Daily Forex Analysis by Finexo.com 08/07/2010

Today is a busy day with both the European Central Bank and the Bank of England scheduled to release statements regarding their interest rate decisions. While neither central bank is expected to raise its benchmark rate, any positive comments could lead to gains for the Euro or the Pound. Also, investors will also want to watch today’s weekly U.S unemployment claims given the relative drought of U.S data, and last week’s disappointing Non-Farm Payrolls release.


The Euro continued to hover near a seven week high against the Greenback on Thursday, as risk appetite returned to the markets following a sharp rally on Wall Street. The Euro rose to $1.2688 during late Asian trade, its highest price since May 21, as fears over a slowdown in the globally economic recovery subsided. Yesterday, the IMF revised its global growth forecast to 4.6% from 4.2%, reflecting a stronger-than-expected growth in the first half of the year.

Later today, ECB president Trichet is expected to hold rates steady at 1.0%. Instead the meeting’s main focus will be on the fragile state of the European economy and its banking system, as there is still considerable debate over the reliability of the bank stress tests.

Support/Resistance 1.2663/1.2618


The Australian Dollar struck one a week high against the Dollar this morning, as yesterday’s rally on Wall Street boosted risk appetite and the Australian job growth reported its best quarter since 2006. According to official data, Australian employers added workers in June for a fourth consecutive month, supporting the RBA’s view that the nation’s economy is strengthening. This morning’s report showed that employment rolls rose by 45.9K and the unemployment rate held at 5.1% from its revised reading in May.

Support/Resistance 0.8662/0.8746

Written by Finexo.com