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Euro Higher Following Yesterday's Losses 17 January 2013
by Jonathan Millet
USD/CAD moves higher following mixed US data
The USD/CAD currency pair moved higher after key data from the United States was released. The data received somehow painted a mixed picture of the market, not overwhelming many. The retail sales were quite strong, but a sluggish response was received from the manufacturing sector and the PPI or the Producer Price Index came within the range of market expectations. The USD moved on to around the 0.9870 mark which was the highest level it attained in the past one week. Against its Canadian counterpart the USD was valued at 0.9877 dollars as the high and 0.9832 as the low. There was some support at 0.9833 while on the upside the major resistance level seemed to be the 0.9898 mark.
German economy contracts over weakening euro
By the end of 2012, Germany’s economy had already shrunk by a considerable amount as showed by the official reports. This was accompanied by weak demand globally and a recession spreading across Southern Europe triggering sharp declines in investments. As reports released on Tuesday showed, the German economy has been unable to sustain the seventeen member bloc’s stability in growth as many experts had earlier hoped. Germany had to rely on a considerable deal in the previous year on exports for growth as consumer spending (which is the main support for imports from other nations in the bloc) remained significantly low. The expansion in the German Gross Domestic Product was at 0.7 percent in the year 2012 after two consecutive years of 3 percent growth.
EUR/JPY loses ground
The EUR/JPY currency pair slumped 0.6 percent at 117.42 after moving from a four day low of 116.45. The spot however, has somehow found some support at the nine day EMA (117.02) with some support also being observed at 115.93 mark. If we see a break below that level then most probably the next set of targets would be around the four hour EMA at 115.10. In intraday trading on the upside some resistance would be obtained at the 118 level and if it crosses above that then at 118.80.
Drop in US inventories, rise in crude futures
The price of Crude futures climbed by almost one percent as they settled near its highest level in the past four months after a surprising decline that was made in the US crude stockpiles. The data released from the Energy Information Administration showed that the oil stocks were falling and had now reached at almost nine hundred thousand barrels while forecasters had been expecting to see a rise of about two million barrels. The drop in all probability was caused by the reduced imports of crude from the western coastal regions. The price of light sweet crude was higher by 96 cents higher at $94.24 for every barrel, the highest since mid-September. ICE Brent North Crude Oil was seen trading at $110.61. March Brent was sold at $109.68 for every barrel.
Stocks edge lower in mid-day trade; Boeing stocks decline
The rising number of problems reported in Boeing 787 aircrafts is constantly sending the stocks down sharply causing the Dow Jones industrial average to move lower. Two of the biggest airline companies in Japan grounded all of their Boeing 787s for checks to ensure their passengers’ safety. The plane, Dreamliner, has seen constant problems that include a fuel leak and battery fire causing many emergency landings recently.
The S&P 500 index was flat at 1472 while the DOW went down by 24 points as it reached 13,510 shortly before mid-day. The NASDAQ composite on the other hand moved up by eight points to the 3118 mark.
Jonathan Millet Chief Editor of ForexMinute.com
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