The dollar continued its gain against the major currencies
The dollar climbed to the strongest level in almost six months against the euro and advanced to a seven-month high versus the yen as the European and Japanese economies shrank and crude oil dropped. The U.S. currency gained against the euro for a fifth week, its longest weekly winning streak since February 2006. The pound dropped last week against the dollar the most since July 2005 after the Bank of England cut its forecast for British economic growth. The dollar rose 2.2% last week to $1.4658, from $1.5325 on Aug. 8. It touched $1.4658 on Friday, the strongest level since Feb. 20. The U.S. currency increased 0.3% last week, when it reached 110.66, the strongest since Jan. 2. The euro fell 1.9% to 162.30 yen, the biggest decrease since May. Sterling fell 3% last week to $1.8661 after touching $1.8512 on Friday, the lowest level since July 2006. The cable declined in each of the past 11 days, the longest stretch since at least January 1971. Crude oil continued to fell extending its decline to 24% since reaching a record $147.27 a barrel on July 11. On Friday the futures contracts with delivery in September dropped to $111.31 a barrel, which supported the dollar raising. Today on fundamental level, the focus is on the European trade balance data, which is expected to raise over the psychological zero level.
EUR/USD
The euro extended its negative sentiment against the dollar. Today first support is expected at 1.4590, followed by 1.4440 and the key level at 1.4300. On the opposite direction resistances are expected at 1.4760, 1.4970 and 1.5175, as the last two are also 61.8% and 50.0% Fibo of the 1.4310-1.6035 movement.
EUR/USD (chart, table)
USD/JPY
The dollar continued to gain against the yen and on Friday, the greenback reached new 8- month high at 110.64. It the dollar extend its gain it will meet resistances at 111.80, 113.50 and 114.65. On the opposite direction first support is expected at 108.60, 107.42 and 105.70, as the second one is also 61.8% Fibo of the 114.63-95.75 movement.
USD/JPY (chart, table)
GBP/USD
The sterling was also under pressure against the dollar. Today first support of the cable is expected at 1.8512, followed by 1.8175. On the opposite direction resistances are seen at 1.8990, 1.9140 and 1.9360, as the first two are also 23.6 and 38.2% Fibo of the 2.0153-1.8512 movement.
GBP/USD (chart, table)
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18.08.2008 FX daily review.pdf, 188 Kb
