Following the USD's minor slide in yesterday's trading, it appears the greenback has started to regain some of its previously lost ground, but the market is still shaky. The Dollar spent most of yesterday's trading gaining ground on the EUR and JPY, hitting levels of 1.4807 and 89.52 respectively. By the end of the trading session however, the USD had reversed course and started losing against its primary rivals.
Comments by Fed Chairman Ben Bernanke surprised many investors as he joined the rallying cry for a stronger Dollar, which may lead to strength for the USD in the days ahead. On the other hand, the USD still faces downward pressure from sudden spikes in risk appetite following positive news reports as its safe-haven status has not yet diminished.
As the US prepares to enter its holiday shopping season, retail sales will become a major factor in currency valuation through the last half of November and the entirety of December. Traders should take note of these reports in the weeks ahead as they will drive the market during this time of year.
Looking at today, forex traders have two primary reports from the United States which will be released simultaneously at 13:30 GMT. The first is Building Permits which will reveal the status of a portion of America's housing sector. The second is the monthly CPI data, which highlights the level of inflation among consumer prices over the previous month. Today may be a volatile trading day due to these reports as well as the release of Britain's monetary policy statement a few hours earlier.