Hard hit on the US dollar value
In the latest round of currency trading news, two main events have recently dominated the currency landscape. The first main concern is the recent decision by the United States federal government to continue its policy to maintain its current levels of quantitative easing.
There were hopes that such measures would be tapered off due to increased positive sentiment and rising employment figures, but the government seems to be taking much more of a cautious approach.
This has hit the value of the United States dollar quite hard. While this may have disappointed some online Forex traders, others will choose to capitalise on this short-term bearish outlook should we see a reversal in the relationship between the Euro and the dollar in the weeks ahead.
The second factor that will influence Forex trading this week are the upcoming German elections. All signals hint that chancellor Merkel will win a third term in office. This will serve to maintain confidence throughout the Eurozone and should increase the motivation for investors to place their funds into a stable European Union. However, there is still a slight chance that Mrs. Merkel will be forced into ceding some of her power to the Social Democrats (her main opposition). Some fear that such political wrangling may send jitters across the markets and likewise dampen sentiment on a strong Euro.
Most analysts however see this as merely a short-term concern. As the European Union continues to show signs of sustainable growth, online Forex trading will likely continue to be focused (at least temporarily) on the substantial disparity between the dollar and the Euro. Traders may opt to capitalise in this weakness before more positive figures regarding economic growth within the United States are publicised. Either way, all eyes seem to be focused on this week’s German elections.
