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European Session – Hard Brexit fears drive sterling to fresh 3-month low

Posted on October 3, 2016 at 2:44 pm GMT

Sterling looks set to start the third quarter on a weak footing as it plummets 1% on fresh concerns that the UK could be heading for a ‘hard Brexit’. Fears were heightened after the British PM, Theresa May, outlined for the first time the expected timetable of when the government would trigger Article 50. Speaking at the Conservative party conference over the weekend, May signalled that Britain would seek to regain full control of immigration and withdraw from the jurisdiction [..]

Technical Analysis – EURJPY challenges 50-day moving average after consolidation

Posted on October 3, 2016 at 7:51 am GMT

EURJPY has been more or less in a steady decline since December of 2014 when the pair peaked at 149 yen. This has been a huge 27% downmove (from 149 to 110). There have been some signs lately however that the pair is consolidating and finding support around the present levels. For example, although the pair spiked to as low as 109.33 in the immediate wake of Brexit, since then it has not fallen below 110.80. Currently it is challenging [..]

Asian Session – Pound down in thin trading due to Chinese holidays

Posted on October 3, 2016 at 6:55 am GMT

There were few major moves during today’s Asian trading as holidays in China and a lack of important developments created little volatility. Dollar / yen traded in a narrow range between 101.25 and 101.50, following unsuccessful attempts by the pair to break below 100 the previous couple of weeks. In economic data, the Bank of Japan’s quarterly Tankan survey of business confidence came in lower-than-expected for large manufacturers, but was steady compared to the previous quarter. The Big Manufacturers’ index [..]

European Session – Euro jumps back above $1.12 on reports of reduced fine for Deutsche Bank

Posted on September 30, 2016 at 2:58 pm GMT

Deutsche Bank’s troubles continued to keep markets on edge in Friday’s European session, while signs of slowing consumer spending in the US weighed on the dollar. Concerns about the health of Deutsche Bank intensified today following news that some hedge funds have reduced their exposure with the German lender. The euro slid for most of today’s European session to hit a 1½-week low of 1.1153 dollars. However, the single currency sharply reversed upwards after some reports suggested that the Bank’s [..]

Week Ahead – US jobs to be watched by Fed; RBA expected to hold rates

Posted on September 30, 2016 at 1:11 pm GMT

The latest non-farm payrolls report out of the United States will be the main focus of the coming week. But the RBA’s October monetary policy decision and industrial production numbers out of Germany, France and the UK will also be watched. Asian markets are expected to be a little quieter with Chinese markets closed for the entire week for the National Day Golden Week holiday. BoJ Tankan survey to show mixed sentiment The week will start with the Bank of [..]

Technical Analysis – USDJPY eyeing sub-100 after it drops below cloud

Posted on September 30, 2016 at 7:46 am GMT

The yen has managed to rally against the dollar for most of 2016, but is this rally running out of steam around the psychologically important 100 level? According to the charts, the most likely outcome is another test of 100 and then a possible break. Although the daily chart gives a clearer bearish picture, here the 4-hourly chart is examined for shorter-timeframe trades. A test of 100 (100.06) both on September 22nd and September 27th showed the level holding and [..]

European Session – Yen slides 1% as oil deal boosts risk-on mood; dollar up on solid US data

Posted on September 29, 2016 at 2:40 pm GMT

The oil deal-driven risk-on sentiment ebbed slightly in late European trading on Thursday but the safe-haven yen continued to fall out of favour as it slid by around 1% against most major currencies. Yesterday’s surprise announcement by OPEC that a deal had been struck to limit output appears to have had more of an effect in boosting dollar/yen than statements from either the Fed or the Bank of Japan have in recent weeks. The dollar has risen sharply today to [..]

Oil rally fizzles out as doubts remain on OPEC commitment to deal

Posted on September 29, 2016 at 12:45 pm GMT

OPEC countries announced a surprise agreement on Wednesday to cut oil output for the first time since 2008, sending oil prices sharply higher. The deal calls for OPEC members to limit output to a range of 32.5-33.0 million barrels a day from the current 33.24 million bpd. The unexpected announcement comes after much speculation about whether any agreement was possible at the three-day meeting in the Algerian capital, Algiers. The bloc’s largest member, Saudi Arabia, has been at loggerheads with [..]

Technical Analysis – Bullish AUDUSD climbs to near 3-week high

Posted on September 29, 2016 at 8:01 am GMT

AUDUSD briefly pierced the 77 level today and traded at its highest since September 8. A few attempts to break through 77 had failed recently but OPEC’s deal to cut output boosted commodity currencies, revitalized risk appetite and helped the pair cross above that level. Prices quickly fell back from their high of 0.7709 as there was profit-taking and the pair was close to being overbought. The next target on the upside is the 0.7731 level which was reached in early September. If that [..]

Asian Session – OPEC deal to cut output boosts commodity currencies, risk appetite

Posted on September 29, 2016 at 6:47 am GMT

During today’s Asian session the market was still dealing with the aftermath of yesterday’s surprise decision by OPEC to limit its oil production. The market was at best expecting a deal to freeze output and there were serious reservations that OPEC would achieve even that as many meetings in the past ended in disarray and without any agreement. Therefore the fact there was an agreement and the additional aspect that it involved a production cut (even if it was a [..]

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