Source: ForexYard
The combination of better than expected euro-zone news and a poor US ADP Non-Farm Employment Change figure caused the USD to extend its bearish trend throughout the day today. The EUR/USD shot up well over 100 pips during the European trading session, and once again broke the 1.3200 level before staging a slight downward correction. Meanwhile the USD/JPY hit a fresh three-month low earlier in the day. Rumors began to circulate that the Bank of Japan would soon intervene in the market place after the pair dropped as low as 76.02 earlier in the day.
Turning to tomorrow, a speech from Fed Chairman Bernanke is likely to generate significant market volatility. Following the last speech from the Fed Chairman the dollar took heavy losses against its main currency rivals. While it is not yet known what Bernanke will say, the dollar may fall further unless he is able to boost investor confidence in the US economic recovery.
Traders will also want to remember that the all important US Non-Farm Payrolls figure is set to be released on Friday. The indicator is widely considered to be the most important news event on the economic calendar, and large shifts in the market place are guaranteed to occur. The USD may come under renewed pressure if the payrolls figure comes in below expectations.
Forex Market Analysis provided by ForexYard.
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