Tuesday, 11 Aug 2009

USD on Course for Bearish Correction

Since this morning's release of Japan's Overnight Call Rate and subsequent policy statements, the JPY has entered a steady uptrend versus is major currency counterparts. Whether or not this recent bullish trend will last depends on the market conditions at the opening of the US markets. With the USD entering a bearish correction at the start of today's trading, the likelihoods of a reversal may have grown slim.

Considering the corrective behavior of the US Dollar in today's early trading sessions, many are forecasting last Friday's positive employment data to begin getting priced in. As positive results in the United States have been forecasted to add risk appetite to the market, downward pressure on the greenback may henceforth be anticipated.

Another report to be wary of is the news surrounding the Canadian Dollar (CAD). With Canadian Housing Starts falling slightly from what was expected, the CAD may be under further selling pressure, which only strengthens the bearish channel this currency has entered over the previous week.