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Euro to Dollar Trend 23 Oct 2009

Euro vs Dollar Chart 22 Oct 2009

Another positive day for the euro vs dollar as we climb ever higher, with yesterday’s candle closing the trading session in a strongly bullish mood, with the deep lower wick finding strong support from the 9 day moving average which is always a very positive signal. Having breached our initial target of 1.50 yesterday, we can now look towards our medium term target of 1.50 for the euro vs dollar pair, and with all three moving averages pointing sharply higher, and with little in the way of resistance ahead on the daily chart, this should be achieved sooner rather than later. The Euro’s progress higher is assisted by poor employment data in US which is preventing the FED from raising interest rates for fear of jeopardizing the current fragile recovery.   Until this picture changes the FED may have an opportunity signal a possible rate rise but until then the dollar will continue to decline for some time.

Virtually all of the fundamental news on the economic calendar today has been focused in Europe and has painted a very positive picture.  The morning started with French consumer spending, French Flash Manufacturing PMI and French Flash Services PMI all of which came in much better than expected at 2.3%, 55.3 & 57.8.  German Flash Manufacturing PMI and German Flash Services PMI came in at 51.1 and 50.9, the latter slightly below expectation.  German IFO Business Climate survey came in at 91.9.  The Flash Manufacturing PMI and Flash Services PMI for Europe also came in ahead of forecast at 50.7 and 52.3.  The final item was Industrial New Orders which too came in ahead of expectation at 2.0% – all this data now giving ECB more worries about the current strength of the Euro if the current recovery is to be maintained.  Meanwhile in the US we have a speech from Ben Bernanke who is due to speak about financial regulation and supervision after the crisis and questions are expected.   Next we have the Existing Home Sales figures which are expected at 5.37m and finally a speech from FOMC Member Donald Kohn who is due to participate in a panel discussion on the financial crisis at the Fed Reserve Bankof Boston Conference in Chatham.  You can, of course keep up to date with all the latest fundamental news on the economic calendar, latest currency news and live currency charts by simply following the links.  I have also included details on an excellent ECN broker.