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Technical Analysis – EURUSD maintains short term bullish phase

Posted on August 18, 2016 at 7:02 am GMT

The break above the 100-day moving average earlier this week helped shift the bias to bullish in the short term. EURUSD maintains a positive outlook as prices rose above the key 1.1300 level this morning. A daily close above 1.1300 would open the way towards 1.1350. Strong resistance is expected at 1.1427, which is the June 24 high. But clearing this level would bring the May 3 high of 1.1615 into view. RSI is still rising and is well into [..]

European Session – Sterling supported by upbeat UK jobs data; dollar slips ahead of Fed minutes

Posted on August 17, 2016 at 3:05 pm GMT

The UK employment report released today was much more upbeat than one would expect in an uncertain environment caused by Brexit. The data was surprisingly robust and lent support to sterling, which mostly held above the key $1.30 level today. A high of $1.3054 was reached in the London session following the UK labour market data. In the month of July, the number of Britons claiming unemployment benefits fell by 8,600, one month after the vote to leave the EU, [..]

Technical Analysis – USDCAD facing downside pressure

Posted on August 17, 2016 at 2:33 pm GMT

USDCAD hit a 7-week low of 1.2798 yesterday as the sell-off extended to a seventh day, but prices had recovered back above the 1.28 level today. RSI is heading up, supporting today’s rebound, but remains sharply below 50, suggesting the negative bias will likely persist in the near term. Immediate support comes at just below today’s intra-day low at 1.2845, which is also a historical support and resistance level. A bigger drop would take prices below the Ichimoku cloud, shifting [..]

Fresh rate talk by Fed officials ups odds of 2016 rate hike

Posted on August 17, 2016 at 1:16 pm GMT

The odds of a rate hike by the Fed in 2016 as implied by the futures market rose above 50% on Tuesday for the first time since the Brexit referendum. Regional Fed presidents William Dudley and Dennis Lockhart yesterday reignited expectations that the Fed could tighten policy this year, adding to the rate rise calls by John Williams made last week. Expectations of a US rate increase had receded after the shock ‘leave’ outcome of the UK’s EU referendum as [..]

Asian Session – Dollar firmer on Fed rate comments; kiwi slips despite upbeat data and rise in dairy prices

Posted on August 17, 2016 at 7:49 am GMT

Fed policymakers revived talk of a possible rate hike in September after two Fed officials kept open the possibility of a move as early as next month. New York Fed President William Dudley said on the Tuesday the Fed is “edging closer” towards the point in time where it will be appropriate to raise rates further. Atlanta Fed President Dennis Lockhart sounded even more hawkish, saying “it’s conceivable” to have two rate increases this year. The remarks pushed the dollar [..]

Technical Analysis – Oil bullish above 100-day moving average

Posted on August 17, 2016 at 7:20 am GMT

WTI oil has staged quite a strong rally from the August 2 low of 39.23 to the August 16 high of 46.71 but stopped just before the 61.8% Fibonacci retracement level at 46.88 (retracement of downleg from 51.65 to 39.23). The market maintains a short term bullish bias after breaking above the 100-day moving average. Immediate support lies at the 50% Fibonacci at 45.43. As long as prices remain above the 50% Fibonacci there is scope for a move higher. [..]

European Session – Dollar shrugs off soft US inflation to recover back above 100 yen on Dudley’s rate hike comments

Posted on August 16, 2016 at 2:52 pm GMT

The euro staged a strong rally today to briefly reach the $1.13 level in European trading with the help of a broadly weaker US dollar. A mostly risk off environment in the markets today supported the safe haven yen, thereby pushing the dollar below the key 100 yen level. The greenback initially fell to a more than seven-week low of 99.53 yen after soft US inflation data but it soon reversed losses to climb back above the key 100 yen [..]

US inflation remains muted as energy prices fall for first time in 5 months

Posted on August 16, 2016 at 2:27 pm GMT

Consumer prices in the United States showed few signs of accelerating as annual CPI eased to 0.8% in July from 1.0% in June. Consensus forecasts were for CPI to slow to 0.9%. On a month-on-month basis, prices in July were unchanged from June, as expected. A 4.7% drop in gasoline prices over the month – the first decline in five months – dragged down the consumer price index. Overall energy prices were down by 1.6%. However, this was partly offset [..]

Weak pound pushes up UK factory prices; Headline inflation at 20-month high

Posted on August 16, 2016 at 11:15 am GMT

Producer price inflation data released in the UK today revealed the first evidence that the dramatic slide in the value of the pound has started to create upward pressure on factory input prices in the UK. Consumer price inflation was largely within estimates however, though the headline rate ticked up to a 20-month high. Input prices rose at an annual rate of 4.3% in July, beating forecasts of 2.0% and a sharp jump from -0.5% in June. This was the [..]

Asian Session – Dollar slides towards 100 yen; Sterling firms ahead of inflation data

Posted on August 16, 2016 at 8:46 am GMT

The US dollar resumed its downtrend against the yen on Tuesday as recent soft economic data continued to dampen expectations of a Fed rate hike. Traders were also cautious ahead of the latest US inflation numbers due later in the day, while comments from San Francisco Fed President John Williams also weighed on the greenback. Writing in a publication by the San Francisco Fed, Williams highlighted the limitations of monetary policy when there is little room to cut rates lower [..]

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