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European Session – FOMC minutes boost risk, weaken dollar, oil above $50

Posted on October 9, 2015 at 2:36 pm GMT

The dollar pushed lower against most major currencies today in reaction to the minutes of the Federal Reserve’s latest policy meeting. The FOMC minutes released on Thursday suggested the US central bank was in no hurry to raise interest rates after its “on hold” decision at last month’s meeting. This left investors to push back expectations of a rate hike until next year. Fed policymakers were still watching US inflation rates and the impact of slower global growth when considering [..]

Technical Analysis – Gold surges past 1150; outlook mixed

Posted on October 9, 2015 at 1:43 pm GMT

Gold prices rallied on Friday to rise above 1150 to a two-week high as bullion took advantage of a weakened outlook for the dollar. Prices have risen above the Ichimoku cloud but remain well below the 200-day moving average and within the narrowing trading range that’s been forming since July, giving a somewhat mixed outlook for the medium term. The 61.8% of the Fibonacci retracement level of the May-July downleg is the key resistance level at 1170.50 that gold needs [..]

Week Ahead – Inflation data to come in focus but China trade data also eyed

Posted on October 9, 2015 at 12:12 pm GMT

Inflation data will be the dominant data theme in the coming week as CPI figures are published for the United States, United Kingdom, China and the Eurozone. Industrial production will also come into focus as data is due from the US, Japan and the Eurozone, as well as Chinese trade data. The start of the week is expected to be fairly quiet though as Japan, Canada and the US markets are closed for national holidays. After this week’s Bank of [..]

Asian Session – Dollar comes under pressure on dovish Fed minutes

Posted on October 9, 2015 at 7:47 am GMT

The dollar came under renewed pressure after the FOMC minutes revealed concern about the impact on US growth from the slowdown in China and the turbulence in financial markets. Most analysts now think that it is unlikely the Fed will raise rates in 2015. The FOMC anticipate that the recent global developments pose further downside risks to inflation in the near term compared with their previous forecast. The slowdown in China and the potential spillover to other economies could depress [..]

Technical Analysis – Oil above $50, bullish intra-day above cloud

Posted on October 9, 2015 at 6:30 am GMT

Oil prices rose outside the Ichimoku cloud early on Friday and broke above the key psychological level of $50. The intra-day bias is to the upside as the tenkan-sen lines has made a bullish crossover above the kijun-sen line. Momentum is bullish as the RSI is back above 50. Prices are approaching close to a key resistance level of 50.50. There would need to be a decisive close above this level for upside momentum to remain. Otherwise a fall back [..]

European Session – ECB, BoE drive euro, pound lower, FOMC minutes in focus

Posted on October 8, 2015 at 2:02 pm GMT

Central banks were in focus today, beginning with the Bank of England policy meeting, the European Central Bank’s “account” of the last policy meeting and finally the FOMC minutes later. The euro was strong in the early part of the European session against the dollar and rose above the key 1.13 level for the first time in a week. A session high of 1.1314 was reached even though data showed Germany’s trade surplus narrowed sharply in August to 19.6 billion [..]

Pound gives up gains after Bank of England lowers near-term inflation outlook

Posted on October 8, 2015 at 1:48 pm GMT

The Bank of England kept interest rates unchanged at 0.5% today as expected at the end of its October meeting. The Monetary Policy Committee (MPC) voted 8-1 to keep rates on hold, with one member (Ian McCafferty) voting to raise rates by 0.25%. The Bank maintained its forecast that the UK economy would expand by 0.6% in the third quarter but pointed to weaker growth globally in the second half of the year. It acknowledged there was uncertainty on how [..]

Technical Analysis – GBPUSD back above 1.53 on weakened upside bias

Posted on October 8, 2015 at 9:47 am GMT

GBPUSD rose for a third day on Thursday to a 2-week high as it extended its gains above the 1.53 handle. Looking at the momentum indicators, RSI has stalled just above 50 and the stochastics are still rising, though they could be reversing soon as the %K line has moved into overbought territory. This suggests the upside bias is weakening but further gains in the near term cannot be ruled out. The medium-term picture remains bearish despite prices rising above [..]

Asian Session – Dollar edges lower ahead of FOMC minutes

Posted on October 8, 2015 at 7:27 am GMT

Asian stocks were mixed on Thursday as shares in Tokyo closed lower on poor machinery orders, while shares in China surged by almost 3% as trading resumed after a week-long holiday. Core machinery orders in Japan plunged by 5.7% month-on-month in August after falling 3.6% the previous month. The figure was sharply below estimates of a 3.3% rise. The data cast doubt on the Bank of Japan’s upbeat message on economic growth following its policy meeting yesterday and kept alive [..]

Technical Analysis – NZDUSD above cloud weakens bearish bias

Posted on October 8, 2015 at 6:47 am GMT

NZDUSD ended a 7-day rally at 0.6646 on Wednesday, reaching the highest level in six weeks. RSI is still in bullish territory and not overbought yet so there is scope for a move towards the 38.2% Fibonacci retracement level at 0.6749. This is the retracement of the 0.7743 – 0.6139 downleg. Other technical signals that support a bullish near term bias include the fact that the market is above the daily Ichimoku cloud and the tenkan-sen is above the kijun-sen [..]

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