20th July to 24th July 2009 Euro / USD
Posted by admin | Posted in Weekly and Daily Wake up | Posted on 20-07-2009
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Last week had drastic impact on the forex market however scene seems to be reviewed this week. Dollar index dropped down close to 79.49 losing 77 points maintaining index still above June’s lowest at 78.33. As per the calculations, further decline in the dollar is predictable. This makes it clear that Dollar will remain bearish in the coming term as well as risk tendency is higher comparatively.
It’s been reported that Ben Bernanke, FED Chairman will release semi-annual monetary policy on Tuesday. However, downtrodden currency index and uncertainty of its future is to be considered with caution meanwhile.
Euro/USD index rebounded last week tremendously and reached high of 1.4165.The ratio suggests that Euro /USD has yet not reached an optimum level instead figure 1.4337 is just the consolidation of higher increase from 1.2456 in the triangle form. Initial ratio will remain same with no major changes this week. Though, there may be some pull back action. The downside figure will still remain above 1.3832 and will bring up another rise.
Current index shows that there will be progress from 1.2456 but this doesn’t indicate it as the third leg in continuation. While the five wave structure indicates this is the last leg of the whole structure. There are chances of another high above 1.4337. The upside would be limited at the combined resistance of 1.4622/45 to bring out the whole consolidation. At the downside, if there is support of 1.3832 then the rise of 1.2456 would be indicated completely. This will turn its focus to the trendline (which is at 1.3617 at this point of time) support.
Presently, it’s assumed that price initiating from 1.2329 are just the consolidation ratio to larger down trend. The decline from 1.6039 may get resumed once the consolidation is completed. If index gives further down to 1.2329 then this will assure that it will resume at 1.1639 key giving long term support.
As of now, we can hold on to this long term bearish view till resistance to 1.4867 holds.
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