Checking news updates the dollar weakened for the start of the week. It did not perform well against the euro or yen. By the end of the week the dollar was in a holding pattern waiting for Wednesday when the U.S. Fed would hold another policy meeting. Plenty has gone wrong with the USD in the last couple of weeks like the start of September with its decline in nonfarm payrolls. The fact that forex signals show a lack of support for the USD may continue throughout the entire month of September 2013. Plenty has the USD reacting with fewer gains, even going forward.
Forex Signals Received a Short Boost
Obama announced Larry Summers would become the next chairman for the Fed. As the former treasury secretary many reacted positively to the news. Unfortunately the elation did not last as new forex signals appeared. Further talk about the tapering of stimulus caused issues along with more Syria talk. Volume in the USD started to dissipate. The USD/JPY hit 81.451 and the EUR/USD was $1.3304.
The Japanese yen did not increase as much as investors hoped as more investors focused more on Nikkei talks about the Olympics and the Fed taper being discussed for mid week. Actually stocks gained more in Japan than the yen on the announcement of the Olympics.
Going back to other reasons for the forex signals to show weakness in the dollar, before Obama could even make a decision for the Fed chair a major upset occurred. Summers announced he would not continue his candidacy for the chair. This has left Janet Yellen in the position. She is dovish in terms of policies, which could affect how well the dollar will react if she replaces Ben Bernanke in January.
There is some hope as investors wait for the Fed announcement to be made according to Ken Dickson. He believes the dollar is going to appreciate no matter who takes up the next Fed chair. Dickson works for Standard Life Investments, an Edinburgh company. He believes Summers would have been better and more positive for the dollar, but Yellen won’t cause an overall depreciation.
Forex Signals in Retail Sales
Monday in the third week of September started off with USA retail sales being lower than expected for August. Many are concerned about the forex signals showing weaker economic growth for the third quarter. Yet, sales in certain areas increased like autos, electronics, furniture and appliances. These rises clearly show consumer confidence in being able to afford these goods as opposed to not spending money on them at all. Consumer sentiment also hit a rough patch down from 82.1 to 76.8.
Struggles are still there for the dollar and some news is not as expected. The hope is that some decisions will be made soon that will show encouraging forex signals instead of more rough patches ahead for the USD. Until that happens though the USD is going to continue gaining a little and losing ground against the yen and potentially the euro.
Get a free Forex PDF PLUS:
- 14 Video Lessons
- Free One-on-One Training
- A 5000$ Training Account
- In-House Daily Analysis
- Get FULL ACCESS