Analysis of EUR/USD, GBP/USD, USD/JPY, Gold according to Elliot's wave principle

The dollar had fared well once again in the past week. Once the American currency corrected itself in the middle of October and returned towards 1.28 USD/EUR, the dollar has risen even higher. By the end of last week the exchange rate was around 1.267 USD/EUR. The rise of dollar can be mainly contributed to the publish macroeconomic data from the US; higher inflation than anticipated and positive data from the labor market. The EU macroeconomic calendar was rather empty, that is why the investors focused mainly on Thursday's PMI index from the major European economies. Especially the German indicators have surpassed investor's expectations, which is what has most likely halted a further decline of EUR.

This week the attention of investors will be mainly on the USA. Apart from important economic data (orders for durables are expected to increase, the first GDP estimate for Q3 14 should have a solid momentum of 3.5% q/q annually according to SG.) the FED will meet. The American central bank will incase of a consensus end the program for purchasing QE3 assets. What stance they take after their meeting, towards the current trend of global economic decline is also very important. If they express doubt for US economy, that could result in a revision of market expectations regarding the increase of interest rates and weakening of the dollar.

EUR/USD

Last week nothing significant has taken place on the EUR/USD frontier. At the beginning of the week the EUR/USD has risen to 1.2824 and then it has decline to 1.2613, ending the week at a price around 1.2700. The EUR/USD is moving in a rising channel and it is clear that it finds its support around 1.2650. This week we can expect a rise towards 1.2883 or a fall towards 1.2650. If the price falls below this level we can experience a significant decline towards 1.2500.

GBP/USD

Last week the GBP/USD has reached a level of 1.6183, where it has hit a resistance and fallen all the way to its support at around 1.6020. From the graph, it is apparent that GBP/USD is forming a triangle like shape, where we can expect a significant breach. If there is an upward breach we can expect movement towards 1.6200, in the opposite scenario a fall towards 1.6000-1.5950.

USD/JPY

The USD/JPY currencies have grown weaker in the past week towards 106.29 where a support was created, which gave birth to a rising channel on the USD/JPY (as shown in the graph). Throughout the week the USD/JPY has reached 108.34 where it can be currently found. This week we expect the USD/JPY to move in its rising channel towards 109 but if it deviates from this channel we can expect a fall towards 107.50.

GOLD

Gold has deviated from its rising channel in the past week. In the beginning of the week it has reached 1254 USD and from there it slowly declined to 1225, where it has deviated from the channel. This week we rather expect a decline towards 1200 USD and a creation of support and resistances for a long-term declining channel.