Federal Reserve Announces Global Recession Ending
UFXBank Research from UFX Bank at 11/26/09
Daily Review 26/11/2009
USD Dollar (USD) – The Dollar fell across the board after the Federal Reserve said the global recession is reaching its end and signaled it will tolerate a weaker Dollar, which encouraged investors to buy riskier assets. Unemployment Claims came out batter than the forecast at 466K vs.500K forecast and New Homes Sales climbed more than forecast at 430K vs. 408K forecast. NASDAQ and Dow Jones rose by 0.32% and 0.29% respectively, crude oil jumped by 2.6% closed nearly to 78$ a barrel and Gold (XAU) rose by 1.8% reached to a new record high during the day (above 1190$ ) but finally closing at 1187$ an ounce . No economic data expected today.
EURO (EUR) – The Euro surged to a 15 month high against the Dollar after the Federal Reserve refrained from voicing concern over the U.S. currency’s decline. GFK German Consumer Climate came out at 3.7 vs. 4.2 forecast. Overall, EUR/USD traded with a low of 1.4955 and with a high of 1.5144. Today, German Prelim CPI is expected at 0.0% vs. 0.1% prior and M3 Money Supply is expected at 0.7% vs. 1.8% prior.
EUR/USD - Last: 1.5102
Resistance 1.5144
Support 1.5095 1.5039 1.4999
British Pound (GBP) – The Pound rose versus the Dollar after the GDP report data was released and showed the UK economy shrank less than previously estimated in the third quarter, coming out at -0.3%, bringing the longest recession on record closer to an end. Overall, GBP/USD traded with a low of 1.6574 and with a high of 1.6744. Today, CBI Realized Sales is expected at 12 vs. 8 prior.
GBP/USD - Last: 1.6654
Resistance 1.6724 1.6819
Support 1.6643 1.6503 1.6472
Japanese Yen (JPY) –The Yen continued to strengthen versus the Dollar after breaking below 88 for the first time in 10 months as the Federal Reserve’s signal that it will tolerate a weaker Dollar encouraged investors to buy assets outside America. Overall, USD/JPY traded with a low of 87.21 and with a high of 88.63, trade balance came out better than expected at 0.42T vs. 0.31T forecast. No economic data expected today.
USD/JPY-Last: 86.51
Resistance 87.48 88.37 89.13
Support 86.29
Canadian dollar (CAD) – The Canadian Dollar strengthened to the highest level in a week versus the Dollar after Russia’s central bank said it will add the currency to its reserves and as copper rose and gold headed for the longest string of gains in almost three decades. Overall, USD/CAD traded with a low of 1.0449 and with a high of 1.0583. No economic data expected today.
CAD/USD - Last: 1.0500
Resistance 1.0526 1.0642 1.0726
Support 1.0450
