Masoud : Midweek EUR/USD Review 7 Sep 11

Hello koala king and folks.

Good day to you.

During the second quarter of this year, Euro zone GDP and twenty-seven EU member states in Europe rose 0.2% compared with the first quarter.

The question on whether will Greece continue to receive financial assistance surfaced again as lender countries are worried that the policies in Greece are insufficient to overcome the budget deficit crisis. The Europe Union, IMF and central banks of Europe will be accessing Greece's economic austerity program. The Euro Zone debt crisis and ts impact on Europe's banking system is probably intensifying and one market analyst said that many investors are probably reluctant to step into the market now given it's turbulent conditions.

The German Parliament has launched an investigation into the 2012 budget with the aim of a reduction in government debt. Germany in the draft budget forecast through increased tax revenue and increased government revenues from privatization aims to reduce government debt of 48.8 billion euros in 2012 to 27.2 billion euros. The final budget vote will take place 25 November in Germany. Germany is doing well economically after the economic crisis of 2008 but the question is that with the low rate of growth of world markets, how long will this country be able to resist. Meanwhile Germany's economic growth in the second quarter of this year has been announced to be only 0.1%

 

From a technical perspective:

As I said in the weekly EUR/USD analysis, the Euro currency will continue to fall. A continuance of the previously mentioned triangle pattern may extend this fall to about 1.3750. (161.8% Fibo).

Have a nice time.

Masoud.

Masoud is a businessman and a Senior Forex Koala. Connect with him at our page on Facebook.
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Masoud : Midweek EUR/USD Review 7 Sep 11

Masoud : EUR/USD Weekly Review 5 Sep 11

Hello koala king and folks.

Good day to you.

Eurozone annual inflation in August compared to same month the previous year remained unchanged but the number of unemployed in this area increased. The unemployment rate in Germany is 7% and the average unemployment rate in the Euro Zone rose to 10%. However inflation remained at 2.5% for the seventeen-nation Euro Zone.

The rate of inflation targeted by the central banks in Europe is less than 2% and analysts expect the European Central Bank to combat inflation by raising interest rates for the third time this year from 1.5% to 1.75%.

The August unemployment figures in America which represents the country's labor market is depressed. America's unemployment rate is unchanged in August compared to last month at 9.1%. Graph of unemployment in America during the past six months shows that despite the White House promise to reduce unemployment, the opposite may be happening. An employment market downturn could increase the risk of an economic crisis.

Recent economic indicators of the Euro Zone were disappointing and the economic outlook is not bright. Signs of an economic boom has faded again.

It will be a busy week. The IMF will report on Greece, the European Central Bank and Bank of England will release its monetary policy and the G7 finance ministers are meeting in France.

 

From a technical perspective:

As you can see in the above picture, EUR/USD in time frame H4 after the formation of a triangle, the triangle has broken down. While the currency pair is below 1.43, probably the EUR/USD will decline. 

Have a great weekend.

Masoud.

Masoud is a businessman and a Senior Forex Koala. Connect with him at our page on Facebook.
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Masoud : EUR/USD Weekly Review 5 Sep 11

EUR/USD Weekly Review 4 Sep 11

Good day forex trading koalas.

This weekend is a busy one for me. Not that i can read my favorite forex charts to the wee hours of the morning but rather, MY CRAZY WORK HAS CONSUMED MY WEEKEND. Sigh. When is my million dollar forex take profit arriving? :P

In the previous EUR/USD Weekly Review, we noted that the SMA 20 was pointing up. Having said so, there was still the SMA 50 to be monitored before we could see a possibility of a sustained upwards push beyond the current range. 1.45 / 1.46 were turning out to be tough resistances. Fundamentally speculations were wild regarding the possibility of a third round of quantitative easing by the US Federal Reserve as Mr Bernanke announced the extension of the upcoming policy meeting to two days instead of the usual one.





Technical Analysis

Looking at the EUR/USD chart above, we note a bearish week for the currency pair. As mentioned last week, the current range is a strong range to break and without the indication from the SMAs of the possibility of a strong trend, the medium term outlook is uncertain.

SMA 20 = flat
SMA 50 = flat

Observation of the SMAs give us the uncertainty possibility again. With both SMAs flat, there is no clear indication of the possibility of a sustained trend. However it is important to note that the SMA 200, which usually suggests the long term momentum, lies right below the price action and it may serve as a support against any further bearish advances.


Fundamental Analysis

The important US Non-Farm Payroll report was released on Friday and it was much worst than expected. This will have far extending implications as it is already a concern for many investors and economists that the US economy is stalling. With a depressed employment market, the drag on the economy will be greater. This probably added to the bearish momentum of the EUR/USD.

The depressed employment market will add more pressure to the US government. While it is good to note that the US dollar still gained in this instance of risk aversion, we must be far sighted and understand that the appeal is slowly losing due to the various factor such as a low interest rate, a downgraded credit rating and a chronically sick economy / debt situation.

Over in the Euro Zone, the discussions and disagreements over a Joint Euro Bond continued with Germany objecting it due to the fear that it will increase it's refinancing costs due to the association with financially weaker countries. A S&P official also mentioned that the Joint Euro Bond in discussion will be rated according to the weakest country in the combination and this further complicates the matter.

We may see weak trading volume on Monday due to a US holiday. Important upcoming economic events include the Euro Zone minimum bid rate announcement.

Trade Safely

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EUR/USD Weekly Review 4 Sep 11