Forex Daily Forecast, Analysis and Prediction

Following weeks or relative inaction, the USD-JPY finally sprang to life last week. The price found solid resistance at the 100 SMA, around 81.60, and sold off for the next few days, closing below the critical 80.00 level.

The U.S. Dollar finished sharply lower on Friday against its key counterparts on government credit rating fears and lackluster interest rate prospects. Markets began pricing in the previously unthinkable - a US Treasury default - on risks that U.S. legislators may not agree to a budget deal as the government will soon run short of cash.

The Swiss Franc just keeps on getting stronger, prompting the Swiss National Bank to start issuing vaguely disguised threats of intervention. Little surprise, really, since the Franc is at all time extremes against many currencies, including the Pound, the Euro and the Dollar.

EUR has traded sideways for the past day or so, but that sideways trading actually indicates the upside momentum has weakened.

Much to the surprise of many traders, the GBP rallied hard yesterday once it firmly broke above the 1.5945/55 level. Consequently, the hourly chart now shows a strong trend on the upside.

GBP recently showed a recovery from its steep losses by finding a support at the 1.5781 level.

The EUR hit below 1.4070 yesterday and now is downtrending strongly, not only on the hourly chart but on the daily chart too.

Technical and fundamental analyses in one place, with charts of the major currencies to give you a glimpse of what to expect in your Forex trading during the week of July 11, 2011.

After the nice run up in March, when the AUD/JPY appreciated from 74.48 to 90.02, this pair has not done much. The Japanese became “lifeless” and the price is largely responding to what happens to the Australian Dollar.

The British Pound hit below the 1.5990/70 level and we can therefore consider the hourly trend as down at the moment.

The overall behavior of this pair does not offer many clues about what the price might do next. However, when we look at highs and lows we can identify certain patterns.

The British Pound/Swiss Franc has been in one of the longest and most persistent trends of recent years. This pair, together with the EUR/CHF, started a downtrend during the financial panic of 2008 and is still moving lower.

NZD/USD is seeing the end of a flat correction - see what our expert trader is doing now.

We need to see a move below 1.4440 to confirm that the current leg up from the late June low has ended. The market is now oversold on hourly chart and that makes it questionable as to whether it will break down directly from here.

With so many markets closing up last week, it looks like the tides are finally changing - or are they? Take a look at our forecasts for the majors this week to see what you can expect in your Forex trading.