ForexPros Daily Analysis June 23, 2011
Outlook for the EUR/USD & GBP/USD for today
Wall Street finished lower on the background of Bernanke' speech. He suggested that economy's slowdown is impact by factors that might continue to 2012. However, the plunging was expected after Wednesday's risings in the US markets.
The level of 1280 at the S&P 500, which was a resistance level until two days ago, is now a supporting area. Many traders who missed the initial break-up will try to join in now, so the bulls might show up around this level. A sharp break-down of 1280 will signal that Wall Street's increasing on the beginning of the week was just a correction.
The unemployment claims and existing home sales data are today's main events.
The Euro reached the target I had set at 1.44, but the volatility in Wall Street makes it hard to determine a clear direction. The triangle in the daily emphasizes this situation as we can see that highs are getting lowers, whereas lows are getting higher. This indicates that the buyers and sellers are about to meet around 1.43. Things look positive for the Euro, but it depends on the US stock markets.
The pound is finally facing the support of the 200 SMA at 1.605, which I have been following for several weeks. An "Inverted Cup with Handle" pattern appears in the daily chart, and a successful break-down might cause a deep diving to 1.57. However, when a chart looks so accurate, you must take precautions against a false break. If the buyers show their strength and the pound crosses above yesterday's high at 1.6270, it will be a bullish signal.
Forex Trading analysis written by Bastian Rubben for Forexpros.
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