{"id":4573,"date":"2009-11-04T10:39:36","date_gmt":"2009-11-04T15:39:36","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=4573"},"modified":"2009-11-04T10:39:36","modified_gmt":"2009-11-04T15:39:36","slug":"eurusd-experiences-solid-recovery-from-tuesday-lows","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2009\/11\/04\/eurusd-experiences-solid-recovery-from-tuesday-lows\/","title":{"rendered":"EUR\/USD Experiences Solid Recovery from Tuesday Lows"},"content":{"rendered":"

By Fast Brokers<\/strong> – The EUR\/USD logged sizable losses yesterday as we witnessed a broad-based preference for the Greenback despite a breakout in gold and U.S. equities ending slightly positive.\u00a0 Therefore, it seems downward momentum was more in control than correlations and fundamentals.\u00a0 Speaking of gold, yesterday\u2019s breakout was impressive, and the precious metal is looking to test its psychological $1100\/oz level.\u00a0 Though much of gold\u2019s strength may be attributed to India\u2019s large bullion purchase from the IMF, the breakout could also signal another pullback in the Dollar due to their negative correlation.\u00a0 In fact, the EUR\/USD and GBP\/USD have posted encouraging gains since yesterday\u2019s bottom as investors await the FOMC\u2019s monetary policy decision this afternoon.\u00a0 Since the Fed is expected to keep a loose monetary policy for the foreseeable future, any unexpected wording would likely have a large impact on the Dollar.\u00a0 If the Fed does stand pat as anticipated, then tomorrow\u2019s ECB and BoE meetings should carry some more weight in the FX markets.<\/p>\n

It will be interesting to see how the ECB behaves tomorrow since the central bank has recently voiced its displeasure of such a weak Dollar.\u00a0 Since the Chinese RMB is pegged to the Dollar, the Euro has also lost a lot of value against the Yuan, causing further damage to the EU\u2019s recovering manufacturing sector.\u00a0 However, the EUR\/USD has pulled back from October highs following the ECB\u2019s public objection, so it is uncertain whether the central bank will continue to be more Hawkish or omit more of a neutral tone.\u00a0 Considering these observations, the ECB\u2019s rate meeting tomorrow has an air of uncertainty to it, meaning volatility may pick up over the next 24-48 hours.<\/p>\n

Meanwhile, the S&P futures have climbed back to their psychological 1050 mark while crude trades around its own psychological $80\/bbl level.\u00a0 Therefore, the bulls have placed the riskier investment vehicles back into a more reasonable position following last week\u2019s large pullback.\u00a0 As a result, the EUR\/USD finds itself at a crossroads as well.\u00a0 The currency pair has multiple uptrend and downtrend lines we can create while the psychological 1.50 level bears overhead and the psychological 1.45 level rests underneath.\u00a0 Therefore, investors should keep a close eye on the Dollar\u2019s reaction to upcoming monetary policy decisions until the Greenback commits to a new near-term trend.<\/p>\n

Present Price: 1.4780<\/p>\n

Resistances: 1.4796, 1.4814, 1.4828, 1.4847, 1.4859, 1.4876, 1.4890<\/p>\n

Supports: 1.4773, 1.4759, 1.4740, 1.4711, 1.4684, 1.4648<\/p>\n

Psychological: 1.50, 1.45<\/p>\n

\"\"<\/a><\/p>\n

Market Commentary<\/strong><\/em> <\/span>provided by <\/span>Fast Brokers<\/strong><\/span><\/span>.<\/a><\/p>\n

Disclaimer:<\/strong> <\/span>FastBrokers\u2019 market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell\/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.<\/p>\n

Risk Disclosure:<\/strong> <\/span>There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Fast Brokers – The EUR\/USD logged sizable losses yesterday as we witnessed a broad-based preference for the Greenback despite a breakout in gold and U.S. equities ending slightly positive.\u00a0 Therefore, it seems downward momentum was more in control than correlations and fundamentals.\u00a0 Speaking of gold, yesterday\u2019s breakout was impressive, and the precious metal is … <\/p>\n

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