MoneyTec 2.0 - Online Forex Traders & Brokers Social Networking Community » Trading Talk » Fundamental Trading

[Fxgreece team]

Further Dollar Weakness Ahead?
Another day another dollar weakness all across the board, with EUR/USD finally breaking the important 1.39 level and moving its way up toward 1.40. The question is where will it stop? Well, there are not a lot of positive things for the greenback at the moment as we are approaching the end of the week, what with oil climbing to new record highs just above $80 and fears of slowing in the US economy getting stronger by the hour.
Yesterday we didn’t have any important economic news coming out of the US, so traders were reluctant to commit either way, nevertheless we saw euro in a buy mode during the whole day. The only important economic indicator is tomorrow’s US retail sales which market players await in order to see the damage spilling to the consumer sector.
As the time comes near the FED meeting, there is a mountain of speculation as to what will happen that day with the majority of analysts almost certain that Fed will cut rates by as much as 50 points. Last Fridays weak payroll data in combination with fears of credit crisis continuing in the short term, gives plenty of reasons for investors to continue the uptrend in the EUR/USD. The dollar is being sold all across the board no matter what the situation is and that is likely to continue until EUR/USD finds a temporary top near or above the 1.40 level. There are a lot of talks of protecting barriers around those levels, but all that can change easily if further demand for the European currency exists.
Today we don’t have any important news releases so the Euro bulls will try to test new highs against the dollar maybe even 1.3950.
Question is now, how will ECB react to levels above 1.40? In the past they said that they feel comfortable within the recent 1.35-1.38 levels, but anything above 1.40 might trigger some reactions, since such strong euro will eventually hurt the European economy. However, if inflation persists in the euro area, Trichet and his friends might find it hard to decide what the next move will be as recent comments left room for more hikes to come…
Also, be aware of EUR/GBP levels as the pair staged an impressive rally these days, re visiting .6870- last seen in May. The pair found it very difficult to break this level in the past but the recent strength in the euro might make this possible, targeting .6950.

[fxallien]

Your articles are very good. Thanks

[pinalli]

i was about to go long for dollars. after reading ur article i think i should think twice. but i read in so many links that dollar decline will gonna stop soon. wat do u think will be the impact onyen and swiss franc???

[forexlover1]

I saw on the news near closure of some banks in USA, is it true!!
but I don`t think the price decline is leading to closure of the banks , but when I was looking for this news I saw another story attractive me that 30% bonus on deposits of live accounts
In forexgen is this true !!

so plz i will wait for your replay

[fdrago2]

look Interest in forming partnerships of Trader Professionals

[fdrago2]

As I commented: The index of the dollar reached its peak and begins monthly decline of the same. Analysts oil left in doubt oil inventories as calculated only 1M in inventories of crude and not those who reported 12M U.S. Concerns have been rising, the dollar lost considerable ground level. The United States is being held hostage to speculation concerning possible outcomes of Lehman Brothers Holdings Inc.. Fannie Mae and Freddie Mac.

Regarding Lehman, it is said that he could not sell part of its share capital to Asian investors, having more difficulties in coping with potential quarterly losses, around 4,000 million dollars. While regarding the mortgage, how will the doubts to run abultadas maturities of their debts without asking for extra help, is an uncertainty.

For the moment all my findings were valid. In buying AUD / USD and NZD / USD, for sale USD / CAD.

[fdrago2]

It is currently generating significant correction of all currencies against the dollar. Undoubtedly the FEd intervening the market before Bernanke's talk at 14:00 GMT. Obviously that has deepened the crisis in U.S. mortgage . I convey comments...

08/22/2008 07:43 AM
Freddie Mac Warren Buffett:Says in not positioned against the dollar and equities are more attractive than they were a year ago - CNBC interview
- Fed Chairman Bernanke does not have a "magic wand" for solving the problems of the US economy.
- Berkshire has no bets against the USD or any direct currency plays, believes USD strength will not last if current account deficits continue.
-- Repeats that there is a "reasonable chance" shares in the GSEs will be wiped out

[fdrago2]

Why are still buying dollars?. You buy it? or Who buys it?

Aug. 22 (Bloomberg) -- Fannie Mae and Freddie Mac, the two largest mortgage finance companies, ``don't have any net worth,'' billionaire investor Warren Buffett said.
``The game is over'' as independent companies said Buffett, the 77-year-old chairman of Berkshire Hathaway Inc., in an interview on CNBC today. ``They were able to borrow without any of the normal restraints. They had a blank check from the federal government.''
Freddie Mac and Fannie Mae touched 20-year lows yesterday on the New York Stock Exchange on speculation a government bailout will leave the stocks worthless. U.S. Treasury Secretary Henry Paulson won approval from Congress last month to pump emergency capital into the companies, which account for more than half of the $12 trillion U.S. mortgage market.
Fannie and Freddie mispriced their products and ``kept existing because they had the federal government behind them,'' Buffett said. Berkshire had been among the largest holders of Freddie until about 2001, when it became apparent the company wasn't being run well, he said.
The two mortgage companies recorded almost $15 billion in combined net losses in the past four quarters as delinquencies rose to record levels, shrinking their capital. The swoon sparked concern they may not be able to weather the worst housing slump since the Great Depression and prompted Paulson to step in with a rescue plan.
Fannie, down 95 percent in the past year, advanced 24 cents $3.40 at 8:18 a.m. in New York trading. The stock was trading at almost $70 a year ago. Freddie advanced 23 cents to $3.39 and is down 91 percent this year.

[fdrago2]

As commented. This intervention and assistance from the Central Banks to help FED will cost them an eye of the face .... The ECB and the BOE have been the rope to the neck .. I leave the translated link. See

http://translate.google.com/translat...-8&sl=es&tl=en

http://translate.google.com/translat...-8&sl=es&tl=en

http://translate.google.com/translat...-8&sl=es&tl=en

[fdrago2]

As commented. This intervention and assistance from the Central Banks to help FED will cost them an eye of the face .... The ECB and the BOE have been the rope to the neck .. I leave the translated link. See

http://www.libertaddigital.com/notic...276337377.html

http://www.libertaddigital.com//econ...ar-1276337269/

http://www.libertaddigital.com//econ...es-1276336739/

Use http://translate.google.com/translate_t?hl=es#

[fdrago2]

OK. Look the last post. I have banned in this post.

Further Dollar Weakness Ahead?

[jeff15]

the Federal Reserve of the US released an expected report which has shown that the present financial condition and wild market instability have ‘substantially reduced’ the fiscal reserves at some of the major banks are under operations. However, the report has shown that the most firms still hold excess reserves in accordance with the previous regulatory standards.

[jeff15]

According to Recent Forex updates seen on CNBC the release calendar was very light on the last Sunday, so US futures may remain a very good guide during the trading session for the USD direction, as it has been the case recently.