Yen and dollar retreat ahead of Fed Beige book survey
Wednesday, September 8, 2010
, Posted by Usman Ali Minhas at 8:56 AM
The Japanese yen and US dollar slipped against higher-yielding currencies ahead of the Federal Reserve's Beige book survey which is predicted to show that recovery is waning.
In addition, a successful bond selling by both Portugal and Poland managed to lower debt concern in Europe, helping the euro to rebound.
On the other hand, the dollar snapped its earlier advance against a basket of major currencies as depicted by the dollar index which slipped to 82.49 from the day's high of 82.91.
Concerning the euro-dollar pair, it rebounded on the daily and 4-hour charts after the bond selling news which showed improvement in demand. News released today showed that German industrial production incline din July but lower than estimates.
So far the pair is trading at 1.2753 after rebounding from strong support at 1.2680, touching a high of 1.2762 and a low of 1.2657, while for the rest of the day the pair is expected to move between support and resistance at 1.2675 and 1.2830 respectively.
Turning to the sterling-dollar pair, it is moving south on the daily charts. Today, manufacturing production lingered at 0.3% in July and industrial production surged to 0.3% from -0.5%, but the boost came after a measure of US house prices soared beating forecasts. Later in the week, the BoE will announce interest rate and APF quantity for the month of September where both are expected to remain as is.
The royal pair is currently trading at 1.5480 after visiting a high of 1.5492 and a low of 1.5341, whereas it is expected to move between support at 1.5350 and resistance at 1.5500 for the rest of the day.
With regard to the dollar-yen pair, it is showing slight incline on the daily basis; however, the dollar is still unable to rebound from the downside trend that began since May amid the weakness the US economy is witnessing and the absence of any intervention from the BoJ to weaken its currency.
Now, the pair is trading at 83.93 after recording a high of 84.03 and a low of 83.32, while support is seen at 83.30 while resistance is at 84.75.
