Dollar Plunged Heavily…

Daily Forex Fundamentals | Written by Crown Forex | Jul 16 08 07:14 GMT |

"Significant downside risks to the outlook for growth" this is what Mr. Bernanke said yesterday in his semiannual testimony, but seriously my dear reader that downside risk to growth is hovering around most economies in the world, not just the Americans and the British, as this time growth in the European Union is tumbling after it proved to the whole world the resilience of their economy. The recorded a new yesterday, taking advantage of the weak dollar that was affected by the ongoing issue of Freddie Mac and Fannie Mae, supported by its one fundamental was not the case yesterday; but falling down as a correction from the extreme overbought area what we got today, as now the pair is trading around 1.5903 levels, with investors tending to take some of their profits after they saw the Euro record a high of 1.6038. With this profit taking transaction the pair might dipping more to the downside facing support levels at 1.5820-30 levels. As for today's calendar the European Union has just some inflationary data that are going to be discarded due the lag of those results, where Trichet had hiked rates after this month. Not just the Euro, the Royal currency took advantage of the weakening dollar, rallying to the upside recording a high of 2.0156, as it started its trading today in a plunging behavior down to 2.0039 levels, as its still holding above the 2 psychological barrier, the data today would affect the pound movements, with expectations that the people filling for unemployment benefits will increase in June as their economy is still struggling, fighting inflation and trying to revive growth. According to technical indicators the pound falls in an extremely overbought area, increasing the expectations that the market participants will head to profit taking transactions any minute but still waiting for today unemployment data. Finally the US dollar, facing serious challenges with Fannie Mae and Freddie Mac issue and what the upside risks to inflation from the surge in food and commodity prices; all what is occurring in the markets had its toll on the US dollar against the Japanese Yen taking it down to 104.20 levels with intention that it would continue its movement to the downside according to the technical indicators, as the target facing the dollar is 103.60 now. Crown Forex