Dollar Wins the week big time – Are the tables turning?
Posted on October 30, 2009 by Yohay
Filed Under Forex News | 10 Comments
This was the week of the dollar, making a strong corrective move across the board. This temporarily halted with the release of the good GDP from the US, but risk appetite was soon replaced with fear. Fear started the week and and fear closed it.
The US dollar index rose from 75.30 to 76.26 at the time of writing, close to the close. The dollar hit the brakes on the big downhill trend seen since mid-March. Is it a temporary stop? Or does it signal a change?
- EUR/USD fell below the 1.4842 support line, and didn’t recover since. Trading at 1.4727, it lost this week approximately 270 pips. Quite a dive.
- GBP/USD managed to resume the comeback, after being hit by the terrible GDP release last week. It weathered the dollar’s weakness in “bold” way and finished the week higher. Next week’s rate decision might cool it down.
- USD/CHF was quite close to parity, but rose with the dollar’s strength up to 1.0248, a rise of about 150 pips.
- USD/JPY dropped under 90 in the late hours of trading. Also the Yen enjoys fear, and is considered a “safe haven” currency. The Dollar Yen correlation of fear worked well for it, and for some Yen crosses.
- USD/CAD suffered a disappointing GDP release. GDP had all the reasons to rise, and the disappointment was stopped only by the 1.08 resistance line, altogether a 300 pip gain.
- AUD/USD: Even the Aussie, backed by a strong economy and rising interest rates needs a break. It fell about 200 pips. The fall was cushioned by the 0.8950 support line that served as a resistance line not so long ago.
- NZD/USD: I was sure that a rate hike was coming. The market (and myself) were disappointed by the rate decision and the dovish comments around it. At 0.7161, the kiwi lost about 370 pips – the dive of the week.
That’s it for this week. Weekly forecasts will be published towards the opening of the new week. The upcoming week, starting a new month, is packed with events (Non-Farm Payrolls is the climax).
Have a great weekend!
Enjoyed the post? You may want to subscribe by RSS feed or Email.Tags: AUD/USD,Currency Correlation,EUR/USD,forex overview,GBP/USD,GDP,interest rate,Non-farm payrolls,NZD/USD,Parity,resistance line,support line,USD/CAD,USD/CHF,USD/JPY
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