Dollar May Extend Losses This Week

The US dollar fell against virtually all of its currency rivals during evening trading on Friday, following a significantly worse than expected Non-Farm Payrolls figure. In addition, the US unemployment rate increased from 8.1% to 8.2%. The USD/JPY fell close to 50 pips, reaching as low as 77.65 after the news was released. The pair was able to stage a mild upward correction before finishing out the week at 77.97. After weeks of bearish movement, the EUR/USD was able to capitalize on the US news. The pair went up over 100 pips by the end of the day and closed out the week at 1.2427. Turning to this week, the dollar could see further losses if investors determine that the Fed is getting ready to initiate another round of quantitative easing to stimulate growth in the US economy. Traders will want to pay attention to potentially significant US indicators, including Tuesday's ISM Non-Manufacturing PMI. Additionally, a speech from Fed Chairman Bernanke on Thursday may contain information regarding any new policies the Fed plans on using to grow the economy.

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading. ForexYard