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Monday August 2, 2010 - 10:27:23 GMT
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Forexpros Daily Analysis - 02/08/2010
ForexPros Daily Analysis August 02, 2010
Fundamental Analysis: Interest Rate Decision
The Reserve Bank of Australia (RBA) decision on short term interest
The decision on where to set interest rates depends mostly on growth
and inflation. The primary objective of the central bank is to achieve
stability. High interest rates attract foreigners looking for the best
"risk-free" return on their money, which can dramatically increases
for the nation's currency.
A higher than expected rate is positive/bullish for the AUD, while a
than expected rate is negative/bearish for the AUD. The analysts predict
future reading of 4.50%.
The Euro broke support specified in yesterday's report 1.3028, and came
close to hitting the suggested target of 1.2962, but it stopped a few
before it, then it bounced clearly. It is clear that the Euro is facing
difficulties ahead of and around 1.31: there is the well known
1.3092, Friday's top 1.3105, and now we can also see that after the
the price has bumped into 1.3086 a couple of times during the Asian
If the price can go back to trade above 1.3086, reaching 1.32 (and
will be only a matter of time! The targets in this case will be 1.3200
bottom we still remember 1.3266. On the other hand, short term 61.8%
Fibonacci level has became the most important support for today,
that it is just above the rising trend line from June 29th low on the
chart. In case we break this support which is at 1.3020, the price will
& correct the whole move up from Tuesday's low 1.2731 to yesterday's
which will ideally target the area between 1.2950 & 1.2874. It is
mentioning that the latter is the most important support for the time
* 1.3020: Fibonacci 61.8% for the rise from Friday's low.
* 1.2950: Jun 27th low.
* 1.2874: Fibonacci 38.2% for the whole rise from Jul 21st low to
* 1.3086: Asian session high, tested twice.
* 1.3200: Apr 23rd low.
* 1.3266: Apr 25th important bottom.
Finally, we have clearly surpassed wave 5 bottom, which indicates that
correction we have been monitoring for the past days is finally over,
makes it official: we are in a new down wave! But the bounce from
low 85.93, which is closing on the important resistance 86.81 this
warns of a correction to what we have seen of the new wave so far (the
from 88.10 to 85.93). Nevertheless, with a correction in these areas, or
without, dropping far below 86 and may be below 84.81 itself has turned
a most probable scenario. The resistance which will determine if this
from Friday's low will go on or stall, is 86.81. If broken, the Dollar
keep shooting higher, targeting 87.49 & then what we imagine as the
"ceiling" for the price at this stage 88.10. But, if we break the
support 86.25 instead, we will start dropping to areas below Friday's
we find 85.60 & 84.81 to be the most attractive of which.
* 86.25: Jul 16th low, just 2 pip below Thursday's low.
* 85.60: the falling trend line combining the daily lows of Jul 1st
* 84.81: Nov 27th 2009 low, and the low of the last 15 years.
* 86.81: Jul 26th & 27th lows, and an obvious hourly support.
* 87.49: Jul 29th high.
* 88.10: Jul 28th top.
trading analysis written by Munther Marji for
Trading Futures and Options on Futures and Cash
transactions involves substantial risk of loss and may not be suitable
all investors. You should carefully consider whether trading is suitable
you in light of your circumstances, knowledge, and financial resources.
may lose all or more of your initial investment. Opinions, market data,
recommendations are subject to change at any time.
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Amazing Trader EVENT RISK Calendar:
Tue 24 Oct
All Day flash PMIs
Wed 25 Oct
01:30 AU- CPI
08:00 DE- IFO Survey
08:30 GB- GDP
14:00 CA- BOC Decision
14:30 US- EIA Crude
Thu 26 Oct
11:45 EZ- ECB Decision
12:30 US- Weekly Jobless
14:00 US- Pending Homes Sales
Fri 27 Oct
12:30 US- GDP
14:00 US- final Univ of Michigan
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- POTENTIAL PRICE RISK: Medium Tue-- All Day Global flash PMIs. First good look at October economic performances.
- POTENTIAL PRICE RISK: HIGH Wed-- 01:30 GMT AU- CPI. Top Inflation indicator.
- POTENTIAL PRICE RISK: HIGH Wed-- 08:00 GMT DE- IFO Survey. Top German indicator.
- POTENTIAL PRICE RISK: HIGH Wed-- 14:00 GMT CA- BOC Decision. No Policy Change Expected.
- POTENTIAL PRICE RISK: Medium Wed-- 14:30 GMT US- EIA Crude. Top Weekly WTI Statistic.
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