Federal Currency is the Highlight

Daily Forex Fundamentals | Written by Crown Forex | Jan 07 09 08:19 GMT |

The Federal Reserve Bank released its minutes stating why they reduced interest rates to near zero showing that there are "substantial" risks for the economy to severely spiral downwards during December even with the interest rates near zero as the outlook for the U.S. economy remains weak. Today the U.S. economy is scheduled to release its ADP employment change with expectations showing that the service sector shed 493 employees from the prior 250 terminated employees. The dollar is slightly rising in the markets on anticipations that the Barack Obama's $775 billion package of tax reduction and government spending will revive the economy. The euro is sliding versus the dollar as a result of speculations in the markets that the ECB will reduce interest rates next week to ease recession effects and avoid deflation worries. The European Union today will release its producer prices index (PPI) yearly reading with expectations showing will fall to 4.4% from 6.3% further supporting a rate cut by the central bank. The EUR/USD is currently trading at 1.3483 between the support of 1.3455 and the resistance of 1.3550 while recording a high of 1.3541 and a low of 1.3430. The Bank of England is expected to slash interest rates tomorrow by 50 basis points leaving rates at 1.50 percent which is the lowest since 1694! The anticipations of a rate cut are pressuring the pound to lose strength in the markets. The GBP/USD is currently traded at 1.4908 while recording a high of 14940 and a low of 1.4861. The UK economy lacks major fundamental data while the momentum indicators are showing us that the pair is trading in an overbought area and if successfully reaches the resistance of 1.4995 it will reverse to head towards the support of 1.4872. The yen is also falling versus the dollar as investors are waiting for the new President-elect Barack Obama to be sworn into the White House. The pair is currently trading at 93.80 between the support of 93.50 and the resistance of 94.15 while recording a high of 94.13 and a low of 93.36. Crown Forex disclaimer:The above may contain information for investors/traders and is not a recommendation to buy or sell currencies, gold, silver & energies, nor an offer to buy or sell currencies, gold, silver & energies. The information provided is obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. I am not liable for any losses or damages, monetary or otherwise that result. I recommend that anyone trading currencies, gold, silver & energies should do so with caution and consult with a broker before doing so. Prior performance may not be indicative of future performance. Currencies, gold, silver &energies presented should be considered speculative with a high degree of volatility and risk.