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Mixed messages by Fed ahead of next week’s meeting

Posted on September 13, 2016 at 1:23 pm GMT

Federal Reserve officials speaking in recent days have given mixed messages to the markets with regards to policy tightening. It appears that US central bank policymakers will be going to next week’s meeting divided, with some concerned that delaying a rate hike could see a spike in inflation while others take a more cautious stance. The latest Fed speaker was Governor Lael Brainard who delivered a dovish speech at the Chicago Council on Global Affairs on Monday. She urged prudence [..]

Technical Analysis – USDCAD looking for bullish break of key 1.31 level

Posted on September 13, 2016 at 7:29 am GMT

USDCAD briefly popped above the key 1.3100 level on Monday but closed below it on the day. The area around this key psychological 1.31 level is a strong resistance area which has been tested several times this year. Looking at the bigger picture, the pair has been trading within a range between 1.27 and 1.32 since May this year. The flat 50-day and 200-day moving averages are an indication that the overall trend is neutral. In the near term, the [..]

Asian Session – Gold rises as dovish Brainard suggests rate hike delay

Posted on September 13, 2016 at 5:51 am GMT

The US dollar slipped as the rate rise odds fell after a speech by Federal Reserve Governor Lael Brainard at the Chicago Council on Global Affairs on Monday. This was the last speech from a Fed speaker before the US central bank’s blackout period ahead of the FOMC policy decision next week. Brainard’s speech had a dovish tone as she urged prudence and saw less urgency in raising US interest rates. The dollar initially tumbled on Brainard’s comments and equities [..]

Yen rallies on risk aversion; Fed’s Brainard speech expected for clues

Posted on September 12, 2016 at 2:31 pm GMT

The Japanese yen put in a strong performance on Monday as falling stock markets and rising bond yields caused investors to buy the safe-haven currency. The yen gained around 1% against most majors since the start of Monday’s Asian trading. Dollar / yen dropped below 102 to 101.92, euro / yen dropped to 114.34 and pound / yen fell back to 135. The market’s turbulence was apparently linked to fears that central banks such as the European Central Bank and [..]

Technical Analysis – AUDUSD increases downside bias after break below 50-day moving average

Posted on September 12, 2016 at 7:57 am GMT

AUDUSD has reversed almost all of the bounce from the August 31 low of 0.7489 to the September 8 high of 0.7731. This brings the near term bias back to bearish especially after prices fell below the key 0.7600 level and below the 50-day moving average at 0.7582. The RSI has dipped into bearish territory below 50, signaling further downside. The immediate target in the event of a fall in prices lies at 0.7500. But a break below the August [..]

Asian Session – Yen outperforms on safe haven buying; aussie hit hard by risk off mood

Posted on September 12, 2016 at 7:04 am GMT

The safe-haven yen benefited from risk aversion that was evident in all markets. There was a broad selloff in Asian equity markets which dampened invertors’ risk appetite and was the main driver behind the yen’s strength. The dollar started the new trading week on the back foot and opened in Asia with a gap lower against the Japanese currency at 102.54 yen. This led to the greenback trimming some gains made on Friday when it was driven higher by hawkish comments [..]

European Session – Dollar edges higher against yen on Fed’s Rosengren’s hawkish comments

Posted on September 9, 2016 at 3:00 pm GMT

The US dollar was broadly stronger by the end of the European session, helping reverse the euro’s post-ECB gains. The ECB’s inaction on Thursday pushed the euro higher but the bounce did not have staying power and it soon reversed as the markets turned their focus on the December ECB meeting for further stimulus. The euro’s rise above the key $1.13 level yesterday turned lower soon after and the currency remained below this key level today, falling to as low [..]

Week Ahead – US retail sales eyed after recent weak data; BoE meets as recession fears ease

Posted on September 9, 2016 at 1:49 pm GMT

Inflation and retail sales data out of the US and UK will come into focus next week, while industrial production numbers for China, the Eurozone and the US will also be watched. Another highlight is the Bank of England’s policy meeting but this could be a non-event after August’s ‘sledgehammer’ stimulus package. Chinese business investment could hit 17-year low After a fairly quiet Monday, Chinese data will kick-start the week on Tuesday. The latest batch of industrial output, retail sales [..]

Asian Session – Euro extends gains after ECB disappoints; Oil prices hold at 2-week highs

Posted on September 9, 2016 at 8:34 am GMT

The ECB’s less dovish tone yesterday continued to weigh on risk appetite in financial markets on Friday, while reports that North Korea had carried out another nuclear test also hit sentiment in Asian trading today. The euro jumped to a two-week high of 1.1326 dollars after yesterday’s decision by the European Central Bank to keep monetary policy unchanged. But it later pulled back before reversing upwards again to climb to 1.1284 dollars in Friday’s Asian session. Today’s gains were capped [..]

Technical Analysis – GBPJPY neutral after rising in bullish channel

Posted on September 9, 2016 at 7:18 am GMT

GBPJPY was in an uptrend channel from the August 16 low of 129.07 to the September 2 high of 138.82. This short term bullish market structure is still in place but the upside momentum has faded, as indicated by the RSI. The levelling off in the momentum indicator suggests the market will likely consolidate in the near term and a neutral bias is expected for the moment. As long as RSI remains above 50, there is scope for a rebound [..]

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