Dollar Falls as Euro Rises
UFXBank Research from UFX Bank at 11/10/09
Daily Review 10/11/2009
USD Dollar (USD) – The Dollar fell to a 15 month low against the currencies of major U.S. trading partners after G20 finance officials pledged to maintain stimulus measures, encouraging investors to buy higher-yielding assets. NASDAQ and Dow Jones jumped by 1.97% and 2.03% respectively, Crude oil rose by 2.6% closing at 79.43$ a barrel , GOLD (XAU) advanced to a new record, rising by 0.5% to 1100.8$ an ounce. Today, FOMC Members Lockhart and Yellen will speak. Investors are expected to close some of their short positions on the Dollar before Veterans Day Bank holiday tomorrow.
EURO (EUR) –The Euro rose against the Dollar and the Yen after a report showed Germany’s exports climbed more than economists predicted, adding to signs the Euro's economy is recovering, boosting demand for higher-yielding currencies. Overall, EUR/USD traded with a low of 1.4830 and a high of 1.5020. Today, German ZEW Economic Sentiment is expected lower at 55.2 vs. 56 prior, ZEW Economic Sentiment is expected to rise from 56.9 to 58.9.
EUR/USD - Last: 1.4975
Resistance 1.5012
Support 1.4969 1.4914 1.4811
British Pound (GBP) – The Pound rose versus the Dollar reaching its highest level since September as Risk Appetite encouraged investors to higher yielding assets. RICS House Price Balance came out better than expected at 34% vs. 29%, BRC Retail Sales Monitor came out at 3.8% vs. 2.8% prior. All in all, GBP/USD traded with a low of 1.6590 and a high of 1.6843. Today, Trade Balance is expected to show a decline of -6.1B vs. -6.2B previously.
GBP/USD - Last: 1.6756
Resistance 1.6788 1.6843
Support 1.6734 1.6704 1.6615
Japanese Yen (JPY) –The Yen fell against most majors as growing risk appetite causes a flight from the safety of the Yen into higher yielding assets. Overall, USD/JPY traded with a low of 89.69 and with a high of 90.26. No major economic data expected today.
USD/JPY-Last: 89.95
Resistance 90.10 90.26 90.85
Support 89.73
Canadian dollar (CAD) – The Canadian Dollar gained versus the Dollar as G20's comments made commodity prices and demand for higher yielding assets grow. Overall, USD/CAD traded with a low of 1.0542 and a high of 1.0774. No economic data expected today.
CAD/USD - Last: 1.0570
Resistance 1.0582 1.0681 1.0779
Support 1.0542
