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Forex · News · Forex ForecastsNEWS / Forex Forecasts |
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We are expecting important events at the end of the week…Rate dynamics and recommendations on EUR-USD and GBP-USD
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13:56 07/28/2004
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We are expecting important events at the end of the week…Rate dynamics and recommendations on EUR-USD and GBP-USD
The dollar got stronger on the Euro and pound sterling following the release of the first series of significant indicators on the U.S. economy. Conference Board Consumer confidence index rose to 106.1 in July against the revised June indicator that equaled 102,8. According to initial data, June index equaled 101,9. July fogure came out the highest in the two last years and exceeded economists’ expectations. Index component, reflecting Americans’ attitude towards the economic situation, rose from 105,9 in June to 106,5 in July. Index component, reflecting expectations of Americans in terms of the nearest six months, increased from 100,8 in June to 105,8 in July.
This time fall-leader was pound sterling and the reason for that was breaking out of the significant support line at 1,83. Large investment funds made their stop orders right at that level. The first target at 1,822 was reached and fixed on pound sterling.just as forecasted.
The Euro consolidated close to strong level of support at 1,2060 and that time positive data on Germany was the reason why the Euro fell against the dollar, as Germany is one of the third largest European economies. Business optimism index rose to 95.6 points in July from 94.6 points in Jume, reports Ifo Economic Institute. Economists, surveyed by Bloomberg, had looked for 95.0 points. Index increase relects increase in exports that help German companies to compensate weakness of consumer spending. Another quite important factor is rate hike expectations.though ECB authorities did not make any definite decision upon that matter, the given question is to be discussed on August 5 at the regular ECB meeting. Let us remind that the rate of refinancing is 2,0% per annum in Eurozone.
We should also note that the process of dollar quotations’ rise against major currencies has some hidden threats. We can not exclude external and domestic political factors of the U.S.
The external factor is permanent militant concerns, a problem which will become aggravated during Olympiad in Greece, where they have already taken unprecedented security measures. The internal factor is the heat of the pre-election campaign in the USA. It is expected, that this weekend the Democratic party of the USA will promulgate the data on budget deficit, which, according to many analysts, will reach a record point and will exceed a psychological barrier of 400 billion dollars. As we know, budget deficit is the weak point of the U.S. economy and the release of negative parameters on this economic indicator puts essential pressure upon dollar. And the third factor that puts pressure on the dollar is high prices for oil on the world market. Despite insignificant correction – prices for oil keep at their maximums. September futures on indicative Brent oil grade got $0,19 expensive and rose to $38,30 per barrel at the beginning of trades. Prices for “light” American oil dropped by $0,07 to $41,37 per barrel.
Recommendations: stick to Tuesday recommendations – keep long-term shorts and don’t forget about protective stops.
Recommendations: stick to Tuesday recommendations – keep long-term shorts and don’t forget about protective stops.
The forecast was created by trans1.
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