The USD and the JPY climbed versus the EUR

Varengold Bank Research Team from Varengold Wertpapierhandelsbank AG at 11/05/09

Good morning from beautiful Hamburg. Today, we will report about the JPY and its continuing upward trend. This time, the JPY gained against all of its 16 major counter parts. Additionally, we show some stocks data from Japan. We wish you a good trading day.

The USD and the JPY climbed versus the EUR. The slow recovery from the world financial crisis increases the demand for the JPY as a refuge. Versus the JPY, the EUR reached 133.94. The USD rose to 1.4839 against the EUR. The JPY continued its gain against all of its 16 major counterparts as the U.S. Federal Reserve reiterated its pledge to keep the interest rates near zero and before a report forecast to show that the U.S. jobless claims grow up. The JPY rose to 90.32 against the USD. Versus the GBP, the JPY reached 149.15. While the JPY continued its upward trend, the local stocks lost.

The Nikkei 225 Stock Average dropped 1.4% and the MSCI Asia Pacific Index of regional shares lost around 0.7 %. The investors take off their money and sell the currency of a nation with low interest rates to buy currencies with a higher interest rate. The Benchmark interest rates are 0.1 % in Japan and in the U.S. near zero. Instead of that i.e. the benchmark interest rates in Australia are 3.5 % and in New Zealand 2.5 %.

Since the beginning of October, the GBP has been trading in a bullish trend against the USD. The last days, the currency pair touched its upper Bollinger Band. During the last two weeks when it touched the upper line, the prices rebounded and fell near to the lower Bollinger Band. Furthermore the GBP reached its resistance at 1.6580 and it seems that the resistance is strong enough. Also the RSI may indicate a downward price correction.

With the ending of October, the AUD has been trading in a bearish trend channel against the USD. The currency pair traded several times near the upper line before it touched the bottom line where the prices could recover. Every time that happened in the trend channel, the prices rebounded. Furthermore it seems that the Momentum will cross the signal line from the top which could support a continuing bearish trend.