Forex Trends Still Unclear

Last week’s dramatic rise of the EUR/USD was fueled by increasing trading volumes although the fundamental reasons for doing so were more vague. As such, the EUR/USD dropped out of its new Bull channel overnight falling to 1.4530, see chart.

Although the EURO fared well recently against the USD, its general strength is still in question as it weaken against most of the other main currencies.

The fact that the US Libor rate at its lowest rate ever, could explain the surge of the JPY against the USD and EURO last week despite increasing risk appetite. The USD/YEN sits at 132.05 presently.

THE UK’s AAA credit rating could come back under pressure if its public sector net borrowing rises again later this week. The GBP/USD is now at 1.6530.