Kathy Lien is Director of Currency Research at GFT, and runs KathyLien.com.
Kathy has a Bachelors degree in Finance from New York University. Kathy has written for Stocks and Commodities, CBS Market Watch, ActiveTrader, Futures and SFO Magazine. She is frequently quoted on Bloomberg and Reuters and has taught seminars across the country. She has also hosted trader chats on EliteTrader, eSignal, and FXStreet, sharing her expertise in both technical and fundamental analysis.
For the second day in a row, the US dollar recuperated last week's losses. Yesterday it was the high yielders that lost the most ground against the greenback, but today, it is the majors such as the Euro and the Japanese Yen that experienced the biggest drop.
The volume of data on the day couldn't help the pessimism surrounding the greenback as traders took advantage of the session to further the bearish momentum seen yesterday.
A row of positive indicators from the US fundamental calendar couldn't take the sting out of yesterday's record current account deficit leaving the dollar to continue its path lower against the major currencies.
Yesterday's slide in the dollar deepened significantly today with the Euro breaking the psychologically important 1.20 level and USD/JPY falling far below 118.00.
The US dollar sold off against all of the majors today and justifiably so. The cards are stacking higher and higher against the greenback as we head into what is expected to be a fairly volatile week.
Today was non-farm payrolls Friday but you may not necessarily know that if you were just watching the market's price action. Comparatively speaking, the dollar's reaction to the mixed non-farm payrolls report was far tamer than most traders were probably expecting.
On a day devoid of any major economic data, the dollar gave back some of its gains. Tomorrow we are expecting the trade balance report, which should inject a bit of volatility in the markets.
In two days, the EUR/USD erased nearly all of the past month's gains. With expectations continuing to build up for an extremely strong non-farm payrolls report, traders are either squaring euro shorts or buying up dollars in anticipation of a good number.
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