Forex Daily Outlook –January 25

The Euro appreciated yesterday against the USD for the second consecutive day. Will this rally continue today? There are many news items and events that may affect forex traders today including:  FOMC rate decision, U.S. pending home sales, the German business climate survey, Great Britain’s GDP growth in the Q4 and ECB’s President Draghi will speak.

Here is a short outlook from the main news items and events that may affect today’s forex trading for January 25th:

Forex Market January Update:

The Euro to US Dollar continued its rally and slightly rose yesterday by 0.17% to reach 1.3036; during January, the EUROS/USD rose by 0.60%. The Australian Dollar and GBP also rose, while Canadian Dollar slightly depreciated against the USD.

The chart below shows the development of the Euro to US Dollar during January.

Chart Euro to us dollar conversion currency  25 January

Correlations among Exchange Rates

The chart below presents the correlations among several leading exchange rates to the Euro/USD (daily percent changes) during recent months.

Correlations Euro to us dollar and other forex rates 2011-2012 25 January

The chart shows that the strongest relation during January (up to date) is Euro/USD with USD/CAD.

Current Forex Trading January 25th 

Euros to US Dollar is traded at 1.2957 a 0.6076% decrease as of 14:57*.

GBP to USD rate is at 1.5576 a 0.32% decrease as of 14:56*.

(* GMT)

Forex Daily Forecast

German Business Climate Survey: This survey projects the changes (on a monthly basis) in the business climate of Germany. If this report will continue to show positive figures, it could also positively influence forex (Euro) traders;

Great Britain GDP fourth quarter growth 2011: This report will present the quarterly growth rate of the British economy during the fourth quarter; during the previous quarter the GB economy grew by only 0.5% (Q-2-Q);

ECB President Speaks: Following the last interest rate decision to keep the ECB rate unchanged at 1%, and the recent announcement of S&P to downgrade several EU countries’ credit rating, the President of the European Central Bank, Mario Draghi will talk about these issues and will try to calm the financial community. This speech might affect the forex traders, if there will be positive headlines from this speech;

U.S. Pending Home Sales: This report present the changes in pending home sales in the U.S. for December 2011; in November the pending home sales index rose by 7.3% compared with October’s index. If it will continue to rise, it may positively affect USD.

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