Euro tapers and consolidates at 1.4405 - FX Solutions Forex Update

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by: fxsolutions
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Date: Thu, 1 Sep 2011 Time: 9:11 AM
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Chris Advincula, Market Analyst at leading Forex trading broker FX Solutions (http://www.fxsolutions.com/), provides traders with an overview of currency market activity and the news surrounding it on 18th August 2011, including news of consolidation for the Euro.

"The euro came off from the intraday high of 1.4510 yesterday and eased down to the light supported level of 1.4385 and consolidates at 1.4405 after a relatively quiet Asian and Early European session.

The modest Yen buying action has prompted the decline of Yen crosses evident of a modest risk-aversion and lower Asian stocks, thus pushing the euro dollar lower. Aside from the profit-taking, comments by two Fed officials yesterday gave reason for investors to sell the euro on a slightly bearish sentiment.

The Philadelphia Fed President Charles Plosser said that, "We are in the business of supporting the stock market."

The Dallas President Richard Fisher said, "The Fed should never enact such asymmetric policies to protect stock market traders and investors." Both contend that the recently pledged low interest rate policy won't help spur growth.

Fisher added: "I believe what is restraining our economy is not monetary policy but fiscal misfeasance in Washington. Instead, the government must build a modern, appropriate set of fiscal and regulatory levers and pulleys to encourage investment by private companies."

Japan's Trade Balance for July although slightly higher-than-expected at +72.5 bio versus the forecast 71 bio, exports declined to -3.3% against -1.6% last month which led to a lower Nikkei closing today.

The Australian Dollar and Aussie-Yen are both lower by 60 points, again equity driven (SP ASX -1.22%) and after the price of copper and oil dropped.

Nikkei is -64.28 points to 8,992.98 (-0.71%)
Hang Seng is -0.21 points to 20,288.80 (-0.00%)
S&P ASX is -52.60 points to 4,251.30 (-1.22%)
Shanghai is -8 points to 2,592.36 (-0.34%)"

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