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Asian session – US dollar off highs while European PMIs, flash inflation on tap

Posted on January 4, 2017 at 8:08 am GMT

The US dollar index backed off a little from its 14-year high registered the previous day, as traders took stock of the greenback’s strong start to the New Year. Manufacturing sentiment in the US, China, the UK and Japan seemed to confirm that the global economy was starting 2017 in a positive spirit, which augured well for further Fed rate hikes and an even stronger dollar. The euro managed to reclaim the 1.04 level for now, having dipped to as [..]

European session – Dollar rallies and pound gains on strong manufacturing surveys

Posted on January 3, 2017 at 3:54 pm GMT

The US dollar continued its upward march, scaling new highs following the release of a very bullish manufacturing survey for December. The much awaited ISM manufacturing PMI came in better-than-expected at 54.7 compared to the previous month’s 53.2 reading and analyst forecasts of a 53.6 print. What was especially noteworthy however was the big jump in the prices paid component, as the sub-index rose to 65.5 from 54.5. Obviously such a big move seems to confirm worries about future inflation [..]

Technical Analysis – EURUSD maintains bearish market structure

Posted on January 3, 2017 at 8:07 am GMT

EURUSD is maintaining an overall bearish market structure as prices remain below the 50 and 200-day moving averages. After a brief attempt for a correction to 1.0651 on December 30, 2016, prices fell back below what was a key support level at 1.0500 and the downtrend appears to be resuming. The level at 1.0500 has now turned into resistance and major support now lies at 1.0400. RSI remains below 50 in bearish territory and suggest that downside momentum for EURUSD [..]

Asian Session – Australian dollar gains on upbeat China PMI data

Posted on January 3, 2017 at 7:34 am GMT

Currency markets were relatively quiet during the Asian session as Japan was closed for a public holiday today. Many major markets were also closed on Monday for the New year’s day holiday, which led to overall thin trading volumes. Australian markets were the first major markets open today. The biggest mover in the session was the Australian dollar which was lifted by upbeat data out of China. Australia’s benchmark index, the S&P/ASX 200 rose 1.2 per cent. The aussie gained [..]

Week Ahead – 2017 gets off to busy start with Non-farm payrolls and PMI data

Posted on December 30, 2016 at 1:22 pm GMT

As the holiday period comes to an end, the economic calendar is looking more packed over the coming week despite many major markets being closed on January 2nd. The US and the Eurozone will have the busiest calendars, while PMI figures out of China and the UK will also be important. China manufacturing PMI likely to ease in December Whilst most of the world will be celebrating the New Year, PMI data out of China will start the week on [..]

Asian Session – Euro spikes above $1.06 in thin trade; Dollar recovers above 117 yen

Posted on December 30, 2016 at 9:57 am GMT

Major pairs were hit by volatility on Friday as ultra-thin volumes on 2016’s last trading day triggered some sharp moves. The euro spiked up to 1.0652 dollars in early Asian trading in a move that was triggered by an illiquid market than by news. The jump had a knock-on effect on other crosses and the dollar briefly fell to a 2-week low of 116.04 yen. Things settled later in the Asian session with the euro easing to around 1.0525 dollars. [..]

Technical Analysis – EURGBP in renewed attempt to break above 50-DMA

Posted on December 30, 2016 at 8:04 am GMT

EURGBP has fallen about 10% from its post-Brexit high of 0.9260 to December’s 5-month low of 0.8304. The slide has pushed the pair below the 50-day moving average and has threatened to end the year-long rally. Prices have reversed higher since touching the December low but the rebound has been weak. The near-term bias is positive as the RSI has climbed back above 50 and is rising. The current upside momentum briefly drove prices to a 1½-month high of 0.8669 [..]

European Session – Dollar attempts a rebound in muted holiday trading

Posted on December 29, 2016 at 3:54 pm GMT

Currency markets were subdued on Thursday as volumes remained light with just one more trading day left before the end of the year. The US dollar moved away from the two-week lows it touched against the yen earlier in the day, while the euro and the pound managed to hold on to key levels. With little in terms of new data to excite the markets, US treasury yields continued to be the main driver of the dollar. Treasury yields came [..]

Forex News – Review of 2016

Posted on December 29, 2016 at 12:08 pm GMT

The year 2016 got off to a turbulent start, with worries about China’s economy escalating once again and fresh volatility in financial markets triggering concerns about a deepening crisis. But despite bigger shocks that followed, namely, Brexit and the US election outcome, financial markets appear to be ending the year on a positive note, even as further economic and political risks lie ahead in 2017. China slowdown triggers market turbulence China and its slowing economy was much of the focus [..]

Technical Analysis – USDJPY still consolidating after recent stretch in overbought territory

Posted on December 29, 2016 at 10:21 am GMT

USDJPY has been in a steady retreat since hitting a 10½-month high of 118.66 on December 15. This was expected as prices broke out of the upper Bollinger band in mid-December before consolidating. Other indicators also show the pair was overstretched following the strong rally seen since the beginning of November. RSI has come off overbought levels but remains comfortably in bullish territory above 50, while the stochastics have fallen to just above oversold level and the %K line appears [..]

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