Forex and Gold Daily Report for October 22, 2012

The US dollar and the yen retreated in a mild “risk on” week as a combination of ongoing fears over the euro zone’s debt crisis and mounting concerns over the outlook for the global economy drove investors to the relative safety of the U.S. dollar.

The EU Summit didn’t provide any breakthroughs on the debt crisis, with Greece still urging for more cash and Spain still taking its time, as the banking union isn’t getting closer. While gold  futures ended Friday’s session at the lowest level in six weeks.

In the week ahead, investors will be focusing on U.S. data on third quarter economic growth, as well as the outcome of the Federal Reserve’s first policy meeting since the central bank announced a third round of quantitative easing in September.

  • The Australian dollar benefited from some solid releases last week, as Home Loans and New Motor Vehicle Sales looked sharp. As well, Chinese  GDP and Retail Sales, and industrial production beat estimates.
  • EUR/USD enjoyed hopes for progress in the debt crisis and advanced within its range. With no real breakthroughs, the pair didn’t break critical resistance. The EU Summit didn’t made any progress on debt crisis issues.
  • Strong UK employment numbers and solid retail sales were not enough to bolster the pound this week.
  • USD/JPY finally made a big move, and tackled uptrend resistance, as the global mood slightly improved. BOJ governor Masaaki Shirakawa is under rising pressure to act more fiercely to lower the value of the Japanese yen.
  • Gold futures ended Friday’s session at the lowest level in six weeks, as a combination of ongoing fears over the euro zone’s debt crisis and mounting concerns over the outlook for the global economy drove investors to the relative safety of the U.S. dollar.

To download complete report; CLICK: Forex and Gold Daily Report for October 22, 2012

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