The USD gained on the EUR, but produced rather range bound trading versus the GBP and JPY on Tuesday. The greenback advanced against the EUR, but its move will be interpreted as rather tranquil by most. Housing Starts data proved disappointing yesterday missing its estimate, but Building Permits turned in slightly better than anticipated figures – thus leaving sentiment on the rather tentative ground it had started the day out with. Goldman Sachs basically met the same fate as it turned in numbers that were not up to expectations. However, investors did manage to produce gains for the investment banking giant by day’s end. Today there will be very little economic data, but Fed Chairman Ben Bernanke will testify before the Senate Banking Committee.
Bernanke’s testimony today will be followed by a question and answer period, which could produce fireworks. The testimony will be about monetary policy and the prospects for the American economy. Taking into consideration that this coming November will be have a vital election, many believe the Senate today and the House of Representatives tomorrow will use these next two days as a political platform. The Fed Chairman will certainly face questions about the recovery which has proven hard to grasp and the lack of job creation and its effect on the housing sector and broad consumer sentiment. Leading up to today’s American trading session, market participants have been tentative. The Bernanke hearings, and tomorrow’s Existing Home Sales and weekly Unemployment Claims, should be enough to cause a stir. The question is if investors will be prompted to climb down from their fences, but taking into consideration the lack of confidence that pervades, it is likely that traders will be the first to battle as they search for fair values across the board.
Written by bforex.com
