9. Forecast for the week
EURUSD 28.03.11-01.04.11
Again, the problem in Europe. At last week announced his resignation, Prime Minister Socrates of Portugal, after being proposed by his office savings program was rejected by Parliament. This could not affect the rate of the euro against other currencies on the Forex. During Friday's session in the euro fell against the U.S. dollar by 85 points.
From a technical point of view, the decline this week has been so important to be able to talk about changing the three-month uptrend. Those not having such a possibility remains, and the key levels in this regard shall be 1.3990 - 50% Fibonacci retracement level of the monthly growth rate (orange), and 1.3900. Sure the breakdown of these two levels, will inevitably lead to a further reduction in price of the euro, with the immediate goal of 1.3720 - 38.2% Fibonacci retracement levels on the three-month growth (blue discontinuous), close to which is the bottom line of the Bollinger Bands. The nearest resistance to further growth, in our opinion, will be provided in the area of 1.4260 - a three-month high, overcoming a pair of which will rise to the level of 1.4350.
In light of what happened, and judging by the market reaction to the resignation of Prime Minister of Portugal, we are inclined to believe that investor confidence was shaken in euros, and that will attempt to make the speculators that with high probability, can lead to a drop in EURUSD rate as early as next week .
Recommendations:
- Sell near 1.4250, 1.4000 with the immediate goal, limiting losses 1.4300
- Sell below 1.3990, increase below 1.3900, to 1.3720, 1.4070 limit losses
- Buying above 1.4260 to 1.4350, 1.4180 limit losses.
