The euro’s movement this week was signified by high volatility as the announcement of China’s government eased concerns, caused by troubles of Spanish banking system, then speculation about the possible ban of naked shorts in Germany brought back the uncertainty.
The euro dropped to 1.2370 against the U.S. dollar on Monday and continued its decline before returning to this level again on Thursday, then fell again on Friday. Against the Japanese yen the shared European currency performed similar moves, falling over the week, rebounding on Thursday, and then resuming its move down on Friday. The trend is somewhat different for the Great Britain pound as after the rebound on Thursday the euro managed to retain its upward momentum, the fact, which can be explained by the disagreement in Britain’s government.
The euro tends to react strongly on any news and speculations as the traders try to use any piece of information to predict the future of the European Union and its currency. This actually makes harder to give any solid prediction, therefore it’ll be interesting to see what news will bring us the forthcoming week.
EUR/USD closed at 1.2270 this week after opening at 1.2546 and reaching the weekly low level of 1.2153. EUR/JPY closed at 111.54 after it opened at 113.15. EUR/GBP closed at 0.8484 after opening at 0.8670 and reaching its weekly low of 0.8421.
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