Forex Daily News: August 4, 2010 - GBPound-ing the USD

Written by UFXBank Research Team
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USD Dollar (USD) – The Dollar weakened against most major currencies after negative data that was released, succeeded to support a weakening Dollar. Pending Home Sales came in much lower than expected (-2.6% vs. 0.5% forecast) and Personal Spending also weakened a bit from the expected forecast (0.0% vs. 0.1%). NASDAQ and Dow Jones weakened by 0.52% and 0.36% respectively, crude oil rose by 1.5% closing at $82.55 a barrel, Gold (XAU) strengthened by 0.2% closing at $1187.5 an ounce. Today, ADP Non-Farm Employment Change is expected to rise from 13K to 38K, ISM Non-Manufacturing PMI is expected at 53.2 vs.53.8.

EURO (EUR) – The Euro strengthened to a three month high versus the Dollar after industry data showed that U.S. pending home sales fell less than expected in June, which led Forex Trading investors to prefer the euro instead of the Dollar. The pair has been trading upwards since July and succeeded to break all the resistances levels that it had, therefore the momentum is strongly bullish. The next resistance on the four hours chart is located at 1.3380 level. Overall, EUR/USD traded with a low of 1.3147 and with a high of 1.3262. Today, Retail Sales are expected to be 0.0% vs. 0.1% previously.

EUR/USD – Last: 1.3226







British Pound (GBP) – The Pound continued to advance versus the Dollar and has reached to the strongest levels since Feb as former Bank of England Deputy Governor John Gieve said policy makers shouldn’t loosen monetary policy further or purchase bonds, given the economy is showing signs of strengthening . The GBP/USD is on a clearly upwards trend, with RSI showing that it should continue to rise and probably will cross the 1.60 level. The next support on the one hour chart is 1.5850. Overall, GBP/USD traded with a low of 1.5861 and with a high of 1.5968. Today, Halifax HPI is expected at -0.4% vs. -0.6% prior, Services PMI is expected at 54.5 vs. 54.4.

GBP/USD - Last: 1.5935







Japanese Yen (JPY) –The Yen strengthened to an eight month high against the Dollar as concern that the U.S. may require additional stimulus measures to boost its economic recovery dampened investor appetite for the Dollar. as long the USD/JPY is trading below 87.0 level a short position is preferred and the momentum is clearly bearish, the next support is located at 85.60, the 10 moving average support a downwards trend as well. Overall, USD/JPY traded with a low of 85.66 and with a high of 86.60. No economic data is expected today.

USD/JPY-Last: 85.51







Canadian dollar (CAD) – The Canadian Dollar depreciated for the first time in four days as signs of weakening growth in the U.S., the nation’s largest trading partner, point to diminished economic prospects. As long the USD/CAD is below 1.0400 levels, the momentum is bearish. The next support on the daily chart is located at 1.0140 and the next resistance is located at 1.0300 levels. Overall, USD/CAD traded with a low of 1.0219 and with a high of 1.0274. No economic data expected today.

USD/CAD - Last: 1.0236