The much bigger than expected increase in U.S. existing home sales for July is another sign that the economy is on the recovery path again. In addition, the Fed’s Mr. Bernanke presented a more optimistic outlook as well. And then there are the stock markets - showing unbroken optimism, right at the start of this week. The inverse correlation of the USD with the stock market is well known and, as a matter of fact, this exists with the recovering economy, too. Future inflation fears overshadow the dollar, because of the recent massive money printing phase.
While we do not see big recovery potential for the USD in this environment, we would wait in today’s trading for favorable short entries, if any, as described below. Especially the EUR / USD now looks extremely overbought, excluding any immediate significant upmoves. There are no market-moving data scheduled for today.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
After another strong performance, this market is heavily overbought and near its resistance zone around 1.4450, currently correcting back in this European morning to now 1.4300. We see more of this correction to come today, with repeated upmoves not exceeding the 1.4450 level.
GBP / USD
In low volatility, the pound is continuing its quiet consolidation move between 1.6580 and 1.6420 in early European hours and is currently trading at 1.6500. We expect repeated up- and downmoves in today’s trading, between the mentioned 1.6580 and 1.6420 levels.
USD / CHF
This market is much more undecided against the dollar than the EUR / USD for example. Currently trading at 1.0620, volatility disappeared almost completely in eary European trading. We do not see much trading potential in this market for today.
USD / JPY
Quite in its usual behavior, this market developed in contrast more strongly compared to to other equations with the dollar, which is currently trading at 94.85 against the yen. There is a consolidation of the higher levels now in development, which we expect to continue, giving way to some downward corrections today, but not below the 94.55 mark.
While we do not see big recovery potential for the USD in this environment, we would wait in today’s trading for favorable short entries, if any, as described below. Especially the EUR / USD now looks extremely overbought, excluding any immediate significant upmoves. There are no market-moving data scheduled for today.
by George Clement
Intraday Market Outlook for Day Traders
EUR / USD
After another strong performance, this market is heavily overbought and near its resistance zone around 1.4450, currently correcting back in this European morning to now 1.4300. We see more of this correction to come today, with repeated upmoves not exceeding the 1.4450 level.
GBP / USD
In low volatility, the pound is continuing its quiet consolidation move between 1.6580 and 1.6420 in early European hours and is currently trading at 1.6500. We expect repeated up- and downmoves in today’s trading, between the mentioned 1.6580 and 1.6420 levels.
USD / CHF
This market is much more undecided against the dollar than the EUR / USD for example. Currently trading at 1.0620, volatility disappeared almost completely in eary European trading. We do not see much trading potential in this market for today.
USD / JPY
Quite in its usual behavior, this market developed in contrast more strongly compared to to other equations with the dollar, which is currently trading at 94.85 against the yen. There is a consolidation of the higher levels now in development, which we expect to continue, giving way to some downward corrections today, but not below the 94.55 mark.
