EURUSD - Trends, Forecasts and Implications (Part 1) - page 775
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more fibo
Posted at 15:08 14.12.2009
Despite the dollar having given up some of its gains in the first half of the day, there is still hope for it to strengthen towards the levels previously outlined.
The US economy is indeed showing signs of recovery (not only is the number of the unemployed dropping, but the population is starting to feel more confident as well, which was confirmed by the University of Michigan consumer confidence data that showed an increase to 73,4 against the forecasted 68,8), which fueled the demand for dollars and fuelled the speculations about the possible change in the monetary policy conducted by the US Federal Reserve. It is possible that the dollar will continue its triumphal march this week - unless the upcoming Fed meeting makes adjustments. There is little doubt that the rate level will remain unchanged, so the focus will be on the accompanying statement. If investors find signs of pessimism in the officials' comments or hints that a move to a tightening policy will be made in the very distant future, the dollar could give up everything it has gained. A consequence of the recovery in consumer activity could be a strengthening of inflation, which could indeed force the Fed into an unscheduled interest rate hike. However, as long as unemployment remains at record highs in the country, it is unlikely that such measures by the Fed can be expected in the first half of the year.
There is also hope for the British currency this week. The Pound could be supported by positive consumer price index data. It sows the seeds of doubt whether an ultra-soft monetary policy is worth to be maintained for a longer period. Which means the pound might strengthen after such data.
Throughout the week there will be inflation data for most developed countries. To this there is a gradual reduction in liquidity in the markets because of the upcoming holidays. As a result, increased volatility cannot be ruled out in the coming days. And while the players are still set for a continued strengthening of the dollar, one must be prepared for sharp fluctuations in the opposite direction. In such conditions the probable range in pair EUR/USD, most likely, during the week will not leave beyond the marks 1.4440-1.4825.
Analyst of FIBO Group, Nersesov Michael
Resistance level: 1.51-1.52
Channel: 1.46-1.51
Resistance level: 1.44-1.45
Price: 1.464
Expectation: UP to 1.48-49 rather than to 1.43-44
Another article by Leontiev:
http://news.km.ru/v_amerike_vse_perevernuto_s_nog_/print
With the given acceleration, the sell has not yet won back its 100%, although it could already pull up...
H4 - Upside confidence is high, especially after the breakdown of 1.4679
There is a cluster analyzer in the sub-window (blue-euro, green-bucks). In the main window are the frequency levels.
Wednesday will be a big day. The Fed interest rate meeting. Probably Wednesday will decide where EURUSD will go.
In the meantime, I'm thinking like this....
Eh, it's going to be a shaky day until New Year's Eve, so it's quiet.
Fibo
European pre-marketPosted 09:30 15.12.2009
Hello!
The DJ index rose to 10524 yesterday, but failed to consolidate at that level and closed near the open again, remaining at the second top. The likelihood of an imminent decline is becoming more and more evident. Oil continues to trade at levels of $71.50/72.00/bbl, thus correcting for the recent drop. The likelihood of a decline is also higher than an increase. The same scenario befell Gold, which continued to trade at 1120/1125$/oz.
The euro/dollar pair was trading at 1.46/1.4650. Volatility was low due to the unsaturated economic data. It could also be due to expectations of important data releases, which the week is full of. The Yen continues to remain at low levels around 88.60. The pressure here is on Japanese investors and exporters to return their funds from abroad. The pound rose to 1.6300 yesterday. According to the Bank of England's chief economist, the country's employment rate has not fallen as significantly as expected based on the rate of decline in business activity and production levels.
Players' attention is focused on the results of the US Federal Reserve meeting expected today and tomorrow. If the guidance does not give any signals that the interest rate will be raised soon, there is a good chance that the dollar will come under downward pressure again.
Following the technical analysis, the dollar has an equal chance of both strengthening in pair with the euro further towards 1.4520 and 1.4440, as well as resuming the move towards 1.4825.
For the pound/dollar it is 1.6150 and 1.6050, resistance 1.6340.
For the dollar/yen, it is 88.30, 86.00 and resistance at 90.40
Have a nice day!
FIBO Group MFH Analyst, Michael Nersesov