Hawkish remarks boosts Euro... Signals more interest hike in Eurozone.

What goes up, will definately come back down....Nope, this is not the law of gravity in physics. It does happen in forex as well. The higher it goes without a drop, but when it happens, it's gonna be major. This is what happened in EUR/USD when market was ignoring good US data back in April and continue the hike until a high of 1.2970 last month. After that the EUR/USD continues to drop endlessly and now, it's reached 1.2530 low.

Thanks to Trichet today, and his hawkish remarks during his speak to the EU Parliament regarding higher than expected French Consumer Spending where he signals to persue vigilance on current Euro inflation. This has lead the EUR/USD back to 1.26 zone and USD/CHF almost back down to where it started this week. Definately not a good sign for USD at this point. According to my view, this push is due to the interest rate expectations hike from the ECB and a pause from the Fed. I'm expecting the EUR/USD to break in August or sooner as slower growth and a pause by the Fed will lead to heavy selling of the greenback.

``We are not satisfied with what we are observing with regard to inflation in our own area,'' Trichet said in a speech to a European Parliament committee in Brussels. ``We'll continue to do all that's necessary to counter inflationary risks and anchor inflationary expectations.''

The recent oil crisis from Iran that possible shortage of oil supply from Iran might occur has caused the oil price to maintain in a range of $68 - $71 per barrel. Price will not be expected to move around much until the crisis is over. North Korea missile launch has been dismissed as a 'misunderstanding' that they'll be lauching satellites instead.

I'm expecting to close 3 of my EUR/USD trades before the weekend to avoid paying extra interest rates since I'm not holding any USD/CHF to balance it. Updates of trades will be update tomorrow.