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Technical Analysis – USDCHF in descending channel

Posted on May 18, 2015 at 7:14 am GMT

USDCHF is in a descending channel and has retraced half of the rebound from 0.8209 to 1.0127. The break below the key level of 0.9540 shifted the bias to the downside. RSI is in bearish territory below 50. In the near – term, consolidation is expected around the 50% Fibonacci at 0.9170. A move lower and a decisive break of 0.9000 would strengthen the downside bias and open the way towards 0.8620 and 0.8209. A break above 0.9862 would help [..]

European Session – Euro and sterling set to end week higher as dollar hurt by data

Posted on May 15, 2015 at 2:24 pm GMT

The euro did not perform that well during the European session and fell against the dollar to a low of 1.1323 after hitting a high of 1.1436 on Thursday. However it reversed back up again in early US session trading after some weak US data to beat today’s high and rallied to 1.1423. There were no major data releases out of Europe today but ECB Chief Mario Draghi’s comments from Thursday helped weigh on the single currency earlier in the [..]

Technical Analysis – AUDJPY retreats from 4-month high; maintains bullish bias

Posted on May 15, 2015 at 2:08 pm GMT

AUDJPY continued to slide today after its failure to close at the 4-month high it touched yesterday. The high of 97.27 broke above the upper Bollinger band so a fall back below it was imminent. But prices remain above the 200- and 100-day moving averages suggesting that the bullish run that began at the beginning of April should hold in the near term. For a more sustained rally, AUDJPY would have to break above 97.65, which is 61.8% of the [..]

Week ahead – April CPI data and BoJ meeting to dominate

Posted on May 15, 2015 at 10:33 am GMT

A flurry of economic data is expected next week for the Eurozone, UK, US and Japan as we move into the third week of the month. The US will see CPI figures for April coming out on Friday, where consumer prices are expected to rise to 0% year-on-year in April from -0.1% in March. Before that though, the FOMC minutes for the Fed’s April 28-29 meeting are published on Wednesday, which will be highly watched by the markets for any [..]

Asian Session – US dollar tries to stabilize after more data-induced weakness

Posted on May 15, 2015 at 7:16 am GMT

The US dollar was trying to stage a bounce after being pressured lower following much weaker-than-expected producer prices. Producer prices fell 0.4% instead of climbing 0.1% during April, hinting at deflation at the producer level in the United States. Jobless claims on the other hand were lower-than-expected at 264 thousand, driving the four-week average to a 15-year low. Signs of a tightening labor market contradicted other indicators that indicated a moderating pace of economic expansion. Stocks on the other liked [..]

Technical Analysis – USDCAD bearish below cloud

Posted on May 15, 2015 at 7:07 am GMT

The near term outlook for USDCAD stays bearish as long as prices stay below the daily Ichimoku cloud. A top has been formed at the March 18 high of 1.2834 as prices have been falling since then to touch a low of 1.1919 on Friday. The pair has retraced 38.2% of the upleg from 1.0619(July 2014 low) to 1.2834 (March 2015 high) and prices have been testing this Fibonacci level of 1.1987. The tenkan-sen and kijun-sen lines are negatively aligned [..]

European Session – Pound hits 6-month high, dollar weak after fall in PPI

Posted on May 14, 2015 at 1:40 pm GMT

The euro continued to rise today reflecting the dollar’s weakness after being crushed by Wednesday’s weak US retail sales data. There were no important data releases during today’s quiet European session – markets in Germany, France and Switzerland were closed for public holidays – which consequently allowed the euro to rise to a high of 1.1440, its strongest level since February 19. Sterling hit a six-month high versus the dollar to touch 1.5813. The pound was also being buoyed by [..]

Recent run of mixed data puts timing of Fed rate hike back in doubt

Posted on May 14, 2015 at 1:07 pm GMT

Expectations of the timing of the US Federal Reserve’s first interest rate hike since 2006 has dominated the markets in recent months as US economic fundamentals continue to improve. But as the deeper-than-expected slowdown in first quarter growth has led to a batch of mixed data, analysts have been split on when the rate rise will come. Unemployment data is one of the key indicators that the Fed looks at and the fall in the unemployment rate since the start [..]

Asian Session – US dollar under pressure after weak retail sales, kiwi gains

Posted on May 14, 2015 at 7:32 am GMT

The US dollar was under some serious pressure against most majors, as the dollar index dropped to a 3-month low. The US dollar is off nearly 7% on a trade-weighted basis since its peak on March 13. The latest leg of the dollar’s correction was sparked by much weaker-than-expected retail sales numbers for April, which showed that consumption failed to rebound after a rather weak first quarter. Consumption is the largest component of total economic output. The weak data could [..]

Technical Analysis – AUDUSD extends rally above cloud

Posted on May 14, 2015 at 7:17 am GMT

AUDUSD surged on Wednesday after being in a consolidation pattern since the beginning of May. Prices were hovering around 0.7937 which is the March 24 high. Yesterday prices cleared this level and closed above it and extended higher today to 0.8162 in early European session trading. Upside momentum appears strong and this is also highlighted by the rising tenkan-sen and RSI. Meanwhile, the market is above the daily Ichimoku cloud and this is also a bullish signal. To the upside, [..]

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