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Tuesday July 20, 2010 - 10:12:39 GMT
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Forexpros Daily Analysis - 20/07/2010
ForexPros Daily Analysis July 20, 2010
Fundamental Analysis: Fed Chairman Bernanke Testifies
Ben Bernanke, US Federal Reserve Chairman, will be testifying in
Washington DC, regarding America's economic outlook and financial
His comments may determine a short-term positive or negative trend.
Although the Euro broke the support specified in yesterdayâ€™s reports
1.2889, but it did not reach or even come close to the suggested target
1.2820, as if it was still not ready to drift away from 1.30 yet. On
Friday, the Euro topped at 1.3005, just 8 pips above the resistance that
captured all of our attention: 1.2997. This shows just how important
this resistance is, which is probably the level most qualified to turn
the Euro around, and resize this soaring move into a correction! This
strong & sharp jump is a natural fruit of breaking the top of the
channel after touching it for a record number of times, but eventually
the Euro managed to break it! After that serious barrier, the energized
Euro had faced even a harder one: Fibonacci 61.8% for the giant move
down from 1.3690 to 1.1875. This level is at 1.2997, and will act as a
heavy weight barrier in the face of this rise, which in spite of the
fact that it has achieved more than 1000 pips so far, it still looks
corrective (simply because it did not break the divine ratio 61.8%).
Now, even after a drop of more than 130 pips from Fridayâ€™s top, 1.2997
will still be the most important resistance in the neighborhood, only a
break here means more gains. If broken, we will soar above 1.30 for the
first time in more than 2 months, and we will target 1.3092 &
1.3153. On the other hand, the support has shifted dramatically to
1.2952, breaking it would indicate that we are drifting away from
1.2997. And that will target 1.2820 & 1.2764.
â€˘ 1.2952: the rising trend line from Jul 13th low.
â€˘ 1.2820: Fibonacci 38.2% for the short term.
â€˘ 1.2764: Fibonacci 50% for the short term.
â€˘ 1.2997: Fibonacci 61.8% for the massive dive from 1.3690 to 1.1875.
â€˘ 1.3092: May 10th high.
â€˘ 1.3153: May 3th low..
After the Yenâ€™s strength penetrated the lows of last December &
January, we were left with no notable support protecting the 15-year low
which was reached last November at 84.81! We will not be a bit
surprised if this pair started to move in that direction, and tried to
break that low! On the contrary, we have been expecting this for weeks
now, and it was included in our reports several times. But, signs show
that the possibility of a rising correction is growing, to correct the
drop from Wednesdayâ€™s top 89.09 to Fridayâ€™s low 86.25. On the top of
these signs: the inverted hammer formation, which appeared on the daily
chart. Therefore, and even though we are negative about this pair on the
medium term, we should not neglect these signs which force themselves
upon us for today! Short term support is at 86.78, and if broken, the
price will continue searching for new lows, targeting 85.84, then the
15-year low 84.81. Resistance is presented by the falling trend line
from Wednesdayâ€™s tops, which is at the first Fibonacci level 87.33, if
broken we will ideally target short term Fibonacci level 88.01 & if
broken a quick jump to 88.64 is to be expected.
â€˘ 86.76: the rising trend line from yesterdayâ€™s low.
â€˘ 85.84: Nov 30th low.
â€˘ 84.81: Now 27th low, and the lowest level since 1995!.
â€˘ 87.33: short term Fibonacci 38.2% level.
â€˘ 88.01: short term Fibonacci 61.8% level.
â€˘ 88.64: the falling trend line from Jun 4th on hourly chart.
trading analysis written by Munther Marji for
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.
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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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