Thursday July 7, 2005 - 09:34:32 GMT
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Euro recovers a bit of ground
Good morning everyone from FXstreet.com. Crude Oil and Unleaded Gas hitting new highs did in fact hurt the US Stock indexes overnight, and will presumably be affecting the overall financial markets for some time now, as it is quite clear that the bull oil trend is here to stay. Congratulations to London for having won the 2012 Olympic Games hosting election.
Forex Technicals at a glance
The US Dollar has stopped gaining momentum for now as it was broadly expected. At least, against the Euro and the Swiss Franc. The british pound is going its own way these days, and day after day it is becoming the main loser among the majors. Today’s UK interest rate decision (11:00am GMT), which is expected to show a rate cut for the first time in quite a long period of time, it is already being discounted in the fx markets, where the pound is losing ground considerably across the board, threatening some key levels on the downside. The JPY is also down against the dollar, but that’s more a crude oil game, and therefore from a purely technical popint of view is quite arguable that the move was expected. As Euro holds and pound breaks, EUR/GBP climbs above the 0.6815 level, eyeing the 0.6850/65 area as the next strong resistance level.
Point of View: The british economy has been in quite an uptrend for the past years, but there are some signs of trend-exhaustion, that could lead to the first rate cut in months. These are definitely not great news for the european economy as a whole, since it reflects a downtrend that, in the Eurozone’s case, could lead to a period of serious growth problem.
Trading Tips:This view remains fairly unchanged, thouch big economic events are just round the corner and major moves are likely to happen.”Daily studies indicate that further dollar gains may be considered as extreme moves rather than solid positions, therefore if indicators turn dollar-bearish (confirm the signals) we will be able to long currencies against the dollar with good risk-reward.”
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