Dollar Weak In Markets

The dollar is still deteriorating in the markets as crude prices picked up as OPEC cut production by 500,000 barrels per day increasing the appeal of commodities in the market while attracting investors away from the greenback. Also today the focus is on the fourth largest securities firm in the U.S. reporting their third quarter earnings which will either support the dollar if the readings are upbeat or continue to downgrade the greenback.

The ECB president Jean Claude-Trichet today testified before the EU parliament saying that inflation risks were still to the upside while growth was still to the downside yet they could not cut interest rates as it will further boost inflation higher. The euro was hardly moved by the speech as nothing new was said as it is currently traded at 1.4146 as the same resistance remains from the mornings session of 1.4200 while a support at 1.4050. The pair recorded a high of 1.4178 and a low of 1.4093.

Like the euro, the pound is still gaining on the back of the weak U.S. dollar as the UK released their total trade balance for the month of July coming in showing that the deficit had widened to 4585 from the prior deficit of 4744 while expectations were a deficit of 4200. The release of this data caused the cable not to continue its upside wave towards the resistance of 1.7700, we currently see a support at 1.7565. The GBP/USD is currently traded at 1.7638 while recording a high of 1.7676 and a low of 1.7563.

The carry trades still remain from the Asian session as investors buy high yielding assets and sell lower yielding assets like the yen causing it fall. The yen is also deteriorating as there are anticipations in the market that Lehman Brothers Holdings Inc. will surpass the credit crisis. The USD/JPY is currently traded at 107.34 while recording a high of 107.65 and a low of 106.94. We currently see a support at 107.15 and a resistance at 107.65.

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