Comparative Rate Analysis

Viewing the USDX movement for the opening of the week on October 19, 2009 we could see some short US dollar recovery versus the Japanese Yen as it tries to move in tandem with the USDX as shown in this chart. However, it is only seen as a temporary reaction due to technical basis on the USDX oversold levles on a day to day basis.

Although, the all time low of the USD/JPY was at the price levels of 87.11 registered in April of 2008; the USDX was at 71.40 from the lowest price of 70.81 basis pts. We may probably see some initial assault on this prices as the US Dollar still continue to move lower as of this writing. The 74.50 levels may prove to be tempting as the major sentiments still remain bearish. Watch the prices at the important psychological price of 89.60 USD/JPY when it breaks this support price the next assault will be back to the 87.10 levels.

The GBP/USD has been lagging behind the strength of the EUR/USD as it is currently working at the 1.6400 prices and the EUR/USD at 1.4946. The next objective however, for the GBP/USD is now at 1.6550 and 1.5080 for the Euro. As the USDX holds its bearish tone this may well be achieved in the next few weeks of even shorter. The only assitance that the US dollar may hold is only on a technical basis as it has been oversold or some economic reports that may trigger otherwise.

The continued strength of the Aussie and the Kiwi is relative obvious as they make new record prices. This may also have been the favorable carry trades that is now present with the US dollar being at its lowest interest rates compared with the Australian Dollar. As cash capital investments have shifted from Yen carry trades to the US dollar versus the Aussie.

Carefully weigh the trades with the rates as the obvious Major Trend is still bearish for the US Dollar.

Good Luck and Happy Trading !