EUR/USD Forecast 29 Oct 12


 

Good day forex traders.

 

Welcome to the weekly EUR/USD forecast by yours truly The Forex Koala. New readers will find my style

more geared towards the understanding of the currency pair rather then outright trade calls. No crystal ball

here mate! We are interested in the why and how of the forex market ­čÖé

In the previous EUR/USD updates we note the continued ranging nature of the currency pair.

 

EUR/USD Forecast

 

Technical Analysis

Looking at the EUR/USD daily chart above we note the immediate resistance seems to be 1.3120 right

now. The round number of 1.3 continues to play a pivotal role and neither bulls nor bears can achieve a full

victory for now. The currency pair is now resting on a bullish trend line from some time back and it will be

worth while to observe if there is any interaction. Many traders often make a mistake of considering short

term factors. From a long term point of view, this ranging is expected as the current region now is probably

the current expectation of the market while the Euro Zone sorts its problem out.

 

Fundamental Analysis

Looking at the current Spain situation, the absence of a bailout is causing apprehension as investors do not

like uncertainty. The recent downgrades by the various credit rating companies also created more aversion.

It was reported that the most recent bonds update show a deteriorating situation. The delay of a much

expected bailout is causing a lost in confidence.

In the meanwhile the US is posing better than usual developments. This is probably holding the currency

pair up rather than a depressing drop.

The US Non-Farm Payroll is due this Friday and hence any sign that the recent positive developments are

not flowing through to the US NFP may result in adverse reactions.

 

Trade Safely

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