The dollar strengthened

 @ibtimes
on January 20 2010 1:40 AM

The Federal currency is strengthening throughout the currencies market, having the euro falling to the lowest in five months, while the pound dropped after three days of gains. The USDIX that tracks the dollar strength against a basket of currencies rose in today's Asian session recording a high of 78.02 and a low of 77.46, and it is currently trading around 77.90.

The euro dollar pair declined sharply recording a low of 1.4166 and a high of 1.4288, having the 16 nation's currency trading around 1.4200. The pair breached the 1.4215 levels that should be followed by further declines to the 1.4040 levels. The daily and the four hour momentum indicators are supporting the downside. However, today's trading range may be between 1.4170 levels and 1.4460 levels.

As for the pound dollar pair, it declined as well recording a low of 1.6280 and a high of 1.6369, having the royal currency trading around 1.6300. The daily and the four hour stochastic oscillator say the pair is heading towards an oversold area, so we are anticipating further declines today, but the BOE minutes which is on queue today may support the pound to offset its decline if it signaled recovery is undergoing. Yet, today's trading range shall be between 1.6240 and 1.6500.

Finally, the dollar yen pair is consolidating between 91.40 and 91.00 recording a low of 91.35 and a high of 91.05, while the pair is currently trading around 91.25. Today's support could be found at 89.35, while the resistance could be found at 91.85 and the pair is trading in an oversold area according to momentum indicators on the daily charts. The U.S core PPI will be released today and it may affect the pair's trades.

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