FOREX NEWS. The US Dollar has managed to maintain its position against all the other major currencies. However it is still vulnerable as it keeps moving within a price range around the lows. Last week’s US economic data imply that the US economy will probably continue recovering.
The new data on the Euro-zone debt situation only added pressure on the common Euro currency against the other majors, which didn’t allow EURUSD to break above 1.45. USDJPy was the only currency pair where USD showed some strength. Moreover, the weakness of USDJPY reveals the weakness of JPY-cross pairs.
The recurrence of the Euro-zone debt issue will make the financial market uncertain because either restructuring or default will cause losses in the EU’s financial sector, where banks are the main sovereign debt holders. It is too early to speak about some restructuring or default within the next few weeks. However if the future succession of events develops this way, investors will definitely be seriously concerned about that. It also should be noted that this is the pre-Easter week, so numerous market participants will probably take a break, which may lower the liquidity and increase the volatility of the market.
The current market situation is crucial: the US Dollar is weak while the Euro currency keeps declining, which makes precious metals grow in value (alternative currencies so to say). If Euro keeps falling down, the market of precious metals may see another price hike (rally) within the next 2 weeks because the demand will grow and the investors will reduce the risks. Gold will probably reach 1.5. However, you should be cautious: this is a very significant and strong psychological level of resistance. The rally may be followed by a sharp decline if the level is reached.
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Numerous traders from the Department of studying Masterforex-V trading system note that the USD index is the main tool that can help to anticipate the future succession of events:
* a short upward wave on the senior TF (the cancelation of wave В for the downward “Hound” of H1)
* an internal SC (1.6251/21)
* pivots at 1.6184, 1.6207 and 1.6407
* On breaking through the pivots the price will complete the entire series of H4 waves from 1.6251 (see the last с(С) н1)
a) a series of upward FZRs (downward FZRs – for the reversed currency pairs)
* SC D1 is much higher
b) b(С) from 1.6221 and another try for the downward “Hound” pattern (this time - on the senior TF).
* Look for A + FZR
