Bull trades we’re rife overnight in most part assumed due to the much better than anticipated GDP figures coming out of China, the improved GDP increasing demand for riskier trade assets drove markets to this Bullish reaction. While the currency remains lower compared to all it’s instrument pairs these reports out of China have in fact provided some welcome relief. The EUR/USD rose dramatically over 100 pips until hitting the resistance level at 1.2770. As the markets opened globally the currency pair fell back to 1.278.
The coming outlook for the EUR are looking positive, the EUROZONE has enjoyed improvements in market confidence due in part from the recent success of the LTRO operation. By avoiding a credit crunch the currency has been able to begin to move in a positive direction, however the future is far from certain, especially following te news out of France on Friday. Due to the statement, France (amongst other European countries, was confirmed to have lost its AAA rating. The ongoing economic crisis in Greece continues to reflect on the confidence of the EUR with the countru again on the brink of default after recent talks again broke down.
Meanwhile the EUR/JPY has today risen above it’s recent 11 year low and trading around the 97.70 mark. Market analysts have welcomed the bullish climate though warned forex it’s likley to be temporary since traders should keep close eyes on a number of European news items set for release during the day. News out of the Euro zone could create dramatic changes in currency values. In particular, from Germany the ZEW Economic Sentiment is predicted to generate market and trade volatility. Traders should be aware and track the news and prices during the day.
Towards the end of the day, the Bank of Canada is set to release their rate statement, the Canadian Dollar (loonie) has seen a bullish pattern in recent weeks specifically against the USD. Many in the market are expecting a positive news release regarding the countries economic position and growth forecasts, if this materializes, the CAD should begin to extend it’s gains against paired currencies.
