Friday, 10 Sep 2010

Greenback Sees Gains Following Positive Chinese News

Closing out the week, we see that the USD has made some fairly substantial gains against its main currency rivals following Chinese news that has bolstered investor confidence in the global economic recovery. After again dropping toward that 15 year low reached earlier this week, USD/JPY staged a mild upward correction in afternoon and evening trading. Its currently looking like the pair will close out the week around the 84.20 level. Against the Swiss franc, the greenback jumped over 100 pips in trading today before correcting itself. The pair currently stands at around the 1.0190 level, up over 50 pips from this morning.

The euro has also been able to capitalize on investor risk taking. Both the EUR/JPY and EUR/GBP have seen gains throughout the day, with the later pair moving up almost 70 pips over the course of the day. The exception has been the EUR/USD pair, which after moving up in early morning trading, has since corrected itself. Currently the pair stands at 1.2720.

Next week promises to be a volatile one, as fresh news from the UK, US and euro-zone are likely to heavily impact the market. Traders will want to pay attention to whether any of this news comes in at better than expected rates. If so, the risk taking we saw today will likely continue into next week.