ForexPros Daily Analysis April 14, 2010
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Fundamental Analysis: Initial Jobless Claims
Traders of the US anticipate the publication of the Initial Jobless Claims. It is a seasonally adjusted measure of the number of people who file for unemployment benefits for the first time during the given week.This data is collected by the Department of Labor, and published as a weekly report. The number of jobless claims is used as a measure of the health of the job market, as a series of increases indicates that there are fewer people being hired. On a week-to-week basis, claims are quite volatile. Usually, a move of at least 35K in claims, is required to signal a meaningful change in job growth. A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD. Analysts predict a future reading of 440.00K.
The Euro reached a new low for this week at 1.3544 and from there started a new advancement, which was able to achieve more than 100 pips so far, and it is closing on the important resistance 1.3675, which we believe is the real key that can open the way for more gains. The “fight” between this advancement, and this resistance will be the deciding factor which will determine the direction that we will take from these levels. If the price manages to break the resistance, the rise will go on and get stronger, as we see it targeting the important 1.3776 & if broken we will not be surprised to see 1.3861. The support is at 1.3625, and breaking it would mean that we are on the way to test yesterday’s low 1.3544 once again, and then head towards a very important support, provided by the 61.8% Fibonacci level for the whole rise from 1.3281, which is at 1.3437. In case we reach this level or come close to it, it will be a critical level not only for the short term but for the medium term as well. It is worth noticing that the
EURUSD has not filled the gap or “closed the window”, and thus, the possibility of downside activity remains there.
• 1.3625: previous intraday resistance.
• 1.3544: yesterday’s low.
• 1.3437: Fibonacci 61.8% for the rise from 1.3281.
• 1.3675: short term Fibonacci 61.8%.
• 1.3776: Mar 15th high.
• 1.3861: Jan 29th low.
In what seems to be the strongest attempt to break the falling trend line from 94.77 the price surpassed the trend line with a few pips, but stopped not far from it at 93.34. The thing is that, the technical outlook has not changed for days. We are still trading very slowly in a correction to the up move which topped at 94.77, which is a correction that managed to reach its first target at 92.85. We are still watching for any other technical evidences to decide whether this correction has finished at Fibonacci 38.2% or that it is still going and will soon target Fibonacci 50% & 61.8% levels. Support is at 92.26 and in case it is broken, the price will continue its drop from 94.77 (the correction), and will target the most important support for the short term (and may be the medium term as well) 91.66, and if broken we will target 91.07 as a modest target for such a break on the way to lower targets. As for the resistance it is at 93.34, and breaking it would indicate that we are back to the 94areas after completing a modest correction, and we will target 94.07 & 95.05.
• 92.26: Fibonacci 50% for the rise from 89.74, with the rising trend line from 88.12 coming closer and closer to this level.
• 91.66: Fibonacci 61.8% for the rise from 89.74, a very important support for the short term.
• 91.07: Mar 12th high.
• 93.26: the falling trend line from 94.77 on hourly chart.
• 94.07: important intraday support/resistance.
• 95.05: Aug 24th high.
Forex Trading Analysis written by Munther Marji for ForexPros.
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