Euro, the major currency of the Euro region has jumped up against USD for the 6th straight month. This is the longest winning streak for the currency in last 10 years, all thanks to the increased optimism over the better situation of the sovereign debt crisis of the currency bloc.
Apart from the greenback, Euro has increased against Yen for the 6th straight month as well. In case of Yen, this is longest stretch of increase for Euro, since it was introduced way back in 1999. Since November, 2011, Euro has reached to its highest level against USD currently. Today, it kind of fluctuated though because of the drops in German retail sales. Euro is currently at $1.3575 and at point of time on today, it reached to $1.3594 marking its highest level since 18th November, 2011. Against Yen, it has gained around 0.4% and is at 124.03 Yen per Euro now. In January, 2013, Euro has actually rallied by 2.9% against USD, the biggest monthly gain since October, 2011. Again Yen, its gain for January is 8.4%, the biggest monthly advance in last 11 months.
It has been seen that the Euro has posed a bearish movement in the last 2 months, according to the Head of Research Department of Faros Trading LLC, Dan Dorrow. Dan added that the same has been helping the currency in a huge way over the last few months.
In 2013, Euro has actually been the best performer among the developed market currencies as it increased by 2.7%. Yen actually weakened by 6%, whereas, USD reduced by 0.5%.
According to the foreign exchange strategist of 4Cast Ltd., Shant Movesian, none of the investors feel that the recovery of European markets is sustainable. He added that the market will have its ups and downs continuously. He also commented that Euro will probably be at the current levels throughout the current quarter. The relative strength index of the currency for last 14 days shows that the same may go to a reverse direction soon. The index against Yen and USD was above 70 on today and this signals that has the asset has a far-stretched rally.
A gauge measuring the currency volatility decreased and this marks that there are chances that the price swings will wipe out the profits. The gauge is measured at 8.67% currently.