Monday, June 25, 2007

Dollar Detains Friday`s Lows Across The Board, Existing Home Sales Data In Focus, Monday, June 25, 2007 2:03:32 AM

The U.S dollar showed diverse performance in the early Asian deals on Monday. The greenback trended slightly lower against the British pound but remained rang-bound near Friday`s close against the rest of majors.

Versus the yen, the buck curved in initially but has reversed the losses and started moving sideways to some extent above Friday`s close, lately. Deals in the dollar-yen pair took place amid a lack of information from the Japanese economy.

On the whole, the U.S. currency detained its lows against the majors it touched on Friday. On Friday, the greenback was profoundly weak against most other majors, but despite a fall in the afternoon deals, it had closed slightly above the previous day`s close vis-а-vis the yen.

Friday`s deals have made the greenback hit a two-week low against the euro and the franc, while a7-week low against the pound. However, against the yen, the dollar has been lately moving somewhat below the new multi-year high of 124.12, knocked on Friday.

The buck is likely to remain weak on Monday as the May month home sales numbers, which are scheduled to be released later in New York, are projected to touch multi-year lows.

Signals of a weaker economy is alarming the markets about a rate cut by the Federal Open Market Committee in the near term. The rate decision is due on Thursday, and the general market consensus is a holding back to the existing 5.25%.

Falling solidly on Friday, the dollar closed the day`s deals at 1.3466 against the euro. The losses made the pair be sold at a two-week low, and it is still remaining weak as the markets await the German GfK consumer confidence data. The German data has been listed to be released at 2:10 am ET Monday. Of late, the pair has been bouncing between 1.3457 and 1.3471 with immediate resistance and support levels seen around 1.3435 and 1.3500.

The U.S currency remained largely sideways against the Swiss franc after the pair struck a two-week low on Friday. Late New York Sunday, the pair slipped briefly, but the losses have been reversed lately. However, with the recent moves, the pair has not stepped out of the loose range, which is being upheld after hitting Friday`s low. Compared to the Friday`s close of 1.2286, the pair has been lately priced at 1.2295, and 1.2298 may be considered as an immediate resistance level in the near term. Downside, the dollar is likely to set the initial target around 1.2280.

Against the Japanese yen, the greenback had shown weakness in late Sunday New York deals, but in the Asian session Monday, the pair inverted its direction. Put side by side the Friday`s close of 123.86, the pair waned to 123.61 by about 5:05 pm ET Sunday, but has inversed its direction, lately. Of late, the pair dollar has been obtaining 123.90 yen and if moves further higher, early resistance may be tested near 124.0.

The U.S dollar continued lower against the sterling in the early Asian deals on Monday and the pair hit as high as 1.9997 by about 10:05 pm ET. This compares to the Friday`s close of 1.9984 which set a nearly two-month low for the buck against its British counterpart. However, the pair has picked up a few pips towards the end of the session and is trading near 1.9989 lately. As of now, a resistance in the near term is seen around 1.9982.
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