Forex Trading Weekly Forecast 02.04.2013
The Dow Jones FXCM Dollar Index (ticker: USDOLLAR) rallied for the third-consecutive week driven by Japanese Yen weakness, but sharpgains in the US S&P 500 meant that the safe-haven Greenback fell sharply against the Euro and other risk-friendly counterparts.
Despite a conspicuous string of disconcerting headlines and economic releases, the euro put in for the best performance amongst the FX benchmarks this past week. After six consecutive months of rally, when will this pair show some exhaustion?
The Japanese Yen continued to weaken against its major counterparts as Prime Minister Shinzo Abe floated the idea of changing the law that governs the Bank of Japan, and the low-yielding currency remains poised to face additional headwinds.
The British Pound was one of the worst performing currencies this past week, only outpacing the lowly Japanese Yen by +1.34%, while losing ground to every other major currency, including the US Dollar, to which it shed -0.68% to close at 1.5693.
Gold recouped a portion off the losses sustained last week with the previous metal advancing 0.68% this week to trade at $1670 at the close of trade in New York on Friday.
The Australian Dollar may accelerate lower if a string of disappointing economic data prompts the RBA to deliver an unexpected interest rate cut.
The Kiwi Dollar's fortunes hinge on international trade reports from New Zealand's top export partners: China, Australia, the United States and the UK.