25, October 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

The market seems to have taken another time out and suspended sales of American currency. It is possible that the interest to the "green" was driven by the increasing popularity of exchange shelters that is why the dollar strengthened against the pound and a little bit against the euro, in a dispute with the yen and the Swiss franc, which are a "safe haven" themselves, it continued to bear the loss. The reason for concerns on the market are caused by reports on China, which exacerbated the problems in the banking sector and there were rumors that the indicator of activity in the manufacturing sector will be in the area of decline, below 50.0 in October.

As for the future, the status of the "buck" as a refuge is very unsteady and prone to selling of the U.S. currency in the market continues to be the dominant factor and that is why the sales are likely to be resumed. But for some time the support for the dollar may be granted by technical factors.

The euro changed a little on the day's results. The Ministry of Economy of Germany raised its forecast for GDP growth in 2014 to 1.7% from 1.6%, citing high levels of employment, a strong domestic economy and growth capital investments. Preliminary index of consumer confidence in the euro area rose from 14.9 in September to 14.5 in October. The index is at its highest level since July 2011, for the second month in a row.