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Technical Analysis – EURJPY short-term bearish after failure to breach 116.35

Posted on October 19, 2016 at 7:55 am GMT

EURJPY hit a 3½ -year low in the immediate aftermath of Brexit, but it has since been in a range of 110.81 to 118.45. On the day of the referendum result announcement, the market was very volatile and possibly illiquid, therefore the low we shall use for our analysis will be 110.81 (July 6) instead of the June 24 spike down to 109.36. Despite the consolidation that has taken place since Brexit, the trend is still bearish as price action lies [..]

Asian session – Chinese growth reassures markets; yen gains while dollar is mixed

Posted on October 19, 2016 at 7:18 am GMT

Chinese GDP met expectations and helped to support risk sentiment while the US dollar was mixed versus its peers in today’s Asian trading. The news that China’s GDP growth was in line with expectations was the main news development of the session. Chinese GDP for the third quarter grew by 6.7% compared to the respective year ago period. Industrial output for September missed estimates however, while retail sales were slightly higher-than-anticipated. Overall the data showed that China was on a [..]

European Session – Pound boosted by strong inflation data but dollar mixed

Posted on October 18, 2016 at 3:07 pm GMT

Today’s risk-on sentiment carried forward into European trading, with commodity currencies extending their gains. The euro suffered a dip due to the expiry of options, while sterling was lifted by stronger-than-expected UK inflation data. Annual inflation in the UK rose at the fastest pace in nearly two years in September, increasing to 1.0% from 0.6% in August. Expectations were for CPI to rise to 0.9%. Core inflation also beat estimates, rising to 1.5% in September versus expectations of 1.4% and [..]

UK inflation spikes up to 1% to highest in two years

Posted on October 18, 2016 at 11:52 am GMT

Consumer prices in the UK rose at the fastest pace in nearly two years in September as clothing and hotel costs pushed up the inflation rate. Annual CPI increased by 1.0% in September, up from 0.6% in August and the highest since November 2014. Expectations were for inflation to rise by 0.9%. The month-on-month rate was 0.2% – twice the expected rate of 0.1%. Core CPI, which excludes energy, food, alcoholic drinks and tobacco prices, also beat estimates. The 12-month [..]

Technical Analysis – AUDUSD makes 2-week high but likely to remain in range

Posted on October 18, 2016 at 7:59 am GMT

AUDUSD has had five successive positive trading days which have led the pair to a 2-week high. The short-term outlook according to the Ichimoku analysis is positive as the price has climbed above the cloud and the Tenkan-sen has remained above the Kijun-sen line. The RSI at 60 is also positive and points to possible further gains. Since the end of June, the Ichimoku cloud base has generally supported the price, which shows that the cloud base (currently at 0.7581) [..]

Asian session – Commodity currencies rise on positive risk; US dollar steadies

Posted on October 18, 2016 at 7:14 am GMT

The US dollar steadied while there was some positive risk sentiment that benefited Asian stocks and currencies such as the Australian, Canadian and New Zealand dollars. Sterling mostly held the previous day’s gains. In the day’s key developments, the Reserve Bank of Australia’s new Governor Philip Lowe emphasized the role of inflation expectations, as persistently low inflation could become engrained in consumers’ long-term outlook. This heightened the focus on next week’s quarterly inflation numbers, as the RBA could move to [..]

European Session – Euro tests $1.10 as dollar slips on profit taking

Posted on October 17, 2016 at 3:13 pm GMT

The US dollar faced some profit-taking during today’s European session, as the euro climbed away from its overnight lows and the greenback was struggling to hold on to the 104 level against the yen. According to news reports, there were hopes that the European Central Bank will announce something at its policy meeting on Thursday that will benefit the euro. The ECB’s asset purchase program is set to expire in March 2017 and a decision needs to be taken on [..]

Technical Analysis – Gold below 200-day average and oversold for now; 1200 next big test

Posted on October 17, 2016 at 8:19 am GMT

Having broken through 1300 relatively easily on October 4, gold quickly went on to retreat below its 200-day moving average on October 6. A violation of the 200-day average had not taken place since early February this year. This development calls into question this year’s gold rally – provided of course that price remains below the 200-day and does not bounce back above it. The 200-day is currently at 1264. Gold had reached as high as 1375 in early July [..]

Asian session – Dollar keeps most of last week’s gains as focus switches to ECB this week

Posted on October 17, 2016 at 7:59 am GMT

The US dollar kept most of its gains despite some attempts of profit-taking as the market seemed to brace for a rate hike in December. The dollar index reached its highest in 7 months at 98.15 right after the beginning of Asian trading but subsequently fell below 98 to 97.99. Fed Chair Janet Yellen said on Friday that it would be best to let the US economy run “hot” for a while so as to repair the damage that took place during [..]

European Session – Mixed US data caps dollar’s advance; Carney remarks support pound

Posted on October 14, 2016 at 3:35 pm GMT

Risk appetite extended into Friday’s European session after strong Chinese inflation data had boosted sentiment in Asian trade. The US dollar looks set the end the week on a high note with the dollar index making gains of more than 1% over the week. However, the dollar’s gains were capped today following some mixed data out of the US. Retail sales rose by 0.6% month-on-month in September, in line with estimates and the prior month’s figure was revised up from -0.3% [..]

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