Thursday, April 26, 2012
We had another choppy day of trading activity as investors shifted from risk on to risk off over growing political concerns in Europe and mixed economic data. All of this is happening a day after the FED's FOMC announcement where FED chairman Ben Bernanke hinted to the possibility of further stimulus if the economy shows signs of deterioration or weakness.
In today's technical analysis review, we will briefly explain the price action in the EUR/USD pair and identify common areas of support & resistance for potential trade entries.
Tuesday, April 24, 2012
EUR/USD is exhibiting lower volume & volatility as investors remain uncertain about the Eurozone's ability to solve the two year old sovereign debt crisis. There is a new debate among EU policymakers over whether the Euro-area needs more budget austerity or economic stimulus for growth. Unsettling political news over the weekend, from France and the Netherlands, raised uncertainties over the commitment of core eurozone countries towards fiscal compact & discipline as austerity policies continue to weigh on the region's economies. Right now, we are beginning to see the earlier stages of the impact of contagion on the Eurozone Core nations. Eurozone Flash PMI data came in much weaker than expected at 46.1 from the anticipated 48.1, which is a signal of economic contraction & possible double dip recession throughout the entire Eurozone.
On today, we are seeing a push to the upside on EUR/USD, which could be the result of short covering and also a fairly successful Spanish & Dutch bond auction that helped to dampen fears & encourage risk appetite. Also the S&P/Case Schiller numbers had reported home prices dropping by 0.8%, which produced USD weakness across multiple currency crosses. This news also helped to add steam to the EUR/USD rally.
In today's V.I.P. webinar, we briefly discuss the current price behavior in the EUR/USD pair and we also place a few live trades using the Slumdog Forex trading system.