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Technical Analysis – EURCHF, Monthly: Euro eyes parity versus franc after SNB decision to float

Posted on January 16, 2015 at 10:40 am GMT

The decision of the Swiss National Bank to stop defending the Swiss franc floor at 1.20 led to a huge move in the euro / franc pair, with the franc strengthening as much as 30% at some point within a few minutes as it dipped to as low as the 0.85-0.90 range. Chaos ensued as for a brief period it was difficult to ascertain what the market price for franc pairs was. The important question for FX market participants is [..]

Asian Session – Euro tries to recover from SNB aftershock

Posted on January 16, 2015 at 8:34 am GMT

The euro tried to stabilize against other majors after the Swiss National Bank decided to scrap the floor of the euro / franc exchange rate. Foreign exchange markets were still dealing with the aftermath of the Swiss decision. Trading in the euro / Swiss franc pair was volatile, as the rate fluctuated between 106 and 98 Swiss centimes. Parity seemed to act like a magnet for the pair for the time being and it was rumored that the SNB was [..]

European Session – Swiss National Bank shocks markets by abandoning franc floor with euro

Posted on January 15, 2015 at 3:17 pm GMT

The main news today was the abandonment of the 1.20 floor by the Swiss National Bank of the Euro / franc exchange rate. The surprise decision caused widespread dislocation in foreign exchange markets, as euro / franc dropped as much as 30% to 0.85 from around 1.2010 before the decision. Euro / franc appeared to stabilize around the 1.03 level, while there was also intense speculation that the SNB was intervening in the markets in order to maintain the pair [..]

Technical Analysis – EURUSD Daily: Euro probes fresh 9-year lows but pair still oversold

Posted on January 15, 2015 at 10:40 am GMT

Euro / dollar made a fresh 9-year low at 1.1673 today, Thursday, January 15. The euro is still in a firm downtrend since May’s 1.3990 2 ½ year high. The 2005 low is at 1.1640. Pressure on the euro has been relentless since December 16, when the pair failed to continue a relief rally very near the base of the cloud or the Senkou Span A at 1.2572. The subsequent decline has been almost 900 pips – a huge move [..]

Asian Session – Dollar recovers after losses, aussie rallies on employment, commodities

Posted on January 15, 2015 at 8:25 am GMT

The US dollar posted gains against the Japanese yen after falling near the 116 level the previous day. Dollar / yen traded at 117.72, after US index futures staged an impressive recovery overnight and Wall Street was set to open substantially higher later. US dollar bulls were taken aback by much weaker-than-expected retail sales for December released the previous day. The data showed that US consumer purchases were not as buoyant as economists expected during the run-up to Christmas. This [..]

European Session – Dollar drops following retail sales disappointment

Posted on January 14, 2015 at 3:26 pm GMT

The US dollar found itself on the defensive against both the euro and the Japanese yen, as retail sales during December fell much more than expected. Advance retail sales dipped 0.9% against expectations of a marginal dip of 0.1%. It appeared that lower energy prices had not encouraged consumers to spend more. The news immediately hurt the dollar as treasury yields fell and stocks were also down. The speculation that the Fed would delay its first interest rate rise until [..]

Technical Analysis – EURJPY, Daily: Euro / yen at 2 ½ month lows; eyes 134 14-month low

Posted on January 14, 2015 at 9:49 am GMT

Euro / yen has deteriorated sharply since making a high at 149.76 (just below 150) on December 8. In making a fresh 2 ½ month low at 137.43, euro / yen is confirming its bearish trend on the daily chart. Euro / yen has been trading below the Ichimoku cloud for more than a week and the Tenkan-sen and Kijun-sen are negatively aligned since a bearish crossover on December 19. The one caveat is that the speed of the euro’s [..]

Asian Session – Yen gains on safe haven appeal; aussie drops on copper

Posted on January 14, 2015 at 8:29 am GMT

The yen managed to gain during today’s Asian session, as volatility in risk assets made traders seek safe havens such as the Japanese currency. Dollar / yen dropped to a near 1-month low of 116.73 before bouncing back to 117.15. Stocks were volatile on Wall Street, as the benchmark S&P 500 traded as high as 2057 in early trading but plunged as many as 50 points to reach a low of 2007 in late session. Euro / yen fell to [..]

European Session – Euro drops in anticipation of ECB action next week

Posted on January 13, 2015 at 3:01 pm GMT

In an otherwise quiet session, the euro dropped to as low as 1.1763. ECB policymakers, including Benoit Coeure today, have been continually hinting at action at next Thursday’s policy meeting. Such action should involve sovereign bond purchases and the market is basically expecting the scale and method of such purchases. The dollar was approaching the euro’s 9-year low registered the previous week at 1.1753. The main statistic of the day was UK inflation. UK inflation fell to 0.5% year-on-year in [..]

Forex News – UK inflation undershoots expectations; core pickup keeps sterling up

Posted on January 13, 2015 at 1:50 pm GMT

UK inflation for December came in lower-than-expected today at 0.5%, versus expectations of a slowdown to only 0.7%. The previous month of November, inflation was at 1%. This was the lowest inflation reading in the UK since 2000. However, core inflation, which excludes food, energy, alcohol and tobacco and is a better indicator of underlying inflation dynamics, actually increased to 1.3% from 1.2% the previous month. The pickup in core inflation was perhaps the reason that the pound actually rose [..]

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