FOREX review for the next week (10/24/11 – 10/28/11) from ForexCloud

Last week was the “correction week”; as we mentioned this possibility in our previous review. On Monday, the EUR/USD pair had a little jump up to 1.3914 (it was its reaction to the European’s minister’s financial meeting) and it reached October’s maximum price. After that, on Tuesday, all markets went on the correctional movement and the EUR/USD price fell to the support level of 1.3700 (the minimum short time value was 1.3652). The next three days were with high volatility and on Friday, the market came back to the bullish movement and finished the week off with almost the same prices, just like it started. On the weekly chart we can see a nice “hammer” candle. It means that this week, we can expect a continuous bullish trend and we can expect that the EUR/USD price will reach at least 1.4000.

There are a few reasons why this prognosis can fail. The first one can be a minor result from the EU summit (very unlikely) and the second, there can be some very bad economic news during the week, but as far as we don’t have any important economic news scheduled for the week, this reason is also not very possible.

The oil price for the next week will most likely stay in the same horizontal trend, but we can expect some down movement as a reaction to news from Libya, where the world community can expect the end of the civil war. This pressure cans slow down the bullish ride of “oil dependent” currencies (AUD, NZD, and CAD).