Forex: Up and down; Is the EUR/USD at 1.3000 a chance?
Forex pairs in this Article »
EUR/USD
FXstreet.com (San Francisco) - The Euro's recovery against the US Dollar was rejected at the 1.3010, November high, with the EURUSD falling fast to 1.2945on the back of a cocktail of developments. Following these choppy movements, the pair set a conform zone to traded calm in a narrow range between 1.2965 and 1.2975.
First a well above consensus Pending Home Sales in October that spurred fears on QE suspension. Second a big upward revision on US 3Q GDP but with most of that growth drove by inventory building and government spending. Third, the Democratic leader Chris Van Holland saying that the two sides are not close to a deal on the fiscal cliff. And fourth a very well anticipated sell interest just above the 1.3000 mark make a cocktail that was used to launch the pair around 65 pips down where the EURUSD found support. But overall, a general sense of optimism is over market.
In the opinion of analyst Richard Lee at FXstreet.com, the combination of a strong US Q3 GDP print plus the recent improvement seen in both the labor market and the housing sector could prompt investors to start thinking of a good year-end for the greenback. In his own words, "These three reports, in addition to bullish expectations for tomorrow's Chicago PMI survey, continue to fuel dollar gains. The trend is likely to continue as long as economic data remains positive for the world's largest economy and fiscal cliff concerns are kept at a minimum".
On the other hand, BK's analysts Kathy Lien and Boris Schlossberg wrote in a recent article that market is "caught in the Middle of Washington's War of Words" with such as "Kabuki dance" that is "driving us nuts and reminds us of the days when EURUSD seesawed on sovereign debt headlines."
Kathy Lien pointed that the "1.30 level is proving to be a huge area of resistance for EURUSD, which tested but failed to break above this key level 4 out of the last 5 trading days." In this line and according to the Bank of Tokyo-Mitsubishi UFJ's European Head of Global Research Derek Halpenny, the EURUSD "will continue to be contained by the belief that the Fed will maintain an ultra-loose monetary stance."
BTMU expert believes that a "pop higher in EURUSD over 1.3000 that looks imminent should be taken as a good opportunity to sell" as far as "the downward trend in EURUSD still intact."
The Westpac strategy team agrees with the idea that EURUSD is likely to struggle above 1.3000 and they attribute very low odds to the September/October double top highs at 1.3150 being taken out. The team believe that EURUSD will find it difficult to sustain any moves above 1.3000 looking forward.
But do you think gthe EURUSD stand a chance to go up? let's see the EURUSD's short term outlook. The hourly chart shows a slightly bullish tone as indicators head north above their midlines and price holds above a bullish 20 SMA. Selling interest around 1.3010 has prove strong so far, yet renewed attempts to break higher will likely succeed with 1.3080 then at sight. Support levels are at 1.2970 1.2945 1.2910 while resistance frontier remains at 1.3010 1.3040 1.3080.
First a well above consensus Pending Home Sales in October that spurred fears on QE suspension. Second a big upward revision on US 3Q GDP but with most of that growth drove by inventory building and government spending. Third, the Democratic leader Chris Van Holland saying that the two sides are not close to a deal on the fiscal cliff. And fourth a very well anticipated sell interest just above the 1.3000 mark make a cocktail that was used to launch the pair around 65 pips down where the EURUSD found support. But overall, a general sense of optimism is over market.
In the opinion of analyst Richard Lee at FXstreet.com, the combination of a strong US Q3 GDP print plus the recent improvement seen in both the labor market and the housing sector could prompt investors to start thinking of a good year-end for the greenback. In his own words, "These three reports, in addition to bullish expectations for tomorrow's Chicago PMI survey, continue to fuel dollar gains. The trend is likely to continue as long as economic data remains positive for the world's largest economy and fiscal cliff concerns are kept at a minimum".
On the other hand, BK's analysts Kathy Lien and Boris Schlossberg wrote in a recent article that market is "caught in the Middle of Washington's War of Words" with such as "Kabuki dance" that is "driving us nuts and reminds us of the days when EURUSD seesawed on sovereign debt headlines."
Kathy Lien pointed that the "1.30 level is proving to be a huge area of resistance for EURUSD, which tested but failed to break above this key level 4 out of the last 5 trading days." In this line and according to the Bank of Tokyo-Mitsubishi UFJ's European Head of Global Research Derek Halpenny, the EURUSD "will continue to be contained by the belief that the Fed will maintain an ultra-loose monetary stance."
BTMU expert believes that a "pop higher in EURUSD over 1.3000 that looks imminent should be taken as a good opportunity to sell" as far as "the downward trend in EURUSD still intact."
The Westpac strategy team agrees with the idea that EURUSD is likely to struggle above 1.3000 and they attribute very low odds to the September/October double top highs at 1.3150 being taken out. The team believe that EURUSD will find it difficult to sustain any moves above 1.3000 looking forward.
But do you think gthe EURUSD stand a chance to go up? let's see the EURUSD's short term outlook. The hourly chart shows a slightly bullish tone as indicators head north above their midlines and price holds above a bullish 20 SMA. Selling interest around 1.3010 has prove strong so far, yet renewed attempts to break higher will likely succeed with 1.3080 then at sight. Support levels are at 1.2970 1.2945 1.2910 while resistance frontier remains at 1.3010 1.3040 1.3080.
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