16, September 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

The end of the week was a relatively quiet day in the foreign exchange market, as investors took a pause after the recent movements. Euro and Pound maintained a high level while the U.S. dollar was traded in the defense against the mixed economic signals.

The dollar reacted with a growth, but after disapproval data, it returned to earlier levels. EUR/USD was traded above 1.3300 but the pair closed the last trading day slightly lower. The same story with GBP/USD. Pound kept winning, but it went below 1.5800 against the dollar by the end of the day. USD/JPY continued to fall on Thursday, testing the 99.00, but it finished the week at 99.50.

Judgment Day for the Fed is approaching, on September 17, and the market is preparing for that. Despite the fact that the next FOMC meeting will take place against a background of disappointing NFP last Friday, Fed Chairman Ben Bernanke and Co. still suggest that some restrictions should be expected, or the USD sell-off may follow as the newspapers all over the world say. According to Adam Button, the Forexlive editor, "The market believe at $ 10 billion, as the most likely it is an amount of narrowing this week". This is the expectation that the restriction to a smaller amount can reduce the dollar.

Belief in European economy is gradually returning to international investors, which is evidenced by the recent survey of Bloomberg (Bloomberg) Global Poll.

Euro has become a haven for investors, entrenched by nearly 5 percent this year against the currencies of nine developed countries, being the best performer according to the Bloomberg correlation-weighted index.