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UFXBank Forex Outlook: EUR/USD Down on Sovereign Debt Concerns

Written by UFXBank Research Team
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USD Dollar (USD) – The Dollar strengthened versus the other major currencies in Forex trading after Federal Reserve Chairman Ben S. Bernanke said the central bank may boost purchases of U.S. debt, which then succeeded to support a stronger Dollar. The NASDAQ increased by 0.13% and the Dow Jones decreased by 0.17%. Crude oil rose by 0.2% and closed at $89.38 a barrel, the highest price in two years. Gold (XAU) strengthened to a new historic record, rising by 0.7% and closed at $1422.40 an ounce. No major economic data is expected today.

Euro (EUR) – The Euro fell against most major currencies as European officials showed divisions about how to contain the sovereign debt crisis, damping appetite for the region’s currency. The main support of the EUR/USD on the daily chart is 1.3250, and if the price breaks below this level, the Euro could fall below 1.3200 levels. Overall, EUR/USD traded with a low of 1.3246 and with a high of 1.3421. Today, German Factory Orders are expected to become positive, from -4.00% to 1.90%.

EUR/USD – Last: 1.3342








British Pound (GBP) – The Pound weakened versus the Dollar as concerns over the sovereign debt crisis in the euro zone helped in drifting the pound and other higher risk currencies trading against the Dollar. The next resistance for GBP/USD on the daily chart is located at 1.5800, and if the rate breaks above this rate, a long position is preferred. The support level on the one hour chart is 1.5650. Overall, GBP/USD traded with a low of 1.5655 and with a high of 1.5770. Today, Manufacturing Production is expected to rise from 0.10% to 0.30%.

GBP/USD - Last: 1.5740








Japanese Yen (JPY) –The Yen traded within a very narrow range versus the Dollar after no major news from these areas was released that could influence a big movement on this pair during either the Japanese or US sessions. As long the USD/JPY is trading below the 83.20 level, a short position is preferred. The 20 moving average on the daily chart supports a downwards trend as well. Overall, USD/JPY traded with a low of 82.56 and with a high of 82.99. No economic data expected today.

USD/JPY-Last: 82.74







Canadian dollar (CAD) – The Canadian Dollar weakened against the US Dollar after Canadian Building Permits came out at -6.5% vs. the -2.9% forecast in October. This led investors to sell the Canadian currency during the session. The support level of the USD/CAD on the daily chart is still located at 0.9980, and if the price breaks below this level, the momentum will continue to be negative for the US Dollar. If the price crosses the 1.0120 level, the dollar could rise to the 1.0200 level. Overall, USD/CAD traded with a low of 1.0021 and with a high of 1.0083. Today, BOC Rate Statement and Interest Rate Decision is expected to remain at 1.00%.

USD/CAD - Last: 1.0050











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