The US dollar struggling to hold onto Friday’s gains
City Index October 7, 2014 2:11 PM
<p>The USD lost most of its gains yesterday on what can only be described as profit taking after the huge moves we see on Friday […]</p>
The USD lost most of its gains yesterday on what can only be described as profit taking after the huge moves we see on Friday and some concerns on the timing issues of the next FED rate hike. Today is starting a bit mixed with the euro losing, and the yen and GBP strengthening against the greenback.
The pound has started strongly today but failing so far to break the 1.6110 resistance level, but has rallied from a low of 1.5939 on Friday to a 1.6100 level now. Manufacturing production is due out this morning which will no doubt help in either direction, expected to be lower than last at 0.2% from 0.3%.
The euro led the gains yesterday climbing from a low on Friday of 1.2498 to a high of 1.2674, again the profit taking was key here, and now await our next direction.
The JPY also strengthening against the USD, sending back down to 108.60 with the BoJ staying unchanged on their policy and Kuroda saying the weak yen is positive for the Japanese economy. Currently staying strong in this USD move across the board, with Kuroda talking now he could help the yen to weaken further with his comments.
The RBA overnight announced that it is keeping the cash rate at 2.50% but noting that the Aussie dollar is still too high. Despite this, the AUD found it as a positive and had a small bounce and is now just trading below the 0.88 level.
Supports 1.2610 1.2580 1.2570 | Resistance 1.2640 1.2660 1.2700
Supports 108.45 108.00 107.10 | Resistance 108.80 109.15 109.70
Supports 1.5995 1.5956 1.5940 | Resistance 1.6110 1.6160 1.6210
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.