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Technical Analysis – GBPUSD increasingly bearish after falling out of down sloping channel

Posted on January 8, 2016 at 7:56 am GMT

GBPUSD has fallen out of the downward sloping channel and has turned increasingly bearish this week. A 5-year low of 1.4532 was touched on Thursday at 1.4532. The technical indicators are bearish, with the tenkan and kijun lines negatively aligned and pointing downward. The daily Ichimoku cloud is falling and the market is below it. The RSI is in bearish territory below 50 and entering oversold levels. The market has scope to target the June 2010 low of 1.4345. [..]

European Session – Euro pops back above $1.08, gold rallies as investors seek safety amid risk aversion

Posted on January 7, 2016 at 2:39 pm GMT

The US dollar was weak versus the Japanese yen and against the euro amid risk aversion as Chinese markets tumbled again today while the yuan was devalued. Oil fell to fresh eleven-year lows along with the Canadian dollar. There was a slew of Eurozone economic data out today which included German retail sales, the Eurozone economic sentiment survey results for December and unemployment figures and retail sales for November. The Eurozone unemployment rate showed a small drop in November to [..]

Eurozone unemployment ticks down in November, sentiment improves in December

Posted on January 7, 2016 at 11:10 am GMT

The Eurozone economic sentiment survey results for December and unemployment figures and retail sales for November were released on Thursday. Soon after these reports, the euro was little changed against its major counterparts but held gains near the highs of the session. Earlier, German retail sales data were released, showing a rise of 0.2% month-over-month in November from a 0.1% decline the prior month. Eurozone economic and business confidence readings were higher than expected in December. The Eurozone unemployment rate [..]

Asian Session – Fresh Chinese yuan devaluation roils markets; yen gains

Posted on January 7, 2016 at 8:44 am GMT

A fresh devaluation of the Chinese yuan by 0.5% and an early closure of the country’s stock markets as indices fell by their daily maximum of 7%, led to further risk aversion in global financial markets. Specifically, as the People’s Bank of China fixed the yuan at 6.5646 versus the dollar, down 0.5% on the day (a relatively big adjustment), it marked the lowest for the currency since 2011. This created some uncertainty about where the Chinese authorities would eventually [..]

Technical Analysis – Gold could reverse higher after making potential double bottom

Posted on January 7, 2016 at 5:54 am GMT

Gold prices are making a potential double bottom chart pattern – which is a trend reversal pattern. Prices have broken above a three-point trendline drawn off the mid-November high of 1097.97 and are targeting the 38.2% Fibonacci retracement level of the drop since the middle of October high of 1191.47 to the December low of 1046.29. The 38.2% retracement is found near $1101, which is near the mid-November high. RSI is in bullish territory above 50 and pointing upwards which [..]

European Session – Sterling at new 9-mth low on weak services PMI, oil below $35

Posted on January 6, 2016 at 4:07 pm GMT

The yen outperformed on safe haven flows, pressuring the dollar/yen pair to a new 2 ½ month low of 118.24. This is the lowest level since October 15. The risk off mood was set early in the day by weaker China Caixin services PMI and geopolitical risk on news that North Korea tested a hydrogen bomb. Services PMI dominated the news today, with the Euro zone, the UK and the US all publishing their numbers for December. The euro continued [..]

Chinese yuan weakens to 5-year low, PMI renew slowing growth fears

Posted on January 6, 2016 at 9:05 am GMT

China continues to be the focal point for the markets after data showed a setback to services sector growth in the world’s second largest economy. Investors closely watch PMI reports as China is making a transition from its old, manufacturing-driven economy to the new world of services. Thus, today’s disappointing Caixin services PMI numbers renew concerns about slowing growth in China. According to the private survey, activity in China’s services sector expanded at its slowest pace in seventeen months in [..]

Technical Analysis – AUDJPY bearish below Ichimoku cloud

Posted on January 6, 2016 at 7:50 am GMT

AUDJPY has fallen further below the daily Ichimoku cloud on Wednesday to touch a fresh 2-month low of 84.17. It appears that the bounce from the 3-year low of 81.99 that saw a recovery to 90.71 on December 4, has soon lost steam and prices have been falling since then. RSI is in bearish territory below 50 and falling, which is also highlighting the downside bias. Sustained trading below the cloud would expose the 81.99 August low for a retest. [..]

Asian Session – Yen extends gains as risk sentiment sours on China data, N. Korea

Posted on January 6, 2016 at 7:21 am GMT

China dominated the market focus again on Wednesday, as a weaker-than-expected Caixin services PMI dampened risk sentiment. Safe haven flows moved back to the Japanese yen as investors were concerned about slowing growth in the world’s second largest economy. A private survey carried out by Caixin showed the services PMI for December came in at 50.2, having printed a reading of 51.2 in November. Today’s figure was the lowest in seventeen months and was below the expected reading of 52.3. [..]

European Session – Euro extends decline to 1-month low, yen continues to outperform on risk aversion

Posted on January 5, 2016 at 3:22 pm GMT

The Chinese market stabilized overnight, with the help of local regulators and authorities, giving some confidence to investors but the effect mostly lasted only during the Asian session and wore off by the European session. It was evident that risk aversion was back as the yen gained ground and the dollar strengthened against most other majors. The euro extended Monday’s decline to trade to a one-month low below $1.08. It reached its lowest level since the December 3 ECB meeting [..]

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