Posted on May 20, 2011 by Trading Point Investment Research Desk at 5:08 am GMT
The Euro today during the Asian Session was traded steadily above last week’s low. The single currency made most of it gains during the EU and US session yesterday following the weak US data that were released showing a slowdown in manufacturing sector growth and a drop in April’s existing home sales. Nevertheless the Euro was able to record a session high of 1.4336 which was very close to the 1.4338 from last week. Upon exceeding that level the Euro would find a next resistance at 1.4422 which could really mean is capable to go all the way back to the levels prior to the last ECB interest rate policy meeting. The start of the European Session will involve the announcement of the producer price index figures for Germany, the biggest economy in Europe that could provide a good signal on how the week will end for the Euro.
The US Dollar over the last two weeks has been following an uptrend against the Japanese that reached yesterday to a 3-week high. The US Session saw the USDJPY declining in value and dropped to a 2-day low which showed a first signal that the decline could have been a potential trend reversal and not just a correctional behavior. After making some gains during the end of the US session and start of the Asian session the pair found resistance at 81.76 which was the session high, much lower than yesterday’s 82.22. Unless some gains are seen in the next few hours for the USD this could really end to a weaker Dollar. During the Session the Bank of Japan announced its unanimous decision to retain the interest rates at a rate ranging between 0-0.1 %. The USDJPY was barely affected following this announcement.
The Sterling was able to recover a significant amount of Wednesday’s losses during the EU and US session yesterday. The Asian Session today saw some oscillations in the GBP/USD pair with direction being dominant. The session high of 1.6242 was recorded shortly after the start of the session with the session low of 1.6212 not deviating significantly from it, showing evidence of silent trading. The GBPUSD pair is currently traded at 1.6229.
The Aussie during the Asian session was traded quite flatly around 1.0665. The Australian Dollar was unable to extend its gains over the American Greenback as it had failed once again to break the resistance level at 1.0680 that was also tested yesterday. As during the session the difference between the high and low was only 22 pips with the session high achieved several times it can be said that unless the 1.0680 level is broken soon investor may decide to drop long positions and the Aussie dropping. This flatness in trading was also very visible in the price of silver with whom the Aussie is highly correlated.
The price of Gold has recorded some gains over the Asian session . The session had opened at USD1494.18 an ounce with a slow but steady increase rate bringing its value to USD1497.33 an ounce. As the precious metal is traded currently slightly lower than the session high at USD1496.73 an ounce it is highly likely the increase will continue during the EU session.
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