Forex Commentary:

The euro gained against the dollar Thursday even though many believe that a bailout of Portugal is likely. In late afternoon trading Thursday, the EURUSD climbed to $1.4183 from $1.4123 late Wednesday. Yet a bailout typically has the opposite effect.

The euro, used by 17 European countries, has also climbed about 5 percent this year on expectations that the European Central Bank will lift interest rates as soon as April. Higher interest rates can boost demand for a nation’s currency, boosting its value.

The British pound dropped to $1.6111 from $1.6246, while the dollar edged up to 80.95 Japanese yen from 80.86 yen. The U.S. dollar fell to 97.65 Canadian cents from 98.06 Canadian cents and slipped to 0.9073 Swiss franc from 0.9081 Swiss franc.

Trading Setups / Chart in Focus:

NZDUSD

The NZDUSD rose today and challenged the “event area” / horizontal level at 0.7520. We can see price has yet to break through this level, until we get a weekly close above this obviously significant level we could look for potential rotations lower, although right now there are no obvious bearish price action setups to warrant a short.

Silver and Gold

Silver and gold both put in bearish rejection bars, forming pin bars after rather impressive up moves. We could see some rotation back to value in both metals, although trading counter-trend against such strong bull markets right now is obviously not suggested. Still, these markets look like they could cool off a bit in the near-term.

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Other Markets:

On Wall Street today U.S. stocks moved higher as optimism over upcoming earnings helped to keep shares buoyant.

The S&P 500 broke above its 50-day moving average at 1,305, a widely followed technical indicator, leading investors to believe the market may have moved past the worst of the pullback caused by the disaster in Japan.

The Dow gained 84.54 points, or 0.70 percent, the S&P 500 added 12.12 points, or 0.93 percent, and the Nasdaq gained 38.12 points, or 1.41 percent.

Upcoming important economic announcements: 3/25/11

5:00am EST: Euro-zone – German Ifo Business Climate
Day 2: Euro-zone – EU Economic Summit