At the moment of writing, the market is still unsettled but is starting to pull back down to react accordingly to the US data. However, the improved risk sentiment that is blooming in 2012 is resisting to the Dollar appreciation, as the currency is seen now as safe haven.
FXstreet.com analyst Valeria Bednarik says that the hourly RSI levels are in overbought and “selling pressure increases in the 1.3045/60 area, strong technical resistance zone”. However, like the current momentum, the 4 hour chart is bullish “although recent highs just above the mentioned should limit rises over the upcoming US session”.
Bednarik points on the downside, supports at 1.3010, 1.2970 and 1.2920. On the upside, resistance may appear at 1.3045, 1.3080 and 1.3115.
forex market Wednesday 4th of January 2012
Wednesday 4th of January 10:00 – Euro Area Annual Inflation (November): the inflation in Euro Area remained at 3.0% in October, and according the recent flash estimate the inflation rate remained unchanged. But the recent developments in the EU including the high uncertainty in the EU and the rise in balance sheets of ECB due to the loans it gave to EU banks. If the upcoming inflation rate estimate will rise, it may slightly lower the chances of an additional ECB interest rate reduction;
Wednesday 4th of January 15:00 – U.S Factory Orders: This monthly report will examine the changes in U.S. factory orders of manufactured durable goods during November. This report may indirectly signal the changes in U.S. demand for commodities such as crude oil. According to the recent flash report, during November new orders of manufactured durable goods increased by $7.5 billion or 3.8% to $207.0 billion; Non-defense new orders for capital goods inclined by $5.9 billion or 8.1% to $78.7 billion
EUR/USD forecast january 4 2012
Price also traded sideways: the purple line breaks down the channel, back above the channel and goes to the red line of resistance. A few hours earlier in the price range of red and purple trend line and still breaks them down and breaks the main purple dotted trend line and then going trend movement down to a minimum of corrective movements on 14 December 2011, after the census forms minimum divergence MACD at D1. Price meets resistance in the previously blue channel + blue trend line has a broken on Monday. Price bounces them up and knocked at least test of December 14, upward and goes down again. Day rose candles confident sales.
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