By TraderVox.com
Tradervox.com (Dublin) – The US dollar has advanced against most global currencies as economic slowdown dampened the mood in the market. Last week, the ECB made an important decision to lower interest rates which increased demand for riskier assets. Here is an outlook for the major currency pairs this week.
EUR/USD: The pair started last week on a high, attempting to break the 1.2670 resistance line; it slid downwards as the market reacted to difficulties in executing EU leaders’ decision. However following the ECB rate decision, the cross dropped to two-year low of 1.2286. Europe sentiments indicate that economic conditions in the region are worsening; this is likely to force the euro/dollar pair further down where new low of 1.2260 is expected to offer some support during the week.
GBP/USD: this pair lost close to two cents last week to close at 1.5484; this week, the pair has eight releases that are likely to affect it. The pound started last week on a high at 1.5678, rose to 1.5721 but fell to 1.5484. The pair has received support at 1.5415 and below this is the 1.5361 line. On the upside, there is 1.5521 which If broken will open doors to 1.5600 support line. However, market analysts are predicting a downside trend for the pair this week.
USD/JPY: the pair slid lower last week, but it had remained stable through the week and the dollar weakened as a result of the mediocre US Nonfarm Payrolls data. The pair has been trading on an uptrend channel since the beginning of this month and it is close to support at the moment. For this pair, it is important to remember that uptrend support has more significance than uptrend resistance. It is expected that the pair will remain neutral through the week.
USD/CHF: the pair climbed three cents last week as Swiss franc fell, closing the week at 0.9769. This week is a bit quiet for the pair with only two events set to affect it. The cross is expected to continue with the decline if there are no strong data from Switzerland to revert this.
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