Forex Daily Forecast, Analysis and Prediction

The XAU/USD pair had a relatively tight range yesterday as investors tries to digest Friday's downswing. Demand for gold has been significantly decreasing as the conditions in the marketplace have dulled the precious metal’s safe-haven appeal.

The WTI contract barely budged during the session on Monday, which of course wouldn’t be a surprise as the Americans were celebrating President’s Day. As it is a Federal holiday, many financial institutions were closed, and only the electronic global trading was available.

The EUR/USD pair did very little on Monday, but the Americans were away celebrating President’s Day. The largest players in New York were certainly away, and as a result there is only so much that can be read into the price action.

The USD/CAD pair shot straight up during the session on Monday, but the Americans were also away for the President’s Day holiday. Because of this, the pair would be greatly effected as a majority of the volume in this market tends to be North American trading, and the population of the American trading community is much larger than the Canadian one.

The NZD/USD pair fell during most of the session on Monday, although it needs to be stated that we had low volume due to President’s Day in America. This kept a lot of the larger New York offices closed, but the action was indeed telling to me.

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Yesterday's low trading activity gave me a chance to get caught up on my charts, and I caught an important pattern on the EUR/CAD that I missed on Sunday.

For the greater part of 2012, the Swiss National Bank (SNB) ensured that the Swiss Franc was never strengthened beyond its acceptable exchange rate of 1.20 against the Euro.

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Gold settled at $1608.78 an ounce on Friday, its lowest settlement since August 17. Breaking below the January 4 low of 1625.64 triggered a sell-off which gained momentum after the latest reports released from the Unite States provided further evidence that the world's biggest economy is continuing to recover.

The EUR/USD pair had a fairly quiet session on Friday as the markets in general went back and forth. It seems that most traders simply were not interested in taking a lot of risk in the marketplace going into the weekend, as is often the case on a Friday.

The USD/CAD pair had a strong showing on Friday, attempting to break through the 1.01 level. However, as it has done several times recently it failed. The one thing that does give me caution about shorting this pair is the fact that the lows are getting higher recently, and it does seem like a relentless attempt to breakout.

The NZD/USD pair fell rather harshly during the Friday session as the 0.85 level offered far too much resistance. New Zealand retail sales came out and push the pair above the 0.85 handle during the late date Thursday, but as you can see by the time we close the session on Friday we had close below the 0.8450 level.

The AUD/USD is trying very hard to give up the support level at 1.0225 established last week. If we look at the weekly chart we see that the upper descending trend line is holding true to form, while the downside still has some bearish potential to at least 1.0149, the low from October 14, 2012 as well as the intersecting point for the rising trend line and the Monthly S3.