ForexPros Daily News October 21, 2010
Forex – EUR/USD edges higher after Geithner remarks
Forex Pros – The euro edged higher against the U.S. dollar on Thursday, erasing early losses, following remarks by U.S. Treasury Secretary Timothy Geithner.
EUR/USD hit 1.3975 during late Asian trade, a daily high, the pair subsequently consolidated at 1.3973, gaining 0.07%.
The pair was likely to find support at 1.3636, the low of October 5 and resistance at 1.4155, last Friday’s high and a 10-month high.
In an interview with the Wall Street Journal Geithner said he believes major currencies are “roughly in alignment now,” suggesting he sees no need for further dollar falls against the euro and yen.
He also called on G20 finance leaders to agree to “norms” on exchange rate policy ahead of the weekend G20 meetings and said he would seek out targets for “sustainable” trade surpluses and deficits as a way to help rebalance the global economy.
The euro was also up against the pound, with EUR/GBP gaining 0.50% to hit 0.8856.
On Tuesday, the Federal Reserve’s Beige Book reported that “national economic activity continued to rise, albeit at a modest pace” from September through early October.
This was in contrast with the previous beige book, released in early September, which reported “widespread signs of deceleration compared with previous periods.”
Forex – USD/JPY erases gains, re-approaching 15-year low
Forex Pros – The U.S. dollar erased gains against the yen on Thursday, falling to a fresh daily low, following remarks by Japan’s Chief Cabinet Secretary.
USD/JPY retreated from 81.81, the pair’s highest since Tuesday, to hit 80.97 during European morning trade, shedding 0.12%.
The pair was likely to find short-term support at 80.87, the low of October 15 and a 15-year low and resistance at 82.34, the high of October 12.
Earlier in the day, Japan’s Chief Cabinet Secretary Yoshito Sengoku said Japan hadn’t set a line to defend its currency at 82 yen per dollar after the country’s prime minister and finance minister held a meeting to discuss the yen’s gains.
“It wasn’t about whether 82 yen was the line, but that the Finance Ministry will monitor the currency markets and we’ll take decisive measures appropriately at an appropriate timing,” Sengoku said.
Meanwhile, the yen was down against the euro, with EUR/JPY gaining 0.07% to hit 113.33.
The dollar’s earlier gains came after U.S. Treasury Secretary Timothy Geithner said he believed major currencies are “roughly in alignment now,” suggesting he sees no need for further dollar falls against the euro and yen.
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