Good day forex traders.
It is mid week and i hope you are on track to a happy weekend with a bagful of pips!
In the previous EUR/USD forecast we noted that Cyprus became the fifth euro zone country to seek a bailout, further inflaming the Euro Zone budget deficit crisis. Over in the US, officials were reported to be considering delaying automatic spending cuts.
Looking at the EUR/USD hourly chart above, we noted that the 1.2450 region is turning out to be an immediate support. The trading range is around 50 pips and this is considered to be quite narrow. Without doubt, 1.2450 must be taken down before 1.24 comes into play.
Fundamentally, reports of China’s commitment to maintain the stability of it’s economy probably brought about a short term rally due to optimism. As i mentioned many times, China is a major world economic driver and hence when China is feeling good, the markets probably will be too!
Not to be outdone, the Euro Zone brings along it’s own economic development and true to the Euro Zone’s current fave, more depressing news! Spain is reported to be struggling with it’s budget deficit and is set to retract on promises made during the election. This will definitely increase the social strain and as i mentioned always, investors do not like a troubled nation.
The EU economic summit is due tomorrow and this is probably a reason why trading is tight. Everyone just wants to wait and see. Apprehension is strong.
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