The U.S. dollar extended its losses against majors after a weak manufacturing report which followed the dovish Fed remarks announced yesterday; therefore, casting doubts the largest economy in the world may fall in a double-dip recession.
The dollar index, which tracks the dollar movements versus six major currencies, slipped to 82.61, the lowest in two months, compared with today's opening at 83.35.
In fact, the better-than-estimated profits reported today by JP Morgan could not offset the negative impact of the drop in empire manufacturing and industrial production.
Regarding the euro-dollar pair, it is continuing its rise on the daily charts, in the absence of economic fundamentals from the euro zone, after the Spanish bonds sell news. For the moment, the pair is trading at 1.2888, recording a high of 1.2896 and a low of 1.2706, the pair is predicted to move between support and resistance at 1.2815 and 1.2895 respectively. Some analysts see that the breakout of 1.2680, which represents a neckline to a bullish technical pattern, may take the pair to 1.30 levels.
As for the sterling-dollar pair, it extended gains for the third day as it currently reached 1.5373 recording a high of 1. 5393, continuing the upside direction that started since mid May. The breach of resistance 1.5312 earlier today helped the pair to reach this area where it is expected to move between support at 1.5280 and resistance at 1.5435.
Concerning the dollar-yen pair, it fell on the daily charts after a report released today showing that the Chinese economy grew 10.3% in the first quarter from 11.9% in the first quarter which enhanced demand on the yen as a refuge on signs the Chinese economy is slowing down. For now, the pair is trading at 87.36, recording a high of 88.49 and a low of 87.21, whereas support is seen at 86.95 while resistance is at 88.65.