UFXBank Daily News: GBP Stalls vs USD on Slow Growth

Posted by admin on January 31, 2011 under forex market | Be the First to Comment

USD Dollar (USD) – The U.S Dollar rose against most major currencies in Forex trading after growing concern for Egypt’s political turmoil. This situation has triggered investor risk aversion with traders buying into the “safe haven” of the U.S Dollar. The main concern is that we are going to see an expansion of this turmoil out of Egypt to other parts of the Middle East, and as a result, the rate of oil will continue to rise. The Stock Markets in the U.S declined as the Dow Jones fell by -1.39% and the NASDAQ fell by 2.48%. Crude Oil increased by 4.3% to $90.25 per barrel, the most since September 2009. Gold (XAU) rose to a rate of at $1343.50 an ounce and could reach the level of $1355 in the near future. Today, personal spending is expected at 0.6% vs. 0.4% previously, and the Chicago PMI is expected at 0.5% vs. 0.3% previously.

Euro (EUR) – The Euro slid against the U.S Dollar for the first time after three weeks of getting stronger. The political concern in the Middle East has provided its influence on the currency. According to the daily chart and with consideration of the political turmoil, the momentum is strongly bearish for the pair, which is facing support at 1.3500 and resistance at 1.3600. Overall, EUR/USD traded with a low of 1.3572 and with a high of 1.3700. Today, no major economic data is expected.

EUR/USD – Last: 1.3597

Resistance	1.3640	1.3750
Support	1.3570	1.3520	1.3400

British Pound (GBP) – The Pound slid for the first time in three weeks versus the greenback after growing speculation arose that the Bank of England may not raise interest rates in the close period, as growth slows. The Consumer Confidence report came out at -29, worse than the expected -20. The sterling dropped on Friday by 100 pips to 1.5840, breaking its support level at 1.5900 as was expected. The main support at 1.5820 hasn’t been broken down yet. The pair will likely continue to be bearish and rates of 1.5600 and 1.5500 don’t seem far away. Overall, GBP/USD traded with a low of 1.5820 and with a high of 1.5880. Today, no major economic data is expected.

GBP/USD – Last: 1.5860

Resistance	1.5890	1.5950	1.6000
Support	1.5820	1.5790	1.5760

Japanese Yen (JPY) – The Yen rose against the Dollar and closed around the 82.10 area. According to the daily chart, the main support level is still at 82.00. In the case that the pair does break this support level, the rate is expected to continue to fall to 81.50 and then to 81.00. Overall, USD/JPY traded with a low of 81.98 and with a high of 82.66. Today, the Prelim Industrial Production report is expected.

USD/JPY-Last: 82.08

Resistance	82.30	82.57	82.91
Support	82.00	81.50	81.00

Canadian dollar (CAD) – Canada’s dollar declined against its U.S counterpart the most in almost three month. This is likely due to the Bank of Canada’s governor, Mark Carney, saying that the strength of the currency is a problem for economic expansion. The pair could remain bearish because the U.S Dollar is considered as a safety island in times of crises. Today the GDP is expected to be release and the forecast is expected to be unchanged from its previous outcome of 0.2%. Overall, USD/CAD traded with a low of 0.9860 and with a high of 1.0035.

USD/CAD – Last: 1.0006