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Technical Analysis – EURUSD resumes downside bias

Posted on December 18, 2014 at 8:16 am GMT

EURUSD made a brief correction after bouncing from 1.2246 to 1.2600 but has fallen for the second day and is fast approaching 1.2246 again. The downside bias has gained momentum after breaking back below the 78.6% Fibonacci retracement level at 1.2462 – of the upleg from 1.2040 to 1.3992. RSI has fallen back below, also highlighting the downside bias. The market remains below the Ichimoku cloud. A break back below 1.2246 will see a resumption of the bearish trend which [..]

Asian Session – US dollar extends post-FOMC gains

Posted on December 18, 2014 at 7:52 am GMT

The US dollar rallied strongly after the Fed expressed confidence in the country’s economic rebound. The accompanying policy statement said the Fed would be “patient” in removing policy accommodation and loose monetary policy would likely remain in place until 2017, according to the Fed Chair. When asked to specify what “patience” meant, Janet Yellen said that rates would remain at zero at least for the next couple of meetings. That would put the earliest date for a rate hike at [..]

European Session – All eyes on FOMC as dollar gains

Posted on December 17, 2014 at 3:01 pm GMT

The US dollar was broadly stronger leading into today’s Federal Reserve policy meeting and US inflation release. There are expectations for a shift to a more hawkish tone as there is speculation that the Fed will tweak its statement and remove its ”considerable time” phrase, with reference to interest rates. Market chatter says the Fed will replace this phrase with a different term that would show some indication that the central bank is gearing up to begin hiking rates in [..]

Forex News – BoE minutes retain concern over low UK inflation, weigh on pound

Posted on December 17, 2014 at 2:09 pm GMT

The United Kingdom was in focus today as there were some key data releases from there. These included the Bank of England minutes and jobs data. The BoE minutes of the latest Monetary Policy Committee’s meeting on December 4th offered little to change the view that interest rates will stay near record lows until at least the second half of 2015. Concerns over inflation remain. The MPC doves were still a majority as only 2 out of 9 MPC members [..]

Technical Analysis – USDCHF has scope for push higher

Posted on December 17, 2014 at 8:30 am GMT

USDCHF has found support at the top of the Ichimoku cloud, giving hope for the bulls. The overall market structure is bullish as the pair has been making higher peaks and higher troughs since March – when it bounced off a 3-year low of 0.8698. After correcting lower from a high of 0.9816 to touch a low of 0.9551, the pair bounced back and has scope to test the 38.2% Fibonacci retracement of the move from 0.9816 to 0.9551. To [..]

Asian Session – Dollar / yen recovers ahead of FOMC

Posted on December 17, 2014 at 8:16 am GMT

The currency market was waiting for the outcome of the 2-day Federal Reserve meeting today and the US dollar managed to post some gains. There was increased turbulence in forex markets lately as a result of falling crude oil prices and the collapse of the Russian ruble, which created a risk aversion atmosphere. Dollar / yen climbed to 117.28 during the Asian session, after dropping to as low as 116.30 in early trading. Dollar / yen dropped to as low [..]

European Session – Euro, sterling up on data

Posted on December 16, 2014 at 3:11 pm GMT

Currency markets were volatile today due to a risk-off climate which triggered safe-haven demand, resulting in flows to the yen. The dollar’s recent losses against the euro and the yen were extended. Some weak US housing data did not help the greenback. Housing starts declined 1.6% in November, as the annual rate of total housing starts fell to 1.03 million last month from 1.05 million in October. Last week’s low near 117.43 yen was taken out by early Asian session [..]

Forex News – Eurozone PMIs beat expectations on periphery strength; euro gains

Posted on December 16, 2014 at 2:11 pm GMT

The flash Markit Purchasing Manager Indices (PMIs) for the Eurozone were released today and they were stronger-than-expected, at least on an aggregate level. The Eurozone composite flash PMI came in at 51.7 compared to expectations of 51.5 and a 51.1 prior number. Manufacturing PMI was at 50.8 compared to 50.1 the previous month and Services PMI was at 51.9 versus 51.1 in November. The composite PMI for France improved at 49.1 in December compared to 47.9 in November, whereas the [..]

Technical Analysis – EURUSD pauses decline and consolidates

Posted on December 16, 2014 at 8:48 am GMT

The overall trend for EURUSD is bearish but the pair has been consolidating recently after a correction higher. There was a bounce from 1.2246 to the 78.6% Fibonacci retracement level of the upleg from 1.2040 to 1.3992. This level comes in at 1.2460. The RSI has flattened out and is hugging the 50 point level, signaling consolidation for the time being. Likewise the tenkan-sen and kijun-sen lines have also flattened out to indicate a pause in the recent decline in [..]

Asian Session – Yen stronger amid risk aversion and oil’s collapse

Posted on December 16, 2014 at 8:26 am GMT

Yen strength pushed dollar / yen down to a near 1-month low, as risk aversion caused the safe haven Japanese currency to gain. Many traders use the yen as a funding currency for investments into higher yielding assets and when those positions go wrong, they liquidate their stakes and buy back the yen in order to repay their debt. Dollar / yen traded as low as 117.11, before rebounding slightly to 117.30. The collapsing oil price was spooking markets and [..]

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