The USD/CHF's intraday pullback attempts during the week have been brief and have been followed by very convincing bearish continuation action seen in the 4H chart as it falls in a declining channel. Price action has been dominantly bearish as well.

The worst case scenario will be if the actual reading declined below 0.0% the prior reading, confirming the decrease of demand levels on products and services affected by increasing unemployment rates in UK which reached to its highest levels in 14 years, which will lead to increasing fears and pessimism that the economy might be heading towards deflation.

With its announcement this week that it will keep interest rates near zero until at least late 2014, the Federal Reserve has put another large crack into the foundations underlying the US dollar. In a misguided attempt to provide clarity and transparency, Ben Bernanke has instead laid out a simple road map for economists and investors to follow.

The Fed has indicated that quantitative easing part three has commenced. As a part of the Fed's own version of glasnost, Bernanke has sought to lift the veil on the sausage making behind the decisions reached by the FOMC. To that end, our central bank has disclosed they now have an inflation goal of at least two percent.

The dollar has experienced modest weakness against its major rivals in U.S. trading on Friday as traders mulled over a gross domestic report that fell short of analyst expectations. Meanwhile, traders anxiously awaited the verdict on Greece's plan voluntarily restructuring its sovereign debt.

A Commerce Department report showed that the U.S. GDP increased at an annual rate of 2.8 percent in the fourth quarter compared to the 1.8 percent growth seen in the third quarter. Economists had been expecting an increase of about 3.1 percent.

The greenback moved lower against the euro to 1.3207, extending a five-week low. The buck hit as low as 1.3221, its weakest level since Dec. 21. The buck has continued to slide against the European currency since hitting a 17-month best of 1.2623 last week.

Against the British pound, the greenback has slipped to 1.5721 and the dollar saw a more notable drop to 76.7342 against the Japanese yen. The greenback slipped to 0.9133 against the Swiss franc and hovered just above parity at 1.0019 against Canada's loonie.

Fitch downgraded Spain's long-term Issuer Default Rating to 'A' from 'AA-', Italy's to 'A-' from 'A+', Belgium's to 'AA' from 'AA+', Cyprus' to 'BBB-' from 'BBB' and Slovenia's to 'A' from 'AA-'.

Meanwhile, in the U.S., a report from Reuters and the University of Michigan showed that the consumer sentiment index for January was upwardly revised to a reading of 75.0 from the mid-month reading of 74.0.

The material has been provided by Instaforex Company - instaforex.com

This helps explain the weaker than expected 2.0% rise in personal consumption expenditure (PCE), following 1.7% and 0.7% in Q3 and Q2 respectively. The PCE chart (red graph) shows a potential dead-cat bounce, which may fail to regain the 3.6% high attained in Q4 2010. Finding the growth will be challenging, especially as stalled US budget negotiations risk forcing $1.

v US Q4 '11 GDP misses forecasts, registering +2.8% versus+ 3.0% expected; v EUR higher as Greek debt talks progress; Portuguese debt comes into question with yields spiking to a fresh all-time high; v JPY bounces back from losses earlier this week, nearing an all-time high against the GBP as foreign purchases of short-term Japanese assets surpassed Japanese investor outflows.

FOR THE WEEK, DOW ENDS DOWN 0.45 PCT, S&P 500 UP 0.08 PCT, NASDAQ UP 1.07 PCT The material has been provided by Instaforex Company - instaforex.com

S&P 500 UNOFFICIALLY CLOSES DOWN 0.14 PCT, AT 1,316.65 The material has been provided by Instaforex Company - instaforex.com