For more currency & commodity news & info, visit http://ufx.co/UFXM-youtube
Wall Street finished the trading day down amid growing uncertainty over the Federal Reserve’s budget negotiations. The S&P 500 dropped by 0.32%, the NASDAQ declined by 0.20% and the Dow Jones lost 0.33% from its value.
The US Dollar fell slightly versus most of the majors as investors await the Federal Reserve’s decision to begin tapering its USD85 billion monthly asset purchases, and is expected to keep the negative momentum until this decision is announced. Today, the Federal Budget Balance is expected at -142.60B vs. 91.60B previously, and the 10-y Bond Auction also due for release.
Gold rose by 1.81% on Monday, closing at $1,260 an ounce, with the weakness of the greenback boosting demand for gold as an alternative investment. Crude Oil rose by 1.42% to close at $93.97 a barrel amid growing concern over the U.S. Oil Inventories.
The Euro gained against the other majors over speculation that the German Consumer Price report will beat expectations. The French Industrial Production came out worse than expected at -0.30% vs. 0.20%. Technically, according to the 4-hour chart, the EUR/USD is moving in an Ascending Channel with the pair currently at the top of the channel and a retracement towards 1.3670 expected.
The Pound gained against the US dollar after the Manufacturing Production came out as expected at 0.40%, and the Trade Balance worse than expected at -9.70B vs. -9.30B. Technically, according to the 4-hour chart, the GBP/USD’s trend is strongly bullish. Breaking below the support level of 1.6420 could lead the pair to the next support level at 1.6370.
The New Zealand Dollar rose versus the U.S dollar as investors looked away from the greenback in favor of higher yielding assets. Technically, according to the weekly chart, The NZD/USD is trading in a Symmetrical Triangle; breaking out of the triangle could initiate a strong movement of 200 pips. For the moment, the NZD/USD trend remains bullish as long as the pair maintains its support level of 0.8260. Today, the Interest Rate Decision is expected unchanged at 2.50%, followed by the RBNZ Press Conference.