The Euro remained steady in overnight trading on Friday after hitting its lowest in last three weak versus the US dollar. Uncertainty seems to be increasing among the investors as Euro reached its record low versus the Swiss Franc due to euro zones sovereign debt situation.
However the Euro recovered in overnight trading as it reached its oversold and level and found support by traders. The latest news of revision in Fitch Ratings for Portugal and a possible downgrade to A-plus has created more negative sentiments for the Euro in the market. Standard and Poor also revised and downgraded its rating for Portugal to A minus which happens to be two notches lower than Fitch’s rating.
Economist James Ashley from RBC Capital Markets commented, “Fitch’s move was widely expected to some extent, and it was one notch only so there was not much reaction,”
Volumes have also reduced due to Christmas on the way however expectations are maintained with trading sessions after Christmas holidays.
The Euro recovered to 1.3130 against the US dollar in overnight trading in after hitting its three week low of $1.3055 on Thursday.
A trader commented, “The euro is still a sell-on-rally trade. Anything above $1.32 is worthwhile selling in my view and probably there won’t be any buyers until the low $1.30s, where we could see some Asian central bank interest.”
As compared to Swiss Franc the Euro stood at 1.2607 in overnight on Friday as compared to its all time low of 1.2440 on Thursday. Relative strength index also shows a near term oversold position for the pair EURCHF. However the aggressive buying in Swiss Franc indicates a further short term bullish rally for currency as indicated by most analysts.
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Daily forex trading news written by Rehan from DailyForexTrade.com
