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UFXBank Forex News: European Expansion Slows, Dollar Rises

Written by article default Tuesday, 24 May 2011 07:24

USD Dollar (USD) – The Dollar advanced in Forex trading against most of the major currencies as the stock markets had a big drop yesterday on concerns for debt of Greece. In addition, there were riots in Spain over the economic situation in the country, which led investors to keep their money in safer investment channels. The NASDAQ and Dow Jones fell by 1.58% and 1.05% respectively. Crude oil fell by 2.4%, closing at $97.70 a barrel. Gold (XAU) rose by 0.4%, and closed at $1515.40 an ounce. Today, FOMC Member Duke will speak, and New Home Sales are expected at 905K vs. 300K previously.

Euro (EUR) – The euro fell against the Dollar and weakened for a third day against the yen on speculation that Europe’s sovereign-debt crisis is worsening as the region’s industrial expansion slows. The Manufacturing PMI came out at 54.8, worse than the expected 57.6. The EUR/USD is facing a serious support level at 1.4000 levels. If the pair breaks below this level, it might decline to 1.3800. Overall, EUR/USD traded with a low of 1.3968 and with a high of 1.4144. Today, the German Ifo Business Climate is expected at 113.9 vs. 114.2 previously.

EUR/USD – Last: 1.4056

British Pound (GBP) – The pound fell for a third day against the dollar after Sky reported, in a blog on its website, that more than one of the U.K.’s four biggest banks will be put on review today as a withdrawal of government support may increase credit risk. The next resistance level of the GBP/USD on the four hour chart is located at 1.6300. If the pair crosses this level, the pound could continue to rise toward 1.6370, or even more.  The pair has a resistance level at 1.6090, and if it breaks below this level, it might decline to 1.6000. Overall, GBP/USD traded with a low of 1.6087 and with a high of 1.6232. Today Public Sector Net Borrowing is expected at 5.0B vs. 16.4B.

GBP/USD - Last: 1.6110

Japanese Yen (JPY) –The Yen weakened versus the Dollar due to yesterday’s dollar strength. The USD/JPY is struggling with 82.00 levels, and as long as the pair is trading below this level, a short position is preferred. However, if the pair breaks the 82.00 level, it might rise between 83.00 and 83.50. Overall, USD/JPY traded with a low of 81.31 and with a high of 82.03. No economic data is expected today.

USD/JPY-Last: 81.80

Canadian dollar (CAD) – The Canadian dollar fell against the US Dollar as crude oil dropped again. According to the 4 hour chart, the pair is facing a resistance at 0.9750, and if the pair breaks this level, the rate might jump to 0.9825 and could rise to 0.9900. Overall, USD/CAD traded with a low of 0.9730 and with a high of 0.9809. Today, no major economic data is expected.

USD/CAD - Last: 0.9760