The U.S. economy yesterday released its housing data showing that existing home sales fell therefore scaring investors from the dollar, while today we continue to see that the dollar is declining. The dollar is seen declining as the Dollar Index, which gauges strength of the dollar against six major currencies, is currently trading at 86.00 while recording a high of 86.21 and a low of 85.88.
The euro remains under pressure from the ongoing worries that the sovereign debt in the euro zone, will weigh on the outlook of the region, which therefore keeps the euro trading near low levels. Also today, as we witnessed the manufacturing sector weaken in Europe, therefore meant that production output remains weak from the current economic conditions as mentioned. The EUR/USD is currently trading at 1.2283 between the support of 1.2215 and the resistance of 1.2330 while recording a high of 1.2305 and a low of 1.2242.
The Bank of England released its minutes, which showed that the vote on interest rates was 7-1 as Andrew Sentance wanted to increase interest rates to 0.75% as a way to slow down inflation, while the rest wanted it steady at 0.50%. From the results of the minutes, increased the appeal of the pound in the markets which supported its rise. The pound dollar is currently trading at 1.4914 above the support of 1.4815 and below the resistance of 1.4960 while recording a high of 1.4928 and a low of 1.4800. Over the one-hour basis, the technical charts are showing us that the pair is being traded in an overbought area.
The yen is seen inclining past the weak dollar while the pair is currently traded at 90.34 while recording a high of 90.59 and a low of 90.32. The technical charts are showing us there is a support at 90.00 and a resistance of 90.80. The volume indicator over the one-hour chart are showing us there is low volume in the markets.