FOREXYARD: Forex News Blog | |
- Gold Prices Outperform
- USD May Bounce Back Vs. Danish Counterpart
- Scandinavian Currencies See Major Gains vs. Safe-Haven Dollar
- Platinum Hits Another Record High
| Posted: 27 Sep 2010 08:12 AM PDT
The price of spot gold continues to rise, moving closer to the psychological level of $1,300 as the dollar falls out of favor. During the European trading session on Monday, spot gold prices held close to their all-time high, trading at $1,200, from an opening day price of $1,2981. The price continues to be buoyed by overall dollar weakening that intensified following last week's announcement by the Federal Reserve. The release of the Federal Reserve Open Market Committee meeting minutes declared the Fed's willingness to enact further quantitative easing measures to help stimulate the US economy. The chance of further quantitative easing was increased on Friday in a speech by Fed Chairman Ben Bernanke. The Fed chief noted the effort to reduce unemployment has been significant. Despite the lengths the Fed's has gone to, the quantitative easing has not reduced rising US unemployment numbers. Last month the US unemployment rate rose to 9.6% from 9.5%. The easing of monetary policies in the US has been a major contributor to the rise in the price of spot gold. As a steady stream of dollars continue to increase in the markets, inflation fears are rising given the lack of commitment by central bankers to reduce the amount of dollars available. As the dollar continues to fall out of favor with traders, market players have looked to other instruments to act as safe havens such as the Swiss franc and the Japanese yen. However, none of these instruments are able to keep up with the strong appreciation that has been seen in the price of spot gold. Gold prices are up over 400% since 2001. Looking at the weekly chart, since the price of spot gold rose from the $685 resistance level in October of 2008; the price is up 90%. A rising trend line follows the rise in the price. The price of spot gold has made a push above its previous high at $1,265 (S1) and reached a new all-time high last week, trading at $1,299. The next support level falls at the July low at $1,156 (S2). $1,300 should act as the next resistance level because it is a big round number that traders tend to focus on and therefore set their limit orders near this level. Should the $1,300 price level be breached, traders will want to target the $1,400 level for spot gold prices.
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| USD May Bounce Back Vs. Danish Counterpart Posted: 27 Sep 2010 03:23 AM PDT
Over the last two weeks, the US dollar has been dropping at a steady rate against the Danish krone. Since the 12th of September, the USD/DKK pair has fallen almost 3500 pips, to its current level of 5.5375. As we will see through a variety of technical indicators, the pair may have hit a low point and has the potential for a significant upward correction. We will be looking at the 8-hour chart provided by Forexyard. The technical indicators being examined are the Stochastic Slow, Relative Strength Index (RSI) and Williams Percent Range. 1. The Stochastic Slow has recently formed a bullish cross, meaning that an upward correction is likely to occur in the near future. 2. This theory is supported by the Relative Strength Index, which is currently right around the 20 level. Typically anything below the support line at 30 is a sign of the pair being oversold. Traders can take this as a sign that a bullish move may occur. 3. Finally, the Williams Percent Range, currently at the -90 level, is well into oversold territory. This lends further support to our original theory that upward movement is likely to occur.
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| Scandinavian Currencies See Major Gains vs. Safe-Haven Dollar Posted: 27 Sep 2010 03:15 AM PDT
Following last week’s Swedish parliamentary elections, the Swedish krona continues to make gains against its US counterpart. While the elections initially caused some investor concern regarding the stability of the Swedish government, the krona has managed to maintain its gains vs. the greenback going into this week’s trading. Currently the USD/SEK pair is trading around the 6.8080 level, down over 2700 pips from a week ago. The dollar has not faired significantly better against the other Scandinavian currencies. USD/DKK has fallen over 1600 pips while USD/NOK dropped 1850 pips in the same period of time. Analysts attribute the dollar’s losses to positive global economic news which has caused investors to shy away from the safe haven currency. The Scandinavian kroner saw decidedly more mixed results against the euro in the past week. While positive economic news has led to a drop in value for the greenback, the euro has seen gains across the board as investors move to riskier assets. Both EUR/SEK and EUR/NOK have been range trading over the last week. While both are currently in a downtrend, they are likely to see an upward correction in the near future. EUR/DKK on the other hand has been trading at a relatively steady rate for some time now. Currently at 7.4485, the pair is currently up around 30 pips from this time last week. This week, the Scandinavian currencies will likely move according to news out of the US. Traders will want to pay particular attention on Thursday, when the weekly US unemployment claims will be followed by a testimony from Fed Chairman Bernanke. Should the news reflect continued growth in the US economy, the dollar is likely to drop. If so, betting on the Scandinavian kroner may pay off. |
| Platinum Hits Another Record High Posted: 27 Sep 2010 02:02 AM PDT
Platinum advanced to a new record high, as prospects for a further decline in the dollar boosted investor demand for precious metals as alternative holdings. Platinum prices jumped $10.10 to $1,632 an ounce on Monday reaching its highest level since May 18th. Technical indicators show there are good chances platinum prices will increase further with a potential price of $1675.00 in sight. - The technical indicators used are the Bollinger Bands, the MACD , the Relative Strength Index (RSI) and Fibonacci retracement lines.
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