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- Using Indicators and Software to Trade Forex
Archive for August, 2010
Risk Aversion Leads to USD Gains against Most Forex Majors
Risk aversion led to the US dollar posting gains against many major currencies in the forex trading market. The US stocks market suffered from a drop, with Dow Jones and NASDAQ dropping by -1.39% and -1.56% respectively. The Core Price Index came out as expected at 0.1%, while the report for Personal Spending posted a 0.1% gain from the forecast at 0.4%,. As for the commodities market, crude oil fell near the $74 level per barrel, while gold barely moved and closed at $1,236.50 per ounce.
After posting gains for several days, the euro lost its momentum and declined against the dollar after trading below the 1.27 level. On August 31st, the EUR/USD pair marked a low of 1.2633 and a high of 1.2771. The British pound also fell against the dollar as investors seek safer assets due to the closing of UK banks. The GBP/USD traded between 1.5452 and 1.5574. While major currencies failed to rise against the dollar and other forex majors, the Japanese yen came out strong as ever after posting gains across the board.
The Yen Skyrockets to New Highs
The Japanese yen was able to post gains against some of the majors over the past weeks. On August 25th, the yen just hit new highs against the dollar as forex trading investors turned to safer assets following the slow economic recovery. The yen reached a new high that was last attained 15 years ago in 1995. Trade balance came out much better than the expected 0.47T, at 0.61T. The USD/JPY pair traded at a high of 85.15 and a low of 83.59.
The British pound fell against the dollar after reports that the UK may be in for another recession. The GBP/USD pair traded at a high of 1.5505 and a low of 1.5372. The euro remained nearly unchanged against the dollar, but the euro crashed against the yen. The EUR/USD pair traded at a high of 1.2719 and a low of 1.2587. The US dollar was able to post gains against many of the majors.
Risk Aversion Leads to Gains for the US Dollar
As weak economic data continues to plague many of the other major currencies, forex trading investors are turning to the dollar for refuge. On August 24th, the dollar was able to gain against most of the forex majors. Both of the stock markets fell, with Dow Jones going down by 0.38% and NASDAQ falling by 0.92%. The commodities also weakened with gold closing at $1,228.50 per ounce and crude oil closing at $73.10 per barrel.
The pound was approaching a four-week low against the dollar due to a forecast that business confidence will weaken for the quarter. The GBP/USD pair traded at a high of 1.5619 and a low of 1.5499. In a twist of even worse fate, the euro fell to a near six-week low because of weak economic data in manufacturing. The EUR/USD pair traded at a high of 1.2729 and a low of 1.2647. With worries over global economic growth, the Japanese yen posted gains against other forex majors as investors turn to a safer currency. The USD/JPY traded at a high of 85.64 and a low of a low of 85.09.
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