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European Session – Euro slips to 10-day low as ECB meeting comes into focus

Posted on October 19, 2015 at 2:21 pm GMT

The euro was one of the worst performing major currencies on Monday, slipping to a 10-day low against the dollar. The single currency has been declining since its reversal from the 1.1500 level last week and it would be difficult to rebound ahead of a European Central Bank meeting on Thursday. Downside momentum is expected to remain since many bet that ECB Chief Mario Draghi would sound dovish and try to talk down the currency. While no move is expected [..]

Technical Analysis – EURUSD runs out of steam but maintains bullish outlook

Posted on October 19, 2015 at 1:26 pm GMT

EURUSD fell for a third day on Monday, increasing the downside bias for the near term. RSI is holding just above 50 but the stochastics have fallen sharply as the momentum that took prices to a seven-week high of 1.1494 fades. Medium term indicators remain bullish though with prices still above the Ichimoku cloud and the 200-day moving average. EURUSD would need to surpass the August 24 peak of 1.1713 to maintain the bullish bias that’s been in place since [..]

China growth falls to below 7% for first time since 2009 but beats expectations

Posted on October 19, 2015 at 10:34 am GMT

GDP growth in China slowed to an annual rate of 6.9% in the third quarter of the year from 7.0% in the previous quarter. But the figure was slightly ahead of consensus estimates of 6.8%, which eased fears of a sharper slowdown. China’s economy, a leading driver of world growth, has become a major cause of concern in recent months following the stock market crash and falling property prices. As the government attempts to rebalance the Chinese economy, there are [..]

Asian Session – China GDP beats estimates but slowest since 2009; dollar steady

Posted on October 19, 2015 at 7:09 am GMT

China’s economy slowed to the lowest level since 2009 in the third quarter of the year but the growth rate beat forecasts, easing fears of a hard landing. GDP expanded by 6.9% in the third quarter, above estimates of 6.8%, though this was down from 7.0% in the second quarter. With signs of government stimulus measures boosting consumption, the buoyant service sector helped growth come close to the official target of 7% for economic growth as the manufacturing sector struggles. [..]

Technical Analysis – USDCAD tests cloud bottom, downside bias remains

Posted on October 19, 2015 at 6:44 am GMT

USDCAD is testing the Ichimoku cloud base around 1.2943 early on Monday. The tenkan-sen line is also capping prices. The market dropped to 1.2832 on Thursday before bouncing, as the 38.2% Fibonacci retracement level (of the 1.1919 to 1.3456 May to September rise) provided support at 1.2867. The market remains vulnerable to further downside moves since the tenkan-sen and kijun-sen are negatively aligned. Also RSI and MACD are bearish. A fall below the 50% Fibonacci at 1.2687 would reinforce the [..]

European Session – Euro slips as Eurozone inflation remains negative, upbeat US consumer sentiment lifts dollar

Posted on October 16, 2015 at 2:27 pm GMT

The euro traded heavily since yesterday’s sharp decline against the dollar and remained below the key 1.14 level. Eurozone inflation remained negative as indicated by the final CPI number released today, which came in at -0.1% year-on-year, as expected. August trade data for the region disappointed and showed the trade surplus was lower-than-expected. The euro touched a low of 1.1333. Going forward the single currency may remain under pressure ahead of next week’s ECB policy meeting especially after dovish comments [..]

Technical Analysis – GBPAUD stuck below cloud with downside bias

Posted on October 16, 2015 at 2:25 pm GMT

GBPAUD continued its attempt to claw back losses from its recent correction. But with prices below the Ichimoku cloud and the 50-day moving average, the near term outlook is slightly bearish until additional confirmation that the longer-term uptrend will resume. Also, RSI has yet to cross above 50, suggesting the pair has yet to gain enough positive momentum for a stronger rally. The bottom of the cloud is the nearest resistance level at 2.1328. A rise into the cloud would [..]

Investment themes: US dollar weakens but keeps within ranges

Posted on October 16, 2015 at 1:44 pm GMT

The US dollar index fell to its lowest in around 7 weeks during the past few sessions, as the evidence in favor of the Fed keeping rates unchanged this year started to gather. The latest bad news for the US economy came from the September retail sales report, which showed consumption weak. This will probably negatively affect third quarter GDP growth and could give the Fed reason to pause for a think rather than go ahead and hike rates. Before [..]

Week Ahead – Markets await China GDP, ECB meeting and flash PMI data

Posted on October 16, 2015 at 10:28 am GMT

Following a week of key indicators that on balance favored a US and UK rate hike, it will be the turn of the euro to come into sharp focus as the ECB meets to consider whether further monetary easing is necessary for the Eurozone. Before that though, investors will be on edge for key data coming out of China at the start of the week. Monday will see the release of third quarter GDP data for China, which is expected [..]

Asian Session – Dollar extends gains after strong data; Euro down on ECB easing expectations

Posted on October 16, 2015 at 7:18 am GMT

The dollar extended yesterdays’ rally at the start of today’s Asian trading but fell back in late Asian session. Stronger-than-expected inflation and jobless claims data on Thursday boosted the dollar, calming fears about the strength of the US economy and raising the prospect of the Fed hiking interest rates this year. Adding to the dollar’s bullish sentiment were comments by Cleveland Fed President Loretta Mester. Speaking at an event in New York, Mester said she believes the US economy can [..]

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