The U.S. dollar rose against the euro last week, shaking off a brief dip after Egyptian President Hosni Mubarak stepped down. Investors had widely priced in his exit and technical factors were already weighing on the common currency. As a result, the USD rose against the EUR, pushing the oft- traded currency pair to 1.3496. The dollar experience similar behavior against the GBP and closed at 1.6000.
In addition, the recent spate of U.S. economic data has been supportive of the greenback and most strategists are looking for more outperformance on the dollar.
It currently seems that the market is showing signs of renewed confidence in the American economy, and as a result in the USD itself. Considering the somewhat surprising turn of events, large volatility could be expected in dollar-trading in the near future, which will provide forex traders opportunities to see unusual profits.
As for the week ahead, many interesting economic releases are expected from the U.S. Traders are advised to focus on the Retail Sales, TIC Long-Term Purchases, Building Permits, weekly Unemployment Claims, and the PPI reports, as these are likely to have a large impact on the USD. Traders should take under consideration that if the major reports will fail to reach expectations, the US dollar may erase its profits from the past week.