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The recession, which started during 2008, in the US and later on spread to Europe and other major countries, have had an effect on the correlations among crude oil price and major currencies.

I will show in this short analysis the relations among major currencies and US dollar to petroleum price (WTI), by presenting the correlations of these indexes' month to month percent changes during 2010.

Further, I will show the correlation between US dollar euro rate (EUR/USD) and crude oil price month to month percent changes over the last decade (1999-2010).

These data will confirm two things that are usually assumed in the market:

1. There is a strong correlation in 2010 among crude oil ...

EURUSD Forecast
The EURUSD was volatile yesterday, but overall still maintain its strong intra-day bullish bias after unable to break below 1.3250 support area. The bias is bullish in nearest term testing 1.3500 key resistance area. So far the bullish momentum looks very strong and seems ready to test 1.3500 but note that as long as price stays below 1.3500 medium outlook remains neutral. In fact, some people may be interested in selling the Euro around 1.3500 area due to a good risk-reward ratio there. However, a clear break above 1.3500 would be an early sign of a bullish reversal scenario with potential bullish target at least around 1.3800 and activate my bullish mode. Immediate support at 1.3350. Break below that area could lead ...

EURUSD Forecast
The EURUSD had a bearish momentum yesterday, continued the bearish short term bias after unable to make further upside pressure testing 1.3500 key resistance area on Friday. While medium term outlook remains neutral as price still moving in a wide range area of 1.3500 – 1.2950/00, nearest term technical bias still suggest more bearish potential especially if price able to make a clear break below 1.3244/50 testing 1.3150 support area. As you can see on my h1 chart below, 1.3250 support area is a key intra-day support level that should be watched closely as any price action around that level could be very important for intra-day trading activity. Immediate resistance at 1.3320. A failure to make a clear break below ...

EURUSD Forecast
The EURUSD made another strong bullish momentum yesterday, even stronger than what we had on Wednesday, topped at 1.3382 and closed at 1.3347 after made a strong break above 50% Fibo retracement of 1.3431 – 1.2873 around 1.3150 area. The bias remains bullish in nearest term testing 1.3500 key resistance area. However, I think it’s a good idea to see the overall situation with a broader technical view. As you can see on h4 chart below, price actually has been moving in range area so my medium term outlook remains neutral. Only a clear break above 1.3500 (right shoulder) could be an early signal of a bullish reversal scenario where the head and shoulders (H&S) bearish scenario on the daily chart would no longer valid ...