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Technical Analysis – Oil pauses recent rally to fall below $60

Posted on May 26, 2015 at 7:19 am GMT

Crude oil is trading above the 50 and 100 – day moving averages but it is below the 20 – day moving average. A close below it would confirm that a short-term top is in place at 63.59, the May 6 high. Prices are expected to find support at 57.77, which is the 23.6% Fibonacci retracement of the downleg from 107.45 to 42.84. A fall through this support would take prices to the next support level of 55.70. To the [..]

European Session – Euro hurt by Greek debt worries and Spanish elections but dollar extends gains

Posted on May 25, 2015 at 2:09 pm GMT

European trading was thin today as major markets such as the UK, Germany and Switzerland were closed for a bank holiday. But the euro could not escape attention as worries over Greece and the outcome of Spanish regional elections added uncertainty for the single currency, pushing European shares lower. Comments over the weekend from Greece’s interior minister that the government will not be able to meet the June debt repayments to the IMF totalling 1.6 billion euros unless it reaches [..]

Technical Analysis – USDJPY back in bullish territory

Posted on May 25, 2015 at 1:25 pm GMT

USDJPY remains firmly in bull territory after hitting a day’s high of 121.76. The Bollinger band’s centerline (the 20-day moving average) has crossed above the 50-day moving average, signalling that prices have moved out of their recent 2-month range of between 120.83-118.32 and into an upside momentum. But with prices breaking out of the upper Bollinger band for the past five sessions, a correction in USDJPY is possible. The stochastic oscillator is also pointing to a small reversal or a [..]

Fed Chair’s promise for interest rate hike boosts dollar

Posted on May 25, 2015 at 9:28 am GMT

The US dollar received a boost on Friday as Fed Chair Janet Yellen said she expects rates will start to head higher “at some point this year”. The fact that the Fed intends to increase interest rates – given of course that the US economy maintains its dynamism – was a boost to the US dollar which had been troubled by the prospect that rates could stay near zero for this year as well. US economic data had mostly underwhelmed [..]

Asian session – Dollar consolidates Yellen, CPI gains

Posted on May 25, 2015 at 7:24 am GMT

The dollar was consolidating and extending its gains from the previous week, after favorable inflation data and Yellen’s ‘pre-announcement’ of an interest rate increase this year. The euro was under pressure due to worries about a possible Greek default. On Friday in the United States, two key events helped the dollar to make significant gains. Firstly, core inflation for April beat expectations in an indication that inflation could become a concern in coming months and if the Fed is too [..]

Technical Analysis – GBPUSD closes below 200-day moving average favouring weakness

Posted on May 25, 2015 at 7:08 am GMT

GBPUSD closed below its 200-day moving average on Friday and continues to trade below it on Monday, so this favours weakness. Prices are also below the tenkan-sen line, which suggests the recent rally to the high of 1.5813 has taken a pause, giving a neutral bias in the immediate term. Upside resumption could be possible since the market is above the daily Ichimoku cloud and RSI is still in bullish territory above 50. GBPUSD has made a good recovery from [..]

Dollar jumps after US core inflation rises more than expected

Posted on May 22, 2015 at 2:29 pm GMT

US April inflation data out today triggered fears in the markets that inflation in the United States will rise closer to the Fed’s 2% target sooner than anticipated, pushing forward expectations of a rate rise. Consumer prices in April rose by 0.1% on the month from March, in line with forecasts, giving a year-on-year rate of -0.2%, which is lower than March’s -0.1%. However, the all-important core CPI rate, which excludes the volatile food and energy prices from the index [..]

European Session – Euro falls to 1.10 as dollar surges on US inflation data, focus turns to Yellen

Posted on May 22, 2015 at 2:17 pm GMT

The dollar surged across the board on Friday following the higher – than – expected US core CPI number in April, which rose 0.3% m/m versus 0.2% m/m in March. On an annualized basis, core CPI was up 1.8% y/y compared to a prior 1.7%. The core inflation number excludes food and energy costs and it rose at the fastest pace since January 2013. Meanwhile, the headline CPI number edged up as-expected at 0.1% after a 0.2% increase in March. [..]

Week Ahead – US Q1 GDP could get revised down; Japan inflation to dip close to 0%

Posted on May 22, 2015 at 12:21 pm GMT

The coming week will be relatively quieter following the past week’s data-packed schedule. Monday will be the quietest with very thin trading expected as all major European markets, as well as the US are closed for a bank holiday. The United States will see the release of durable goods orders on Tuesday, which is expected to fall by 1% in April after a 4% rise in March. Services PMI by Markit out the same day is forecast to show a [..]

Asian Session – Bank of Japan steady as US inflation, Yellen speech key ahead of long weekend

Posted on May 22, 2015 at 7:25 am GMT

The US dollar returned some of its recent gains versus other majors in what has been overall a good week for the greenback after the pummeling it received the previous few weeks. The Bank of Japan’s decision to hold policy steady seemed to have little effect on the yen, as dollar / yen dropped back below 121 at 120.70. Lackluster economic data again out of the United States the previous day was the reason for the pullback in the dollar, [..]

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