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Good day forex trading koalas!
Yesterday Masoud mentioned that if the EURUSD continue on to break the support of 1.2850, the target will be 1.2700 or even 1.2680. However if it holds, it is likely that EUR/USD will come up to 1.3050. The EUR/USD probably faces bearish pressure.
Looking at the EURUSD chart above, we see a bearish momentum since the currency pair hit 1.2880+. For the forex traders new to the class, these red lines of potential support and resistance are drawn by me after scanning the charts up to years ago! I LOVE IT WHEN MY CHARTS WORK!
As per what Masoud said, the currency pair did indeed attempt a bullish run. This was probably due to the announcement that Japan will join China in a drive to help stabilize the Euro Zone Deficit Crisis. We could see a spike in the EURUSD but moments later, the excitement ceased to exist. It was reported that Japan will be using it’s existing Euro reserves for the bond purchases and hence no new Euro will be bought. Knee jerk reaction indeed!
Having said so, this will still probably add positivity regarding the Euro Zone situation and this was seen in the equities markets.
Portugal is due to have a bond sales tomorrow and it was reported that the yields are rising to levels that are probably not sustainable and hence may trigger a road down bailout lane. Depending on the outcome of the sales, be careful of risk aversion.
Tomorrow bring us more economic data as the markets gear up for 2011. US Treasury Sec Geithner is due to speak and hence please plan your trades well.
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