The Dollar recorded a volatile trading session as the U.S. Treasury Secretary Timothy Geithner unveiled plans for a public-private partnership to buy the toxic debts of U.S. banks. In effect, Geithner's speech led to a rally on Wall Street that resulted in a 7% rise in the Dow Jones and other indices. The other big factor that helped spur a rally on Wall Street was better-than-expected U.S. housing data. This showed a 5.1% increase in Existing Home Sales from January to February. As a result, the Dollar cut its losses that it made earlier on in... ( read more )
Archive for March, 2009
March 23, 2009 - USD Weakness Is Likely to Continue
Last week's decision by the Federal Reserve to buy up U.S. Treasury securities has generated one significant result: an across-the-board sell-off of the USD. Jumping an unprecedented 334 points against the EUR directly following the announcement last Wednesday, the Dollar has continued to take hits through the end of last week and today. Two primary results occurred as a result of this sell-off. The first, as was just mentioned, was a volatile decreasing movement in the Dollar's pairs and crosses. The second was a subsequent rise in the value o... ( read more )
March 20, 2009 - Chairman Bernanke is Scheduled To Speak Today
The has continued its weekly demise this week , as it reached close to a two month low against the EUR on Thursday. The greenback also saw significant downtrends against the GBP and the JPY as well. The Federal Reserve's decision to expand the supply of Dollars by buying government debt, which was announced 2 days ago, is continuing to severely damage the U.S currency. Yesterday the USD lost a staggering 200 pips against the EUR to close at 1.3659. Against the JPY, the Dollar dropped a staggering 150 pips or 1.5% to close at 94.55. The Dollar's... ( read more )
March 19, 2009 - Why Is The USD So Weak?
Many traders fall error to the belief that their trading strategy is fool-proof. Anyone watching the value of the USD these past few weeks would no doubt fall victim to this fallacy by going long on the greenback in expectations for it to continue acting as a safe-haven. Even pros make this mistake. The sad truth is that the USD has been artificially held high simply because the U.S. economy is believed to be the support of the global economic system.
I’ve been telling my clients lately that the recent weakness will end soon and the Dollar... ( read more )
March 19, 2009 - The Greenback Crashes After Fed Rate Announcement
Investors fled the USD en masse yesterday after the U.S. Federal Reserve stated that it would begin quantitative easing - basically printing money - in order to revive the U.S. economy hopefully by the beginning of next year. After such a devastating loss in value, traders now have the opportunity to discover a new range for the value of the USD and will begin to do so throughout the rest of this week. Once stabilized, the USD may in fact begin to climb back up as it returns to safe-haven status in the coming weeks.
The greenback dropped on... ( read more )