Forex Forecast

EURO/USD


The dollar managed to strengthen during the week as a whole

In addition, rebounding US bond yield and softening oil price strengthened both the USD and the stock market which triggered stop sells on the EUR
The US data continued to suggest a moderation in economic growth rate with first-quarter GDP growth slowing to 3.1% from 3.8%

The Euro-zone indicators have remained generally weak, despite a decline in German unemployment


Resistance 1.2944-1.2976-1.3002-1.3047
Support1.2830-1.2782-1.2739-1.2668

Trend neutral-bearish



GBP/USD

hit a high of US$1.9162 before the sell-off that sent it down to US$1.9053. Resistance was seen at US1.9150 and support was at US1.9059


Resistance 1.9080 ... 1.9102 ... 1.9135 ... 1.9160
Support1.9053 ... 1.9028 ... 1.9012 ... 1.8987

Trend neutral



USD/CAD



Resistance1.2682....1.2745...1.2840
Support 1.2500 ...1.2450... 1.2430 ...1.2398....1.2341

Advice Stand aside

Tuesday,May3,2005

EURO/USD

Data released in the U.S. yesterday saw March construction spending rise 0.5% to US$ 1.052 trillion while the April ISM index printed at 53.3, down from 55.2 in March. The most important in the market this week is likely to be today’s Federal Open Market Committee meeting

Growth is still running close to trend and inflationary pressures are building, with the core PCE deflator accelerating over the last three quarters to 2.2 pct

The FOMC's statement will be a little less exuberant about the state of the economy. They will continue to worry about inflation."

With the Euro zone’s PMI falling from 50 to 49.2, the EUR came under pressure and finished near the US$1.2863 level. Support and resistance levels were seen at US$1.2830 and US$1.2950 respectively


Resistance 1.2954-1.2973-1.3000-1.3041
Support1.2833-1.2819-1.2781-1.2746


Trend neutral-bearish

Wednesday,May04,2005

EURO/USD


After FOMC had raised interest rate by 0.25% to 3.00%

The major resistance level at 1.2930 was breached during the Asian session and now it is probably the time to re-focus on 1.2990 which is another major resistance.


Resistance 1.2988, 1.3020, 1.3062
Support1.2928, 1.2879, 1.2836


Trend neutral



USD/CHF



Resistance 1.1936, 1.1985, 1.2028
Support1.1878, 1.1839, 1.1795


Advice Stand aside

I'm finding your thread very interesting Juan ,keep up the good work .

Thursday,May05,2005

EURO/USD


Strong buying from Asian funds provided EUR’s early gains. Support was seen at US$1.2915 and resistance was at US$1.2980.
"U.S. dollar weakness is primarily from profit-taking after the Fed statement.

EuroZone Retail Trade surprised a bit to the upside - coming in at 0.3% for March vs. the -0.2% expected.

- EuroZone Services PMI slipped slightly to 52.8 from 52 in March


Resistance 1.2976-1.3004-1.3045-1.3083-1.3119
Support1.2920-1.2841-1.2778-1.2736



Trend neutral



USD/JPY


"The market is getting bulled up on the China angle once again and dollar/yen has followed that."


Resistance 104.80-105.11- 105.37- 105.60
Support104.30- 104.09 103.86-103.62

Trend neutral-bearish


GBP/USD

Today is the much-awaited general election in the UK

Friday,May06,2005

EURO/USD


We are waiting for the non-farm payrolls.


Euro has traded in a tight range between 1.2930 and 1.2970..
.

Resistance1.2987-1.3012-1.3045-1.3088-1.3130
Support1.2922-1.2840-1.2783-1.2739


Trend neutral


USD/JPY


The USD/JPY pair traded on a tight range of 104.22 to 104.72 ahead of the US non-farm payroll figure. Support was seen at 103.90 and resistance was at 104.95.


Resistance 104.88-105.20-105.42-105.83
Support104.37-104.19- 103.92-103.61


Advice Stand aside

Monday,May09,2005

EURO/USD


Euro lost its ground against the Dollar after the US data on Friday

The employment data was considerably stronger than expected with a non-farm payroll increase of 274,000 for April.

The Euro-zone economic prospects will remain weak in the short term with little prospect of a revival in growth and the ECB will keep interest rates on hold at 2.0% even though a rate cut is still very unlikely

Resistance 1.2838- 1.2860-1.2885- 1.2921
Support 1.2796-1.2771-1.2734- 1.2692

Trend bearish



GBP/USD

Pound was sent down after US payroll data from US$1.9004 to US$1.8903..

The latest data has shown that the housing market in the UK has been weakened.



Advice Stand aside

Tuesday,May10,2005

EURO/USD


The euro retraced most of its intraday losses against the U.S. dollar today as the single currency tested bids around the US$ 1.2785 level and was capped around the $1.2845 level

The EUR was mostly range bound during the NY trading hours with traders looking ahead to the US trade data on Wednesday

There's been some mild movement, but overall it doesn't look very exciting. We're sort of looking ahead to the trade figures to give us an indication of where the dollar is going. Markets are still trying to feel out the beginnings of a dollar rally and just kind of looking to the next piece of data for further evidence of a dollar rally."

Resistance 1.2877- 1.2920-1.2952-1.2973
Support1.2814- 1.2796-1.2760- 1.2738

Trend neutral-bearish


GBP/USD

The GBP remained weak throughout the day against all majors on the back of the sharp fall in British Manufacturing output
March manufacturing output receded 1.6%, defying expectations of a 0.1% increase,
"The data is quite negative for sterling. Manufacturing is much worse than expected. And on top of that PPI data suggests that inflationary pressures are building as well."



Resistance 1.8864-1.8908-1.9000-1.9072
Support1.8805-1.8763-1.8675

Trend neutral-bearish

Wednesday,May11,2005

EURO/USD


The single currency touched a low of US$1.2816 but finished at around US$1.2870. However, weak US figures sent the EUR up to US$1.2893. Support and resistance level are US$1.2800 and US$1.2938

The Trade Balance data today will have a major impact upon the market direction

Key support is seen now at 1.2850.


Trend neutral


USD/CHF


Resistance1.2020- 1.2039- 1.2070- 1.2096
Support1.1990- 1.1962- 1.1941- 1.1887

Trend neutral

Thursday,May12,2005

EURO/USD

The US trade deficit fell 9% in March to $54.9 billion from a revised $60.6 billion (previous $61.0 billion) in February

The Trade balance data confirmed the direction started by the non-farm payrolls release and right now, the 1.2850 area looks like a huge resistance and the support level at 1.2770 will probably be quite easy to break

EUR USD is in a consolidation after the last bearish movement.
The downtrend should continue to gather momentum


Resistance 1.2829-1.2908-1.2957-1.2986
Support1.2760-1.2735-1.2714-1.2663


Trend bearish

GBP/USD

The Sterling fell to a one-month low of US$1.8720, hit by the report on UK inflation by the Bank of England, together with a strong trade figure from the US. The BoE reported a downgrade in inflation forecast due to weaker consumer spending.

The May inflation report of the BoE projects GDP growth to remain close to trend over the next three years.


"The reduction in the goods deficit is curious given what appears to be a global soft patch. Some of this appears to be due to oil and erratic items. But the report is surprising nonetheless."


Trend bearish

Monday,May16,2005

EURO/USD

The EURO fell to a 7 month low against the USD. It opened at US$1.2700 on Friday, but broke the low from February immediately afterwards, and traded down to a low of US$1.2611. US import price rose 0.8%, double the market expectation


Trend bearish



Resistance1(Asian,early European session) 1.2615



Resistance 1.2646-1.2689-1.2774-1.2850
Support 1.2582-1.2540-1.2497-1.2445


USD/JPY

The USD was traded strongly against the YEN on Friday.


Resistance107.57-108.10-108.53-109.74
Support107.26-106.70-106.38-105.82

Trend bullish

EURO/USD
The euro showed some consolidation against dollar yesterday. Despite these lower than expected numbers from the US, the euro failed to gather any real momentum and gave back most of its gains later in the day. Inflation reports will be the focus this week with US PPI due out tomorrow, US CPI on Wednesday and Eurozone CPI on Thursday.

ECB Governing Council member Liikanen reiterated the central bank's mantra by indicating that interest rates cannot stay low forever despite the fact that price stability remains under control. Therefore, despite dismal economic data, the ECB has essentially eliminated any possibility of a rate cut.

Today's support 1.2570
Today's resistance 1.2720

GBP/USD
Sterling failed to capitalize on the disappointing US data, extending its slide amid concerns that the UK housing market could see its worst year in a decade. The pound has fallen for the seventh consecutive day, shedding almost 7 cents – 3.5% of its total value. April CPI data for the UK comes out tomorrow and is forecasted to be 2.0%. Additionally, other important indicators due out this week are unemployment figures, MPC minutes and retails sales. If retail sales live up to their weak expectations, it could spell further trouble for cable.

Today's support 1.8290
Today's resistance 1.8530

EURO/USD
The euro is currently hovering just above 1.26 mark. The euro is also facing some downside pressure in light of a survey published today by TNS-Sofres which said that 53% of the French population plan on voting against the EU constitution. This is a reversal from the previous poll, which showed 52% support for the constitution. A French “non” on May 29 would put pressure on the euro as markets debate the future of the EU constitution.

Today's support at 1.2550
Today's resistance remains at 1.2710


GBP/USD
Sterling was supported earlier today on news that the UK government plans to sell GBP 2.5 billion worth of 50-year bonds on May 26. Sterling was also supported by a combination of stable annual inflation data of 1.9% and disappointing industrial production figures from the US.

Tomorrow, unemployment figures are released for the UK as well as the MPC minutes. Additionally, retail sales data comes out on Thursday. There is some downside risk for cable if these numbers show a continuing gap in economic performance between the US and Great Britain.

Today's support at 1.8265
Today's resistance at 1.8530

EUR/USD

The downward move for the pair was triggered by the technical breakout from the 1.2600 support , resulting in the test of the daily trend support at 1.2550. The pair continues to trade around 1.2540-1.2550 – the critical trend line from the 1.1389 low. Any significant break below this could see the euro test 1.2480 – the 61.8% retracement of the rise from the 1.1760-1.3663 high. Resistance now stands at 1.2580 followed by 1.2655 and 1.2700.

Today's support at 1.2470
Today's resistance remains at 1.2660


GBP/USD
Decisive break below 1.8230 will set the cable en route to 1.8160. Previous support of 1.8320 will become resistance, followed by 1.8430 – the 61.8% retracement of the 1.7744-1.9549 high.

Today's support at 1.8130
Today's resistance at 1.8380

EUR/USD
Bouncing back slightly from its 7-month low against the greenback on Friday, the euro posted small gains against the dollar despite continued political turmoil in France and the Netherlands, both of which may reject the EU constitution, and Germany, whose SPD government lost a crucial regional election, prompting Chancellor Schroeder to call for early elections. An important indication on the health of the German economy – Europe’s largest – is due out today in the form of the ZEW Economic Sentiment survey. Although it is not expected to change much, any weakness could prove bearish for the euro.



EURUSD met resistance at 1.2600 and could see further upside capped at 1.2640 and 1.2680. The critical trend line of 1.2550 from the 1.1389 low has continued to hold, despite being tested for the past two days.


Today's support at 1.2500
Today's resistance remains at 1.2680


USD/JPY


USD/JPY showed steady gains against the dollar, despite remarks by China’s Vice Premier Wu Yi that China’s decision to revalue the yuan is not subject to any specific timetable and will occur only when “conditions are right.” She went on to further state that “we will abide by market rules, but we will not succumb to external pressure.”

Today's support at 106.80
Today's resistance at 108.80

EURO/USD
The euro was unable to sustain its rally against the dollar as French opponents of the EU constitution gained ground and prominence. Some members of French President Jacques Chirac’s own party decided to speak out against the constitution and showed support for a “no”vote. Just days before the crucial May 29 vote, prominent politicians such as Senator Philippe Marini, former Socialist Prime Minister Laurent Fabius, anti-immigration leader Jean-Marie Le Pen and anti-globalization campaigner Jose Bove have criticized the constitution.

Today's support at 1.2510
Today's resistance remains at 1.2680

GBP/USD
Sterling was supported earlier today on news that the UK government plans to sell GBP 2.5 billion worth of Sterling was unable to maintain its early morning rally and has since lost ground against the greenback. With existing homes sales in the US posting record numbers today, the gap between the economic performance of the US and the UK is widening. Although a continued divergence in the two economies could prove bearish for cable, there are some recent events that could bolster sterling bulls. Opinion polls in both France and the Netherlands show that there exists a very real possibility that the EU constitution will be rejected in either one or both of the countries. As support for the “no” camp swells, traders may come to see sterling as a safe haven, thus providing it with a bit of a boost.

Today's support at 1.8230
Today's resistance at 1.8420

EURO/USD
The euro bounced back against the greenback, despite diminished business confidence in Germany, which saw the Ifo survey index unexpectedly fall to 92.9 from 93.3. Mixed US data helped to push the euro higher for the third consecutive day.

Downward pressure on EURUSD still exists leading up to the crucial vote on the EU constitution in both France and the Netherlands. An upward revision of Q1 GDP in the US tomorrow could also exasperate the growth differential between the US and the Eurozone. Support for the euro

Today's support at 1.2550
Today's resistance remains at 1.2710


USD/JPY
Upward pressure is currently being exerted on USDJPY as China digs in its heals with regards to revaluation of the yuan.

Today's support at 107.25
Today's resistance remains at 108.80

EURO/USD
The downward move for the pair was accelerated by the triggering of stop orders and the general lack of volume. Although the pair is trading at 1.2470, only tomorrow’s trading will show whether the 1.25 level has been broken. Further support is seen at 1.2450 and 1.2390. EURUSD resistance occurs at 1.2510 and 1.2535, followed by 1.26 and 1.2624.

Support at 1.2330
Resistance remains at 1.2510
GBP/USD
The downward move for the pair was accelerated by the triggering of stop orders and the general lack of volume. Although the pair is trading at 1.2470, only tomorrow’s trading will show whether the 1.25 level has been broken. Further support is seen at 1.2450 and 1.2390. EURUSD resistance occurs at 1.2510 and 1.2535, followed by 1.26 and 1.2624.


Support at 1.8090
Resistance at 1.8230 __________________

EURO/USD
The French referendum outcome, no matter how expected, is sending waves of reaction around the world. The real question is whether the vote was a “no” to single Europe’s politics or single Europe’s politicians. Analysts predicting the ‘breaking up’ of the Eurozone should note that the European project has already overcome enough setbacks in its 50-year old history.
Euro’s decline is so far contained by the 1.2320 support.

Support at 1.2320
Resistance remains at 1.2450

USD/JPY
While USDJPY drifts higher, resistance is seen at 108.50, followed by the April 5 high of 108.87. Support starts at 107.45, followed by 107.30. Further support is seen at 106.84 – the 61.8% retracement of the 103.64-108.87 high.

Support at 107.30
Resistance at 108.80

EURO/USD
Remarks from Italy's welfare minister calling for a referendum to see whether Italians want to temporarily bring back the lira. Although we see the chances of such a referendum being organized as extremely slim, the market reaction to the statement is considerable.


Support at 1.2200
Resistance remains at 1.2380


USD/JPY
We see the yen extending Friday’s gains on a combination of a rate doubts in the US and the Bank of Japan’s gradual retreat in money market liquidity. The central bank kept liquidity below the 30-35 trillion yen target for a second day in a row in line with its attempts to curtail current account reserves. The BoJ had previously stated its intention to cut the generous liquidity because the quantitative easing policy has failed in making a difference to improve lending by commercial banks.

A breach below 107.50 sees next target at 107.00. The pair’s Relative Strength Index continues to edge lower, reaching 55, a level not seen since May 12.

Support at 107.00
Resistance at 108.50