EUR/USD Fundamental Analysis June 4, 2012, Forecast

Analysis and Recommendations:

The EUR/USD continues with negative sentiment but was able to add a few pips today to close the week at 1.2384. The US was hit with a slew of negative eco data, which caused a dip in the strength of the USD. The pair traded most of the day in the low 1.23 range and it a low of 1.2290 breaking through the 1.22 number.

After markets digested the poor eco data, the USD was able to maintain its strength, although many investors moved back to the safety of gold, which the markets had been ignoring. Markets are now sure that the Feds will take some aggressive action to get the US economy back on the recovery trail.

The flagging economic indicators from the U.S and China are proving to be a headwind for investors, who are already unnerved by the escalating debt concerns in the Euro region. The evening session could pack a punch with some heavyweight economic indicators scheduled for release from the U.S. After a disappointing ADP employment numbers yesterday, market watchers would be looking at the government payrolls and the data is seen as quite influential on the financial markets. Taking the centre stage this evening would be the U.S manufacturing figures, which is expected to paint a glum picture. However, any major incongruity in these data could spell doom on the weekend trade.  After kick starting the year on a positive note, the U.S economy is showing signs of dithering in midst of jitters from Europe and domestic macro-economics. Now, markets are set to enter a phase, where any dismal news out of the Europe could dent a significant blow to the financial markets and investors would be zealously looking at the Greek elections slated for June 17^th.

To sum up the US for the past two days, there is just one thing to say, “spring stall” most of the indicators from the US have been negative or lackluster.

Employment data is terrible, Unemployment data is just as bad, Housing data is negative overall. Durable goods and retail sales, consumer confidence and manufacturing have all turned negative.

If it wasn’t for the mess in Europe, investors would be fleeing the US. Today, the Nonfarm data showed that the US only added 69,000 jobs, when it needs to average 200,000 additions per month. Unemployment has climbed back to 8.2%. GBP was revised downward this week and ISM manufacturing reported below forecast.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data for June 1, 2012 actual v. forecast

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Government Bond Auctions

Date  Time  Country 

May 31  14:30  Sweden 

Jun 04  10:00  Norway 

Jun 05  00:30  Japan 

Jun 05  09:30  Belgium

Jun 05 14:30 Sweden 

Jun 06  09:30  Germany 

Jun 06  09:30  Portugal 

Jun 06 14:30  UK 

Jun 07  00:30  Japan 

Jun 07  08:30  Spain 

Jun 07  08:50  France 

Jun 07  09:10  Sweden 

Jun 07  15:00  US 

Jun 08  10:00  Belgium 

Jun 08  15:30  Italy