Johns Hopkins data. 

As a result, oil rose to seven-year highs as the WTI benchmark marched toward the 80 USD level. Remember back in April 2020, when futures dropped to -40 USD? Good old days.

There is not much macro news on the agenda today. However, the US services ISM is due and should decrease to 59.9 in September, from 61.7 in August. The employment index is expected to stay unchanged at 53.7, while the prices paid (or inflation subindex) will most likely rise to 79.7 from 75.4 previously, confirming that inflation is not transitory.

Traders could also pay attention to ECB President Christine Lagarde, who is due to speak in Frankfurt. But since nothing new will most likely be said, there should not be any significant volatility in the markets.If the index drops below that level, we could see a more significant decline, with the initial target at 14,830 EUR.