Tuesday October 5, 2004 - 10:27:47 GMT
Share This Story
INVESTICA Ltd - www.investica.co.uk
Forex: Return to range trading?
The Euro retreat back through important support at the 1.2350 level will undermine near-term Euro sentiment and there will also be fears that narrow ranges will again prevail in the short term. Greenspan is likely to be generally optimistic today, but the dollar will still find it difficult to secure strong buying interest. Overall, the Euro needs to push back above 1.2350 to regain momentum, but the dollar offers little immediate value stronger than 1.2250.
The Euro lost support at the 1.2350 level during Monday as short dollar positions were closed. The Euro weakened to a low of 1.2260 before a slight recovery to 1.2275 in early Europe on Tuesday.
There are still uncertainties over the US economy and markets will be looking for guidance from Fed Chairman Greenspan today. Greenspan is likely to remain generally optimistic and is also likely to suggest a further interest rate hike in November. This stance would offer support to the US currency, although heavy buying is unlikely.
The Euros inability to sustain a break higher, coupled with very tough resistance above 1.24 will reinforce speculation that narrow ranges will prevail again. The markets may try to push the dollar stronger and trigger further Euro selling, but it will still be difficult to see substantial dollar gains given the doubts over longer-term trends. The Euro-zone data remained weak with the PMI index for the services sector weakening to 53.3 in September from 54.5 the previous month.
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."