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Monday ended the strengthening of the U.S. dollar. After a relatively long lower U.S. dollar managed to recover some of the lost positions against all currencies. The main reason for this movement is the expectation of market participants of meetings of central banks in the U.S. and the Eurozone.

The EUR/USD fell during trading on Monday. The factors supporting the growth of the European currency in the moment, as well as statistical data that could give impetus to growth. Now, many traders and investors are waiting for the meeting of representatives of the European Central Bank. We add that the markets do not expect major statements by the central bank, except, perhaps, the indication, the ECB will keep rates at exceptionally low levels in the future. A few weeks ago, many believed that there is a small possibility that the ECB will lower its bid. However, recent data on economic activity in the euro area and Germany were better than expected. According to this, the ECB may argue that it will keep interest rates unless you need help. The EUR/USD is trading near the 1.3250 resistance, a break of which will open the way to the lower levels, especially to the level of 1.3170.

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Bidding on Monday were not in favor of the U.S. dollar, the U.S. currency lost ground against major currencies, the reason for this was the release of data on the housing market in the U.S. Why market participants are waiting for the news? Because last week, Fed Chairman Ben Bernanke said that the housing market is one of the primary indicators on the basis of which it was planned to start reducing stimulus. The sudden drop in June, the pace of home sales in the secondary market indicates not quite got stronger the U.S. economy, which in turn pushes the possibility of reducing the incentive program. Sales in the secondary market in June fell, but remained at a level consistent with a strong housing market. Meanwhile, prices continued to rise, as stocks remained low.

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At the end of trading on Thursday, the euro rose sharply against the dollar, recovering with most of the previously lost positions. The fall of the euro, in the beginning, it was caused by a report on the current account surplus of the euro zone, which fell in May compared with the previous month. The European Central Bank reported that the decrease is caused mainly due to the higher deficit in current transfers and income decline.

The second factor reducing EUR/USD began to economic data in the U.S. . After reporting a significant increase in initial claims for unemployment benefits in the U.S. last week, the Labor Department released a report that showed that last week the number of initial claims for unemployment benefits fell more than expected. The report states that the primary applications for unemployment benefits in the U.S. last week fell from 24 thousand to 334 tysysyach. The dollar also helped the Philadelphia FED manufacturing index, which also was better than analysts' expectations.

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During trading on Monday, the European currency was moving sideways. It was promoted by a small activity that often occurs at the beginning of the week. However, the pair EUR/USD fell to 1.3000, where the support, and then began to rise to the top of the zone range at 1.3080 . At present, the euro is just trading at the upper limit of what is - the possibility of the sale, more patient traders expect growth to the level of 1.3100, which will enter into a deal to sell at the lowest risk. During the opening of the European session border formed by the range is likely to be under pressure, traders should use the strategy of breakdown, because soon the market in the short term will move in the direction where the boundary will be broken. It should also be remembered that usually the breakdown of the price movement is quick and sharp, so it is wise to use pending orders to enter the position.

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As we expected, the week started with the weakening U.S. dollar. Currency exchange rate EUR/USD during the session on Monday reached a level of 1.2880, where the upward movement of the euro stalled. Euro increased in relation to the dollar, even after the publication of data on industrial production in Germany, which were worse than analysts' forecasts. The pair in our opinion would be short-lived and most likely is corrective in nature, the way of the EUR/USD rate is 1.2900 and 1.3000, traders will play on the slide just a couple of these levels. The weakness of the euro and the comments suggest European economists. Since the ECB Governing Council member Nowotny said that the period of low economic growth in the euro zone will continue for some time, ECB president Draghi also said that the recession in the euro area is still ongoing. Thus, the fundamental and technical factors point to the depreciation of the euro against the dollar in the long term. In the current situation it is necessary to wait for the signal to resume growth in the dollar, so for example, if the EUR/USD will not be able to consolidate above 1.2900 level marketers should consider opening short positions. The immediate goal of the downtrend is 1.2750 level, within a month may also decline to the level of 1.26, about the bank's analysts said Westpac.

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Bidding on Thursday against the backdrop of mixed dynamics of the dollar. During the Asian session the dollar showed steady growth, reaching the level 1.2922 the pair EUR/USD, but during the European session, the pair EUR/USD was able to partially recover from the lows. After yesterday's breakout of strong support, which stood at 1.30, which now plays the role of resistance, we expect a further decline in the Euro, with the closest targets 1.29 and below 1.28 . "Weather" - still negative.

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At the beginning of a week the European currency has opened above level 1.30, thereby once again confirming force of this support. The last week has inherently carried out in a range between two borders 1.31 - 30. We consider that EUR/USD steam in the near future will constantly bargain in a corridor of the prices, thus jumping from one channel in another. At present we see, how pair having beaten off from support at level 1.30 goes again up to the next purpose - to level 1.31 . To play on the dollar party in long-term prospect from the technical point of view excellent idea, but we also allocate possibility, for more short-term transactions. Traders should watch behaviour of pair of EUR/USD near borders of ranges, namely 1.30 and 1.31, and respectively to open positions on sale from resistance and on purchase from the bottom border - supports. If earlier we allocated two big channels 1.32 - 30 and 1.30 - 28, now EUR/USD steam is fulfilled even more smoothly from the technical point of view. At break of level 1.30 that at a descending trend of euro is more probable, rather than probity borders at level 1.31, it is necessary to open transactions on sale for the purpose of 1.29, and for more conservative traders up to level 1.28 .

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During the day EUR/USD pair lowered, but wasn’t able to leave the diapason of prices of previous day. This demonstrates that the market had taken a little break after an abrupt fall, and is now probably going to face consolidation. Nevertheless, in long-term perspective we assume that the descending tendency will continue for the EUR/USD pair. We should mention that the pair is again lower than the level of 1.32 and is heading towards the level of 1.30. We still think that the pair movement during the summer period will be carried out between the boundaries of 1.32-1.28. At the moment traders should watch the resistance levels, where they can open positions for lowering European currency, which is level of 1.32. More aggressive traders with low risk should sell from the level of 1.3150-30. The behavior of price near the level of 1.30 will show whether the dollar is potent enough to move further towards 1.28, or we will see again a market trapped in the area of 1.32-30.

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Currently we assume that EUR/USD pair reached a possible turning point. After all, Federal Reserve system made an open statement, declaring that they hope to leave the game of quantitative easing, and the European Central Bank, as it seems is preparing to weaken money-credit policy in the future. Look at the weekly graph, and you will see that the line of the descending tendency was worked out well over the course of previous 5 sessions, and the market just dropped from that level. We expect many fluctuations above, but abrupt ascending rally on EUR/USD pair will be sold out, and as a result euro will be trading at much lower levels against dollar.

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Is the USD/JPY pair ready for growth?

USD/JPY pair was able to grow on Tuesday during the session, consolidating higher than the level of 95, which is acting like a support now. In fact, we assume that the level of support is spreading from 94 to 95, as a result we have to continue watching consumers engage in a game in the mentioned area. We will be able to see on the graph whether there was a significant sale of the USD/JPY pair, and that can be more or less connected with anxiety because of actions of Japanese government and their principles of currency politics, that is why many traders closed their long positions on this pair. However, interestingly enough even with a massive sale the market fell only on the line of 38.2% on Fibonacci from upper levels. In other words, the fall lasts about 900 points. The majority of traders is concentrating on short-term trading, selling the pair, but nevertheless in long-term perspective such adjustment is a common case, because the market can’t grow constantly.

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EUR/USD in expectation of FOMC

EUR/USD pair grew in price during the last week and it was able to consolidate higher than the level of 1.33. However, our graphs demonstrate the line of resistance which should implement the pressure on EUR/USD pair closer to the end of the week. There are several candle-hummers on a daily graph in succession, thus we assume that the next week will be a Euro week. Undoubtedly, the market is expecting the Federal Reserve system press conference, which will happen in the second half of the week. The results of the meeting will determine the destiny of US dollar, whether the chairman of the DRS announces a program of quantitative easing or no. But we consider that the traders will prefer waiting for the closure of the candle on the day of the press conference. However it is obvious that one should buy EURO higher than the line of tendency and sell it lower.

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EUR/USD pair dropped at first lower than the level of 1.33 during the session on Thursday, but as you can see it grew significantly to form hummer-shaped candle again. This is the second hummer in succession, and in most cases it means an optimal action. Now the level of 1.33 looks as a quite strong support on the market, and as a result we think that the tendency for growth for Euro will remain. However, there is a line of fall of European currency on a weekly graph, which can demonstrate a significant resistance. Besides, it should be noted that distinct European indexes look absolutely terrible. It is especially true in terms of such peripheral countries as Spain, Italy, Greece. News and economic data from Europe will most likely shoe negative development which will keep a strong growth.

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To buy or not to buy?

After opening with the descent on Monday, EUR/USD pair gave the signal to sell, the level of 1.3250 kept the growth of the pair on Friday, nevertheless, the pair was stuck at the support level, which now became the level of 1.3200, and investors who were hoping for the euro to fall, had to destroy their positions. The pair strong growth after the rebound from the support affected a newly formed level of 1.3250 and now we see how EUR/USD is trying to consolidate higher than the level of 1.3300. The speed with which the European currency is moving is demonstrating the signs of rally that we can witness in a short-term perspective. Eventually we think that the pair will consolidate higher than the level of 1.33, now it is high time to open the deals for purchase.

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XAU/USD pair is in the side movement, upper bound is at the level of 1400 and is restraining growth of gold. Yesterday trade was not different from the previous 9 days. The pair reached 1401.81 level, but afterwards it retreated to the level of 1381 – which is currently a local minimum. American data demonstrated that consumer confidence index has grown to 76.2 from 69, as shown in report from S&P's, real estate price index grew by 10.9%. On the one hand we see bull pressure from stock market that has grown in power, low expectations of inflation all over the world and great economic data from the USA, and on the other hand precious metals find support due to increasing demand, which is formed by Asia and Central Banks, after lowering of the price of assets by ¼. That is why traders should wait a little bit while the market gives signal for closure of this hard market. The key levels in near-time outlook are 1400 and 1373.60. The breakdown of the level of 1400 and keeping it higher on a 4- hour graph will be a good signal for bulls.

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EUR/USD pair was working on its technics on Wednesday. You can see that the pair was moving towards the level of 1.30 and it meta strong resistance there. In a weekly review we assumed that the market would experience difficulties when moving higher than this area, but we have to acknowledge that we are surprised how precise was our assumption. 1.30 level is a strong resistance, but Be Bernarke’s remarks helped to keep the pair from following growth, he did not exclude the possibility to begin removing the politics of quantitative softening during the following several months. It is not important because the following movement of the EUR/USD pair is uncertain.

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From the start of current week EURUSD tried to descend. On Monday the descending trend was pretty evident and didn’t give rise to doubt. But on Tuesday after crushing support level of 1.3500, EURUSD pair grew.

Thus the descending movement ended and now there is a signal for purchasing the pair, since after the “fake” breakdown of support Euro can continue its growth towards new resistance situated at 1.4000.

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After breaking down the level of support of 88.000 last week and passing higher than this level, this week the pair USDJPY adjusted to this level- support of Wednesday, and after failed attempt to break down this support lower on Thursday it pushed off from it strongly, by renewing local maximum by 89.700.

Currently this phenomenon demonstrates that there is a strong continuing ascending trend on USDJPY pair and it is very dangerous and not profitable to trade against the trends. Keeping long positions on the pair brings great profits and it allows pulling stop loss which determines part of the income from time to time.

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As it was stated earlier in a weekly premarket review on Sunday, there is a very interesting situation on gold. The quotations of gold are in trading diapason of 1636 – 1677 dollars for Troy ounce, and there were three attempts to reach lower bounds of quotation within a month stay in the trading diapason. It means that in case of descent of quotations lower than 1650, gold will be actively bought by traders and 1636 is a potent support.

Quotations often reach upper bound. A fake breakdown occurred during first days of 2013. A fake breakdown could be a fake signal to buy, which proves the usefulness of abstention from trading during New Year and Christmas. The error was quickly fixed by pretty powerful movement, which returned inside a trading diapason fast.

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Last week destroyed bulls’ hopes to continue the ascending tendency on the market. The correction of the growth goes on but the question remains: is the descending movement a correction or we are looking at the deployment of the market? Meanwhile the markets are falling and this goes on. It is not essential whether it is a deployment or the correction, since there are no signals for purchase.

One of the weakest currency pairs (as usual) was EURUSD pair that moved away from euphoria connected with quantitative easing in the US and a great ransom of government bond in Eurozone. Now after a quick growth the pair is lowering on a daily basis and the first stop might be a level of support of 1.2750. Interestingly enough the correction level of Fibonacci is the same of 38%. That is why it is possible to keep short positions on euro dollar up to this mark or to open new sales. Future of the movement of EURURSD pair quotations will be determined on 1.2750.

Tuesday-Wednesday of this trading week were decisive for British pound and gold.

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As we wrote yesterday euro is under the pressure of bad news and hence it is descending. On Thursday under the pressure of fresh news on Great Britain deficit growth and ECB forecast descent of European economy development in 2012 (ECB is planning the economy descent by 0.3 %) euro broke down the level of support by 1.2320, from which on Wednesday a rebound of pair quotations was realized.

This breakdown is a perfect technical example of the fact that there is a pessimistic sentiment on the European market of union currency and the quotations must descend. With such negative background and technical weakness of Euro it will possibly descend to 1.2180-1.2210, where a short stop will occur and the bulls will have the opportunity to change the progress of events that are developing currently negatively for euro, which might drop lower than the current minimum for this year.

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As we have stated several times there is a strong connection between Australian dollar rate and economic situation of raw materials market. The higher the oil price the higher Australian dollar rate is.

So it did not come as a big surprise when AUDUSD pair decreased today with oil. The corrections of oil might continue for indefinite time, but the ascending trend is still on and consequently it is necessary to start looking for entry points to the market with purchases on AUDUSD pair.

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While everybody was guessing if EURUD pair will be able to return to its previous trading range of 1.2320 – 1.2660, the euro suddenly dropped to the minimal value this year- the closing price on Friday 1.2155.

Certainly the EURUD pair dropped for a reason. And the reason was significant- negative news. As we have stated many times, the markets and especially the euro currency market reacts very actively to any negative news. And on Friday there were 2 reports. The first one: growth retardation of Germany, the country which is the engine of Europe. The second one: unsuccessful allocation of 10-year state obligations of Spain, which weren't popular among investors even at 7% (the maximum value of obligations profitability lately).

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In May dollar was save haven currency and the worse the better rule was applicable. It means that usually bad news could cause the growth of dollar.

It shows that dollar is strong as a reserve currency. But news about the level of unemployment in the USA, which was expected to stay at the same level (8%) changed to 8,2%.

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Recently gold market has been risky and market volatility unpredictable. Gold was at 1545 in May but there was a fast growth on the June 1 after the bad news from the USA and lack of investors, who were scared of the risks and left the scene. In next few days the rates became consolidated. On the 6th of June gold pushed resistance at 1631, but not higher. Positive comments on eurozone recovery of the ECB president caused to the fall of gold and as a result of this investors who left the market on June 1 started selling it in order to enter the market.