Fri, 10 Sep 2010 00:00:00 +0200

Encouraging US News Leads to Renewal in Risk Taking

Riskier currencies made significant jumps in overnight trading, as positive news from the US economy led to renewed optimism in the global economic recovery. The most recent US Trade Balance and Unemployment figure both came in better than expected, and led to gains for the Canadian and Australian dollars. Still, the news was not enough to help the euro, which took some losses against the US dollar.

EUR/USD

The EUR/USD has gone increasingly bearish yesterday, and currently stands at the 1.2670 level. The daily chart's Slow Stochastic supports this currency cross to fall further today. However, the 4-hour chart's RSI signals that a bullish reversal will take place today. Entering the pair when the signs are clearer seems to be the wise choice today.

GBP/USD

The pair has recorded much bearish behavior. However, the technical data indicates that this trend may reverse anytime soon. For example, the daily chart's MACD signals that a bullish reversal is imminent. An upward trend today is also supported by the hourly chart's Slow Stochastic. Going long with tight stops may turn out to pay off today.

USD/JPY

The pair has been range-trading for a while now, with no specific direction. The Daily chart's Slow Stochastic providing us with mixed signals. The 4 hour charts do not provide a clear direction as well. Waiting for a clearer sign on the hourlies chart might be a good strategy today.

USD/CHF

The typical range trading on the 4-hour chart continues. The 8-hour chart RSI is floating in neutral territory. However, the pair currently sits near the bottom border of the daily chart's RSI, suggesting an upward correction may be imminent. Going long with tight stops may turn out to be a good strategy today.

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