The US dollar slipped against a basket of major currencies after a report released showing that US initial jobless claims increased to 500 thousands from 488 thousands, while continuing claims slid to 4478 thousands from 4491 thousands.

The news added to concerns with regard recovery in the world's largest economy, especially after the dovish tone of the Fed announced recently which suggests that they will keep interest rate near zero till at least mid next year to avoid falling into double-dip recession.

The dollar index, which tracks the dollar movements versus six major currencies, reversed its earlier gains as it plummeted from a high of 82.70 to 82.03 where it is currently trading.

Concerning the euro-dollar pair, it rose to 1.2894 after visiting a low of 1.2769 where it found solid support that pushed it higher to 1.2900, while for the rest of the day the pair is expected to move between support and resistance at 1.2790 and 1.2950 respectively.

The euro rebounded after the US news but it started to gain momentum after the Bundesbank has raised German growth forecasts for the current year to 3.0% from the previous 1.9% estimated in June.

Also, the European Commission said Greece is eligible for having second loan payment which offset the negative impact of the news releasedby German magazine stating that the Greek austerity measures will damage the economy.

Turning to the sterling-dollar pair, it rebounded strongly from a low of 1.5506 after finding support at these levels, boosted by the upbeat reports released today.

Retail sales climbed to the highest level in five months in July while budget deficit narrows better than forecasts which lifted the royal pair to a high of 1.5666, while it is currently trading at 1.5657. For the rest of the day, the pair is expected to move between support at 1.5600 and resistance at 1.5710 for the rest of the day.

With regard to the dollar-yen pair, it rose earlier today on speculations the BoJ will intervene to halt the yen's appreciation then it retreated from a high of 85.91 to 85.22 after the downbeat US news. So far, support is seen at 84.75 while resistance is at 85.70.