Forex, Dollar, Euro, GBP, Yen and Other Currencies :}: Where to Now?

From a fundamental and historical point of view, the markets
should continue higher, especially due to Friday’s impressive NFP
figure. Friday’s immediate reaction from stock traders was to drive the
indices to higher ground. The result diverged by such an extent, from
analyst expectations, that throughout the session stocks lost their
steam as many questioned the surprisingly good report. On the Forex
market the Dollar index saw a dramatic change, as the
Dollar jumped against counterparts, the Dollar/Yen pair soared during
Friday’s session climbing by over 200 pips. While it might seem strange
that the Dollar increased against counterparts, especially as it has
acted as a safe-haven over the last couple of months, recent movement
came down to a combination of profit taking and higher U.S bond yields.

As mentioned above
Friday’s numbers gave the markets a green light regarding the strength
of the U.S economy. On one hand, currencies should continue on their
normal path, which means that the GBP/USD, EUR/USD and USD/JPY could
see higher ground in the long term. On the other hand, the Dollar could
gain strength in the short term as investors are now rushing into the
green back due to the following;

Traders
are now pricing in a high chance of a rate hike, towards the end of the
year- this is attracting foreign money into the Dollar.
Profit taking after Dollar counterparts presented an impressive rally.