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Forex · News · Forex ForecastsNEWS / Forex Forecasts |
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Dynamics of rate and recommendations on EUR-USD and GBP-USD.
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07:14 03/30/2004
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Dynamics of rate and recommendations on EUR-USD and GBP-USD.
Support zone – 1,095-1,045 levels on EUR – held its ground and price couldn’t pass those levels.
It’s too early to talk about the change of global trend, though there appeared signs of it. Global trend has marked the wave on trend 1, triangle can be interpreted as complex correction wave 2. Downward breaking of triangle border by price is the first sign of birth of downtrend wave 3.
Downtrend correction is a result of closing long-term orders by position players. Another quite important factor that acts against the dollar is security concerns. The Euro players got more optimistic after the release of the European Commission quarterly report on the EU economics.
Steady rise has been outlined in the Eurozone economy for 2004. However, its development in the short-term prospective is not very clear. According to the quarterly report of the European Commission, the rates of economic growth of Eurozone will speed up in the second half of 2004, despite recent contradictory data on business climate of 12 Eurozone countries.
Though increase in the world demand could compensate export volume reduction caused by strengthening of the Euro, risks still remain. But analysts are still concerned with the weak consumer demand. “Risks are mostly connected with Eurozone consumer spending, which is still very weak”, - said in the report of the Europan Commission.
Besides, there appeared some doubts as to expecting reduction of ECB refinancing rate. The head of European Central Bank, Jean-Claude Trichet, addressed before the European Commission. He said that ECB could revise its forecasts on the rates of economic growth in Eurozone, if consumer spending does not increase. That resulted in speculations as to the possibility of refinancing rate reduction that could take place this week. Index component, estimating income expectations of consumers, dropped to –7,5 from –0,3 in March, notes the report that was composed by surveying 2000 consumers. Index component, determining expectations in terms of overall economic state, dropped to –12 from –2, whereas expenditure expectations rose –25 from –25,7, notes GfK report.
Recommendations: prior to the meeting of ECB and FRS US heads, quite volatile currency moves are expected in the nearest market prospective. That is why we recommend not opening new positions and keeping positioned postponed orders, mentioned in the previous recommendations.
Recommendations: prior to the meeting of ECB and FRS US heads, quite volatile currency moves are expected in the nearest market prospective. That is why we recommend not opening new positions and keeping positioned postponed orders, mentioned in the previous recommendations.
The forecast was created by trans1.
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