Thu, 31 Mar 2011 00:00:00 +0200

Gains in Equity Markets Fuel USD Declines

The dollar was down on the day as an equity rally fueled greater risk taking in the FX markets. As such, lower yielding currencies such as the dollar and the yen sold off. Today, traders will be anticipating US weekly unemployment data, a day prior to Friday's jobs report.

EUR/USD

Technical indicators are beginning to show signs that this pair may be in overbought territory, signaling a downward correction may take place today. A bearish cross on the 8-hour chart's MACD has taken place, while the Bollinger Bands on the same chart are beginning to tighten. Opening short positions may be a wise choice today.

GBP/USD

The 8-hour chart's Bollinger Bands are narrowing, indicating that a price shift is likely to occur in the near future. The 4-hour chart's Williams Percent Range has entered overbought territory, which could mean the price shift will be downward. Going short with tight stops may pay off today.

USD/JPY

The daily chart's Relative Strength Index has entered the overbought zone, which is typically a sign that the pair will face a downward correction. This theory is supported by the Stochastic Slow on the same chart, which has formed a bearish cross. Going short may be a wise choice today.

USD/CHF

Most technical indicators place this pair in neutral territory at the moment, meaning that a significant change in price is unlikely to occur in the near future. That being said, it appears that a bullish cross may be forming on the 4-hour chart's Stochastic Slow. Still, traders will likely want to take a wait and see approach 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

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