EUR/USD view for week NOV/19/2007

Not much things changed since last week...

I. Important news from the week:

1. Gold correcting ($785)

2. Market correcting, while JPY raise (unwinding carry trade).

II. As I wrote before:
FED blew it!!! They totally destroyed the dollar in long term. I think they will inflate now, and stock market will go higher and higher, but only in nominal terms.

III. The parallel uptrend (old wedge):

EUR/USD 1 week chart:
No change, price is inside the channel, probably will go down. In case it go up, it will not show some significant new high.

EUR/USD 4 hours chart:
For the moment this is just a potential H&S, but we will see.

EUR/USD 1 hours chart:
Here is the "speculative" chart. This chart was done Friday.

Blue channel down - target is 1.46, because there we have longer term support (pink), then up.

Currently EUR/USD open up, with 20 pips gap. It is above the channel, but I think soon it will fell inside. I am still unsure if I will trade this gap. Better wait 1.46 and go long


GBP/JPY 1 week chart:
No chart, but we still have huge H&S formation. Target is under 200.

Do not trade GBP/JPY. It is extremely volatile.

V. Summary:

I can say absolutely the same as previous week:

Generally USD will rise / NEUTRAL now, EUR to fall, but play carefully.

There is one very important thing that helping USD - everybody is against it, even supermodels like Gisele who demanded her contract to be in EUR :-)

Remember EUR is just a worthless paper as the USD is. Eurozone has own problems too. The only reason EUR go up against the USD is because Eurozone and ECB do not inflate as much as FED. Or may be they do now. Who knows. The inflation we see now, is actually from money supply increased 6 mo ago. So we do not know if ECB printing money or not.

There is only one real currency and is called GOLD. As you can see, gold rising against all currencies, not only against the USD. This may mean only one thing - inflation rising. Actually some people believes gold is bubble, but this is wrong opinion (will explain why I thing that some other time).

Happy week and trade!!!

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