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11.05.2012 05:15 PM
Fundamental Analysis, for May 11, 2012

 

The dollar remained strong during the day on all fronts, dragging down major currencies.
Although the JP Morgan presented significant losses on its balance sheet, the Dow managed to close higher maintaining a slight downward trend in the short term.

Technically, it seems that the dollar will extend gains in the long run. Other majors have passed through the highs of EUR/USD and AUD/USD and seen as double bottom formations corresponding to a recovery of the euro and the Aussie for the next hours. The same is for pairs USD / CHF and USD / CAD and their respective figures.

The American session has not started yet and the daily data are not available. When the trend is quite complicated to change it considering that the reports from Canada as well as the rate of U.S. wholesale inflation (both at 8:30 Eastern) and the preliminary consumer confidence report from the University of Michigan released at 9:55 have influenced the trend.

Remember that coins crossing dollar’s low have been trading for several weeks or months and changed the direction in quite similar way taking into account the reports and actions of Wall Street.
The British pound is the only exception: it remains strong and is able to reach new highs in the coming hours. It was favored by the wholesale inflation data but it still is located in the area of 1.6060.

The yen, meanwhile, is also strong and unchanged. But a falling dollar can also affect the JPY in the coming hours.
Gold and oil have the signs of exhaustion. In general the day is favorable for the dollar.

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