Forex Fundamental Analysis

The euro fell against the dollar after European Central Bank President Jean- Claude Trichet said the central bank must do everything possible to boost confidence, signaling he may cut interest rates further.

U.S. Dollar Trading (USD) the Dollar gained in Asia as stocks came under pressure for the second day in that region. Most of the gains were given up in the US session as equities bounced into the close.

The chief savior for the United States in this economic, financial and banking crisis, aside from China of course, will be the American consumer. If the United States' economic growth is to resume, there is no possible substitute for American consumer spending. It is the average US family budget that is the ultimate object of all government plans and business investment.

Currency markets have relented the Dollar sell off to start the week as equity markets in Europe, UK, and the US have all taken hits in Monday trading.

USD/JPY struggled to reach the key 100.00 price level for most of the past week, unable to break this important psychological level until Friday, when price closed the week just around 25 pips above it.

EUR/USD adhered to a short-term uptrend support line this past week, as it recovered partially from a substantial drop the week before.

Overall, the majors enjoyed strong momentum during the early part or the Asian session, but some of the pairs lost the momentum as we headed into the Asian close.

By David Leal
The buying in equities may have tapered out for today, but the bullish move remains in play.  Commodities fell along with equities mainly due to the strengthening of the dollar.

Andrew Wilkinson: A Senior Market AnalystThe kitchen sink approach from the Federal Reserve and U.S. treasury in which countless, or at least extremely sizable, amounts of dollars are being thrown at the domestic problem is resulting in a weaker dollar as investors look to central banks where deflation is deemed a lesser risk.

The USD ended last week mixed across the majors as the currency gained against the Pound Sterling , Euro, Yen, and Canadian Dollar, but fell versus the Swiss franc, New Zealand dollar, and Australian dollar. The US unemployment rate hit 8.1 percent as 651,000 jobs were lost according to government data.