The USD continues to trade between 1.3100-1.3300 against the EUR, and the pair seems to be moving without direction in anticipation of the next big event to hit the news. As long as the 1.3500 level stays untouched, there is a good chance that the pair may move lower again in the coming days. Risk aversion continues to give the Dollar strength and that is likely to continue until we see signs of stabilization.
Investors are speculating that the European Central Bank (ECB) will follow an expected interest rate cut today with further reduction... ( read more )
Archive for January, 2009
January 14, 2009 - EUR Levels are Priced in Tomorrow’s Rate Cut
Over the past week, traders have witnessed a gradual depreciation in the value of the EUR. This has been brought about by negative economic news as well as the assumption that the European Central Bank (ECB) will have to enact strong measures to bring about a correction to the value of its currency. This morning, as traders plant their steady positions in expectation of tomorrow's rate cut, we have begun to see some upward movement to the EUR as many may actually believe that a rate cut will not weaken the currency, but ultimately bring its val... ( read more )
January 13, 2009 - USD Goes Up On Risk Aversion
Trader's aversion to risk has continued to push safer currencies higher as global equity markets continue to trend lower. Both the Nikkei and Dow Jones Industrials ended lower yesterday and that has been influencing the currency markets. The financial markets show the concerns of a global recession. Traders have been unraveling riskier investments financed with loans from currencies with ultra low Interest Rates, predominately in the USD and the Yen. These two currencies may continue to see support in the short term as investors lose confidence... ( read more )
January 12, 2009 - The Greenback Shows Bullish Signs Post NFP
The big news for the USD this week appears to be the continuation of its recent rally. Approaching 1.3400 against the EUR in today's early trading hours, there is potential for the Dollar to remain in this bullish slide until other fundamental news shifts attention elsewhere. Also, while not absolutely certain, there is a distinct possibility that the USD has broken its recent downtrend against the British Pound and may be on the rise there as well. Two important events occurred this weekend which had a significant impact on the greenback: the ... ( read more )
The EUR Gains a head of the Nonfarm Payrolls
The U.S Dollar continued to slide against the EUR in yesterday's trading session, slipping by nearly 200 pips at one time. However, it recovered to close down 35 pips, at 1.3646. The greenback also lost ground against the JPY, to close down by 125 pips, at 91.25. The reasons for the Dollars decline yesterday were largely due to investors the depth of the U.S. recession and the prolonged Israel-Gaza War.
On Thursday the USD declined on the release of negative economic data, which showed that U.S. unemployment benefit rolls swelled to a 26-ye... ( read more )