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Wednesday, June 3, 2009

Risk Aversion and the USD

Today is another classic case of risk aversion, driving up the USD. Why? I don't know. The USD as of late has been likened to toilet paper. Bankers and economists have been threatening the USD by doubting their faith in the dollar as a safe haven, but on a day, with bad political and economic news, the USD was bought up, and given back some lost ground. So, yes, the dollar is still a safe haven for the big investors that over the past few days, have talked it down. I knew economic news was going to be bad during the NY session and thought it would drive the dollar down. The DOW closed at -65.63 for the day. Not a horrible number, but it was enough to drive the GBP down a few hundred pips and the EUR a 100. News out of London about the Parliamentary resignations, didn't help sustain the Sterling's bull run. Now, the charts are starting to level out, and we should start to see some formations starting to take shape through the Asian session.

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