Nothing seems safe! Outlook for British pound, euro, Australian dollar versus the US dollar amidst all this equity market blood-letting
The US dollar (Currency:USD) is a big winner in today's equity and commodity market bloodbath:
The pound versus US dollar exchange rate is 0.09 pct lower at 1.5473.
The euro versus US dollar exchange rate is 0.67 pct lower at 1.3205.
The Australian dollar versus US dollar rate is 1.09 pct down at 0.9190.
Note: The above are wholesale market rates - your bank will affix their own spread at their discretion. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering you more currency. Find out more here.
The headache for equity markets = a boon for the US dollar
What is the fuss on the markets today then?
Ishaq Siddiqi, Market Strategist at ETX Capital tells us nothing is safe in the current environment:
"The Federal Reserve’s chief Ben Bernanke laying out a path to gradually reduce the pace of stimulus by the end of 2013 and end the programme by mid-2014 has sent shockwaves across global risk assets.
"Equity markets in the US sold off rapidly Wednesday following Fed chief Ben Bernanke’s comments over monetary stimulus, weighing heavily across Asian markets in overnight trade. European share markets are responding accordingly [registering sharp falls] although some of the selling pressure seen at the open has eased.
"The euro gets a knocking versus a stronger dollar, commodities are sliding across the board, peripheral bond yields are on the rise and core government bonds are on the back-foot. Nothing seems safe at the moment!
The outlook for the euro, pound and Australian dollar
So, what does the outlook hold for the major currencies? We can only consult the charts for guidance in the current environment.
This is what RoboForex tell us:
"Euro started a fast descending movement. We think, today the price may continue falling down to reach the level of 1.3150 and then start a correction towards the level of 1.3280. Later, in our opinion, the pair may form another descending structure to reach the target at 1.3000.
"Pound continues forming a descending structure. We think, today the price may reach its first target at 1.5340 and return to the level of 1.5490. Later, in our opinion, the pair ay continue falling down towards the target at 1.5230.
"Australian Dollar is still forming a descending structure. We think, today the price may reach the target at 0.9215, consolidate near it for a while, and then continue falling down towards the target at 0.8800."