Forexpros Daily Analysis

Forexpros Daily Analysis - 21/10/2009

Forexpros Daily Analysis Oct 21, 2009


The US Department of Labor will publish its weekly Initial Jobless Claims Report Tomorrow (22 Oct).

The Report is a measure of the number of people who file for unemployment benefits for the first time during the given week.
The number of jobless claims is used as a measure of the health of the job market, as a series of increases indicates that there are fewer people being hired.
Usually, a move of at least 35K in claims is required to signal a meaningful change in job growth.
A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.
Analysts forecast last weeks measure of 514.00K to rise to 518.00K.

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Euro Dollar

The Euro broke the yesterday's support 1.4964, and reached the first target of this break, and Fibonacci important support 1.4891, tested it strongly, but eventually it survived (yesterday's low 1.4881). We will adopt this support level as support of the day, because if it holds, this would mean that the short-term correction is already over, and that we are heading to areas above yesterday's high 1.4993. But, if broken, what will be expected is a correction for the move up from 1.4480, and if this is the case, targets will not be less than 1.4797, and may be 1.4737 also. Short-term resistance is 1.4950, and if broken, we will head with the Euro to the top of the rising channel on the hourly chart, which is currently at 1.5048, and may be we will reach the highest level since Aug 2008, at the resistance 1.5082. The support level at 1.4891 is the most important level for today, and is the line separating positive areas from negative.

Support:
1.4891: Fibonacci 61.8% for the short-term.
1.4842-1.4849: The support area which contains the lows of Thursday & Friday.
1.4797: Fibonacci 38.2% for the whole move from 1.4480.

Resistance:
1.4950: short-term resistance.
1.5000: psychological level.
1.5048: the top of the rising channel on the hourly chart.

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USD/JPY

The Dollar-Yen with amazing accuracy at the first support in yesterday's report (lowest price after the issuance of yesterday's report is 90.06), and then rose to 91.05, breaking 90.73 on the way, but what followed was a modest move. The most important support is the Fibonacci 61.8% for the short-term at 89.77, and if broken the direction would be down to test the important support 88.68, which must hold to prevent another attempt to test 87.97 which survived 2 weeks ago an attempt for a break. As for the resistance, the most important one is 90.90, and the key to the most important stop in these areas is 91.63, which is expected to be an important test. Breaking it means that this rise will continue in the next few days, to areas above 92, where 92.52-92.58 is the first target for this break. While failure here would indicate that this is but a short-term rise.

Support:
89.77: Fibonacci 50% short-term and the bottom of the rising channel on the intraday charts.
89.38: Oct 7th high.
88.68: support area that supported the price twice this month.

Resistance:
90.90: short-term resistance.
91.63: previous support & resistance area, the most important resistance for the short-term.
91.93: Sep 2nd low.

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Forex trading analysis by Forexpros - Written by Munther T. Marji

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Disclaimer
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Forexpros Daily Analysis - 26/10/2009

Forexpros Daily Analysis Oct 26, 2009


The National Australia Bank (NAB) will publish its Quarterly Business Confidence report tomorrow (OCT 27).

The report measures the current business conditions in Australia by analyzing the economic situation in the short term.

The indicator is concluded from a survey of around 1000 companies.

A rising trend indicates an increase in business investment which may lead to higher levels of output.

Above 0 indicates improving conditions, below indicates worsening conditions.

A higher than expected reading should be taken as positive/bullish for the AUD, while a lower than expected reading should be taken as negative/bearish for the AUD.

The Australian Market has seen an improving trend ever since the low reading of Business Confidence this February which stood at -42.

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Euro Dollar


We can say that the Euro is still facing trouble in the 1.5045-1.5062 area, and with closing on towards 1.5082 very slowly, we should be on the watch for a top near this level, where a relatively sizable correction is expected to begin. The most important resistance for now is 1.5082, and only breaking it would weaken the probability of a top formation in this area. The most important support is the bottom of the rising channel on the hourly charts, which meets the moving average SMA100 at 1.4992. If broken, we expect a correction to match the rise from 1.4480, which would take the price in the next few days to 1.4840 at the very least. But, if things go against our expectations, and the price rise and breaks 1.5082, that would open the way towards 1.5144 & 1.5200.

Support:
1.4992: the bottom of the rising channel on the hourly chart, and the moving average SMA100.
1.4896: clear support area on the hourly chart.
1.4840: Fibonacci 38.2% for the whole move from 1.4480.

Resistance:
1.5082: previous daily high from 2008.
1.5144: previous support area that contained more than one daily low during last year.
1.5200: previous resistance area from 2008.

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USD/JPY

Dollar-Yen reached 92 for the first time in more than a month. And after breaking 91.63, its is only logical to say that the odds favor a continuation of this slow rise, probably to our previously suggested target area 92.52-58, which could be an area for the price to reverse from, and start correcting the whole rise from 87.98. Short-term resistance is 91.94, and breaking it would mean we are heading towards the target area 92.52-58, or may be to a more exciting and attractive target, which is 92.88: Fibonacci 50% resistance for the whole down move from 97.77 to 87.98. And since the 2 targets are not far from each other, the whole area combining them (92.52-92.88) is considered one wide resistance area that we expect is able to reverse the direction on the short-term, and initiate a correction that we can not talk about its size now. The most important support is 91.47, provided by the rising trendline on the 15 minute chart. If broken, we will target 90.90 where the known previous resistance meets the SMA100. And Since the RSI is standing in the middle of the way, the odds of going in either direction look close.

Support:
91.47: the rising trendline on the intraday charts.
90.90: the previous known resistance, and the moving average SMA100.
89.38: Oct 19th low.

Resistance:
91.94: intraday resistance.
92.52-92.58: previous well known resistance area.
92.88: Fibonacci 50% for the whole drop from 97.77 to 87.98.

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Forex trading analysis by Forexpros - Written by Munther T. Marji

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Disclaimer

Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Forexpros Daily Analysis - 28/10/2009

Forexpros Daily Analysis Oct 28, 2009


The U.S. Department of Labor will publish the weekly Initial Jobless Claims report tomorrow (Oct 29).

The report is a measure of the number of people who file for unemployment benefits for the first time during the given week. This data is collected by the Department of Labor, and published as a weekly report.
The number of jobless claims is used as a measure of the health of the job market, as a series of increases indicates that there are fewer people being hired.
Usually, a move of at least 35K in claims, is required to signal a meaningful change in job growth.
A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.
Analysts predict last weeks measure of 531.00k to drop to 520.00k

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Euro Dollar

In agreement with the negative technical outlook we talked about in yesterday's report, the Euro stopped at the first resistance in the report 1.4927 with great accuracy (yesterday's high 1.4926), then dropped breaking the support 1.4861, and reached the first target of that break 1.4771 with great accuracy as well (yesterday's low 1.4769). We still favor more downside movement, which is an expectation built on the negative technical outlook after breaking 1.4992, but we should not neglect the rising probability of an upward correction for the drop from 1.5061, which reached almost 300 pips so far. Short-term support is provided by the rising trendline from yesterday's low, currently at 1.4801, and breaking it would mean a continuation of the sharp drop, in order to break 1.4771, and target Fibonacci 61.8% for the whole up move from 1.4480, at 1.4702. Short-term resistance is 1.4844, and breaking it would target the area between 1.4881 & 1.4949. If the negative outlook is to persist, the later (1.4949) should hold.

Support:
1.4801: the rising trendline from yesterday's low on the intraday charts.
1.4760: Oct 13th low.
1.4702: Fibonacci 61.8% for the whole move from 1.4480.

Resistance:
1.4844: Monday's low.
1.4927: Fibonacci 38.2% for yesterday's drop.
1.4978: Fibonacci 61.8% for yesterday's drop, and the most important resistance for the time being.

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USD/JPY

The Dollar-Yen stayed below the resistance 92.27, broke the support 91.98, and reached the first target for this break 91.26 successfully. With this down move, we are getting closer to the bottom of the rising trend channel on the hourly chart, currently at 90.76, making it support of the day. Staying above it, would give this pair a chance to correct the drop from Monday's high 92.31, creating a correction that could reach 91.84, the most important resistance for the short-term. We believe that the borders of the current area are support 90.76 and resistance 97.84, and before breaking any of them, it would be difficult to predict the next move's direction. And we believe that the direction of that move will be the direction of the break. If we break support 90.76, that would mean we broke the rising trend channel, and the trend for the short and medium terms, and that would take the price close to 90 again. On the other hand, breaking resistance 91.84 would mean that the drop from Monday's high is over, and that we are on the way to 92.52-58.

Support:
90.76: the bottom of the rising trend channel on the hourly.
90.06: Oct 20th low.
89.61: Oct 12th low.

Resistance:
91.54: Fibonacci 38.2% for the short-term.
91.84: Fibonacci 61.8% for the short-term, the most important resistance for now.
92.52-92.58: previous well known resistance area.

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Forex trading analysis by Forexpros - Written by Munther T. Marji

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Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Forexpros Daily Analysis - 29/10/2009

Forexpros Daily Analysis Oct 29, 2009

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Traders await tomorrows announcement (Oct 30) by the Bank of Japans Monetary Policy Committee (MPC) on the new monthly short term interest rate.

The decision on where to set interest rates depends mostly on growth outlook and inflation. The primary objective of the central bank is to achieve price stability. High interest rates attract foreigners looking for the best "risk-free" return on their money, which can dramatically increases demand for the nation's currency.
A higher than expected rate is positive/bullish for the JPY, while a lower than expected rate is negative/bearish for the JPY.
Analysts expect no new changes from the banks executives, with this months interests remaining stable at 0.10%.

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Euro Dollar

In agreement with the negative technical outlook we talked about in the past two days, the Euro stopped at the first resistance in the report 1.4844 with great accuracy (highest price after the issuance of the report is 1.4840), then dropped breaking the support 1.4801, and reached the first target of that break 1.4702. And after reaching 1.4702, we should not neglect the rising probability of an upward correction for the drop from 1.5061, which reached almost 400 pips so far. Short-term support is Fibonacci 61.8% for the whole rise from .4480, which is at 1.4702, and breaking it would mean that the drop coming from 1.5061 will be larger than our expectation, and the next targets will be 1.4649 and 1.4610. Short-term resistance is 1.4737, and breaking it would target the Fibonacci 38.2% at 1.4827, and may be Fibonacci 50% at 1.4872. If the negative outlook is to persist, the Euro should not break the most important resistance for the medium-term 1.4916.

Support:
1.4702: Fibonacci 61.8% for the whole move from 1.4480.
1.4649: Oct 7th low.
1.4610: previous support.

Resistance:
1.4737: short-term resistance.
1.4827: Fibonacci 38.2% for the drop 1.5061.
1.4872: Fibonacci 61.8% for the drop 1.5061.

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USD/JPY

Dollar-Yen broke 90.76 and had some drop after that, but it stopped before 90. In spite of that, the technical outlook became more negative, because we broke the rising channel that we have been monitoring lately. The most important support for the short-term is 90.16, and until this moment it managed to hold above it. If it can maintain to do so, we expect a correction for the down move from 92.31. But if it is broken, more of the drop is to be expected, first towards the important 89.61, the last important support above 89, since the next important support is 88.82. On the other hand, the most important resistance for the short-term is 91.02, which represents both Fibonacci 38.2%, and also the retest level for the broken channel. If broken, we expect to rise towards the important 91.52, and if we are in front of a correction, we should not break this level. But if a surprise happens and we break it, the price would be on the way back to 92.17.

Support:
90.16: short-term support.
89.61: previous support & Oct 12th low.
88.82: previous support & Oct 14th low.

Resistance:
91.02: Fibonacci 38.2% for the short-term, and the retest level for the broken channel, important resistance.
91.52: Fibonacci 38.2% for the short-term, important resistance.
92.17: previous well known resistance area.

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Forex trading analysis by Forexpros - Written by Munther T. Marji

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Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Fundamental Weekly Outlook

EU:
Monday: France PMI Manufacturing (Previous 55.3, Expected 55.3), Germany PMI Manufacturing (Previous 51.1, Expected 51.1), Euro-zone PMI Manufacturing (Previous 50.7, Expected 50.7).
Wednesday: France PMI Services (Previous 57.8, Expected 57.8), Germany PMI Services (Previous 50.9, Expected 50.9), Euro-zone PMI Services (Previous 52.3, Expected 52.3). Euro-Zone PPI MoM (Previous 0.4%, Expected -0.4%) & YoY (Previous -7.5%, Expected -7.7%).
Thursday: Euro-Zone Retail Sales MoM (Previous -0.2%, Expected 0.2%)
& YoY (Previous -2.6%, Expected -2.4%). ECB Rate Decision (Previous 1.00%, Expected 1.00%) & then Trichet Speaks at ECB Monthly News Conference.
Friday: France Trade Balance (Previous -3.4 B, Expected -3.0 B). Germany Factory Orders MoM (Previous 1.4%, Expected 1.0%) & YoY (Previous -20.4%, Expected -13.6%).

US:
Monday: ISM Manufacturing (Previous 52.6, Expected 53.0).
Tuesday: Factory Orders (Previous -0.8%, Expected 1.0%).
Wednesday: FED/FOMC Rate Decision (Previous 0.25%, Expected 0.25%).
(Previous 0.25%, Expected 0.25%).
Thursday: Initial Jobless Claims (Previous 530K, Expected 520K).
Friday: Unemployment Rate (Previous 9.8%, Expected 9.9%), Change in Nonfarm Payrolls (Previous -263K, Expected -175K). Wholesale Inventories (Previous -1.3%, Expected -1.0%).

JP:
Monday: Labor Cash Earnings YoY (Previous -3.1%, Expected -2.1%)
Thursday: BOJ Board Meeting Minutes (text report).
Friday: Leading Index CI (Previous 83.2, Expected 86.2), Coincident Index CI (Previous 91.2, Expected 92.5).

UK:
Monday: PMI Manufacturing (Previous 49.5, Expected 50.0).
Wednesday: Nationwide Consumer Confidence (Previous 71.0, Expected 73.0), PMI Services (Previous 55.3, Expected 55.5).
Thursday: Industrial Production MoM (Previous -2.5%, Expected 1.2%) & YoY (Previous -11.2%, Expected -10.3%). BoE Rate Decision (Previous 0.50%, Expected 0.50%).
Friday: PPI Input MoM (Previous -0.5%, Expected 1.5%) & YoY (Previous -6.5%, Expected -1.3%). PPI Output MoM (Previous 0.5%, Expected 0.3%) & YoY (Previous 0.4%, Expected 1.9%), PPI Core MoM (Previous 0.5%, Expected 0.2%) & YoY (Previous 1.4%, Expected 2.0%).

AU:
Monday: House Price Index QoQ (Previous 4.2%, Expected 3.0%) &YoY House Price Index (Previous -1.4%, Expected 4.3%).
Tuesday: RBA Decision about the interest rate on the Australian Dollar (Previous 3.25%%, Expected 3.50%).
Wednesday: Retail Sales (Previous 0.9%, Expected 0.5%).
Thursday: Trade Balance (Previous -1524 M, Expected -2150 M).

CA:
Thursday: Building Permits MoM (Previous 7.2%, Expected N/A). Ivey PMI (Previous 61.7%, Expected 58.0).
Friday: Unemployment Rate (Previous 8.4%, Expected 8.4%). Net Change in Employment (Previous 30.6K, Expected 10.0K).

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Forex trading analysis by Forexpros Written by Munther Marji

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Disclaimer
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Forexpros Daily Analysis - 02/11/2009

Forexpros Daily Analysis Nov 2, 2009

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UK traders await the release of the Nationwide Consumer Confidence report tomorrow (Oct 3rd).

The report is calculated from a survey of about 1,000 consumers, and measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict the consumer spending, which is a major part in the total economic activity.

A higher than expected reading should be taken as positive/bullish for the GBP since it points to consumer optimism, while a lower than expected reading should be taken as negative/bearish for the GBP.

Analysts forecast an increase on lasts months figure of 71.00 to 72.00.

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Euro Dollar

The Euro broke the short-term resistance 1.4737, and reached the first target suggested for this break at 1.4827 successfully. The most important question for now is this: Is the current rise a corrective or impulsive move? We believe that the limit separating those two possibilities is 1.4916, which is Fibonacci 61.8% for the drop from 1.5061. And as long as the Euro stays below this resistance it is considered a corrective rise, while breaking it would announce more upside movement to come, probably to reach new highs above the last top 1.5061. The first resistance in front of us is 1.4872, and if it is broken we will head towards the important test of 1.4916, and if this one is broken we will target 1.4980 first, on the way to higher targets. Short-term support is provided by the rising trendline from Wednesday's low, currently at 1.4786, and if broken we will test 1.4702 again, and if this one is broken we will head towards 1.4649.

Support:
1.4786: the rising trendline from Wednesday's low on the intraday & hourly charts.
1.4702: Fibonacci 61.8% for the whole move from 1.4480.
1.4649: Oct 7th low.

Resistance:
1.4872: Fibonacci 50% for the drop 1.5061.
1.4916: Fibonacci 61.8% for the drop 1.5061.
1.4980: Oct 26th low.

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USD/JPY

As we have expected in Friday's report, Dollar-Yen broke the support 90.75 and reached both suggested targets 90.16 & 89.61 successfully. This drop that started on Thursday and continued into the new week, was the result of stopping near Fibonacci 61.8% resistance at 9.52, and as you know, stopping near Fibonacci resistance levels is an evidence that the trend in down. But on the other hand, the abovementioned drop cashed in 250 pips approximately, which could create a correction from here. That is why we prefer to wait for a break of short-term support 89.61 or short-term resistance 90.23 before talking about the direction of the next move from here. If we break the support 89.61 the downtrend will continue, and will target 89.07 and the important 88.64. And if we break Thursday's low 90.23, we will be heading to a test of short-term Fibonacci 61.8% at 90.68, and only if it is broken, we will expect a retest of the broken channel at 91.28, which would be an important test if it happens.

Support:
89.61: previous support & Oct 12th low.
89.07: previous intraday support.
88.64: Oct 9th low.

Resistance:
90.23: Oct 29th low.
90.68: Fibonacci 61.8% for the short-term, important resistance.
91.28: the retest level of the broken channel.

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Forex trading analysis by Forexpros Written by Munther Marji

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Disclaimer
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Forexpros Daily Analysis - 03/11/2009

Forexpros Daily Analysis Nov 3, 2009

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The Federal Open Market Committee (FOMC) decision on short term interest rate is due out tomorrow (Nov 4).

The decision on where to set interest rates depends mostly on growth outlook and inflation. The primary objective of the central bank is to achieve price stability. High interest rates attract foreigners looking for the best "risk-free" return on their money, which can dramatically increases demand for the nation's currency.
A higher than expected rate is positive/bullish for the USD, while a lower than expected rate is negative/bearish for the USD.
Analysts forecast no change, with the interest rate remaining at 0.25%.

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Euro Dollar

In spite of the importance of the 1.4682 support that has stopped price twice exactly at the same price, we will not wait until it is broken to turn our outlook for the Euro to negative. We will set out most important support at Fibonacci 61.8% for the short-term 1.4744, because it is the last important support defending 1.4682, and if 1.4744 is broken, the odds of breaking 1.4682 on a third attempt will be big. The most important support for the short-term is 1.4809, provided by the falling trendline from 1.4926, and breaking it would give the Euro some strength that could be enough to test Fibonacci 50% at 1.4872. We will await a break of either of those levels before deciding on today's direction. If we break support at 1.4744, that will mean a continuation of falling on the short-term and targeting the important bottom 1.4649 and may be 1.4610 after that. But if we break the resistance 1.4809, today's direction would be up, and the suggested targets would be 1.4872 first, and may be 1.4916.

Support:
• 1.4744: Fibonacci 61.8% for the short-term.
• 1.4649: Oct 7th low.
• 1.4610: Sep 21st low.

Resistance:
• 1.4980: the falling trendline from 1.4926.
• 1.4872: Fibonacci 50% for the drop 1.5061.
• 1.4916: Fibonacci 61.8% for the drop 1.5061.

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USD/JPY

Down to the pip, the Dollar-Yen stopped at Fibonacci resistance specified in yesterday's report 90.68 (yesterday's high is EXACTLY 90.68), and as you know, stopping near Fibonacci resistance levels is an evidence that the trend in down. That’s why we find ourselves favoring a continuation of the short-term downtrend as long as we are below 90.68. And we will await a break of short-term Fibonacci support 90.16, after the price literally "sat" on it for the past few hours. If we break this support the downtrend will continue, and will target 89.61 first, then 89.07 and may be the important 88.64. The price behavior for yesterday, and the amazingly accurate reversal at the Fibonacci resistance that we talked about (90.68),makes it the most important resistance, and only if it is broken, we will change our negative outlook for this pair. If this surprise happens, we will be heading to a test the upper limit of the short-term downtrend (the trendline drawn on the chart), which is currently at 90.95, and that would be an important test if it happens.

Support:
• 90.16: Fibonacci 61.8% for short-term.
• 89.61: previous support & Oct 12th low.
• 89.07: previous intraday support.

Resistance:
• 90.68: Fibonacci 61.8% for the short-term, important resistance.
• 90.95: the upper limit of the short-term downtrend and the trendline descending from last week tops.
• 91.60: Oct 29th high.

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Forex trading analysis by Forexpros – Written by Munther Marji

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Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Forexpros Daily Analysis - 04/11/2009

Forexpros Daily Analysis Nov 4, 2009


Initial Jobless Claims to Be Published in the US Tomorrow

The Initial Jobless Claims is a measure of the number of people who file for unemployment benefits for the first time during the given week. This data is collected by the Department of Labor, and published as a weekly report.

The number of jobless claims is used as a measure of the health of the job market, as a series of increases indicates that there are fewer people being hired.
On a week-to-week basis, claims are quite volatile.

Usually, a move of at least 35K in claims, is required to signal a meaningful change in job growth.

A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.

Analysts forecast 520.00K, down from 530.00K.

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Euro Dollar

The Euro broke short-term support 1.4744 and successfully reached the first suggested target 1.4649. But the point where yesterday's drop stopped, uncovered a very harmonized channel, and price has touched its lines a whole 7 times. Yesterday's low was exactly at the bottom of that channel, as the attached chart shows (hourly chart). We will monitor this channel to try and specify the direction, and we strongly believe that if this channel is broken to the downside, the medium-term price direction will be in a downtrend. The bottom of the channel is currently at 1.4649 which makes this level the most important support for the short-term. On the other hand, resistance congregate its power in one important area, where we find the falling trendline from 1.5061, the moving average SMA100, and Fibonacci 61.8% for the short-term at 1.4762 (calculated for the 5 waves dropping from 1.4843 to the orthodox bottom 1.4631 and not the price bottom 1.4625), which clearly makes this area the most important of all resistance levels. A break of the 1.4649 support will put the Euro under pressure and that would push it lower to 1.4559, then the important bottom 1.4480, and later to 1.4404. While a break of the resistance 1.4762 ill give the Euro a chance to catch a break and to correct upwards towards 1.4846 and may be 1.4897.

Support:
1.4649: the bottom of the coordinated channel on the hourly chart, and the most important support for medium-term.
1.4559: Fibonacci 38.2% for medium-term.
1.4480: Oct 2nd low.

Resistance:
1.4762: important resistance area combining Fibonacci 61.8% for the short-term, the moving average SMA100, and the falling trendline from 1.5061..
1.4846: Fibonacci 50% for the drop 1.5061.
1.4897: Fibonacci 61.8% for the drop 1.5061.

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USD/JPY

After stopping on Monday, at Fibonacci resistance 90.68 down to the pip, Dollar-Yen stopped yesterday at the moving average SMA100, with the same kind of accuracy. And as you know, stopping near Fibonacci resistance levels (and moving averages as well) is an evidence that the trend in down. Thats why we find ourselves favoring a continuation of the short-term downtrend as long as we are below 90.68. And we will await a break of short-term Fibonacci support 90.21. If we break this support the downtrend will resume, and will target 89.61 first, then 89.07 and may be the important 88.64. The price behavior for the past two days, and the amazingly accurate reversal at the Fibonacci resistance (90.68), makes it the most important resistance, and to add to that, the upper limit of the short-term downtrend (the trendline drawn on the chart), is currently at the same level. And only if it is broken, we will change our negative outlook for this pair. If this surprise happens, we will expect price to reach 91.28 then the important resistance 91.63.

Support:
90.21: Fibonacci 61.8% for short-term.
89.61: previous support & Oct 12th low.
89.07: previous intraday support.

Resistance:
90.68: Fibonacci 61.8% for the short-term, and the falling line of the downtrend, important resistance.
91.28: previous intraday important top.
91.63: a well known support area that contained a number of daily tops and bottoms, the last of which was Oct 29th high.

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Forex trading analysis by Forexpros Written by Munther Marji

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Disclaimer
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Forexpros Daily Analysis - 05/11/2009

Forexpros Daily Analysis Nov 5, 2009

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Unemployment Rate in the US to Be Announced Tomorrow

The Unemployment Rate is a measure of the percentage of the total labor force that is unemployed but actively seeking employment and willing to work in the US.

A high percentage indicates weakness in the labor market. A low percentage is a positive indicator for the labor market in the US and should be taken as positive for the USD.

Analysts forecast a 9.90% unemployment rate, up from 9.80%.

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Euro Dollar

The Euro broke short-term resistance and reached both suggested targets 1.4846 and 1.4897 successfully. Yesterday's climb stopped 10 pips above Fibonacci level, then went back to settle below it. That is why this resistance will keep its importance. Breaking it would send the Euro above 1.50, or at least close to the dollar and a half mark. The Euro continued its shine since reaching the bottom of the hourly channel that we talked about yesterday, and is currently rising inside an upward rising channel on the intraday charts, with its top at 1.4972, a level we consider as a first target to a break of 1.4897, and after that we could see 1.5014. The bottom of the same channel is currently at 1.4839, and as long as price holds above it (at the moment its only pips above this level) the potential for more short-term upside works stays alive. On the other hand a break of the bottom of the channel indicates that the direction for the short-term has turned down, which will target 1.4769 first, and may be 1.4701 later. We remind you of the rate decision of the ECB that will be announced today, and the news conference for president Trichet that will follow, which usually moves the Euro violently.

Support:
1.4839: the bottom of the rising channel on the intraday charts.
1.4769: Fibonacci 50% for the last rising move.
1.4701: previous important support/resistance area.

Resistance:
1.4897: Fibonacci 61.8% for the drop 1.5061.
1.4972: the top of the rising channel on the intraday charts.
1.5014: previous resistance.

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USD/JPY

Dollar-Yen broke Fibonacci resistance 90.68 and reached 91.28 as we accepted, with accuracy (yesterday's high 91.30), before retreating fast. This behavior redefined the rising channel on the hourly chart to make its bottom at 90.18. And when calculating Fibonacci 61.8% resistance for the short-term (for the drop from yesterday's high), we find that it is at the resistance level of 90.90. In case of a break of either of those levels, we believe price will move in the direction of the break. If the bottom of the channel at 90.18 is broken, the price will move down and target 89.61 first, and may be 89.07 as well. While if we break Fibonacci resistance at 90.90 we expect a rise to surpass yesterday's high, targeting the important 91.63 first, and only if it is broken we can expect 92 to appear on the price screens when the price targets the obvious resistance on the hurly chart 92.17.

Support:
90.18: the bottom of the rising channel on the hourly chart.
89.61: previous support & Oct 12th low.
89.07: previous intraday support.

Resistance:
90.90: Fibonacci 61.8% for the short-term.
91.63: a well known support area that contained a number of daily tops and bottoms, the last of which was Oct 29th high.
92.17: obvious resistance on the hourly chart.

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Forex trading analysis by Forexpros Written by Munther Marji

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Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.