Tuesday, 4 Aug 2009

Dollar Holds Despite Positive Pending Home Sales Data

Despite fluctuations in the value of the USD throughout the trading day, it seems that the greenback's bearish trend may have come to an end in the short-term. We saw mixed data today, with the most important being the U.S. Pending Home Sales, which rose by a better than expected 3.6%. Arguably this may be a turning point in the Dollar's fortunes for the time being. However, we will need to wait and see.

The EUR/USD cross is actually currently trading higher by 20 pips today at 1.4410. However, against the GBP, the Dollar is trading higher by 15 pips at 1.6934, as we see a slight correction in the pair's behavior, following yesterday's bullish move in the cross. The USD/JPY pair is level today at 95.38, as market volatility seems to have slowed down as late night trading approaches.

Forex traders should take advantage of the high volatility, as there is still more economic news releases that is likely to shape today's overall forex market activity. For example, at 23:01 GMT, there is the publication of the Nationwide Consumer Confidence from Britain. This is likely to lead to high volatility in the GBP/USD cross. Therefore, traders are recommended to open their USD positions as late night trading kicks in.