Monday, 2 Nov 2009

Dollar Recovers from a Bearish Session

The Dollar is now recovering most of its losses from today's trading. The EUR/USD pair is currently traded at the 1.4725 level, down from 1.4840 earlier today. The GBP/USD also shows correction signals as the pair dropped about 100 pips in the last 4 hours.

The Dollar dropped earlier today following a batch of positive data from the U.S economy. The Manufacturing Purchasing Managers' Index survey showed that the manufacturing in the U.S expended at a faster pace than expected on October. In addition, the Pending Home Sales for September rose by 6.1%, beating expectations for a 0.2% rise. The positive data has increased risk appetite and initiated a sharp downtrend for the Dollar and an uptrend for the Euro.

As for tomorrow, the most impacting news publication appears to be the U.S. Factory Orders, expected at 15:00 GMT. This report measures the change in the total value of new purchase orders placed with manufacturers, and following today's positive manufacturing data, another positive figure could increase risk appetite even further.