Euro Edges Higher Supported By Heightened Risk Appetite

The euro got stronger today supported by a heightened risk appetite,
after data surprised the market showing a significant decrease in the
US Jobless Claims. Successful bond auctions in Portugal and Spain and
talks of an increased euro zone safety-net fund raised investors'
hopes about the euro zone problematic debt situation. The single
currency broke above the 1.35 level versus the US dollar for the third
straight day on Friday hitting a high at 1.3531. Speculators expect
the euro to rise higher as it moves towards Wednesday's high at
1.3537.

The Australian dollar ticked higher against the US dollar after a big
drop on Thursday following the better than expected US Jobless Claims.
Data showing a stronger-than-expected growth in China further weighed
on the Aussie. Accelerated growth in China indicates further
tightening measures in China, which, in turn, will hurt demand for
Australia's commodities. The Aussie fell as low as 0.9830 versus the
dollar yesterday but today it edged higher helped by an improved risk
sentiment to trade at 0.9890.

Against the Japanese Yen, the dollar gained more than 1% and rallied
to an intraday high at 83.11 yesterday from 82.09. The pair lost some
of its gains and was last traded at 82.76. Sterling was also hurt by a
stronger dollar on Thursday and fell to 1.5835 dollars from 1.6008.
Today, sterling gains back some of its losses to trade around 1.5920
ahead of the December retail sales in the UK.

Gold plummeted on Thursday weighed by a stronger dollar as well as
low risk aversion in the currency markets. Lower demand for the
precious metal pushed it as low as 1343.13 dollars an ounce from
1371.03. Today it edged slightly higher and was last traded at
1347.93.

*Currency to watch out for: EURUSD & USDJPY*
The EURUSD pivot point is at 1.3420 with a preference to enter into
Long positions at 1.3430
The USDJPY pivot point is at 82.65 with a preference to enter Long
positions at 82.75

*Today's calendar and market movers:*
Germany's IFO- Business Climate is forecasted to rise to 110
UK Retail Sales in December is forecasted to drop 0.1%

*Equity Markets:*
US equities closed negative on Thursday with the S&P500 traded down
0.13% and the DJIA unchanged. The European bourses are also negative
with the FTSE trading down 1.82%, the DAX trading down 0.83% and the
CAC down 0.30%. The NIKKEI and the HSI at the time of writing are
trading down 1.56% and down 0.53% respectively.

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Source: ActionForex.Com