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Currency Pair Overview:

Overbought Dollar Cedes Some Ground

The dollar index based trading had been slow overnight, with the major pairs recovering some of the ground loss during the prior session. All eyes are now on the U.S. session, where investors await further details about President Obama’s plan to limit the risk taken by banks. The dollar index might see a new wave of long orders if the XLF, the Exchange Traded Fund for the financial sector, gets sold again. Any long-Usd moves would help test, and maybe push above, the 78.50 area, where it has previously formed important swing points.

The euro (Eur/Usd 1.4150) 4 hour trend is short. The pair advanced overnight for the first time in the ...

Currency Pair Overview:

Cable Snaps- Majors Follow

The dollar-buying frenzy continued in early Thursday trade, albeit at a slower pace. The pound, which to some extent managed to hold support in the previous session, lost 150 pips overnight, making it the weakest looking pair. Looking ahead, the U.S. session is likely to remain volatile, especially at 08:30 EST and 10:00 EST when investors await the Unemployment Claims and the Philly Fed Manufacturing Index. If these two reports are released better than expected, the market could experience another round of dollar buying, as it will fortify the market’s view that the U.S. economy is recovering much faster than expected.

Dollar Index Technical View: ...

Currency Pair Overview:

Equities Down, Dollar Up

The declining equity market was fully reflected in the value of the dollar index in midweek trade. The dollar index, which tracks the performance of the greenback against a basket of six currencies, gained 85 basis points throughout the day breaking above the 78.00 benchmark level. The major currencies started weakening from the early hours of Wednesday’s session, and to some extent continued to decline throughout the U.S. session. Since December, the market had a strong desire for dollar long positions, however, today’s major currency sell-off had a first; the major currencies moved lower as one, something not often seen over the last few weeks of trading. ...

Currency Pair Overview:

Regional Weakness Drag On The Majors

The dollar index is gaining ground across the board in Wednesday trade, strengthened by the market’s view that the U.S. economy will outperform its peers. This sent Treasury yields higher, creating an almost automated reaction in the currency market. Further enhancing the dollar’s uptrend was the poor macroeconomic news that came from the euro-area, confirming that the economy is moving up and down on a thin line between two different business cycles: recession and recovery.

The equity futures 4 Hour charts are all over the place; they are holding higher, but look a real mess in the near-term. It is no wonder that the forex ...