FX.co ★ Fundamental Analysis For February 13, 2013

On Wednesday the U.S. session behavied differently as the euro and the British pound were goin up against the dollar.

It is unusual to see this kind of movement, although the presentation of the Governor of the Bank of England King on inflation was enough for the British currency to resume its bearish direction performed during several weeks.

King dwelled upon, as one the most important aspects of his presentation, increase in the injections of money into the economy as the way out of the recession. Nevertheless, the risks of recession are not high as the inflation rate remaine below 3%.

The euro, in this context, ignores its British neighbors, and heads to 1.35, aiming to break this level without pausing at 1.3635, the first important resistance.

The single currency resumed a short-term uptrend which appeared to endanger the day before, but this drive does not have the strength it have had before, which led to 1.3710 at the maximum value of this currency in 14 months.

On another note, the yen remains expectant ahead of the monetary policy meeting of the Bank of Japan, which will release its official statement at 10:00 PM Eastern, or at the open of the Asian session Thursday. If there are no significant variations in the press release, the yen may goup exceeding 95 units low against the dollar. However, there are few who believe that the yen can fall too fast, and that a bullish correction might take place in the coming weeks.

The day's agenda includes an important data to consider. The U.S. retail sales figures will trigger the main actions on the Wall Street, where, it is worth noting, the Dow Jones closed at 14,018 points on Tuesday. This movement will have an immediate echo in the major currency pairs, with emphasis on the euro and the British pound, the two currencies that are more sensitive to this type of data in recent times.

The Canadian dollar and the Mexican peso, linked to oil, will be influenced in turn by oil inventories at 10:30. Both currencies are resuming uptrend against the dollar.

Meanwhile, the Australian dollar has lost some appeal during these days. While it has been falling steadily, its movements are somewhat erratic and are of a very narrow price range. The Swiss franc eventually demonstrated no major changes, but only a kind of reversal formation against the dollar (shoulder head shoulder), which could add some strength and that somehow also anticipate an upward movement of the euro.