Dollar Drops after Greek Comments Help Euro
March 2nd, 2010 Posted in In-Depth Analysis
The Greenback slid during Tuesday’s trading as the euro jumped after Greece’s Prime Minister noted that new austerity measures would soon be enacted for the troubled European Union member nation. This comes prior to an upcoming auction of Greek sovereign debt.
The EUR/USD rallied to a session high of 1.3621 but stalled as the pair approached a major trend line. The pair is currently trading at 1.3600.
The dollar also lost ground against the CAD and the AUD after announcements by the nations’ central banks. The Bank of Canada left its base interest rate unchanged after inflation was well below the central bank’s target rate. Australia’s central bank raised rates 0.25% to 4.00% as expected. The Australian economy has shown improving numbers. This could lead to further bullishness for the AUD. This theory will be tested tomorrow.
Tomorrow’s trading day is filled with high impact data for the forex and commodity markets. Some of the major events will be Australian GDP, British Halifax HPI, and U.S. crude oil inventory data. Highlighting the day will be the ADP Non-Farm Employment Change. A result from the report with a better than expected -15K job losses may strengthen the dollar. The EUR/USD could fall to its major support level of 1.3435.
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Tags: EUR/USD, Forex, interest rates, Resistance Line
