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Thursday July 8, 2010 - 09:52:00 GMT
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Forexpros Daily Analysis - 08/07/2010ForexPros Daily Analysis July 8,
Analysis: German CPI
European traders anticipate the publication
of the German CPI. The index measures the changes in the price of goods and
services. The CPI measures price change from the perspective of the consumer. It
is a key way to measure changes in purchasing trends and inflation in Germany. A
higher than expected reading should be taken as positive/bullish for the EUR (as
the common way to fight inflation is raising rates, which may attract foreign
investment), while a lower than expected reading should be taken as
negative/bearish for the EUR. Analysts predict a future reading of
The Euro broke the
resistance specified in yesterdayâ€™s report 1.2603, and successfully reached the
first suggested target 1.2681 with a very good accuracy since yesterdayâ€™s high
was 1.2686. The most important technical event, was touching the top of the
rising channel on the hourly chart for the third time during the Asian session,
after touching it for the first time on Friday, and the second on Tuesday. We
could be before an important turning point at 1.2686, but until this moment we
have not got far from the top of the channel. We should carefully watch the top
of this channel, which is at 1.2690 currently. We will not be able to escape the
fact that a break here will be a very positive signal for both the short &
medium terms. But, if we keep trading below this top, we could be facing a
turning point which will probably lead to a drop of hundreds of points. Short
term support is at 1.2644, and once we break it, we will start drifting away
from the channel top, and will target 1.2552, and may be 1.2442. The resistance
is at the channel top at 1.2690. If this broken, we will target 1.2801 first,
and may be 1.2906 before the end of the week.
1.2644: Asian session low.
â€¢ 1.2552: yesterdayâ€™s low.
â€¢ 1.2442: May 18th
â€¢ 1.2690: the top of the falling channel on
â€¢ 1.2801: May 11th high.
â€¢ 1.2906: previous well known
waiting finally paid, as we finally saw the Dollar/Yen sharply bouncing as we
have expected, and as we have been waiting for. The Dollar/Yen broke the
resistance specified in yesterdayâ€™s report 87.72, only to reach 88.44 (the high
at the moment of preparing this report). This sharp bounce came as no surprise,
with the consolidation around 88, and after bouncing from the support area shown
on the hourly chart below, and after clearly breaking the falling trend line
from June 21st top. Short term support is at 88.19, and breaking it would
indicate a continuation of the drop to 87.35 & 86.47. The resistance is at
88.51, and breaking it would mean that the Dollar is about to capitalize on the
break of the above mentioned trend line, which will ideally target short term
Fibonacci levels: 89.20 & 89.73. This pair is going as expected, in the
expected direction, and in convergence with our negative technical outlook for
the medium term. We absolutely expect the fall to continue on the medium term.
But we should not neglect the enormous possibilities of a bounce up targeting
Fibonacci levels: a bounce is highly probable, even if it was a temp, but the
trend is down without a shadow of a doubt!
â€¢ 87.35: an obvious support area on the hourly chart, and Dec
9th 09 low.
â€¢ 86.47: previous well known
â€¢ 88.51: previous well known
â€¢ 89.20: Fibonacci 50% for the drop from 91.45.
Fibonacci 61.8% for the drop from 91.45.
---Forex trading analysis written
by Munther Marji for Forexpros.
Trading Futures and Options on Futures and Cash Forex
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investors. You should carefully consider whether trading is suitable for you in
light of your circumstances, knowledge, and financial resources. You may lose
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Amazing Trader EVENT RISK Calendar:
Mon 18 Dec
10:00 EZ- final HICP
Tue 19 Dec
09:00 DE- IFO Survey
13:30 US- Housing Starts/Permits
13:30 US- Current Account
Wed 20 Dec
15:00 US- Existing Homes Sales
15:30 US- EIA Crude
Thu 21 Dec
03:00 JP- BOJ Decision
13:30 CA- CPI & Retail Sales
13:30 US Weely Jobless
13:30 US- GDP
Fri 22 Dec
09:30 US- GB- GDP
13:30 US- core PCE Deflator & Presonal Income
15:00 US- New Homes Sales
15:00 US- final University of Michigan
17:00 US- early Closes
Mon 25 Dec
00:00 Christmas Holidays
Potential Trading Opportunities
John M. Bland, MBA
- POTENTIAL PRICE RISK: Medium Mon--10:00 GMT-- EZ- final November HICP. flash data are rarely changed.
- POTENTIAL PRICE RISK: HIGH- Medium Tue --09:00 GMT-- DE- IFO Survey. Key report but usually not a market-mover
- POTENTIAL PRICE RISK: HIGH- Medium- Tue --13:30 GMT-- US- Housing Starts and Permits. Leading indicators of activity
- POTENTIAL PRICE RISK: HIGH-Medium- Wed --15:00-- US- Existing Homes Sales. Top Housing statistic
- POTENTIAL PRICE RISK: Medium- Wed --15:30-- US- EIA Crude
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