The dollar is in a relatively stable state in the market although the overall market is in midst of a crisis. The USD is gaining against the Euro as the European is in a lot of uncertainties due to lack of positive news in regards to issues hovering over the European economy. The European Central Bank is unable to provide any inspiring impetus to the market as it is helpless till the decisions from Spain materialize. The US dollar is also steadily gaining against the Yen as the currency is being devalued. The dollar is also holding its strength with respect to the crude oil as the US has enough reserves to counter the disruptions in the market.
The EUR/USD pair reached a month high recently as traders expected a bailout from Spain which would have enabled the central bank to provide a positive impetus to the currency by buying debt. The expectation was heightened before the meeting of European countries to reach a conclusion but no decisive action taken will lead to a downtrend with respect to the Euro. The inability to reach a conclusion in the Greece issue and to create a stable Eurozone has also created an environment of downtrend. The pair however will remain in a range of $1.28 to $1.31 till the US elections are over. The relative stability of the US dollar in comparison to the Euro will keep the Euro losing little by little.
The USD/JPY pair is continually breaking resistance levels showing no signals of reverting back. Japan is still showing negative reports whereas there are signs of a recovery from the US. The Bank of Japan is facing pressure in order to inspire the economy before November. Thus, the Yen is continually losing against the dollar and no trend reversals are expected in the near future. The uptrend will continue till the 125 mark. There will be efforts of consolidation till the 86 level marks but there are strong signals that the Yen will keep on suffering against the dollar and would not find a convincing resistance in the near future. A lot depends on the decisions of the Japanese central bank.
Oil is expected to become a balancing factor with the differences in the supply and demand kept in mind. The growing economic concerns are raising doubts on the capability of the world with respect to oil demand. The US crude oil reserves are presently at a high which isn’t letting any of the negative factors affect the balance. The advent of the Canadian pipeline on schedule is expected to pull down the oil stocks a bit. If there aren’t announcements of delays from the places that the US is expecting supplies of crude oil, there isn’t going to be any major trend with respect to the oil market. For now there aren’t any abrupt fluctuations in the near future.