News / Page 114

After a dovish FOMC, Fed speakers turn unexpectedly hawkish

Posted on March 23, 2016 at 12:42 pm GMT

The US Federal Reserve surprised markets at its FOMC meeting on March 16 when it took a much more dovish stance than what most traders had been expecting. Although a downgrade of the Fed’s projections on the US economy and its dot plot guidance of the fed funds rate had been expected, markets were taken aback by the overcautious tone of the FOMC statement. In the Fed Chair’s press conference, Janet Yellen downplayed the significance of the recent spike in [..]

Asian Session – Fed rate talk lifts dollar as market calm returns

Posted on March 23, 2016 at 9:17 am GMT

The dollar moved higher in Asian trading on Wednesday as risk aversion faded after the initial market reaction to the terror attacks in Brussels on Tuesday that saw a sell-off of risk assets. Stock markets in Asia were muted today as trading winds down ahead of the Western Easter holiday weekend. The greenback climbed against the euro and the pound but was unable to advance beyond yesterday’s rebound versus the yen. The dollar was last trading at 112.37 yen in [..]

Technical Analysis – EURJPY trending down in descending channel

Posted on March 23, 2016 at 8:08 am GMT

EURJPY continues to fall in the descending channel. The market found resistance at the 50-day moving average on March 11, thereby halting the rally that started from 122.06 on March 1. Prices have subsequently fallen since then, remaining below the middle line of the descending channel, trading in a range formation. Prices are mostly bound between the 38.2% and 23.6% Fibonacci retracement levels of the upleg from 122.06 to 127.27. These levels are at 125.30 and 126.08. The 50% Fibonacci [..]

European Session – Sterling underperforms as Brussels events raise Brexit risk

Posted on March 22, 2016 at 3:14 pm GMT

Market sentiment was generally risk off today in reaction to news of the explosions in Brussels early today. The news helped drive up demand for safe haven assets like the yen and gold early in the European session. By the US session open, a portion of the Brussels-driven move was retraced though. Nervous investors bought up gold which helped to push prices above $1250 following a $10 surge after the news of the terrorist attacks. The yen strengthened versus the [..]

UK inflation remains muted but bigger deficit increases pressure on Osborne

Posted on March 22, 2016 at 12:09 pm GMT

Annual inflation in the United Kingdom was unchanged at 0.3% in February, falling short of estimates that it would edge up to 0.4%. Core inflation, which excludes volatile items such as energy, food, alcohol and tobacco prices, was also unchanged at 1.2%, in line with estimates. On a month-on-month basis, CPI rose by 0.2%, which was half the 0.4% rate expected by economists. Today’s data supports the growing view that the Bank of England’s first rate hike since the financial [..]

Asian Session – Dollar up on hawkish Fed comments; yen surges after Brussels explosions

Posted on March 22, 2016 at 8:42 am GMT

The US dollar extended its gains for a third day on Tuesday following hawkish comments by several Fed officials in recent days. Speaking on Monday, Atlanta Fed President Dennis Lockhart said the US economy had sufficient momentum to justify a rate rise as early as April. Earlier in the day, San Francisco Fed President John Williams expressed similar views saying there was little risk of a US recession and that a rate hike is possible in both the April and [..]

Technical Analysis – GBPUSD fails to sustain rally

Posted on March 22, 2016 at 8:13 am GMT

The rally that started from 1.3834 at the end of February stopped at 1.4513 last week. There was a sharp pullback on Monday to test the 50-day moving average which acted as support but prices have dipped below it in early Tuesday trading. There is scope to reach the key 1.4300 level. The 50-day moving average now turned into resistance at 1.4365. A break below the 1.4300 support level would indicate that a short-term top is in place at 1.4513 [..]

European Session – Pound under pressure after cabinet resignation; oil see-saws again

Posted on March 21, 2016 at 3:39 pm GMT

It was a quiet start to the week with European equities slightly down from Friday’s close. The dollar was broadly higher but off earlier peaks. Both the dollar and the euro found support from remarks by ECB and Fed officials. The ECB’s Francois Villeroy de Galhau said at a Bank of France conference on Monday that the ECB does not have more unconventional measures on the agenda at this point, indicating the central bank is likely to adopt a wait-and-see [..]

Technical Analysis – USDCAD looking bearish below 200-DMA

Posted on March 21, 2016 at 11:56 am GMT

USDCAD has dropped below the 200-day moving average for the first time since September 2014, as it continues its retreat from the 13-year high of 1.4689 high it set back in January. Prices recovered above the 1.30 handle today but they remain sharply below the Ichimoku cloud, which is underlining the negative outlook. RSI remains bearish slightly above oversold levels and the MACD does not yet appear to have bottomed out below 0, suggesting the current downward bias has yet [..]

Asian Session – Dollar rebounds from 5-month lows; yen up as oil slips

Posted on March 21, 2016 at 8:43 am GMT

The Japanese yen moved higher in quiet trading in Monday’s Asian session as Japanese markets were closed for a national holiday. Lower oil prices gave rise to increased risk aversion on the week’s first day of trading, helping the yen advance. The dollar slipped to 111.45 yen in late session, not far from its recent 17-month lows. But against other currencies, the dollar was broadly stronger. The euro continued to slide on Monday but managed to hold above 1.12 dollars. [..]

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