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UFXBank Forex News: Euro Rises on Optimism

Written by article default Wednesday, 19 January 2011 08:25

USD Dollar (USD) – The Dollar weakened versus most of the major currencies of Forex trading after U.S. stocks were up and mixed data was released. There was also some optimistic news from the euro about its debt being supported by a weaker Dollar. The NASDAQ and Dow Jones rose by 0.38% and 0.43% respectively. Crude oil weakened by 16 cents and closed at $91.38 a barrel. Gold (XAU) strengthened by 0.6% and closed at $1368.20 an ounce. Today, Building Permits are expected to rise from 0.54M to 0.56M, and Housing Starts are expected at 0.55M vs. 0.56M.

Euro (EUR) – The Euro rose to a one month high against the Dollar on speculation that efforts by the region’s policy makers to prevent the sovereign debt crisis from deepening may succeed. The resistance of the EUR/USD on the daily chart is still 1.3450, and as long as the rate is above the 10 moving average on the daily chart, the euro is still strong and the momentum is bullish. Overall, EUR/USD traded with a low of 1.3253 and with a high of 1.3466. No major data is expected today.

EUR/USD – Last: 1.3452

British Pound (GBP) – The Pound extended its advance versus the Dollar as a report showed that U.K. inflation accelerated faster than forecast in December (3.7% vs. 3.3% forecast). The GBP/USD has been trading upwards in the past two weeks, and as long as the rate is above 1.5850, the pound is more attractive. Overall, GBP/USD traded with a low of 1.5895 and with a high of 1.6059. Today, Claimant Count Change is expected at 1.40k vs. -1.20K.

GBP/USD - Last: 1.6015

Japanese Yen (JPY) –The Yen traded near a two week high against the Dollar on expectations that the U.S. Housing report will show that the housing starts fell in December, causing the Yen to be more attractive. The momentum of the USD/JPY has been bearish over the last few days, and if the pair breaks below the 82.00 level, the pair could decline to 81.00 or even less. Overall, USD/JPY traded with a low of 82.33 and with a high of 82.82. No economic data is expected today.

USD/JPY-Last:  82.26

Canadian dollar (CAD) – The Canadian Dollar declined against the Dollar after the Bank of Canada signaled that future interest rate increases are on hold because the nation’s economic recovery is threatened by a strong currency and Europe’s fiscal crisis (interest  remain at 1%). As long as USD/CAD is trading below 1.0000 the Canadian Dollar is more attractive and the next support level on the one hour chart is located at 0.9860. Overall, USD/CAD traded with a low of 0.9837 and with a high of 0.9934. Today, there is the BOC Monetary Policy Report and the BOC Press Conference.

USD/CAD - Last: 0.9907