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Forex Market Technical and Fundamental Recap

Discussion in 'Forex Daily News & Outlook' started by forextrends24, Jun 13, 2009.

  1. forextrends24

    forextrends24 New Member

    Mar 27, 2009
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    Today's Forex Analysis summary.

    The U.S. Dollar finished Friday’s trading session higher in lack luster trading. Last week several Forex markets posted closing price reversals. The GBP USD and EUR USD posted closing price reversal tops while the USD CAD and USD CHF formed closing price reversal bottoms.

    All of these patterns followed through to confirm the reversals but did not have the accelerations like the patterns suggested. On the other hand, this pattern usually indicates a 2 – 3 week counter-trend trade so there is still time to make full corrections. Another sign that the correction will follow-through to completion is the fact that none of the closing price reversal tops or bottoms were negated.

    Euro and Canadian Dollar traders are facing other issues besides U.S. interest rates and inflation. The concern for investors regarding these two markets has to do with their rapid rise and its effect on exports. Both German and Canadian economies rely heavily on exporting goods and services to other countries.

    Although it has not been specifically addressed by the European Central Bank and only in a statement by the Bank of Canada, the strong rise in these two markets could choke off demand for exports.

    In summary, both technical and fundamental factors are indicating the Dollar could rally next week. Last week’s closing price reversals and subsequent confirmations are indicating that the Dollar has room to rally. Weakness in the gold market and the lack of inflation should also help the Dollar. In addition, the highly priced Euro and Canadian Dollar could feel pressure if traders decide these two prices are trading at levels which could hurt German and Canadian exports. If these markets do not break on their own then look for the central banks attempt to talk these two markets lower.

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