EUR/USD Up As The Sanction Against Russia Started

The EUR/USD took a hit earlier when inflation data from the Eurozone was lower than expected. This revived fears about deflation int he Euro. However, downward movement for the pair was short lived; Russia has begun selling off its dollar reserves in response to sanction threats from the United States, causing the EUR/USD to rise despite better than expected US industrial production data. Due to the tense political situation, it is likely the dollar could continue to go down as investors search for safe haven assets. Pay close attention to the situation in Eastern Europe. Look for support at 1.3830 and resistance at 1.3965.

The USD/JPY has gone down today despite better than expected US data due almost entirely to tension in the Crimea post referendum. For starters, Russia has decided to sell its dollar denominated holdings, pushing the dollar downward. Secondly, the yen has appreciated a bit due to its appeal as a safe haven asset. The combination of both of these events puts a lot of downward pressure on the pair – which may continue as long as the situation in the Ukraine does not change. Look for support at 101.20 and resistance at 102.20.