EUR/USD Attempt to Break 1.30

By: Bastian Rubben

As I warned here last week, the results season in the US made the stock markets extremely volatile, which caused the currencies markets to get volatile as well. This emphasized once again why it is so important to know how to analyze the US indices when trading currencies. On the technical aspect, the S&P 500 made a false break of the important support at 1370 points, but the sharp declines on Friday took the index down to the support area again, and a successful break-down this time might take it under 1340 points, which is the next significant support.

I mentioned the level of 1.30 at the EUR/USD as an important support that the USD had to break-down in order to start a significant strengthening session against the Euro, but the correction of the US indices in the middle of the previous week helped the Euro rise towards 1.32. However, the bearish momentum of the stocks caused a bearish momentum in the EUR as well, and the pair is close to 1.30 again, as a strong break-down this time might pull the Euro down to 1.28. However, keep in mind that it is mainly depended on Wall Street and therefore good results by the major banks (C, GS) might weaken the USD.

EUR/USD Daily 4/16/12

The British pound rose during last week and show impressive strength against the USD, as the pair GBP/USD reached the level if 1.60. However, like the other major currencies, the pound could not resist the strengthening of the USD on Friday and it fell under the break-up area at 1.585. If the USD continues gaining power, the pound might slide to 1.565, but if the GBP makes the bullish reversal, we might see it around 1.60 again.

GBP/USD Daily 4/16/12

DailyForex.com Team
The DailyForex.com team is comprised of analysts and researchers from around the world who watch the market throughout the day to provide you with unique perspectives and helpful analysis that can help improve your Forex trading.