Finotec News Archive - August 27 2007

Forex Technical indicators

EUR/USD Technical Analysis

Anthony Boyajian
27 August 2007

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Crossing of two moving averages and closing price of the candle is above the short term moving averages

RSI in an uptrend breaks the 70% line

MACD crosses two lines and pointing upwards with high volume

Bollinger gives us a bullish signal after closing the candle above the upper band

FUNDAMENTAL:

European Central Bank President Jean- Claude Trichet may buy time today as he seeks to thaw a credit- market freeze without surrendering a two-year fight against inflation.
In his first speech since the financial-market rout began, Trichet may disappoint investors wanting a clear signal whether he will raise interest rates on Sept. 6. He may instead leave himself with room to maneuver, pledging liquidity to the banking system without closing the door on an increase. He speaks at 3 p.m. in Budapest.
``While they are injecting liquidity they are keeping open the option of hiking interest rates,'' said Marco Annunziata, chief economist at UniCredit Markets & Investment Banking in London.
A week ago, investors bet that the global contraction in credit would prevent the ECB lifting its benchmark rate from 4 percent. That view is now in doubt after the ECB on Aug. 22 loaned an additional 40 billion euros ($55 billion) to banks and said it was sticking to the policy stance expressed by Trichet on Aug. 2. Then, he promised ``strong vigilance,'' a phrase used to foreshadow each of the eight rate increases since 2005.
Investors reacted by reviving their wagers that the ECB will boost borrowing costs by a quarter point next week. The implied rate on the September interest-rate futures contract rose to 4.57 percent last week from 4.34 percent on Aug. 10.

Finotec Analysis Team
27 August 2007

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