The Japanese yen continued its fall for the second day against majors as improvement in services in the U.K. and euro zone and expected progress in U.S. data due later on today sapped demand on the yen as a refuge amid recovery signs worldwide. Also, the bounce in global shares lowered risk aversion, thereby putting further downside pressure on the yen.
On the other hand, the dollar slipped against a basket of major currencies as seen by the dollar index which fell earlier today to low of 86.29 while it is currently trading at 86.70.
With regard to the euro-dollar pair, it inclined earlier today to a high of 1.2326 but it stopped its advance as it hit resistance at 1.2331. The euro was boosted by the better than estimated services data that showed the resume of expansion in the leading sector of the economy. However, the pair is facing downward pressure from the 4-hour and 1-hour charts causing it to retreat to 1.2247. Still, the 16-nation currency is unable to rebound after falling to four-year low last month as debt woes is lowering confidence in the European single currency. The pair reached a low of 1.2223 today while for the rest of the day it is predicted to move between support and resistance at 1.2200 and 1.2290 respectively.
As for the sterling-dollar pair, it continued its rise on the daily charts but halted its gains when it touched a high of 1.4741. The decline on the 4-hour and 1-hour timeframes pulled the pair to 1.4673 where it is currently trading. Meanwhile, the ongoing expansion seen this week in the economy's major sectors is providing evidence the British economy is on the right track towards recovery. Earlier today, the pair reached a low of 1.4633, while it is expected to move between support at 1.4635 and resistance at 1.4730.
Relative to the dollar-yen pair, it surged to 92.64 as the breach of strong resistance at 91.65 yesterday paved the way for further rise. The Japanese economy is also suffering these days from political instability after the resignation of Prime Minster Yukio Hatoyama one month ahead of elections which is weighing on the yen. The pair hit a high of 92.72 and a low of 92.02, whereas support is seen at 91.50 while resistance is at 93.30.