By Finotec – Last week the dollar got lower against the majors after trading at levels 1.2530 against the EUR, the short term tendency is… … still uptrend for the USD and the positive momentum continues mainly because of the expectation for another FED hike at the end of the month and because of good macroeconomic data witch was published last week.

CPI ex F&E witch was published last week was 0.3% and supported the expectation that the FED will be influenced by the inflation pressure of the American economy and raise the interest rate in another 0.25% in other to maintain the inflation other control.

Moreover Michigan survey on last Friday indicated 82.4 points in comparison to the expectation that was only 79 points, this survey mayors the consumer sentiment in the American economy and this increase reflects a larger trust of the American economy strength.

Finotec estimates that the short term uptrend of the USD will continue but in the long term there are concerns that the deficit in the trade balance will encourage a decrease in the USD value.

This week the trade balance in Europe and Japan will be published and expected to be lower than the priors, this data might pull the value of the EUR and the JPY down.

If we combine this data to the durable goods witch will due out this week and expected to be 1% the dollar might continue changing hands in high levels.

By Finotec

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By DailyFX – EUR/USD * The decline from 1.2976 is likely in a 4th wave consolidation, which means that immediate risk is to the downside back… Read the rest of this entry »