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Week ended 24th June, 2011 – Currencies this week .

Recent trends say that when ever there is problem in Euro-zone, investors are shifting to Swiss FRANC and USD. This week  Swiss  FRANC was in strongest level against EURO. Problem in Euro-zone, not only Greek debt problem but also the rating downgrade of 13 Italian banks by Moody’s and bad economic news (better to say bad FED news) from US, effected the market this week.
Most of the Asian currencies declined this week. There was not much change for Korean WON in weekly basis, in last week it gained 0.2%. In Tuesday after local share rose from few days of declines, WON was higher against the dollar. But in later days of the week WON was lower because of uncertainty about next stimulus in US and strong dollar demand from importers. Due to political uncertainties Thailand’s BHAT weakened more than 1% this month, foreign funds were also selling shares on concern of coming election. In the early days of the week AUD fell versus major peers after their central bank said about keeping interest rate unchanged .

Coming week

I was expecting some rise in Euro though it rose but later part of this week it dropped. The main reason behind this drop was Greek problems. I have a feeling if it breaks 1.40 then it will be dropping more in coming days. But if better news come then it may again rise to test 1.45 level.
AUD is still facing side based movement with downward bias, if it breaks 1.045 then it will be testing 1.03 level.
Swiss FRANC is getting some good support at around 0.836 level. Japanese YEN is still moving in the range of 80-83. In Thursday it tried to go up but last day’s move was again disappointing.

Though in initial days USD dropped but in the later period it rose. It is getting some good amount of resistance at 76 level. If problems in Greece come into some solution then it may drop from here. Last week I was talking about a pattern, now in coming days if it breaks 76-77 level then it will negate that pattern. In the lower side 73.5 levels is good support for it. Last day I was talking about building a chart pattern for USD, now in coming days if it breaks 73.5 then it will be going for that.
Last two day’s move of Brazilian REAL were not looking good to me. What I think that it may test lower support level. Unless it breaks 1.53-1.63 level, I do not expect any new move from it. There is a chance that REAL is making lower highs and lower lows.
Mexican PESO is hardly trying to go past 12 level but it is getting good resistance there. In the lower side 11.5 is good support for it.
What I think that currency market will remain like this. Unless the matters of European debt problems are coming into some solution, especially matters about Greek bail-out fund and other expense cuts, Euro will perform like this. On the other side authorities in US need to take some strong steps for the betterment of the financial world.

NOTE :  Please see the disclaimer below this blog .


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