Close of Friday with a weekly depreciation against the Dollar happened against the background of resuming concerns about the perspectives of the European economy and the decline of euphoria triggered by the launch of QE3 in the USA. The majority of the countries in the EU are still in recession, so the ECB will most likely have to lower interest rate. In this connection the forecasts about the rate of the Euro again changed in the direction of a decline. According to evaluation of big financial institutions the downgrading of the rate of the Euro is expected to $1.20 by December. The average forecast of 50 bank analysts about the currency pair by the end of the year comprises $1.24. The difference in actions of the USA and the EU is huge as Mario Draghi presumes while Ben Bernanke acts…
Last week the Euro depreciated against the US Dollar from 1.3171 to 1.2918 with later recoil to 1.2986. Nevertheless the bounce back up doesn’t affect the started downward correction due to the loss of trust in the Euro. The Resistance above is the level of 1.3538, but reaching it will be most likely problematic taking to consideration the absence of positive economic data and also vague plans of the ECB President of stabilizing of the EU financial system. As for down side it is open for deep correction. The level of 1.2600 is not excluded and in case it is broken the rate might fall even further down.
The British Pound was appreciating against the US Dollar from 1.6163 to 1.6307. But the achieved levels didn’t withhold and the currency rolled back to 1.6234. The technical analysis of the pair suggests potential correction which might be quite essential. The correction area is in the range 1.5360 - 1.5520.