Wednesday, 9 Sep 2009

Dollar Touches Yearly Low Against EUR

The Dollar continued its sharp decline across the board today during the New York trading session. Pushing the EUR/USD all the way to its yearly high was a heightened risk appetite as traders compounded on the negative momentum against the Dollar. Increasing expectations of an economic recovery have helped change market sentiment. Global currencies and equities also rose on the increased risk taking. Crude Oil for the second day benefited from the weaker Dollar and stands at $71.50.

The EUR/USD climbed to the 1.4599 resistance line but failed to make a breach and currently is trading near the 1.4550 and falling. The pattern of deflating the Dollar has continued into its fifth day. The pair today broke the resistance line of 1.4500 and now traders have set their sites on 1.4600.

Global investors are finding little reason to hold Dollar positions, though tomorrow that sentiment could change. Tomorrow the U.S. Trade Balance is set to be released and an outcome above expectations could put a stop the bearish streak the Dollar has experienced.