Pending Home Sales Hurt the Dollar

 @ibtimes
on February 03 2010 5:40 AM

The dollar fell today versus the EUR as worries were reduced over Greece's ability to repay its sovereign debt. However, trading ranges were tight as investors were hesitant to open such large positions prior to the release of the U.S. Non-Farm Payrolls report on Friday.

The EUR/USD rose to a closing price to day of 1.3965 after opening the day at 1.3914. The GBP/USD also rose to 1.5972 from 1.5929, while the USD/JPY fell to 90.36 from 90.76.

The USD gave back some territory today against the majors after its recent rally. Some of the appreciation of the EUR/USD may have been caused by traders taking profits from the recent decline in the pair.

U.S. economic data was positive today after the release of better than expected monthly pending home sales. The economic indicator posted an increase of 1% after economists predicted a climb of only 0.4%.

Today traders will be following the release of the ADP Non-Farm Employment Change along with the ISM Non-Manufacturing PMI. The ADP report has been known to show a correlation with Friday's all important Non-Farm Payrolls Report and can significantly move the market. The ISM survey gives a feel for how businesses view the American economy. Better than expected releases for these indicators could send the EUR/USD back to its next support level of 1.3830.

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