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Asian Session – Dollar surges above 110 yen for first time since 2008

Posted on October 1, 2014 at 7:17 am GMT

The dollar strengthened above 110 yen for the first time since August 2008 and gained versus most of its major counterparts. The US is the only major economy which is on a stable path toward monetary policy normalization so the greenback is in strong demand. There is growing speculation an improving economy will give the Federal Reserve more reason to increase interest rates. The dollar hit a fresh 6-year high of 110.08 yen in early Asian session trading. Despite a [..]

European Session – Euro below 1.2600 after soft Eurozone inflation

Posted on September 30, 2014 at 1:38 pm GMT

The dollar index broke above a four-year high as sentiment for the greenback remained strong. The euro fell below 1.2600 to hit a 2-year low, placed under pressure by disappointing Eurozone inflation which eased again to its slowest pace in nearly five years in September. According to a flash estimate of consumer prices by Eurostat, headline CPI was in line with forecasts at 0.3% year-on-year in September but the core figure which excludes volatile food, energy, alcohol and tobacco prices, [..]

Forex News – Mixed economic data to keep pressure on Bank of Japan, yen

Posted on September 30, 2014 at 10:31 am GMT

A whole range of Japanese economic releases on Tuesday painted a mixed picture of the country’s economy. Industrial output and household spending were disappointing while unemployment and retail sales were better-than-expected. Starting with industrial output, it dropped 1.5% month-on-month during August, compared to consensus expectations of a 0.2% rise and a 0.4% increase during July. It remains to be seen whether the recent weakness in the yen (dollar / yen dropped by around 7% during the third quarter) will be [..]

Technical Analysis – EURUSD oversold but has scope for further downside

Posted on September 30, 2014 at 7:18 am GMT

EURUSD is strongly bearish as all technical indicators are in sell territory. Prices have been making lower highs and lower lows and the market is below the 200-day moving average. The daily Ichimoku cloud is falling while the tenkan-sen ad kijun-sen lines are negatively aligned. RSI is showing a strong downward momentum although it is at 22 in oversold territory, which implies the euro is temporarily oversold. EURUSD has scope for further downside towards the November 2012 low of 1.2660 [..]

Asian Session – Dollar’s advance pauses for breath as Chinese, Japanese data come in soft

Posted on September 30, 2014 at 6:36 am GMT

The final day of the third quarter is witnessing the US dollar pause for breath after some outstanding gains during the past three months. According to some technical indicators, such as the Relative Strength Index, the greenback was quite overbought – say versus the Japanese yen – hence a pause was to be expected. Looking back to the beginning of the quarter, it is worth pointing out the dollar’s big gains. Euro / dollar was then trading above 1.36 while [..]

European Session – Euro steady after EZ sentiment data, inflation data in focus

Posted on September 29, 2014 at 1:50 pm GMT

The euro was slightly stronger today despite Eurozone sentiment data not being very encouraging. German CPI data was slightly better in August but it will be Tuesday’s Eurozone inflation data that markets will focus on because this data is particularly important to the European Central Bank, which holds its policy meeting later this week. The flash CPI is expected to fall to just 0.3%. The euro inched up to a high of 1.2713 today, bouncing off an intra-day low of [..]

Forex News – US second quarter growth revised up; dollar continues to steamroll higher

Posted on September 29, 2014 at 10:49 am GMT

News that US second quarter growth was revised up to 4.6% was welcome news for US dollar bulls, as it showed that the US economy bounced back strongly from the shock 2.1% contraction of the first quarter. The second quarter featured the best growth of the past 10 quarters, while several one-off factors seemed to have depressed growth during the beginning of the year. The revision from 4.2% to 4.6% was in line with economists’ consensus expectation. The good news [..]

Technical Analysis – USDJPY overbought but strongly bullish above 109.00

Posted on September 29, 2014 at 7:12 am GMT

After consolidating at the 109.00 level, USDJPY pushed higher today to break above last week’s high of 109.52. The pair reached as high as 109.73 in early Monday trading and has scope for further gains as the tenkan-sen and kijun-sen lines are positively aligned on the daily chart. 110.70 is a potential target, which is the August 2008 high. However, RSI is in overbought territory above 70 which signals that the bullish momentum could pause for now. To the downside, [..]

European Session – Dollar boosted by US GDP figures

Posted on September 26, 2014 at 2:00 pm GMT

The last day of the trading week was relatively quiet start due to lack of key data releases, with broad dollar strength being the main theme in currency markets today. The dollar is set to complete its 11th consecutive week of gains in a basket of six major currencies. Today’s release of final US GDP for the second quarter rose to 4.6% as expected above the previous estimate of 4.2% and well above the initial estimate of just 3%, helped [..]

Forex News – Weekly Outlook – US nonfarm payrolls, PMIs and ECB all in focus

Posted on September 26, 2014 at 12:57 pm GMT

All eyes will be on US nonfarm payrolls which are due on Friday as US employers are expected to have accelerated hiring in September and the unemployment rate is forecast to stay steady 6.1%, matching the lowest level since 2008. Nonfarm payrolls are expected to rise to 195,000 this month compared to August’s 134,000. Also from the US, final manufacturing and services PMI releases will be closely watched to gauge how the world’s largest economy is doing. The ISM index [..]

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