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The Forex Week Ahead
EURUSD short position falls 8% on the week: CFTC Commitment of Traders report
Feds Bullard says Fed may have to raise rates before 2014
- Strong data weakens case for QE.
- He is a non voter on FOMC
- Data surprising on the upside
- Unemployment likely to fall to 7.8% this year.
EURAUD continues its fall to new lows
The EURAUD has fallen sharply today as the AUD benefits from the stronger US data.The thought is if the global economy is going to get better, it will help the Australian economy the most. The EU meanwhile still has their problems to sort through and with austerity cuts likely to dominate, the may need help from a lower currency (that is the theory or story at least). The fall lower has so far had little in the way of a correction. The shorter term chart above, has flattened out, but with lower lows and lower highs still in place. A move above 1.2189 and thens 1.2208 is needed to get shorts concerned. From there, look for resistance at the 1.2222 level (38.2% of the move down today).
With the market making new lows today, where might there be a floor. Looking at the weekly chart, the bias remains decidely bearish. The price has a Fibonacci extension that measures out to the 1.20000 level. This would be a nice round number to shoot for. Below that level the 1.1861 is the bottom trendline support target.
FT: Greece leaders oppose new austerity measures
A failure for Greece to approve austerity measures would likely lead to no money from Troika and Greek default in March.
This is the link to the story
http://www.ft.com/intl/cms/s/0/76b31dcc-4e88-11e1-ada2-00144feabdc0.html#axzz1lLJo4c4L
EURUSD moves back above the weeks midpoint and buyers follow
The EURUSD moved above the midpoint of the weeks range and has pushed higher. The next target is the 1.3159 level and then 1.3184. The move higher in the dollar against the EURO on the better US data, has given way to “risk on”. Greece hope and stronger US help the flows. The pair is still mired in the narrow trading range for the week. Perhaps next week the pair finds more of a direction. In the meantime will be paying attention to the technicals for clues as to bias until the break occurs.
GBPUSD expectations for additional QE revised lower
The expectations for additional QE by the BOE at their interest rate meeting next week, has been racheted down to 50 B additional from 75 B which has been more of the concensus. The better global tone is perhaps a contributing factor. Besides, it is easier to add rather than subtract down the road.
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