FX forecast for May 20

- [EUR/USD:] The common currency yesterday rallied up to $1.24, a growth credited to possible interventions by the Swiss Central Bank and, according to some report, by the Central European Bank (CEB) itself, Financial Brains director PhD Sveatoslav Mihalache has told Info-Prim Neo. According to him, considering the nearly 20% decline in the euro value against the dollar from December 2009, the CEB intervention has been something expected and thus plausible. Moreover, Germany’s decision to ban some types of ‘naked’ short selling (when the investor bets on assets or stocks that he doesn’t actually own), suggests the idea of coordinated effort. However, says Sveatoslav Mihalache, the impact would have been greater had the potential CEB interventions been coordinated with a number of central institutions around the world, like Federal Reserve or the Bank of England. The fact that the euro yesterday surpassed the critical level of $1.2330 suggests that a certain rise is possible today as well. The next key level is the one situated at $1.2455, which in case of surrender will open the path towards $1.3090 and in certain circumstances could move the trading range towards $1.28 – $1.35. [EUR/MDL:] Rates predicted for today: 15.68 – 15.73 lei (bid) and 15.85 – 15.88 (ask). [USD/MDL:] Yesterday the Moldovan National Bank gave investors to understand that it was carefully following all the developments on the market, intervening slightly by buying dollars against lei. It was in fact, says Mihalache, a lesson to calm down the fuss on the market and show that the dollar had been overestimated. The intervention is expected to result in the dollar returning to rates of 12.55 – 12.60 lei. Today the dollar will buy at 12.70 – 12.73 lei and sell at 12.83 – 12.87 lei. For further details visit www.fb.md or www.financialbrains.eu