Dollar Begins A New Era Of Growth

By: Deep Trust Trading Analytical Department

The US Federal Reserves decision has been made, along with commentary from Ben Bernanke. The recently begun tradition of holding a press conference immediately after such announcements, as Bernankes European colleague Jean-Claude Trichet does, has been received very favorably by the market. The Feds leadership, as well as the US presidential administration, seems to have decided that it is better to play it safe during stressful times on the world markets and to not contribute to more uncertainty by leaving any details of consultations on US monetary policy out of the meetings minutes.

Yesterday for example, upon hearing from Fed representatives that the Central Bank will continue strengthening measures to stimulate the economy after the end of the quantitative easing program in June, investors and currency speculators perceived this across the board as in favor of the dollar.

For example, the most unambiguous technical outlook is currently forming on the EUR/USD pair the candlestick on the pair will likely be not lower than $1.4200 at the close of this week. Judging by the daily chart, the GBP/USD pair has broken its monthly support level at $1/6100 and is now heading toward its April minimum of $1.5940 where it may meet the barrier option before again starting a bearish trend toward its support level from the beginning of the year at $1.5360.

Deep Trust Trading analysts believe that likely the most curious, and therefore most interesting, outlook is on the EUR/GBP pair, where everything is not as straightforward as it seems. On one hand, the pair came close to its May high of 0.9000, which repeated the November 2010 high of 0.8940 and may break it if it garners support from Euro bulls counting on a resolution to the crisis in Greece. On the other hand, the daily chart clearly shows a long candlestick shadow from the last closing, which indicates a possible lowering to 0.8800 or even 0.8750 if Euro bulls are to be disappointed. We are seeing a more certain bearish outlook and Deep Trust Trading analysts recommend opening short positions on the Euro-pound sterling pair with an interim target of 0.8830.

The NZD/USD pairs daily chart shows a candlestick with a long shadow, indicating that a drop to $0.8100 is certain by the end of the week.

About the Author:
The financial investment company Deep Trust Trading Limited was founded by a group of professional traders from some of the most reputable organizations on the financial market.

Article Originally Published On: http://www.articlesnatch.com

Tags: finances

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