Dollar rose against the euro and major currencies on Friday and touched two year high of 1.2494 as concerns about a worsening global economy prompted investors to cut risky assets. Investors bet that interest rates outside the United States will fall sharply to shore up global growth also weighed on currency movements.
The Federal Reserve Chairman Ben Bernanke's testimony before Congress endorsing another stimulus plan for the sluggish economy also added strength in to dollar. The government's $250 billion injection plan into troubled banks also stimulates the dollar.
But Initial jobless claims for the week ending 18 Oct increased 15k to 478k, above the expected increase to 468K, vs. revised 463k in the prior week (prev.461k). The 4-week average is reported at 480.3k vs the revised 484.8k in the prior week (prev. 483.3k). Continuing claims for week ending 11 Oct pushed lower to 3.720mln, against the revised 3.726mln recorded in previous week (prev. 3.711mln).
The September existing home sales rose to 5.18mln annual rate (+5.5%m/m) against unrevised 4.91mln (-2.2% m/m) in August, and well above the expected 4.95 mln reading for September. Inventory of homes for sale declines to 9.9 months against 10.4 months supply. September homes sales rise is the largest since July'03
In spot, dollar closed at 1.2622(1.298) against the euro, after trading in the range 1.2978– 1.2496.
Weekly Outlook (DEUR December.)
Expected to trade within the range 130.10 and 124.90, breaking of either a side makes the direction, Resistances is 121.50, 119.80. Supports are 131.71, 133.12, and 135.20. Intermediary level is 127.65
Last day, DEUR Dec. traded in the range 127.9– 125.05and closed at 126.14
TECHNICAL OUTLOOK (Intra-day)
DEUR (Dec.) - Bullish above 128.40; bearish below 128.00
COMMODITY
CL.RATE
SUP .2
SUP.1
RES 1
RES 2
DEUR (Dec.)
126.14
124.44
125.24
127.29
128.03
