Daily Forex Market Commentary: 11-20-09
On Wall Street today the Dow closed down 14.28 points or .1 percent. The Dow fell 119 points the last three days of the trading week or 1.1 percent, however it ended up .5 percent because of big gains Monday following a better than expected retail sales report. Stocks saw light selling today on the back of increasing dollar strength and a rise in demand for the safest government debt. The ICE Futures US dollar index, which measures the dollar against other major currencies, rose 0.4 percent. A stronger dollar can hurt commodity prices and also sales of U.S. exporters, whose goods become more expensive overseas as the dollar rises. Traders predict volume will be light again next week because of Thanksgiving. Even with the holiday, next week provides a flurry of economic reports on home sales, unemployment, consumer confidence and demand for big-ticket manufactured goods. Could be an exciting week in the markets.
Pair in focus – euro dollar
We can see in a daily chart of EUR/USD below that the dollar has been gaining strength. A break below support at 1.4800-20 region next week could result in a quick test of 1.4700. Mean while, the uptrend against the dollar is still getting capped at the 1.5050 level and a close above this resistance is necessary for another big move to the upside.
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