Daily FX Forecast

Forex: EUR/USD: Euro at 1.37 will not be seen again in 2009; 1.18 low in Q4 says BBH

The Euro has dropped to 1.3115 low so far on its withdrawal from 10-week high around 1.3740 reached on Mar 19, 20 and 23; According to the Second Quarter Report from Brown Brothers Harryman, 1.3740 would be the 2009 high.The Euro will decline continuously the whole year through. From 1.37 high on the first quarter, BBH forecasts the Euro to drop to levels around 1.29 in the 2Q and 1.22 in the 3Q, reaching the year low on the fourth quarter at 1.18. next year, BBH forecasts the Euro to pick up slightly to reach levels around 1.౨౧

EUR/GBP: Euro bounces from 0.9240 support

The Euro seems to be picking up strongly from support level at 0.9240, reaching levels above 0.9300 on its way to Mar 30 high at 0.9340.Resistance levels stand at 0.9240, and above here, 0.9416 (Mar 27 High) and 0.9430 (Mar 23 High). On the downside, below 0.9240, the Euro could find support at 0.9175, 0.9155 (Mar 24 low) and below here, 0.9145 (Mar 16 low). Once below here, next support could lie at 0.9072.According to Varengold Bank Research Team, further decline beyond 0.9240 should not be discarded:

“The EUR/GBP trades near to its support level at 0.9241 and it seems that the Bollinger bands narrows each other like a bottleneck as same as on March 24th. Comparative to this paradigm could this be a sign that the currency pair may test the support again. Should the EUR break clearly through this line, this could accelerate the downward trend

European stock markets open with gains; Euro and Pound continue recovery

European markets have opened Tuesday’s sessions with gains reversing partially declines posted on Monday; Euro and Pound remain trading higher after having bottomed yesterday.European markets are posting gains around 1.0% on Tuesday following news by Mark & Spencer, UK’s biggest retailer, obtaining better than expected results. Eurostoxx 50 adds 1.04% and German DAX Index is up 1.02%, with French CAC Index 1.12% up after 1 hour of trading.On the macroeconomic front German Unemployment has increased at a larger than expected extent in February.

German adjusted unemployment rate reached 8.1% in Feb from 8.0% in Jan.Euro and Pound at resistance levelsEuro and Pound are struggling with potential key levels at the minute. EUR/USD rally from 1.3110 low on Monday has reached resistance zone at 1.3275/85 level, which is being tested right now.GBP/USD has suffered a slight reversal at 1.4340; the level has been tested twice, and the Pound has been rejected so far. GBP/USD is trading above the 50 day SMA, although rally from 1.4110 low yesterday seems to be losing strength.USD/JPY rally from 95.95 low yesterday has reached 98.35/45 resistance level (Mar 29 High) although the Dollar has not been strong enough to break it yet.