Forex Fundamental and Technical Review

Fundamental market overview:

EUR

"Moody's expects fewer countries below Aaa to retain high ratings"
- Moody's Investors Service

USD

"There is modest growth in the economy, we are growing at a rate that's too slow for the unemployment rate to fall" - Mark Vitner, a senior economist at Wells Fargo Securities in Charlotte, North Carolina

GBP

"What is happening in Europe is not helping the UK at all" - Marchel Alexandrovich, Jeffries International

CHF

"The dollar and yen are the only safe haven currencies left in the currency world"
- Thomas Harr, head of Asian currency strategy at Standard Chartered Plc

JPY

"There won't be an end to the market's volatility until we see something that will calm the situation" - Hitoshi Asaoka, a senior strategist in Tokyo at Mizuho Trust & Banking Co., a unit of Japan's third-largest listed bank

Market expectations

EUR/USD

Bearish momentum has loosened as the price stalled near a support line at 1.3063, turning the bias to neutral. Rallies will encounter resistances at 1.3477/86 and 1.3690, while possible dips will be limited by supports at 1.3145 and 1.3063.

EUR/JPY

A major support area, formed by 0.9985 and 100.14, is expected to trigger a recovery once reached by the currency pair. Bullish advancement is likely to find resistance at 105.00, ahead of 107.36/87.

GBP/USD

Even though the British pound-American dollar currency pair has managed to stay above 1.5335 for some time, medium term outlook remains negative, thus the price is likely to decline down to the level of 1.4973.

USD/JPY

The currency couple hesitates to commence surging, as it gravitates towards a key support zone located at 76.29/25. Resistances are situated at 77.07, 78.45 and 79.57, whereas additional supports may be found at 75.00 and 74.23.

USD/CHF

USD/CHF currency pair is making a pit stop at the level of 0.9233 before it renews the journey towards a long-term target at 0.9916/50. Near-term resistances are at 0.9263 and 0.9301, while the price is supported by 0.9130 and 0.9062.

Most important events of the day

Europe
 
European officials are studying additional measures to stimulate the region's economy, after the German parliament approved larger EFSF.  After Greece announced it will miss deficit targets, EU leaders are reconsidering the second bailout conditions.

Trichet's Legacy Being Scripted by Crisis
Jean-Claude Trichet's legacy is still being scripted as he enters the final weeks of his eight-year term at the helm of the European Central Bank.
USA

The US economy showed better than expected industrial orders data while private spending and wages continue to shrink for the 3rd consecutive month; the labour market has stalled.

Rubin: Economy Needs Stimulus and Deficit Reduction Now
The U.S. economy needs a big one-two punch, with job-creating stimulus followed by a deficit-reduction package, former Treasury Secretary Robert Rubin said Wednesday at the Washington Ideas Forum.

Asia & Pacific
 
Chinese  top  officials  say export growth is likely to slow down in rest of 2011. Meanwhile, economists believe the Chinese economy might face hard landing' under the latest macroeconomic conditions.
 
China Bill Could Violate Trade Rules: White House
The White House Wednesday voiced concern that legislation the U.S. Senate is expected to approve this week designed to press China to let its currency rise could violate international trade rules.