Fundamental Analysis: MPC Meeting Minutes
Initial Jobless Claims
The Initial Jobless Claims is a seasonally adjusted measure of the number of
people who file for unemployment benefits for the first time during the
given week. This data is collected by the Department of Labor, and published
as a weekly report.
The number of jobless claims is used as a measure of the health of the job
market, as a series of increases indicates that there are fewer people being
On a week-to-week basis, claims are quite volatile. Usually, a move of at
least 35K in claims, is required to signal a meaningful change in job
A higher than expected reading should be taken as negative/bearish for the
USD, while a lower than expected reading should be taken as positive/bullish
for the USD. The analyst predicts the future reading of 475.00K.
The Euro went on with its bounce from the bottom it reached shortly after
the weekly open 1.2733, and scored a high at 1.2914, before dropping to the
support we specified in yesterday's report 1.2822 down to the pip. Such a
rebound is considered very "modest" comparing to the drop it followed, which
came very close to 600 pips! We can clearly see that we have not even
reached the first Fibonacci level 38.2%. Technically, the most important
event was dropping to another important trend line, which is the rising
trend line from June 7th low (please refer to the attached chart). This line
which was tested accurately on Monday, is at 1.2802. If this level is
broken, we will be already on the way to test this week's low at 1.2733 as a
first target, and if broken we will see the Euro dropping to 1.2660. On the
other hand, resistance is at 1.2879. Only with a break here will the Euro be
able to move forward. If we get this break, we think that the price will
rise with the target of reaching Fibonacci levels 1.2962 & 1.3033.
* 1.2802: the rising trend line from Jun 7th low on the hourly chart.
* 1.2733: this week's low so far.
* 1.2660: Jul 6th high.
* 1.2879: short term Fibonacci 61.8% level.
* 1.2962: Fibonacci 38.2% level for the drop from the 3-month high of
* 1.3033: Fibonacci 50% level for the drop from the 3-month high of 1.3332.
The Dollar/Yen bored us yesterday with a very limited trading range, it did
not break any of the levels specified in yesterday's report, therefore,
there is only a very limited change to yesterday's technical outlook. Let's
leave the daily & weekly charts we have been obsessed with lately, and just
focus on the hourly chart. We can see that there is a very exciting trend
line, dropping from June 4th top. This line is almost at 86.21: the
resistance which the price tried to break on Friday, but left it alone
shortly after that. Therefore, all of our attention is at the exciting trend
lien & the importance it provides. As long as we are trading below this
line, the downtrend will be ok, but if we break the resistance 86.21 we will
shoot up targeting 87.00 and may be 87.70. Where if we go back to trade
below the support 85.09, there will be nothing stopping the price from
reaching our awaited target 83.85, and may be at a later time we will see
82.65 as well.
* 85.09: yesterday's low.
* 83.87: Fibonacci extension level 138.2% for the falling wave from 86.86,
compared to the wave which started at 88.10.
* 82.65: the trend line combining the monthly lows of Dec 08, Jan & Nov 09,
on the weekly chart.
* 86.21: the falling trend line from June 4th top on the hourly chart, and
Aug 10th top.
* 87.00: Jul 7th low.
* 87.70: June 26th top.
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