EUR/USD

Euro continues growing up, and by the moment it has already reached the resistance level in the area of 1.3185. In order to make a reverse, the price has to form a reversal pattern. If it happens, we should expect Euro to fall down into the area of 1.2926, which is expected to be a starting point of the growth with the target at the level of 1.3752.

NZD/USD

New Zealand Dollar continues reaching new local maximums. At the moment the RSI indicator is testing the resistance line, we should expect it to rebound from the line and fall down to the level of 0.8075. If the price breaks the channel’s lower border, we should expect a much deeper correction.

AUD/USD

Australian Dollar continues moving inside the rising pattern, at the moment the price is forming the area for the 4th pivot point. The pair is expected to fall down from the current levels into the area of 1.0225, where one can consider buying it with the tight stop.

USD/JPY

At the H4 chart of the USD/JPY currency pair we can see the formation of the rising pattern, we should expect the pair to grow up and reach a new local maximum at the level of 78.20. The test of the trend’s rising line at the RSI is an additional signal to buy the pair. One can consider buying the pair with the tight stop.

The pair EUR/USD remains close to five-week highs at the Forec currency market on Friday. By 9.15 MSK the Euro is at 1.3108 against yesterday's closing level of 1.3102.

To all appearance, optimism, which had increased after the meeting of the U.S. Federal Reserve this week, started to subside. New movement drivers have not turned up in the market. According topress reports, Greek lending banks see some progress in negotiations betweenthe country and private capital; however favourable outcome has not yet beenannounce in the market, which intensifies tension about the issue of receivinga second financial aid package by Athens from ECB, IMF and EU. Greece will notbe able to pay off its debts in March without this cash infusion, which willinevitably lead to a default in the country.

Friday is going to be eventful in terms of macro-statistics, which will give the market momentum to determine new movement directions for trades.

Most likely, the pair EUR/USD will not gobeyond the range of 1.3050-1.3130 at the trading session on Friday.

The United States (U.S.) Commerce Department reported durable goods sales orders increased by 3.0% to $214.5 billion. The figure, greater than the 2% analysts had projected, exhibited increasing strength in the manufacturing sector. Purchases were headed by transportation equipment that increased 5.5%. Business purchases that included non-defense capital goods moved up 2.9% eliminating previous months’ reductions. Companies purchased more primary metals, machinery and communications equipment countering depreciations in fabricated metals and electrical equipment orders. Despite the increase, manufacturing only accounts for ten percent of the economy and additional improvements must occur in ailing service’s sector to significantly impact country employment numbers.

Furthermore, the U.S. Labor Department reported jobless claims rose 21,000 to 377,000 for the week ending January 21st. The four week average moved down 2,500 to 377,500 from 380,000 showing a slight improvement. Numbers have remained below 400,000 for seven of the last eight weeks. This level is viewed by some economists as a mark that the economy has been increasing job numbers. Yet, unemployment numbers have a long way to go before they reduce to the historical norms. Additionally, unemployment numbers in January are typically expected to result higher as positions created for seasonal positions dissipate. The monthly average has altered little although recent calculations may suggest unemployment decreases on a larger scale. The current hiring pace, at 150,000 jobs per month, is barely keeping up with natural increases in the labor force. In addition to this, the Federal Reserve expects unemployment to reduce within 8.2%-8.5% at the end of 2012 and degrade further between 6.7%-7.6% by 2014.

With the Fed leaving the door open for further quantitative easing, we expect the U.S. Dollar to get weaker. We have already seen the EURUSD rally lose momentum as the pair failed to break above resistance at 1.3160. If the pair falls below support at 1.3000, the next level of support is seen at 1.2900.

Beating analysts’ expectations of a 2% rise, U.S. Durable Goods orders rose 3% in the month of December fueled by orders for aircraft, automobiles and business equipment. Consumer and business spending rose, and combined with year end replenishment of inventories gave a boost to manufacturing. New Home sales dropped in December by 2.2% to 307,000 annual pace. Even with mortgage rates at record lows, potential buyers are hoping for further drop in prices. Federal Reserve Chairman Ben Bernanke yesterday said the weak housing market was making it difficult for the Fed to rescue the economy.

An adviser to the People’s Bank of China said that the slowing economic growth means that the government is likely to have successfully orchestrated the soft landing for which it has been aiming. Inflation is expected to ease from 2011’s 4.5% to about 3% this year, and some analysts believe that the central bank might move to cut reserve requirements at any time now. Though not yet officially confirmed, a handful of China’s largest banks have apparently been given the green light to boost lending this quarter, perhaps even up by 5% as compared to last year’s lending limit.

The U.S. Bureau of Economic Analysis on behalf of the U.S. Commerce Department reported that the U.S. economy grew 2.8% in the last quarter of 2011, an improvement over the previous quarter’s lackluster growth of 1.8% but falling short of the consensus estimate of 3.0% growth. According to the reading, which was the first of several, it can be primarily attributed to increased consumer spending and higher production from U.S. businesses. Consumer spending rose to 2%, up from 1.7% in the third quarter, but like the GDP data, fell short of analysts’ expectations of 2.4% growth.

Wall Street declined today on the lower than expected print of the fourth quarter GDP. The U.S. economy grew at 2.8% in Q4 2011, lower than the analyst expectations of growth of 3.0%. Consumer spending rose 2%, up from 1.7% in the previous quarter. However government spending fell with a 12.5% drop in defense. Exports grew by 4.7% and imports rose 4.4%. The rise in imports negated the effect of rising exports on the GDP. In a separate report the University of Michigan consumer report showed that consumer confidence rose to 75.0 in January, the fifth straight month of gains.

EUR/USD

The EUR/USD currency pair is moving according to the forecast. Right now the closest target of the fall is the area of 1.2817. One should hold positions opened, and consider opening additional short positions with the tight stop. If the price reaches a new local maximum, this case scenario will be cancelled.



As an alternative scenario we should consider the formation of “head & shoulders” reversal pattern. In this case we should expect the price to test the area of 1.2858, where one can consider buying the pair aggressively with the tight stop. The final target of the reversal pattern is the area of 1.3508.

GBP/USD

Pound is also moving according to the forecast, we should expect the price to fall down to the level of 1.5436. One can consider selling the pair with the tight stop above 1.5590 and increase the amount of short positions only after the price breaks the level of 1.5525. If the price grows higher than 1.5625, this case scenario will be cancelled.

USD/CHF

Franc continues moving inside the descending symmetrical pattern, the target of the fall is the area of 0.9211. At the moment we should expect the price to test the level of 0.9402, where one can consider selling the pair with the tight stop. If the price breaks the channel’s upper border, this case scenario will be cancelled.

NZD/USD

New Zealand Dollar broke the trend’s rising line at the RSI, we should expect the start of the descending movement with the target in the area of 0.7780. One can consider selling the NZD/USD currency pair with the tight stop. If the price reaches new local maximums, this case scenario will be cancelled.

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