Spectacular trend reversal on forex market

The euro lost a lot of ground against the RON over the last two days, once large orders to sell foreign currency were placed on the market. The quotes went down by 4 bani (0.04 RON) in only two days, after having registered fluctuating growth over the last few months. The NBR yesterday calculated an exchange rate of 3.6518 RON/EUR, 0.215 units lower than on the first day of the week. The euro has lost over 3 bani in the last two days if calculated at the official exchange rate. The dollar also lost 0.215 units, reaching 3.0169 RON yesterday. The strengthening of the RON even took the dealers by surprise, who, though expecting a decline in quotes, did not image things would move so fast. The market therefore expects these levels to consolidate over the next few days, and then new declines could follow, though less spectacular this time. Opinions on the market about this sudden slump in the quotes vary. While some dealers say that the orders mainly came from commercial customers, others believe non-resident investors to be behind the large foreign currency sales. “People on the market say non-resident investors – and quite a large number of them for that matter, are behind the sales of foreign currency. I believe the current levels will consolidate at first and then a decline will follow, but the trend will be fluctuating,” a dealer commented. ZF