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Technical Analysis – NZDUSD back above 50-DMA as bias turns bullish

Posted on November 3, 2016 at 2:24 pm GMT

NZDUSD broke above the key 0.73 level on Wednesday and has extended its gains to a fresh one-month high of 0.7328 today. The pair has been trading in an upward trending linear regression channel since January but prices fell to the lower channel in mid-October, indicating a weakening of the momentum. The current rally has taken prices above the 50-day moving average and close to the middle of the channel as the near-term bias has turned strongly bullish. RSI is [..]

Technical Analysis – USDJPY turns bearish, tests moving averages

Posted on November 3, 2016 at 8:32 am GMT

USDJPY has fallen to a critical level today. After a strong rally from near the key 100-yen psychological level, (September 22) the pair peaked at 105.52 on October 28. Since then the market reversed back down while RSI has dipped below 50, highlighting the bearish bias. Bearish sentiment is also confirmed by three consecutive days of posting lower lows and lower highs. The USDJPY pair has now retraced half of the September 22 – October 28 rise and is testing [..]

Asian Session – Sterling hits new 3-week high; dollar drops below 103 yen on US election jitters

Posted on November 3, 2016 at 7:32 am GMT

After a two-day meeting, the Federal Reserve announced on Wednesday that it held interest rates steady again. No rate hike by the Fed was widely expected by the markets because of the growing uncertainty around the upcoming US election. The Fed released a statement that acknowledged the case for a rate hike is getting stronger and left the door open for a move in December. They indicated that they would prefer to wait for further evidence of progress in the [..]

Fed holds rates but sees increased case for rate hike

Posted on November 2, 2016 at 7:44 pm GMT

The US Federal Reserve announced no change to its benchmark rate on Wednesday as it concluded its two-day policy meeting. The Federal Open Market Committee kept the target range for the federal funds rate unchanged at 0.25% to 0.50%, as expected, but signalled it was getting closer to achieving its objectives of maximum employment and inflation of 2%. In its statement, the Fed said the case for a rate rise “has continued to strengthen” but has decided to wait for “some” further [..]

European Session – Sterling rallies on UK construction PMI, dollar weakness persists on US election worries

Posted on November 2, 2016 at 3:06 pm GMT

Risk aversion continued to grip the markets in today’s European session as US election worries grow, lending support to safe haven assets. The dollar extended losses against many counterparts while gold was bid. Economic data released during the European session were on PMI surveys for the Eurozone manufacturing and UK construction sectors but these were a temporary distraction for the markets as the focus was elsewhere, primarily on the US elections. Sterling received an added boost after UK construction PMI [..]

Investment themes – The dollar, the Fed and the recent election-induced volatility

Posted on November 2, 2016 at 3:03 pm GMT

The revelation that the FBI was reopening a probe into Secretary Clinton’s use of a private email server on Friday, October 28, was enough it seems for the markets to reassess the likely outcome of the November 8 US elections. This has caused some volatility across a range of assets although it must also be said that the shake-up seems to remain contained for now. Interestingly one of the biggest victims has been the US dollar. Dollar / yen for [..]

Technical Analysis – USDCHF turns bearish after break below 200-day moving average

Posted on November 2, 2016 at 8:07 am GMT

USDCHF extends its decline from parity and the near-term outlook has turned very bearish after breaking below the 200-day moving average. After a strong rally from the September 29 low of 0.9638, USDCHF peaked near 1.0000 on October 25 before reversing back down. Following several tests of support at 0.9913 (23.6% Fibonacci retracement level of the 0.9638 – 1.0000 upleg), prices fell to find support at the 38.2% Fibonacci at 0.9860. A 170-point drop on Tuesday led to the market retracing [..]

Asian Session – Dollar weakens as focus turns to US election uncertainty, gold rallies

Posted on November 2, 2016 at 7:10 am GMT

There was a risk off environment in Asia on Wednesday which followed through from the US session. The selloff in the US dollar played on sentiment and therefore safe havens like gold and the yen gained. The upbeat sentiment on Tuesday from strong China PMI data has faded as the focus turned to the US elections. Equity markets also joined the selloff while the VIX (volatility index) rose. Some recent polls show Republican candidate Donald Trump leading Democratic candidate Hillary [..]

European Session – Dollar under pressure despite strong ISM as FOMC, elections draw nearer

Posted on November 1, 2016 at 3:32 pm GMT

The US dollar drifted lower in European trading on Tuesday as attention turned to the Fed’s two-day policy meeting, which starts today. Worries that Hillary Clinton, the Democratic nominee, may be losing ground to her Republican rival, Donald Trump, in the US presidential race also weighed on the greenback today. The euro broke above 1.10 dollars on the back of the weaker dollar but the single currency was also strong against the pound. There was no data out of the [..]

Technical Analysis – AUDJPY bullish in upper Bollinger Band

Posted on November 1, 2016 at 2:27 pm GMT

AUDJPY broke above the 200-day moving average today. The line was acting as resistance at 80.05. Prices have so far reached a high of 80.62, which is a more than 3-month high. The pair has been in a steady uptrend since the September low of 75.95. With RSI keeping above 50 in bullish territory since the end of September, the pair looks poised to maintain its bullish outlook in the near term. The market crossed above the 50-day moving average [..]

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