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FXstreet.com (Barcelona) - The Euro has turned down from 1.4170 session high during Asian trading hours, dipping to levels below 1.4100 on early European session, to test support at 1.4085 area; and , according to Karen Jones, technical analyst at Commerzbank, the pair could head to levels below 1.4000.
BOE Holds Steady But Extends QE by GBP50B; Unexpected
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Recent polls by Bloomberg and a Shadow MPC report calling for an end to QE from the Bank of England are way off the mark with the Bank of England announcing this morning that not only will they extend the QE programme, but also double the expected GBP25B addition to GBP50B. This takes the total programme to GBP175B.
Wed, Aug 5 2009 news
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- Forex: GBP/USD breaks 1.7000 resistance
The Sterling has finally broken the 1.7000 key resistance against the Dollar after rising ar
ound 90 pips in the last hour from 1.6960 to post fresh 9-month highs.GBP/USD has jumped above the 1.7000 key resistance after several attempts since the yesterday opening. Pair has risen around 90 pips from 1.6960 to post 1.7045 as fresh highest level since last October 21.
Currently the pair is trading around 1.7035/45, 0.50% above today's opening price action.
According to Carol Harmer, technical analyst at Charmer Charts, the Pound could break above 1.7000 heading to 1.72: "Now today the market does remain looking as though it could trade higher back to 1.7005. Here will be quite crucial. The sellers failing to hold off buyers will see this then trade higher with 1.72 targeted. 1.72 is the measured target from the continuation pattern we experienced all through June and July."
todays update
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Finance Minister Halts Canadian Dollar Rally
The Canadian dollar, which has gaining heavily versus several most traded currencies, finally stopped its rally after the national Finance Minister affirmed that eventual measures may be taken to damp the rising demand for the loonie, which is already jeopardizing Canadian exports.
The Canadian currency was one of the best performing ones since the world started to post more solid signs of economic recovery last month, creating a bullish pattern for high-yielding currencies fueled by a new wave of risk appetite. The current rise of the loonie, may already affect Canadian exporters negatively, since the national currency rose intensively, more than its Australian and New Zealand counterparts for example. Yesterday, Canadian Finance Minister Jim Flaherty stated that the rapid rise of the national currency is already a reason of concern, and measures may be taken to halt its continuation, affecting immediately the Canadian dollar, which dropped from a 10-month high level.
Analysts examine the loonie’s short term situation as an obstacle for Canada to grow, since a high loonie will affect Canadian’s exports and consequently different sectors of the economy. The Bank of Canada may indeed intervene in the currency market, being Flaherty’s declaration already an effective psychological measure that pushed the dollar down for the first time in a almost a week.
USD/CAD traded at 1.0763 as of 10:21 GMT from yesterday’s rate of 1.0681.
Forex: GBP/USD posts 9-month high at 1.6987
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Forex: GBP/USD posts 9-month high at 1.6987
The Sterling has risen around 170 pips against the Dollar during the American se
ssion from 1.6820 to post the highest level since October 21 at 1.6987 in its way to test 1.7000 level. Currently the pair is trading around 1.6935/45, 1.40% above today's opening price action.Valeria Bednarik, Fxstreet.com collaborator, comments: “Pair has resume midterm uptrend, after breaking to the upside, both, 61.8% retracement of last weekly fall, and the roof of the range the pair has been trapped since early June. First strong resistance level comes at the 1.7120 area, followed by 1.7400 level. Downside corrections will find support around 1.6700, that should hold to keep bias intact. Intraday supports come at 1.6950 and 1.6900, while resistances from actual price lie 1.6980 and 1.7030.”
ECB On Hold Once More?
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ECB On Hold Once More?
The ECB meets this week in Frankfurt (Germany). Rates should stay on hold once more, as the recovery process is just beginning in Europe. The U.S. dollar, in the mean time, is still at key support levels against major currencies.
U.S.: Consumer confidence weak.
The process might be slow and the recovery could not take the form of the classical V shape. However, the worst should be over for U.S. economy, after more than one year of losses. Leading indicators increased last month for the third consecutive time, while some corporate earnings have risen above expectations. In addition, manufacturing industries have reduced inventories and orders have improved, despite the sector remaining very volatile. In June, durable goods new orders slumped 2.5% after having increased 1.3% in May and 1.4% in April. Nevertheless, excluding transportation, orders would have jumped 1.1%. The real estate market has found a bottom at current levels and the increase of sales could boost consumer confidence. New home sales moved up 11% in June to 384,000 units. The up move was well distributed among all the U.S. regions with the exception of the South where sells declined 5.3%. Inventories are now at 8.8 months of supply from 10.2 months, while building permits, a forecasting indicator, rose almost 9.0%.
Angelo Airaghi is a Commodity Trading Advisor, registered with the National Futures Association and the Commodity Futures Trading Commission. He has been an active professional since 1990 working for major international financial companies. In the past 10 years, Angelo Airaghi has been an analyst and commentator for national and international media.
The ECB meets this week in Frankfurt (Germany). Rates should stay on hold once more, as the recovery process is just beginning in Europe. The U.S. dollar, in the mean time, is still at key support levels against major currencies.
U.S.: Consumer confidence weak.
The process might be slow and the recovery could not take the form of the classical V shape. However, the worst should be over for U.S. economy, after more than one year of losses. Leading indicators increased last month for the third consecutive time, while some corporate earnings have risen above expectations. In addition, manufacturing industries have reduced inventories and orders have improved, despite the sector remaining very volatile. In June, durable goods new orders slumped 2.5% after having increased 1.3% in May and 1.4% in April. Nevertheless, excluding transportation, orders would have jumped 1.1%. The real estate market has found a bottom at current levels and the increase of sales could boost consumer confidence. New home sales moved up 11% in June to 384,000 units. The up move was well distributed among all the U.S. regions with the exception of the South where sells declined 5.3%. Inventories are now at 8.8 months of supply from 10.2 months, while building permits, a forecasting indicator, rose almost 9.0%.
Angelo Airaghi is a Commodity Trading Advisor, registered with the National Futures Association and the Commodity Futures Trading Commission. He has been an active professional since 1990 working for major international financial companies. In the past 10 years, Angelo Airaghi has been an analyst and commentator for national and international media.
Forex Top Story
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Dollar Hits The Skids As Recovery Hopes Rise
The dollar plummeted across the board versus major counterparts on Friday as traders expressed increased risk appetite after a report showed that the US economy contracted less than analysts were predicting.
The report fueled hopes that the world's biggest economy could lead the world out of the worst recession in decades, and sooner than once feared.
Traders had been hedging of late, refusing to go all-in on the prospect of a global recovery beginning by year's end. However, with stocks on the rise and a number of key indicators showing a faint pulse in the housing and labor markets, the dollar could be in for some big losses to higher-yielding counterparts.
Its already been a rough month for the dollar versus resource-linked currencies, and the euro and sterling joined the buck-bashing party on Friday.
The dollar tumbled to 1.4270 versus the euro, giving back all of its gains from earlier in the week. With the loss, the dollar moved within a penny of its 2009 lows.
The dollar plunged from a month-long trading range versus the sterling, slipping to a 4-week low of 1.6732 before finding support. Back in June, the dollar hit a 2009 low of 1.6744.
Even the yen battered the dollar on Friday. The buck slipped to 94.58 by mid-day after
challenging a monthly high near 96 in the previous session.
Versus the loonie, the dollar dropped to C$1.0762, coming within a hair of Monday's 10-month low of C$1.0749.
The U.S. economy continued to shrink in the second quarter, according to new government statistics released Friday, although the pace of contraction slowed by more than economists had been expecting.
The U.S. Commerce Department revealed that Gross Domestic Product, a closely watched measure of broad economic performance, fell at a pace of 1 percent for the second quarter. Economists had expected GDP to fall at a 1.5 percent rate.
And while the Institute for Supply Management - Chicago released a report on Friday showing a continued contraction in manufacturing activity in the month of July, the pace of contraction slowed by a little more than economists had been expecting.
North of the border, Canadian real gross domestic product (GDP) decreased 0.5% in May, a faster rate of decline than in the previous three months, according to data released Friday by Statistics Canada.
Economist were looking for GDP to fall 0.3% in May.
The dollar plummeted across the board versus major counterparts on Friday as traders expressed increased risk appetite after a report showed that the US economy contracted less than analysts were predicting.
The report fueled hopes that the world's biggest economy could lead the world out of the worst recession in decades, and sooner than once feared.
Traders had been hedging of late, refusing to go all-in on the prospect of a global recovery beginning by year's end. However, with stocks on the rise and a number of key indicators showing a faint pulse in the housing and labor markets, the dollar could be in for some big losses to higher-yielding counterparts.
Its already been a rough month for the dollar versus resource-linked currencies, and the euro and sterling joined the buck-bashing party on Friday.
The dollar tumbled to 1.4270 versus the euro, giving back all of its gains from earlier in the week. With the loss, the dollar moved within a penny of its 2009 lows.
The dollar plunged from a month-long trading range versus the sterling, slipping to a 4-week low of 1.6732 before finding support. Back in June, the dollar hit a 2009 low of 1.6744.
Even the yen battered the dollar on Friday. The buck slipped to 94.58 by mid-day after
challenging a monthly high near 96 in the previous session.Versus the loonie, the dollar dropped to C$1.0762, coming within a hair of Monday's 10-month low of C$1.0749.
The U.S. economy continued to shrink in the second quarter, according to new government statistics released Friday, although the pace of contraction slowed by more than economists had been expecting.
The U.S. Commerce Department revealed that Gross Domestic Product, a closely watched measure of broad economic performance, fell at a pace of 1 percent for the second quarter. Economists had expected GDP to fall at a 1.5 percent rate.
And while the Institute for Supply Management - Chicago released a report on Friday showing a continued contraction in manufacturing activity in the month of July, the pace of contraction slowed by a little more than economists had been expecting.
North of the border, Canadian real gross domestic product (GDP) decreased 0.5% in May, a faster rate of decline than in the previous three months, according to data released Friday by Statistics Canada.
Economist were looking for GDP to fall 0.3% in May.
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