Dollar is steady ahead of economic data

  •  The dollar is stronger on Thursday's currency markets after Q3 Gross Domestic Product was revised slightly higher 2.6% from a previous 1.7% on Wednesday but lower than markets expectation of a 2.8% increase. Data also showed Existing Home Sales increased to 4.68M in November from a previous 4.43M. Today Jobless Claims, Durable Goods orders and New Home Sales will give investors a further insight about US fragile recovery.        
  •  The euro bounced in Asia supported by demand in the region but still remains shaky as euro zone debt problems are expected to deepen further in the New Year. EUR/USD rose to 1.3150 today but still remains below the 1.32 level. The euro zone is threatened by rating agencies Moody's and Fitch that put Portugal and Greece sovereign debt on review for a possible downgrade further weighing on the single currency. On Wednesday, China announced that the country is willing to help euro zone escape its debt crisis offering to buy a significant amount of Portugal's debt but failing to prevent the downward trend of the euro.
  •  Against the Swiss franc, the euro hit a fresh new low on Wednesday at 1.2437. The pair was last traded at 1.2489. The euro also fell against the Japanese Yen today hitting a three-week low at 108.91 from 109.61 yen. Against the Japanese Yen, the US dollar weakened on Thursday falling to 83.05 from 83.56 helped by heightened risk aversion in an end of year thin trading conditions.
  •  The Australian dollar rallied against the US dollar on Thursday hitting a six-week high at 1.0036 breaking above parity level. It appears that the market is optimistic about Australia's economic outlook helped by a strong employment sector and rising commodity prices. In contrast, Australia's neighbor, New Zealand disappointed investors on Wednesday after data showed Gross Domestic Product fell 0.2% for the first time in six months reducing the possibility of a rate hike in the near future. Kiwi slid against the dollar on Wednesday as low as 0.7383 but then recovered to trade at 0.7471 on Thursday.

 Currency to watch out for: EURUSD & USDJPY

  • § The EURUSD pivot point is at 1.3175 with a preference to enter into Short positions at 1.3165
  • § The USDJPY pivot point is at 83.45 with a preference to enter Short positions at 83.40

Today's calendar and market movers:

  • § US Durable Goods Orders in November is forecasted at to drop 0.5%
  • § Canada Gross Domestic Product in October is forecasted to gain 0.3%
  • § US Initial Jobless Claims is forecasted to be unchanged at 420K

 Equity Markets:

 US equities closed positive on Tuesday with the S&P500 up 0.34% and the DJIA up 0.23%. The European bourses were mixed with the FTSE traded up 0.53%, the DAX unchanged and the CAC traded down 0.20%. The HSI at the time of writing is trading up 0.19% and Nikkei is closed on the Japanese Emperor's birthday.