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Forex Daily News: August 24, 2010 - Euro, Pound Fall Again

Written by UFXBank Research Team
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USD Dollar (USD) – The Dollar rose against other major currencies after industry data showed that U.S. existing home sales fell to their lowest level in 15 years (3.83M vs. 4.68M forecast), causing investors to sell higher yielding assets. The NASDAQ and Dow Jones weakened by 1.66% and 1.32% respectively, while crude oil fell by 2.0% to close at $71.36 a barrel, the lowest price in 11 weeks. Gold, on the other hand, (XAU) rose by 0.4and closed at $1233.40 an ounce. Today, Core Durable Goods Orders are expected to rise from -0.9% to 0.6% and New Home Sales are expected at 333K vs. 330K prior.

EURO (EUR) – The Euro fell heavily against the yen and closed almost unchanged versus the Dollar in Forex Trading. It touched a six-week low during the session as main indexes and commodities fell more than 1.5 percent, supported by those buying safety currencies like the Yen and Dollar. The pair is continuing to trade downwards, therefore the momentum is still strongly bearish and a short position is preferred. Overall, EUR/USD traded with a low of 1.2587 and with a high of 1.2719. Today, German IFO Business Climate is expected to weaken from 106.2 to 105.8.

EUR/USD – Last: 1.2656







British Pound (GBP) – The Pound fell against the Dollar after the London based Times reported that Bank of England policy maker Martin Weal said the U.K. faces a “real risk” of a second recession. The GBP/USD has broken the support level at 1.5480 and crossed down the 10 moving average on the daily graph and therefore, a short position is preferred. Overall, GBP/USD traded with a low of 1.5372 and with a high of 1.5505. No economic data is expected today.

GBP/USD - Last: 1.5430







Japanese Yen (JPY) –The Yen advanced to the strongest level since June 1995 against the Dollar, as concern the global economy is slowing encouraged demand for safer assets. The trade Balance came out better than expected at 0.61T vs. 0.47T forecast. The momentum of the USD/JPY is strongly bearish and the next support on the daily chart is located at 83.50, therefore, a short position is preferred. Overall, USD/JPY traded with a low of 83.59 and with a high of 85.15. No economic data is expected today.

USD/JPY-Last: 84.38







Canadian dollar (CAD) – The Canadian Dollar fell for a fourth straight day versus the Dollar, touching the lowest level in seven weeks as investors soured on higher yielding assets and currencies. As long the USD/CAD is above 1.0500 levels a long position is preferred. The next resistance on the daily chart is located at 1.0700, and if the price crosses this level, the trend will continue to be bullish. Overall, USD/CAD traded with a low of 1.0536 and with a high of 1.0664. No major economic data is expected today.

USD/CAD - Last: 1.0595







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