Asian markets followed in Wall Street's shadow Friday, with the Nikkei down over 1.5% and Australian equities sliding to seven-week lows. Investors have been reacting to headlines from Davos forecasting significant headwinds in 2010, with deflationary data out of Japan reinforcing the bleaker outlook on growth going forward.
Traders should expect continued risk aversion going in to today's U.S GDP data, to be released at 13:30 GMT. Predictions are for a strong number, with growing speculation that the figure will even blow expectations out of the water. If this proves correct, GoForex traders can expect equities and commodities to rally hard to close out the month of January.
The euro broke through yesterday's 1.3930 low in the Asian session but was cushioned by the 1.3900 level. GoForex traders can expect further range-bound trading between 1.39-1.40 as traders await the US GDP number to be released.
The dollar rebounded overnight and has been attempting to break the critical 90.00 for the past several hours. A solid break of 90 would be closely followed by a run to the 90.55 area, with the potential of another major boost given a strong US GDP number later in the day.