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Technical Analysis – EURJPY pauses downside bias and consolidates

Posted on February 6, 2015 at 8:25 am GMT

EURJPY has been hovering around the 134.25 level, either below or above it, after bouncing from 130.13. A further bounce to the upside would be limited by resistance at 137.62, at which point we could see a resumption of a decline. Meanwhile, a move to the downside from current levels would see a retest of the low at 130.13. A break below this would target the long term Fibonacci retracement level (38.2%) of the upleg from 94.09 to 149.76. This [..]

Asian Session – Yen strengthens ahead of US employment report despite ‘risk-on’ mood

Posted on February 6, 2015 at 7:53 am GMT

The yen was stronger during today’s Asian trading, as it looked more attractive given some of the woes that are affecting the US dollar and the euro. Dollar yen was trading around 117.25 from around 117.50 the previous day, while euro / yen also continued lower after a peak at 135.15 during the US session. Euro / yen was last trading at 134.28. The yen’s gains came despite yet another very strong performance on Wall Street the previous day [..]

European Session – Euro maintains 1.14 handle, BoE holds rates, pound rises

Posted on February 5, 2015 at 3:00 pm GMT

The dollar was broadly weaker today, helping lift the euro and the pound. US trade data did little to support the greenback, although the main driver will be Friday’s all-important nonfarm payrolls. The euro maintained the 1.14 handle, rallying to a high of 1.1456 to recover most of yesterday’s losses when it fell on news that the European Central Bank will no longer accept Greek sovereign bonds as collateral for regular financing. Germany reported strong factory orders today while [..]

Forex News – ECB toughens terms for liquidity to Greece as government bonds no longer accepted as collateral

Posted on February 5, 2015 at 10:52 am GMT

The news that the ECB would cease accepting Greek government bonds for regular refinancing operations came as a negative surprise for the euro and for risk assets more broadly. The news did not mean that the ECB will no longer provide liquidity to Greek banks, but that banks in need of liquidity and in possession of Greek government bonds would have to apply to the Emergency Liquidity Assistance (ELA) program. This would entail a higher interest cost – about 100 [..]

Technical Analysis – EURUSD tests critical support at 1.1300

Posted on February 5, 2015 at 8:44 am GMT

EURUSD eased towards a critical support level early today, stopping just short of the key psychological 1.1300 level. The pair is now capped by the next psychological level of 1.1400. A break below 1.1300 would target the multi-year low of 1.1096 reached on January 26 and this will strengthen the downside bias. Alternatively, a move to the upside to break 1.1400 would give scope to target the February 3 high of 1.1532. In case of a further move higher, resistance comes in [..]

Asian Session – Euro under pressure after ECB tightens screws on Greece; oil plunges again

Posted on February 5, 2015 at 8:19 am GMT

The euro fell broadly after late in the US session the previous day, the ECB announced that Greek bonds were no longer accepted as collateral for regular refinancing operations. Greek bonds would however be accepted for purposes of Emergency Liquidity Assistance (ELA), for which a higher interest rate is levied and goes on the balance sheet of the national central bank. The move was a negative surprise, as such a move by the ECB was not scheduled before the end [..]

European Session – Sterling rallies on UK Services PMI, euro rally fades

Posted on February 4, 2015 at 3:18 pm GMT

Sterling was the best performing major today, as it was boosted by data showing that the UK services sector expanded faster-than-expected in January. The Services Purchasing Managers’ Index (PMI) came in at 57.2, up from December’s 55.8 and topped forecasts for a reading of 56.6. The pound extended yesterday’s gains versus the dollar to peak at 1.5249, beating yesterday’s high of 1.5197. Focus now turns to the Bank of England policy meeting tomorrow, although no change is expected in the central [..]

Forex News – Oil briefly rises above $54 but will it sustain rally?

Posted on February 4, 2015 at 2:11 pm GMT

Oil prices rallied sharply on Tuesday to rise above $54 a barrel, peaking at $54.20, which is the highest level so far this year. Since hitting a 6-year low of $43.57 on January 29, prices are up more than 20%. The question is whether oil prices are finally on the rebound after having declined for over 7 months, as prices dropped steeply from the June 2014 peak of $107.45. Some analysts say the recent rally will weaken, given that there [..]

Technical Analysis – NZDUSD bounces off 4-year low to regain 0.74 handle

Posted on February 4, 2015 at 8:32 am GMT

NZDUSD jumped more than 2 cents against the US dollar after hitting a 4-year low of 0.7175 on February 3. The pair managed to regain the 0.74 handle and is currently capped by resistance at 0.7450. A break below the 4 year low of 0.7175 would target the next psychological level of 0.7000. The long term bias is bearish, as prices have been steadily declining in a channel from the July 2014 peak of 0.8835. As long as the market [..]

Asian Session – Commodity currencies rebound on oil; euro up on Greece deal hopes

Posted on February 4, 2015 at 8:09 am GMT

There was plenty of action in foreign exchange markets as some significant counter-trend moves took place in the past few sessions. Oil continued to gain, rising around 20% from its trough as US crude oil overcame the $52 a barrel level. Signs that capital expenditure regarding exploration and production were being cut by oil majors such as BP combined with news of last week’s drop in the US oil rig count, gave rise to optimism that the floor in oil prices [..]

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