Friday, 21 November 2014 20:29
The euro dropped against the U.S. dollar on Friday, re-approaching 27-month lows hit earlier in the month as comments by European Central Bank President Mario Draghi weighed on the single currency.
EUR/USD hit 1.2415 during European afternoon trade, the pair's lowest since November 14; the pair subsequently consolidated at 1.2421, tumbling 0.96%.
The pair was likely to find support at 1.2357, the low of November 7 and a 27-month low and resistance at 1.2576, Thursday's high.
Friday, 21 November 2014 17:48
USD/CHF received a boost from Draghi’s dovish comments and rallied to a fresh 1-week high during the European session.
The franc weakened versus the dollar, moving in tandem with the euro, after European Central Bank President Draghi said the bank will do what it must to raise inflation back to its target of 2%.
USD/CHF climbed more than 80 pips in a matter of minutes and hit a 1-week peak of 0.9660 before slowing. At time of writing, the pair is trading at 0.9655, recording a 0.76% gain on the day, and on track to post a modest weekly gain.
There is no data scheduled for the rest of the day, so investors will likely continue to assess implications of Draghi’s comments.
Friday, 21 November 2014 17:08
According to the Analysts at Societe Generale, USD/JPY is accelerating higher after breaking above the channel upper limit and looks poised to move towards 120/124.
“USD/JPY is accelerating its climb after breaking above the multi-year descending channel and is likely to head towards the 2007 highs of 120/124, as well as the 76.4% retracement (log scale) from the 2002 highs and a multi-decadal trend line.”
“Indicators are overstretched, but only a break below 114/113 will indicate the possibility of a retracement.”
“Monthly RSI is overstretched, however there are no signs of a reversal. As can be seen in the weekly chart, 124 happens to be the upper limit of an ascending channel since 2012 and is therefore a decisive level for the next leg of the uptrend. Pullback, if any, should be limited to 114/113.”
Friday, 21 November 2014 16:59
Gold prices did dip into the red in USD terms, although the metal has been resilient in the EUR terms owing to a sharp fall in the EUR/USD pair.
Gold in EUR terms or XAU/EUR pair traded 0.26% higher at EUR 954.38 at the time of writing, while the XAU/USD traded 0.08% lower at 1189.90/Oz levels. Moreover, the metal has outperformed in the EUR terms due to a sharp fall in the EUR/USD pair witnessed in the last few minutes. The EUR/USD declined 0.63% to trade at 1.2461 levels.
The yellow metal is likely to be resilient in non-USD terms as the relative dovishness of the European Central Bank (ECB), Bank of Japan (BOJ) shall keep gold prices supported in terms of their respective currencies.
Friday, 21 November 2014 16:45
The shared currency is nose-diving on Friday, pushing EUR/USD well below 1.2500 following the dovish appreciations by ECB’s Draghi.
EUR/USD weaker on Draghi
The pair is reacting with a sharp pullback to fresh intraday lows around 1.2480 after President Draghi assessed the importance of the inflation to come back to the 2% target as soon as possible. Although he said that inflation expectations in the longer term are still consistent with price stability, in the short-term they remain ‘excessively low’. He also said that the European Central Bank will use all means to push consumer prices back to the 2% target, including an adjustment of the composition, pace and size of the asset purchases if needed. Furthermore, he stressed that the ECB could widen the channels of intervention if the situation so requires it.
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No economic data is available.