| We are going to be seeing two news stories swinging back and forth and back and forth for the next few months. Come see what Story #1 and Story #2 are. Full Story |
| Story Submitter 393 Submitted (1,648 total Useful votes) | Story Stats Submitted Jun 18, 2009 8:03pm (9 hr ago) 243 Views: 1 Comments: Useful Votes: 0 Fade Votes: | Your Vote?
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We are going to be seeing two news stories swinging back and forth and back and forth for the next few months.
Story #1: The first story will go something like this..."Today, we saw the U.S. dollar (USD) and Japanese yen (JPY) lose ground as investors continued to gain confidence in the chances of an economic rebound and moved their money out of the so-called safe-haven currencies and into higher-yielding currencies like the Australian dollar (AUD) and the New Zealand dollar (NZD)."
Story #2: The second story will go something like this..."Today, we saw the U.S. dollar (USD) and Japanese yen (JPY) gain ground as investors continued to lose confidence in the chances of an economic rebound and moved their money into these safe-haven currencies and out of higher-yielding currencies like the Australian dollar (AUD) and the New Zealand dollar (NZD)."
Neither story is wrong or bad, per se. I'm going to be writing those types of stories. It's just that we are going to be seeing a lot of each version going back and forth during the next few months.
That's how things work whenever the market is trying to find a bottom. Some days look bullish and some days look bearish, and investors react accordingly. Just be ready for some price and analysis volatility.
Today, as it turns out, is a Story #1 day.
The yen and the dollar fell against a majority of their most-traded counterparts after reports showed U.S. economic growth recovered, reducing the haven demand for the currencies.
The Swiss franc weakened versus the euro on speculation the country’s central bank may intervene to sell the currency as it approaches the strongest level since March. The pound declined against the euro after U.K. retail sales unexpectedly dropped in May for the first time in three months.
“The market is trying to test the weaker dollar side in general because of some reversal in risk aversion,” said Hidetoshi Yanagihara, senior currency trader at Mizuho Corporate Bank in New York. “People are trying to get out of the dollar to get into other currencies like euros and Australian dollars.”
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