USD weakness continues

The highlight on Fed Chairman Ben Bernanke would be then main focus on assessing the US economy. This would be two weeks before the Fed policymakers would meet to discuss interest rates and their monetary policy. Which apparently would also focus on the coming end of QE2 this June. With the signs of negative sentiments due to the sluggish economic growth with higher unemployment figures does not rest well with the USD. The continuation of its weakness and the some EU leaders political resolve in helping to provide more support on the European crisis have helped the Euro advance its price levels even as of this writing.

Contrary to what other analyst and retail FX traders say that this movement is a correction from its downward trend is actually the opposite. As others have taken an earlier short position starting at the 1.4350, then to the 1.4550 and is currently at the 1.4660 levels. By the time it touches the 1.4880 price levels again then that's the time that they would change their sentiments to a more bullish tone.

We have maintained our stance from its major corrective movement and a price reversal back to it major trend at the 1.3968 low and closing above its 1.4280/00 the last two weeks sessions. However, the cross rates on the EURGBP has had more of a distinct configuration that we called a continuing bullish trend back to the 0.8900 or better since it also did the same corrective movement together with the EURUSD. Currently, at the 0.8920 levels from a registered high of 0.8944 at the start of this week's trading. Some unexpected pullbacks would be seen, as position adjustments and forced liquidation would take place within this week. As some earlier sellers on the Euro would consider throwing in the towel whenever a new high would register.

A mixture of sentiments would prevail after the GBPUSD showed some initial strength at the start of the week compared with the GBPJPY attaining its initial price objective lower at the 130.64 neckline support. Eventually, this support may also be retested but may meet some hedge strategies once penetrated to the low as USDJPY may do the same. This week's trading activity would be critical fro the Japanese Yen vs. the Pound and the Euro. So a careful watch should be taken.