Forex: The euro leads the charge higher, EUR-USD seen over 0.6 pct higher on a daily basis
- Details
- Category: US Dollar Exchange Rate
- Published on Friday, 31 August 2012 14:15
- Written by Will Peters
A look at the performance of the world's most heavily traded currency pairs as we close out a dull August in tumultuous style.
The euro (Currency:EUR) is leading the charge higher for risk today, this as Ben Bernanke gets his speech underway in Wyoming. Whether it proves to be the big event it has been hyped up to be is soon to be seen.
The euro dollar exchange rate is 0.66 pct in the blue in mid-afternoon trade in London, EUR-USD is at 1.2580. Immediate resistance lies ahead at 1.26.
The euro pound exchange rate is 0.25 pct higher at 0.7941.
Ben Bernanke's speech has been released - the Fed chairman says that the first two rounds of QE may have raised US output by 3pc and lifted employment by 2m jobs. But will be get QE3?
It is worth noting that volatility has picked up in early afternoon trade suggesting the last day of the month will be a busy one.
This is fitting, as analysts are forecasting a tumultuous September.
As mentioned, from a technical perspective 1.26 is important for the euro dollar.
"That area is key on the shorter term charts, but is especially significant given it is where the 200-day MA sits as well as the top of the weekly May 2011/August 2012 bear channel. All that suggests a break could set off a decent leg higher, but also that a rejection would be sharp as well," says Sean Osborne at TD Securities.
Turning to the euro pound exchange rate "EUR/GBP is hovering just below decent resistance as well, near 0.7950. The outcome of today’s events should help determine whether we will push through. However, fundamentally we see this pair lower in the long term," says Osborne.
