EUR/USD Erases Losses as Market Sentiment Turns Positive

EUR/USD rose today, erasing yesterday’s losses, as the Forex market sentiment improved. Previously, traders were worried as Hurricane Sandy threatened the United States, causing closure of US stock markets. The markets remained closed today, but damage from the cyclone was smaller than expected, making the trader’s mood improve. Signs that the US housing market continues to recover with increasingly faster pace added to the bullish momentum of the currency pair.
S&P/Case-Shiller home price index rose a little in in August to 142.7 from 142.01 in July. The annual advance was 2.0%, above the previous month’s increase of 1.2% and somewhat higher than the forecast 1.9%. (Event A on the chart.)
Yesterday, the report on personal income and spending was released, showing an increase in September. Income was up by 0.4%, in line with the forecast of 0.5%, and spending advanced 0.8%, while the forecast growth was 0.6%. Both were above the August figure, 0.1% and 0.5% respectively. (Not shown on the chart.)


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