Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

FOREX-Dollar retreats broadly, hits 4-month low

Published 05/12/2009, 09:02 PM
Updated 05/12/2009, 09:08 PM

* Dollar index hits 4-mth low, euro at 7-week high

* Dollar/yen down, looks vulnerable on charts

* Traders cite FT opinion piece on U.S. debt rating

* Dollar falls amid broader rise in risk appetite

By Masayuki Kitano

TOKYO, May 13 (Reuters) - The dollar slumped to a four-month low against a basket of currencies on Wednesday, facing renewed selling amid a recovery in risk appetite that has curbed safe haven buying of dollars.

Traders said the dollar also came under pressure due to an opinion story in the Financial Times that touched on the risk of the United States losing its triple A credit rating and refocused attention on rising U.S. debt issuance.

While the content of the FT article was unsurprising it helped add to pressure on the dollar, which was already looking vulnerable on technical charts, traders said.

"I think the market overall wanted to test the (dollar's) downside and the FT story linked well with that trend," said a trader for a Japanese trust bank.

The dollar index, which measures its performance against a basket of six currencies, hit a four-month low of 81.871. After trimming some losses, it was down 0.5 percent on the day at 81.933.

The dollar index had fallen below the 200-day moving average, a key support on technical charts, late last week.

The euro hit a seven-week high of $1.3722 on trading platform EBS. It later shed some gains to stand at $1.3707 for a gain of 0.4 percent on the day. The dollar fell 0.6 percent against the yen to 95.89 yen.

Market players said the dollar may be forming a head and shoulders pattern against the yen on technical charts and looked vulnerable, although it could draw some support from the 90-day moving average at around 95.45 yen. (Editing by Michael Watson)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.