Forex Trading Library

The Euro was barely saved yesterday…what about today?

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Hardly a day goes by without outstanding events. What’s happening today? Well, The European Court of Justice is due to announce a preliminary, non-binding ruling regarding the constitutionality of the ECB’s Outright Monetary Transactions Policy (OMT). This is relatively simple for the market participants to understand. If the OMT program proofs to be constitutional, the chances for a QE program to be adopted as soon as possible are increasing. If there are some issues with the OMT decision, we might see a delay in the ECB’s decision in rescuing the Eurozone.

Yesterday the EURUSD currency pair has not withstood the pressure anymore, so the 1.1754 was retested. The Euro was saved at the last minute from a devastating episode of depreciation. Will it also be saved today? Hard to say. We have to admit that there are good chances to see the currency under the 1.1700 level.

Meanwhile, the yen is being hardly bought as the market participants feel the impulse to make some safe investments. The USDJPY is now retesting the 117 support level, but we should be watching for a correction up to 118.80. The SNB is struggling to maintain the 1.2000 support level for EURCHF as the Swiss franc seems to be the favorite of everyone.

Concerning the Sterling Pound we have assisted at a rebound from the local lows as the investors lost interest in the Euro. On an H4 timeframe, we can observe another episode of pause in the descending trend, before the breakout of 1.5000 support level. Today the BOE Governor Carney Speaks is due to testify on the Financial Stability Report before the Treasury Select Committee. The Pound could take advantage to put some more distance between it and the 1.5000 level. Finally, a new lower low may prove to be inevitable.

Gold has shyly approached the 1250 resistance level, but it quickly fell to1225 dollars. The precious metal’s appreciation lately is revealing the tension in the market. In fact, market participants are strongly worried about the evolution of the price of oil, about the outcome in the and the possible exclusion of Greece, about the economic slowdown in China and India and also about the monetary policy in the United States.

Gold has shyly approached the 1250 resistance level, but it quickly fell to1225 dollars. The precious metal’s appreciation lately is revealing the tension in the market. In fact, market participants are strongly worried about the evolution of the price of oil, about the outcome in the Euro zone and the possible exclusion of Greece, about the economic slowdown in China and India and also about the monetary policy in the United States.

Last but not least, the star of markets, the oil, may have caused some serious headaches to investors yesterday. The WTI went down to 44.19  while the Brent decreased to 46.39. Who would have thought about that? Probably very few of us. Has the oil market approached the bottom? I would be inclined to say yes, but we cannot rule out the possibility to see the price going down even more before a slow comeback may occur. Goldman Sachs published its forecast for the price of oil as it follows:

  • 6 months – WTI – $39 and Brent – $43
  • 12 months – WTI – $65 and Brent – $70

 

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