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Uncertainty dominates global market
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Last updated: 2010-02-04 |
The first day in February witnessed mixed trading in markets around the world, whereas the Euro managed to break the five day losing streak against the Dollar and inclined today, meanwhile the GBP is trading near its opening levels while the Dollar managed to gain against the yen as uncertainty among investors on the future outlook of the economy affected trading today.
The ECB noted earlier that the bank will hold back on euro purchases giving the Dollar enough momentum against the 16 nation currency thus investors pulled their money from high yielding assets and headed for the opposite and affecting the Euro’s place as a replacement to for the world’s reserve currency; the Dollar.
Meanwhile today’s US trading session witnessed a comeback by the Euro after it declined for the lowest levels in seven months as investors demand for risk rose along with rising stock markets where investors see the recovery process around the world is gaining momentum.
Validating that was the reports released from the world’s leading economy where it showed that inflation levels is still subdued and inline with the Fed projection, thus inflation in the U.S does not threat economical activity so far, adding to that the reports that came out from the Institute of Supply Management that showed rising activities in the manufacturing sector for almost half a year now thus providing the dollar with the momentum to gain against the Yen.
Looking at the U.S Dollar Index; which measures the performance of the Green Benjamin against six major currencies including the Euro, Pound and Yen we see a gradual drop for the Dollar against these majors whereas the index opened at 79.431 where it currently trading at 79.269 after reaching the highest levels for today at 79.481 and the lowest at 79.194.
Meanwhile The euro-dollar pair is gaining on the daily scale where it breached yesterday’s resistance levels at $1.3901, the pair is in attempt to breach the upcoming resistance levels at $1.3920 and $1.3946 but a correctional move to the downside is expected on the four hour chart as the pair approaches a highly overbought area on the RSI oscillator. The pair is currently trading at $1.3911 where it managed to reach the highest levels for today at $1.3934 and the lowest at $1.3849, expectations show that the pair might decline after completing the bullish trend to target $1.3800 levels but to accomplish that; trading must remain below $1.4055. The upcoming support and resistance levels for the pair are set at $1.3870 and $1.3925.
Moving to the cable, the pair is unchanged as stated above where it’s currently trading at the opening levels for today at $1.5944 while it managed to reach the highest levels for today at $1.5978 and the lowest at $1.5848. The pair is expected to decline on intraday basis but a bullish correctional move is projected to happen first for the pair reaching $1.5950 and $1.5980 before descending back to targets $1.5825 and $1.5700 levels, expectations are valid if $1.5950 remains intact. The upcoming support and resistance levels for the pair can be witnessed at $1.5850 and 1.5980 respectively.
Finally talking about the USDJPY pair, the pair managed to breach the resistance levels at $90.52 where its currently targeting the resistance at $91.04, the pair is trading at $90.68 while it managed to reach the highest point at $90.94 and the lowest at $89.86, if the pair managed to close on the four hour chart below $90.75 expectations show that the pair will continue its decline. The upcoming support and resistance levels for the pair can be witnessed at $89.90 and $91.00 respectively.
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