The dollar strengthens ahead of U.S. data  

on February 18 2010 6:48 AM

The green currency inclined against majors before the release of Philadelphia Fed, leading indicator, and jobless claims later on today. If the news showed improvement this will add to signs of recovery after the upbeat figures released yesterday which raised speculations the FED may raise the cost of borrowing faster than other central banks. The dollar index, which tracks the dollar movements versus a basket of major currencies, surged to 80.57, continuing yesterday's 0.1% advance.

With regard to the euro-dollar pair, it is extending its losses to continue the bearish direction that started since the beginning of December, where the 16-nation currency slipped to 9-month low versus the dollar. Still, worries with regard Greece's debt are persisting despite the EU's pledge to support Greece in tackling its deficit, which is prompting investors selling the euro. Meanwhile, the pair is traded at 1.3568 after reaching a high of 1.3612 and a low of 1.3537, where the coming support is seen at 1.3530 and next resistance is at 1.3625.

As for the sterling-dollar pair, it declined on the daily charts as the pound fell today after the data showing that U.K.'s January's budget deficit rose for the first time since 1993. The rising inflation and budget deficit in the U.K. are raising concerns after the economy's weak rebound in the fourth quarter. The pair is now traded at 1.5592, recording a high of 1.5686 and a low of 1.5572, while it is moving between support at 1.5640 and resistance at 1.5715.

Relative to the dollar-yen pair, it is showing decline on the daily charts, but facing an upside pressure from the 4-hour and 1-hour charts. Now, the pair is traded at 90.93, paring some of yesterday's losses, as the Bank of Japan said it will stop the expansion of lending and asset purchase program. The pair reached a high of 91.27 and a low of 90.71, while it is moving between support at 90.80 and resistance at 91.10.

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