Cross Currency and Dollar Index Updates

The greenback advanced against three of the four component currencies. The USD Index is in bearish mode despite better US fundamentals. This is due to expectations built up on eurozone. Dollar Index will not cross level of 80.00 in near future.


EUR/USD has appreciated up to 1.3250 levels. It will further go up to 1.3480, in the mean time it might move sideways.


 AUD/USD is set to consolidate and move higher with support at 1.0700.


GBP/USD is range bound with resistance at 1.6150 and support at 1.5650.


The CAD/USD is benefiting from the Euro zone betterment, though it seems range bound between 0.9875 and 1.0550.


The USD/CHF will move further down if breaks below 0.8950.


USD/JPY is pushing up due to Japan’s weak economic data, with strong support at 77.28.


USD/INR has support at 48.50 and resistance at 50.00, chances are that the support will hold and Re might remain range bound.


EUR/INR has support is at 65.30 and resistance at 65.50. Probably, the pair will breakdown below 65.30.


GBP/INR has support at 78.30 and resistance at 78.65, it might move down once support is broken.


JPY/INR has a weekly resistance at 0.6060 and support at 0.6050.

FOREIGN EXCHANGE MARKET

Foreign exchange is the most volatile of all financial entities traded in the market. Forex market is driven by high liquidity and volatility. The entire forex trading and investment business functions as one large international market.

Forex Market Participation

Market participants and traders involved are speculators, financial institutions, central banks, corporate and governments, throughout world. Prominent and large chunk transactions are done for hedging and balance of payments purposes.  

Factors Affecting Forex

Forex rates are affected by various macro and micro economic conditions prevalent at the real time. Some of the major elements of concern are:

·        Demand and supply of a particular currency against other currency.

·        Economic and financial factors of the country, like balance of payment, GDP, inflation, current account surplus or deficit.

·        Internal and external political conditions.

Dollar Index

Dollar Index is a pertinent pulse of World Economy. Most of the exports and imports are in terms of USD. Even today, it is considered as world currency.

Dollar index shows the health of dollar against six major currencies of the world. Those currencies are Euro Zone currency (EUR) 58.6%, Japanese Yen (JPY) 12.6%, Pound Sterling (GBP) 11.9%, Canadian Dollar (CAD) 9.1%, Swedish Krona (SEK) 4.2% and Swiss Franc (CHF) 3.6%.