Forecast for the week 30.04.2012 – 04.04.2012

In the period from April 30th to May 4th, there will be published a number of key macroeconomic indicators, which may have a significant impact on the sentiment of the world financial markets participants and the Dollar’s positions. First of all, on Tuesday and Wednesday (May 1st and 3rd), the reports on PMI from the Institute for Supply Management in the industrial and non-productive sector will be released. On Friday, May 4th, the Bureau of Labor Statistics will provide the data on the number of newly created jobs in March and the unemployment rate. If they open the optimistic prospects for the U.S. economy, the Dollar’s reaction may be positive against the expectations of the tightening rhetoric on the monetary policy of the U.S. Federal Reserve, and the moderate optimism will contribute to the weakening of the Dollar.

The bidders on the EUR/USD pair, besides the data from the U.S., will also expect the next meeting’s outcome of the Governing Council of the ECB and a traditional press conference by Mario Draghi to be held at the end. The European regulator after the auctions, targeted to increase the liquidity in the banking sector of the EU, known as the LTRO, took a wait and is unlikely to acknowledge the important decisions. Its head will emphasize that they expect the inflation decrease in the nearest future and once again will mark the importance of structural reforms aimed at overcoming the backwardness in the competitiveness of the number of countries in the periphery, as well as he will remind of the need to tighten fiscal policy for the member countries of  the monetary union. The EUR/USD pair, in case of overcoming the resistance in the area 1.3235-1.3260, will target the mark of 1.3385.

The positions of the British pound, considerably intensified in recent times, can be significantly altered by the data on the PMI in industry, services and construction (May 1st, 2nd and 3rd) from the Center of an independent economic information Markit. Recent macroeconomic statistics from the Cloudy Albion was quite positive, and could even reverse the disappointment from the weak preliminary GDP data for the first quarter. If it gets a sequel, the Sterling will continue to put pressure on its competitors. From the standpoint of technical analysis, overcoming the resistance of 1.6165, opens the way to the mark 1.6315, and the movement to this mark has all necessary fundamental prerequisites. Nevertheless, the Pound will continue to closely correlate with the Euro and the EUR/USD pair’s movement will have a significant impact on it.

The Australian dollar expects the lowering of interest rates by the Reserve Bank of Australia, which due to the slowing Chinese economy hinted at such possibility, in case the next inflation data will give it an appropriate space. The Consumer Price Index, fixed at 0.1%, compared with the previous month, with the forecast of 0.7%, suggests that the decrease in the rate by 0.25 basis points will be unlikely to avoid at its next meeting. The Australian currency will continue to feel unconfident, but its behavior will largely depend on the prospects for the Dollar. The New Zealand dollar is likely to continue to fluctuate in the corridor 0.8060-0.8280.
The Dollar came under pressure against the Japanese yen as the stock markets in the U.S. “fell” in the correction. Besides, the scale of expanding of the quantitative easing by the Bank of Japan may not be as significant as expected. Therefore, the Japanese currency can overcome 82.20 and move to the mark of 79.10.

We wish you a profitable trading!

The Megadroid team

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