Reply #17: dollar watch [View All]

[UpInArms]

http://quotes.ino.com/chart/?acs=NYBOT_DX&v=i

80.691 +0.501 (+0.64%)

US Dollar To Face Heavy Event Risks, Chairman Bernanke Testimony

http://www.dailyfx.com/forex/fundamental/forecast/weekly/usd/2010-04-09-2223-US_Dollar_To_Face_Heavy.html

The U.S. dollar lost ground against most of its major counterparts as investors raised their appetite for risk, and the reserve currency is likely to face increased volatility over the following week as the economic docket is expected to reinforce an improved outlook for future growth. At the same time, Fed Chairman Bernanke is scheduled to testify in front of the Joint Economic Committee of Congress next Wednesday at 14:00 GMT and is anticipated to speak on the outlook for the world’s largest economy, and comments from the central bank head is likely to move the major currencies as investors weigh the prospects for future policy.
A government report due out on Monday is expected to show a budget deficit of $67.5B in March following the $191.06B short-fall in the previous month, and the ongoing imbalances in public finances could hamper the long-term outlook for the greenback as the nation’s credit rating remains at risk. Meanwhile, a rise in consumer prices paired with a third consecutive gain in household spending is likely to instill an improved outlook for future growth, and the Fed’s Beige Book due out on Wednesday could denote a more positive tone for the private sector as the expansion in monetary and fiscal policy continues to feed through the real economy. However, Fed Chairman Bernanke is likely to hold a dovish tone during his testimony in front of the Joint Economic Committee, and a reinforcement of the central bank’s pledge to hold borrowing costs at the record-low for an “extended period” of time could certainly drag on interest rate expectations as Mr. Bernanke expects to see a “nascent” recovery this year. As a result, currency traders could face choppy price along with erratic moves in the major exchange rates on Wednesday, but the expected rise in industrial outputs paired with the improved consumer confidence survey due later in the week could generate expectations for

Nevertheless, as risk trends continue to have an impact on the currency market, positive economic developments in the U.S. could encourage an improved outlook for global growth and lead market participants to seek higher yielding investments, but the correlation between the reserve currency and risk is likely to deviate over the near-term as the Fed aims to normalize policy this year. Consequently, the U.S. dollar could react favorably to the slew of data next week as the economic recovery gathers momentum, and a rise in interest rate expectations would certainly stoke a rise in the greenback as the central bank maintains its dual mandate to ensure price stability while promoting full-employment.



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Crude Oil, Gold May Turn Lower as Risk Appetite Falters

http://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/commodities/2010-04-15-0838-Crude_Oil__Gold_May_Turn.html

Crude oil and gold prices may turn lower as US stock index futures decline, hinting at fading risk appetite ahead of the opening bell on Wall Street.

Commodities - Energy

Crude Oil May Vulnerable as US Stock Index Futures Decline

Crude Oil (WTI)      $85.74      -$0.10     -0.12%

Prices bounced from support at $83.19 and are once again perched below resistance at the $87 figure. Risk trends point gently lower as US equity index futures tick down 0.2 percent. First-quarter earnings figures from Charles Schwab as well as People's United Financial Inc are due before the opening bell and may prove to set the tone in the near term. US TICS, Industrial Production, and weekly Jobless Claims reports headline the economic calendar.



Commodities - Metals

Gold, Silver Reversal May Materialize as Risk Support Fades

Gold       $1154.00       -$1.35       -0.12%

Prices have stalled after showing a Dark Cloud Cover bearish candlestick formation below resistance at $1161.80 but ebbing support from risk trends may open the door a move lower as US equity index futures decline ahead of the US trading day. Near-term support lines up at $1144.98.

Silver       $18.35       -$0.11       -0.57%

As with gold, a Dark Cloud Cover candlestick pattern hints that a bearish reversal is brewing as long as prices remain below $18.61, the formation’s wick high. Initial support lines up at $18.25.



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