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Dollar Gains Back Some Momentum
Written by article default Tuesday, 26 October 2010 12:32
The U.S. dollar strengthened today against major currencies, as investors headed for safety measures after some U.S. companies announced results that disappointed estimates, while data from the U.S. housing market also signaled disappointment for investors, as the S&P/CS house price index rose below estimates.Stock markets fluctuated all day amid the mixed results from major U.S. corporations including Ford Motor Co, United States Steel Corp, AK Steel Holding Corp, while gold prices dropped slightly as a result of the strengthening U.S. dollar, while oil prices were unchanged after the U.S. Conference Board announced that consumer confidence improved in October.
The U.S. dollar index, which measures the performance of the U.S. dollar against a basket of currencies including the Euro, the Pound, and the Yen, rose to trade at 77.59, compared with the opening level at 77.16, while recording the highest today at 77.69 and the lowest at 77.04. Gold prices declined slightly to trade at $1339.73 an ounce, compared with the opening level at $1340.75 an ounce, while oil prices slightly inclined to trade at $82.29 a barrel, compared with the opening level at $82.23 a barrel.
The Euro dropped against the U.S. dollar, where the EUR/USD pair is now trading at $1.3862, compared with the opening level at $1.3922, while recording the highest at $1.3982, and the lowest at $1.3838. If the pair continues to trade below the resistance at $1.3985, the target is set at $1.3720, and only rising above $1.4085 would cancel the downside direction.
The British Pound however rose against the U.S. dollar today after the U.K, reported growth that beat estimates, where the GBP/USD pair is trading at $1.5851, compared with the opening level at $1.5707, while the pair recorded its highest today at $1.5896, and the lowest at $1.5706. The pair is expected to rise towards its next target at $1.5915 and then the $1.5965 level, given it can remain trading above $1.5840.
Finally, the U.S. dollar rose against the Japanese Yen, where the USD/JPY pair is trading at 81.32, compared with the opening level at 80.80, where the pair recorded its highest at 81.42 and the lowest at 80.61. The pair is expected to continue its downside wave so long as it continues to trade below the resistance level at 81.35, although breaching this level would open the way for the pair to rise towards the key resistance at 82.15, while the downside target is set at 79.60, and only closing above 82.15 would change the pair’s direction from downside to the upside.