Euro in forex trading

Euro is falling today, in spite of the general inclination toward risk appetite right now. The latest news out of the eurozone is providing disappointment, and that is sending the euro lower in forex trading.

Greek Prime Minister Lucas Papademos said Greece was close to coming to terms on a deal with Eurozone authorities and its bond holders that would reduce the weight of the country’s debt and still provide access to credit as the government struggles to contain its deficit. In order to avoid default, Greece is attempting to reduce its overall debt load to 120 percent of GDP compared to the current 162 percent.

CHF continues to rise despite the EUR’s resilience. The SNB’s pledge to hold the CHF 1.20 cap will soon be tested. Since its inception last September it has worked, however, in the past few weeks’ market sentiment has changed dramatically. China considering greater involvement in EFSF and ESM program has done little to support currency so far.

Speaking before the House Budget Committee in Washington today, Federal Reserve Chairman Ben Bernanke said that the U.S. economy appeared to be gaining in strength.

“Fortunately, over the past few months, indicators of spending, production, and job-market activity have shown some signs of improvement,” Bernanke testified. “The outlook remains uncertain, however, and close monitoring of economic developments will remain necessary.”

IG Index have brought good news to a lot of forex traders this week with the announcement that they are cutting spreads on many different currency pairs once more. (...)

Uncertainty sends euro down on risk aversion

There is just enough uncertainty in the FX market to send the euro lower today in forex trading against the US dollar. The 17-nation currency is heading lower as concerns about Greek debt remain, and as forex traders consider the United States.

The permanent debt relief plan for the European Union is still being discussed, but pessimists ruled the market. The governments within the EU are struggling to create jobs and promote growth, but the debt talks that were supposed to originally cover these topics has mostly progressed into how best to bail out the nation of Greece. Restructuring the Greek debt has become a monumental task and it has deservingly commanded the bulk of the EU’s discussion.

The British pound sterling is currently struggling to hold its value, despite the good news out of the Euro zone that Greek debt talks are nearing an end. The pound had a minor rebound on Monday, January 23, 2012, but experts expect it to give up ground soon. The Bank of England is coming to some conclusions in the near future that probably will include a need to increase monetary support. There is also talk that the BoE will ask to expand the Asset Purchase Facility up above the currently agreed upon 275 billion pounds.

I stopped trading the USD/JPY last year because it was proving to be very difficult and the big price swings were becoming less and less frequent. (...)

To some extent trading the forex markets using long term charts (such as the daily and weekly charts) is a lot easier than trading the short term charts (such as the 1 and 5 minute charts). (...)