Forex: Dollar and Yen showing strength on economic uncertainty

FXstreet.com (Barcelona) - Dollar and Yen open the week on strong positions, trading at multi-month highs against Euro and Pound, favored by risk aversion on the markets as concerns about global recovery returned, accentuated by a difficult financial situation in several countries of the Euro Area, which has triggered declines on equity markets around the globe.

During Asian session, EUR/USD has remained trading in a range between 1.3615 and 1.3720, after having bounced from a fresh 8-month low at 1.3580 on Friday, while the GBP/USD decline from 1.6070 high on Wednesday Feb 3, has extended to a fresh 8-month low at 1.5530 on Asian session.

The Yen has also been favoured by risk aversion, and EUR/JPY has lost more than 600 pips in the last 4 days, dropping from 127.00 on Feb 3 to 120.65, 11-month low on Friday. Likewise, the GBP/JPY has dropped from 145.00 area last Wednesday, to 138.20 low on Friday, the lowest price since April 30, 2009.

European stocks are expected to open the week with gains, probably fuelled by the late rally seen on Wall Street last Friday, while on the macroeconomic front, Eurozone's Sentix investors confidence is expected to improve, yet remaining at negative levels.

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