On Friday growth in dollar as well as fall of share markets have occurred in the US. There are many reasons for that: ambiguous report on jobs in the US, upcoming presidential election, that will take place on November 6. Unfortunately it is hard to foretell the reaction of the market. However if we forget about fundamental reasons and look at the technical outlook of the market, then everything is clear.

The dollar continued the descending trend. EURUSD pair stopped at a support level of 1.2830. This is the third similar instance at this level, and if the price can break it, then the consolidation that has been active for 2 months will stop, and one may sell EURUSD for a long time.

Pound sterling looks stronger and the price lowered only inside the consolidation, there is a long path to the renewal of the minimum.

The trading week happened to be confused, currency pairs moved in different directions during the trading week because of expectations of the news from regulators (the ECB president Dragi’s speech and FRS meeting). However FRS meeting didn’t bring any news. “Twist” program and extremely low rates will continue in the US. As it usually happens, the market moved a little bit before the news but the changes were minimal.

The whole background of trades can be determined as follows: lowering of risks, which is connected with lack of positive changes in Eurozone and there was a growth of dollar during the week. Thus EURUSD pair lowered the whole week and stopped at 1.2935, which is a little lower than sloping support, formed by two previous local minimums. EURUSD entered the 300-wide diapason.

That is why it is logical that at the beginning of this week one may expect signals to buy. A rebound may be expected from sloping support at approximately 1.2950, and formation of rebound model on Monday, since there is already a doji-candlestick on Friday. The aim of sales can be the upper bound of the diapason- which is 1.3130.

Last week there was a deployment towards dollar of all currency pairs, which stopped the decrease in value.

This week it will be wise to trade “for dollar”, since it grows on all positions. For example EURUSD. The pair could not break down and renew local maximum on Wednesday, as many traders wanted. At the place of a breakdown it went down and is trading now lower than the secondary support of 1.3044, which became resistance. The opening of short positions may be realized immediately after market opening and the appearance of signals to trade: the rebound from the level of resistance 1.3044 or the renewal of minimum of last candlestick. The risk should be eliminated to 1.3050-1.3070.

Pound sterling is close to local minimum, which may support the island currency, especially because the pair actively descended for recent two days (Thursday-Friday). So despite the weakness of pound sterling traders’ purchases may appear at this level, those traders hoping for deployment. It makes sales with market openings less attractive, especially because GBPUSD pair is developing in the channel now, to the lower bond, with a small cruising range. Thus if there are open short positions, they should be held with instantaneous fixation of profits, with hints to rebound or quotations deployment, but it’s better to wait with opening of new ones, since the risk is too high.

First two trading days turned out to be differently directed on Forex market. If on Monday dollar grew in comparison to all pairs, then on Wednesday everything was different and the fall of dollar, especially to European currencies was significant.

Thus EURUSD pair grew by more than 100 peeps and achieved the last maximum- 1.3050. The impulse of movement was very strong and with the update of local maximum on Wednesday the growth of quotations of EURUSD pair has to continue, since the pair drew the deployment shape of “double bottom”, which does not exclude the consolidation.

GBPUSD pair is set against the resistance too which is at 1.6130. The situation similar to EURUSD; the growth will occur after breaking down this resistance. However recently pound sterling looks weak in comparison with euro and dollar, that is why it is useless to count on it, and the correlation with EURUSD movement requires excluding it from the portfolio.

Traditionally before opening new trading week we conduct a little analysis and prepare to possible surprises from the market.

So let’s start with the EURUSD pair. Last week we saw a beautiful deployment within classic candlestick analysis (from Wednseday to Thursday), and we have a question now: will the growth continue this week? Friday made it clear that bulls in second half of the day started to fix the profits which led to losing EURUSD positions. Thus there will be attempts to push the quotations down on Monday. But because there is no signal for sales, one shouldn’t sell. And for same reason one shouldn’t buy during first hours of trade. Thus Monday will be decisive for choosing tendencies for a week.

Pound sterling looks more confident but not too much. The situation is almost the same as with euro, so it is advisable to stay out of the market. Just yet.

The US dollar continued to ascend on Tuesday, which was supported by ECB president Mr. Draghi’s speech who did not calm the markets down and did not make the Eurozone politics clear.

The GBPUSD pair continued its lowering. The descent of the pair was very active on Monday and on Tuesday, which led to the breakdown of psychologically important level of 1.6000 and of consolidation of the price lower than this level. The descending trend of GBPUSD has a potential for developing to the support level of 1.5915. However it is dangerous entering market with current situation. One should wait for the recoil.

The European currency doesn’t look better than its island opponent and has been falling for two days compared to dollar, leveling the growth of last week. EURUSD reached the euro consolidation zone on Tuesday, which might detain the fall for a couple of days, However it is better not to go out of the short positions, since there aren’t obvious signals for slowing the descent of euro relative to the dollar.

The first week of October was ambiguous. Something grew, something fell, but one thing is clear: there is not a trend of development of the market. And even the fact that on Friday the quotations of EURUSD grew up to 1.3040 on closing due to the news from the US, it is too early to talk about the continuation of ascending trend, so do not rush to buy.

The euro situation is difficult. Current growth was predicted technically, but fundamentally euro should cost less, that is why the purchases from current levels will have higher risks. In our opinion it is the right time to go out of the long deals and not vice versa. However one should not be sure about the descent of quotations. That is why one should wait for signals for sale on Monday. Sales on EURUSD have high potential of profits.

Gold tried to break down the resistance level of 1790 last week, however several peeps were missing, in order to establish higher than the indicated level. That led to Friday descent of quotations of the data from the USA. This week the gold may continue its slow descent, however it is dangerous to trade with it, since this asset is an asset- asylum for the market, and if something happens the gold can go up at once. So do nor sell it yet, and even if you sell it only with short stop loss.

During three days the market did not decide which side it is on: bulls or bears. Maybe it made a decision. Let’s consider particular cases.

So popular pair EURUSD went into side consolidation without specific price tendencies. The attempt to continue the correction was not successful as well as attempt to renew the growth. And as a result we see the disorder and fluctuation of quotations in a certain diapason.

It is still early to take up any position, one should wait for an adequate signal.

Pound sterling broke down actively the level of support of 1.6130, which was a signal for continuing the descent of GBPUSD pair. If you could not enter short position on Wednesday, it is pretty dangerous to do it now. If one enters now he should put stop loss higher than a current candlestick, higher than 1.6140. The impulse is good and the pair was trading almost without shifts towards main direction.

Last two days of last week brought a chaos to the market. Let us not go into analytical details that would explain such behavior, we are just stating the obvious. On Thursday the market was persuading us that the correction towards ascending trend is over, and on Friday as if it recovered its wits it went down.

Now it turns out that EURUSD pair gave us full opposite bear absorption, but without updating last day’s minimum.

 The price refreshed its minimum on pound sterling, but it came back to the opening price on Thursday, which does not make a bear absorption of Friday complete.

Bad news on US gdp for 2-nd quarter of 2012 that came on Tuesday (1.7 % growth was expected but it was just 1.3 %) stopped the raise of dollar. On Thursday markets were not giving reasons for sales, beat all the traders and there were signals of continuation of ascending trend on many tools. Yesterday there were indicators of changing the direction of movement.

Thus the turning candle formation with a hummer down was formed on AUDUSD pair, which means the end of correction.

A bull absorption was formed on EURUSD pair which is another signal for turning upwards.

There is similar situation on pound sterling against dollar. Only growth of pair GBPUSD is restricted by the resistance of 1.6300, which has to be overcome before the continuation of development.

Today it is Wednesday but the market reminded more of Friday. Our prognosis on the continuation of ascending tendency was correct, and the verdict of German court about the possibility of ESM ratification with restriction of Germany participation in this action of generosity within 160 billion euros only helped the ascending trend in the morning.

However after the lunch a day deployment occurred and all the assets were won back. We will not be looking for the reasons of the deployment, we will just accept it.

As a result the majority of the markets saved the positive result of the day, which does not cancel the ascending trend.

On Monday we saw moderate corrections on main forex tools following the Friday active growth. On Tuesday the ascending tendency continued.

The impulse was strong again. The local extremums were renewed on EURUSD, pound sterling, the Australian dollar.

Thursday and Friday of last week turned out to be very positive for all risk risks. Friday was especially successful for bulls, because all the risk assets went up ceaselessly, saving its positions until the closing of markets.

The reason for such a positive drive is the change in unemployment rate in the USA. Thus it dropped from famous 8.3% to 8.1%, which significantly cheered up the markets.

As it happens usually with good news from the USA, the dollar dropped to risk currencies, this paradox is being investigated by thousands of analysts, that might find many reasons for such strange phenomenon.

Eurodollar broke down triumphantly, the level of resistance of 1.2660 on Friday and on closing of tender was quoted as 1.2815, which has not occurred since May of this year. Thus summer descent of euro is over and one should expect the development of ascending trend.

However for those who are out of the market a serious problem of choosing the exit point into long positions still exists. The problem is that the Euro trend kept unfolding and broke down upwards, and now it is not clear whether the technical correction downwards occurs or not. To enter with current quotations means accepting high risks for stop-loss, to wait for rebound for entry means probable losses of potential profits. Unfortunately there is no single answer.

On Wednesday quotations of EURUSD pair broke down the level of support of 1.0225, thus they destroyed the hopes of bulls for stopping this unfailing fall. Yes. This year Australian dollar is showing enviable trendability which does not give traders chances to trade against the trend.

After the fall of support it is possible to accrue to short positions and to tighten the profits gradually. The nature of the trend allows doing it without any efforts.

The next level on which the trend will be tested is the level of support of 1.0100. And since there are several days needed to reach this level, Australian dollar traders-sellers may say good bye to Friday and begin the weekend right now.

Monday, September 3rd was an exit in the USA dedicated to Labor Day, hence Monday was not the most active trading day, that is why it is advisable not to erase it from graphic analysis, since because of the losses of liquidity on markets the data was not reliable.

That is why it is recommended to look at the trading analysis only on Tuesday.

GBPUSD pair was not able to break down the resistance of 1.5913 (previous maximum) on Monday-Tuesday and is building a graphical figure of deployment of the trend “Double Top”. At the lowering on opening (the beginning of European session) on Wednesday it will be possible to sell the pair with the stop higher than a resistance level (1.5913). If a signal “Double Top” will be confirmed, then the aim of the descending movement will be the level of 1.5750. If the pair goes into consolidation, the sales will need to be closed for a while, until receiving the signal.

On Friday the markets were under the influence of Ben Bernarke’s speech about a possible new round of quantitative easing, which determined the dynamics of quotations in the second part of the day on all of the instruments.

Thus EURUSD pair made an attempt to break down the current trading diapason, but at the end of the day the quotations were not able to linger higher than the border of the diapason and the following week the pair will begin in the diapason which means that there is no signal for buying yet. It is worth being careful with purchases, since a fake Friday breakdown might be an indicator of deployment of ascending tendency.

One of the instruments that demonstrated a strong reaction to Benarke’s speech was gold. That literally broke down the resistance level of 1677, and the quotations of which closed far from it. People who did not make any attempts on Friday may wait for the correction on Monday-Tuesday, which may occur.

Recently a EURUSD pair has been trading in a pretty narrow price range 1.2460 – 1.2580. Despite serious economic news from the USA on Thursday (FRS meeting and Ben Bernarke’s speech), Euro did not demonstrate any serious dynamics as reaction to these events. But the American share market descended quickly and kept descending during the whole trading session.

This excessive tranquility of EURUSD pair has to finally turn into a dynamic breakdown of the diapason. That’s why it is recommended to trade for a breakdown of the diapason and not for a rebound inside the channel.The breakdown direction is not clear yet.

On Tuesday the markets were acting without any serious economic and political news, which was reflected on growth of risk currency that are euro and pound sterling.

The lack of serious negativity and no positive macroeconomic data gave a positive push for finishing a short-term correction on EURUSD and GBPUSD pair continuing the ascending trend, that was observed until the middle of august.

As a EURUSD pair reestablished its positions and at the moment of closing trading session the quotations reached the level of 1.2570. However it is still lower than a local minimum, which was three days ago on a level of 1.2585. Thus it is early to discuss a continuation of ascending trend, one should expect the renovation of maximum.

After breaking down the level of resistance of 1.2320 on Friday (which has turned into support), the EURUSD pair wasn’t able to stay higher than this measure. On Tuesday and Wednesday there were low volatile trading days on EURUSD pair which led to two doji-candlestick formation, that embody inner struggle of bears and bulls on market.

Today the quotations have descended down to support level of 1.2320.

The bad news from Eurozone do not let Euro stabilize higher than the level of 1.2320. Thus yesterday the credit rating of Greece was lowered down to «ССС», the bank of Great Britain reviewed expected indicators towards decrease, the export of France is unprofitable and Germany refuses to enter single Eurobond, which would be under control of Eurozone.

Today the US FRS meeting of two days is ending and the first commentaries on results of reports of regulators are appearing.

The chances of getting positive news from across the ocean were very low and the markets started corrections towards a small previous growth. The pessimism of the market was justified, for instance during the meeting of FRS nothing new was declared (until a detailed deciphering was available). The difficulties of financial sectors were mentioned once more, as well as inflationary policy and unemployment, the basic rate of interest of 0.25 % stays the same the real estate market does not develop and there are many risks for world economy development, that additional measures for stimulation would not be taken, and the old program “ Twist Operation” will function until the end of 2012 without any changes.

On Tuesday the gold was descending, signaling the sales. Signals for sales are confirmed by two factors:

1. The price rebounded from the upper border of the diapason.

2. Three latest candles form reversal candlestick pattern with classical hammer.

Another factor of descending is the closing of long positions by bulls right before the commentaries from the meeting of FRS, that started on Tuesday and will go on until Wednesday. Since lately there have not been any positive news from the USA for traders, so there is a risk of descent of current quotations.

Thus one should occupy the short position on gold (which means to sell) displaying a short stop for reducing the risks of getting wastage in case of very positive news from the United States.

Today the anticipated raise up of the gold triangle has occurred. As we have mentioned earlier this impulse is a great indicator of continuing ascendant movement.

Despite the fact that the impulse was good and strong the gold is still limited in its growth by resistance of 1636.

The Wednesday break should be perceived as a fake one by no means, since the price has not returned even to the boundaries of the triangle after the break that is why the upcoming days it is recommended to make only long deals with gold.

The tension on markets drives gold rates to a narrow band, which becomes dangerous for intraday traders. Why dangerous? Because gold usually has a tendency to break down its bands with abrupt impulses, which may yield big losses to intraday traders within a very short period of time, that do not set limitations on the beatings.

Graphically one may notice a classic isosceles triangle on a daily chart, the triangle which is already done. The price is gripped between two frames, leading to traders who will be waiting for a breakdown towards any direction. On Monday a breakdown attempt failed and the price grew. On Wednesday a raise attempt might become possible.

There is summer slackness on markets. Seemingly… But one should look at the active trading of petroleum and stock indexes, to understand that the slackness does not exist on all markets. As far as the petroleum is concerned, it is growing well and overcame the resistance of 99 -100 (the brand in question is Brent), from the rebound that made it possible to buy. Currently the obstacle for further development is a level of 106-107 $ for one barrel, which would be nice for consolidation to calm down the bears and continue the growth.

There are no reasons for petroleum not to grow. The reserves of oil and gasoline are falling in the USA, the correction of all Arabic crises has come to an end, the heating season is approaching and world economy is increasing and it still needs fuel for functioning. There is a high demand for petroleum and with a growing share market it must increase. That is why purchasing is well grounded both technically and fundamentally. However, those who are not in long yet should wait approaching the level of 106-107 and a price behavior at a given level.

Summer is affecting traders’ activity. On Tuesday, despite good corporate accounts of American companies for the second quarter, the markets were decreasing until a kind man Ben Bernanke (a chairman of FRS) arrived. Of course markets were affected by the pressure and high inflation of Great Britain and low business expectations in Germany.

But there was one important idea that appeared after hearing Ben Bernanke’s ambiguous statement about a possibility of continuing and expansion of a current program of quantitative easing. It was just a reference to low rates of inflation decrease and US economy growth.

Such hint gave markets a pushup but not for a long time, since it was either a hint or just thinking aloud. The situation is really interesting, with markets ignoring economic indicators and reacting to another money printing, nobody believes in economy effectiveness.

In spite of traders’ superstitions, last Friday the 13-th was pretty successful for markets. Is there a rational explanation? Let us try to understand it.

According to newsfeed it is obvious that there weren’t any positive changes or serious news. Thus a couple of leading American banks reported their results. Wells Fargo got by 15% more profit for the first quarter of 2012, in comparison with a year earlier, but the profits of J.P.Morgan Chase turned out to be worse than the prognosis. The prices of manufacturers in the USA have increased by 0.1%, though a decrease by 0.4% was expected. However these were all economy news worth paying attention to for the day. Nothing special, and since under the conditions of prolonged decrease a famous English saying works well “no news is good news”, the background at least did not hamper the development.

Recently the market has been increasing, if there are no meaningful news, and every time this slight growth is interrupted by another negative factor, that causes panic for average trader.

On Wednesday the market was increasing evenly (share market and market of raw materials and also risky assets). But then transcripts of FRS meeting that was held on 20-s of June were released stating the decrease of growth of US economy from 2.4% down to 1.9%, and everybody started panicking and the quotations started deflating.

It is very good that there are sensible people and they remember that Ben Bernarke has already mentioned these data after the meeting and the market had to overcome them. So we should not pay attention to this mishap in a newsfeed.

Last week began with Euro decline and an established breakdown of EURSUD pair by 1.2320. However, in order to trade it is essential to wait for active auctions on Monday (that is at least the opening of European area) and to ensure that the breakdown that took place on Friday was not false, which is possible at such level. Unfortunately, there are no real confirmed data of positions in Forex, and that does not let perform the analysis of the balance of the power of customers and sellers at such level.  That is why the confirmation of the breakdown is so important.

The decrease in petroleum price led to decline in value of Australian dollar compared with USD. Under speculator’s pressure the rates of AUDUSD pair broke down the support level of 1.0225. Perhaps on Monday Australian dollar will decrease significantly, and it will become possible to enter trading on market openings with short stops for support level of 1.0225. The deal seems to be pretty good, since the mark of reduction is at 1.0000, which makes up more than 200 points at current price.

In May currency pair USDCAD showed soaring and on the last day of the month reached the maximum at 1.0365 creating bullish trend, which is marked on our chart with the channel of linear regression.

The fall in oil prices which was caused by the crisis in Europe destabilized the commodity currency of Canada and made the dollar stronger and more popular as save haven currency.
Future growth of currency pair USDCAD is supported by the canadian statics and technical analysis evidence. It is forecasted in the first half of June. As it became known on the May 31 in the first quarter of this year the current operations balance deficit of Canada grew from 10,3 billion to 9,7 billion in the last quarter of 2011.

Market now is on the positive side. Eurozone heading towards recovery, says ECB boss Mario Draghi and this tendency is going to continue. After that there was a stock market rising on Wednesday and then rising of the all the risk-generating assets  including currency.

Remarkably, main currencies had reached their support point just before that and were on that level for several days. The growth of the currencies was only due to the fact of today's positive news. Of course different currencies reacted in a different way to the news. So Currency pair EUR/USD did not show high level of growth it just compensated the previous fall on Tuesday. Most likely it is connected with the eurozone risks, which concern investors. Currency pair EUR/USD could face resistance at 1.2630.