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30 January Forex daily review

Sergiy Zlyvko
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On Thursday, the dollar strengthened above the target level in the main scenario. Statistics from the U.S. was published weak, but it prevented the dollar to strengthen its position against the euro and other currencies. Traders realized that now the Fed follows the macro data, but they are not determinative in deciding to reduce QE3 program, so the response is appropriate. Today we try to consider the rise of the dollar, although if the pair bounces off the trend line breakdown will be postponed to Monday or Tuesday.

Today is a very interesting day in terms of technical and candlestick analysis. On Thursday, the EURUSD backed to the daily trend line. Last week the EURUSD closed with a growth, resulting candlestick formed a combination of Bullish Engulfing. It was a buy signal, but at the same time the British pound formed a sell signal. So, today is Friday – the last day of the week and month. If you do not complicate, please open monthly EURUSD chart and see how monthly candle closes (Bearish Engulfing). Closing the month at the current level and below, a monthly sell signal for the euro is formed and besides, the euro is now lying on the trend line. If the breakdown of 1.35 level will be held today, the next goal for the sellers of the single currency is 1.3300. We made the main scenario to 1.3525 because the euro could fend off the trend line. If the pair whacks, then it pulls back to 1.3620.

By the end of Thursday pound fell to 1.6445 and is now trading at 1.6480. The goal is at 1.6380. There the main scenario leads. British pound must pass 1.6415 to go into free fall and 1.6380 is the goal for today. AO indicator unsuccessfully worth, so the pound could revert to 1.6540 mark. But for today we consider the drop of the pound.

Crosses through the Australian dollar managed to recover to 0.8820. By the time the current 50% of the forecast is executed because price dropped to 0.8760 mark and is trading at 0.8765. In the U.S. session we are waiting for the falling forward to the trend line – 0.8735.

Dollar against the franc reached 0.9045 and unable to get past the resistance zone of 0.9000. Now the road is open to 0.9080 level. Today is Friday, the market closes month. If no one will interfere, then under fairly quiet market the pair can reach the 0.9080. Growth is expected from the opening of the European session. More active will be the buyers, the more they will be able to ward off the sellers. The goal is 0.9075.

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