FOREX market review and forecast for next week (06/04/12 – 06/08/12) by Forex Cloud

The last week finally brought some intrigue into the market. Everything was going good in the beginning, the euro opened the week with a gap on the bull’s side, "fought" for about 24 hours, but on Tuesday the pair gave under the pressure of bad news from Spain (problems with the bank Bankia and the Spain rating decrease by Egan-Jones agency). The fall continued further up to Friday and everything happened like in a bad detective novel, around the middle of the book… In the morning “everything seemed to be going for the best”, but it turned out to be “worse than ever”.  The unemployment in the States raised by 0.1%, “Non-farm Payrolls” fell to 69K, against the expected 150K. And where is the poor trader supposed to run to? In Europe there are problems, in the USA there is unemployment and “aggravation” of the possibility of starting the QE3 and in Japan, things aren’t so good either.

On such news, the EUR/USD pair rose to 1.2459 and… the continuation of the detective for the next week promises to be “cheerful” – on Tuesday, the banks of Australia and Canada make a decision on the interest rate, in Wednesday the European Central Bank, on Thursday the Bank of England, on Friday there is important data that is coming out on inflation in Great Britain and the unemployment rate in Canada, and after the market’s closing will be published some data from China. Getting bored won’t be an option.

If we look at the three hour chart of the EUR/USD pair then we see a continuing divergence in the CCI, which doesn’t prevent the fall to continue… but where is the end? So I am for the bullish correction, but only if the pair breaks through 1.2500 and will strengthen above this level. If this doesn’t happen, it will continue to fall to at least 1.2250. 

EUR/USD 3h:

The pairs GBP/USD, AUD/USD, NZD/USD almost “literally” copied the euro’s movement for the last 3-4 weeks. Observing their charts is pointless – if the euro grows, they will too, and if not, a friendly fall will continue against the dollar…

The USD/JPY pair broke through the triangle, the one I talked about in the last review, only not upwards, but downwards and continued falling to the historical minimum around 76.00. The Bank of Japan keeps The Olympic Calmness and doesn’t hasten to intervene, whether it knows it’s useless, of its awaiting the right moment. We will also wait… 


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