The euro edged lower on Monday ahead of a euro zone finance ministers
meeting to discuss an increase in the euro zone rescue fund. After the
euro hit a one month high versus the dollar last week investors
anticipate decisive steps and measures by the euro zone policymakers
in order to push it higher towards the 1.35 level. ECB president Jean
Claude-Trichet supports an increase in the effective lending capacity
of the safety-net fund but question remains whether Germany will agree
weighing on the single currency.
The euro fell to 1.3291 from 1.3401 against the dollar. Trading is
expected to be volatile due to thin trading as the US celebrates
Martin L. King's Birthday.
The Australian dollar slid today resuming its downward direction
against the US dollar after China announced on Friday that it will
raise the bank's required reserve requirements. China is Australia's
largest trade partner and tightened measures in China's monetary
policy will hurt the demand for Australia's commodities. Floods in
Queensland continue hurting Australia's coal exports further weighing
on the Aussie. Against the US dollar, the Aussie fell to 0.9861 from
0.9985 traded on Friday before the news.
Gold ticked lower today weighed by China's tightening measures that
can affect demand for the precious metal. Gold fell from 1365.48 as
low as 1360.80 dollars an ounce.
*Currency to watch out for: EURUSD & USDJPY*
The EURUSD pivot point is at 1.3390 with a preference to enter into
Short positions at 1.3380
The USDJPY pivot point is at 82.65 with a preference to enter Long
positions at 82.75
*Today's calendar and market movers:*
Foreign investment in Canadian Securities in November is forecasted to
fall to 9.50B
US market is closed due to Martin L. King's Birthday
*Equity Markets:*
US equities closed positive on Friday with the S&P500 traded up 0.74%
and the DJIA up 0.47%. The European bourses are mixed with the FTSE
trading down 0.36%, the DAX trading up 0.01% and the CAC up 0.21%. The
NIKKEI and the HSI at the time of writing are trading up 0.04% and
down 0.53% respectively.
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Source: ActionForex.Com
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