Forex News: A potentially ranging day due to lack of major events
EUR/USD
Forex News: After seven straight days of upward movement the pair finally started to retrace lower on the back of better than anticipated values of the US Retail Sales which strengthened the greenback.
Technical Outlook
The crucial resistance located at 1.3830 wasn’t touched before price started to move south, mostly because the drop was triggered by good US data; however, price was overextended and in need of a move lower. We anticipate the retracement to find support around 1.3710 but the uptrend is still intact and move to the upside are highly probable.
Fundamental Outlook
The only notable event of the day is the release of the US Producer Price Index which shows the change in prices charged by producers for their goods and services. This is a leading indicator of consumer inflation because a higher price charged by producers will eventually generate a higher price paid by the client. The release is scheduled at 1:30 pm GMT and the expected change is 0.0% while the previous was -0.2%; usually higher values strengthen the greenback.
GBP/USD
Better than expected US data strengthened the US Dollar against the Pound as well and the pair continued the descent started a day earlier. Although we had a couple of bearish days, neither bulls nor bears are in complete control from a four hour chart perspective.
Technical Outlook
Yesterday’s drop was stopped by the support level located at 1.6315 which proves once more to be a strong barrier in front of falling prices. Although the latest move was bearish, an extended drop is not highly probable considering the fact that lately the pair has been moving in a horizontal channel on the four hour chart so a bounce higher can occur as the bottom part of the channel was touched. However, a break of 1.6315 will probably trigger a move into 1.6250 support.
Fundamental Outlook
The United Kingdom didn’t schedule any major news releases for today so the direction of the pair will be influenced by the US event mentioned earlier and by technical factors.
We hope you had a profitable trading week and we wish you a relaxing weekend.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
The Forex Market: Mixed movement ahead of ECB President Mario Draghi’s testimony
EUR/USD
The Forex Market: Friday the bears maintained their short-term control and the pair continued to move to the downside, touching the support level located at 1.3710. However, price didn’t travel a huge distance and the day had no special events.
Technical Outlook
For the moment the support located at 1.3710 is able to stop and even reject price higher as seen Friday and the uptrend is still strong, a fact which may trigger moves to the upside. On the other hand, the pair climbed for an extended period of time so it may need a bigger retracement lower before price can go higher, resuming the uptrend. If this is the case, 1.3710 will be broken to the downside today.
Fundamental Outlook
At 08:30 am GMT, Germany will announce the Manufacturing Purchasing Managers’ Index, a survey derived from the opinions of about 500 purchasing managers from the manufacturing sector. The anticipated figure is 53.1, an increase from the previous 52.7. Since this is a leading indicator of economic health, better than anticipated numbers normally strengthen the Euro.
The most significant event of the day will be ECB President Mario Draghi’s speech, which is scheduled at 2:00 pm GMT. The President will testify on monetary policy in front of the European Parliament’s Committee on Economic and Monetary Affairs, in Brussels and the event is likely to have a strong impact on the market, depending on his attitude. We recommend caution if you will be trading at the time.
GBP/USD
The pair moved below the support located at 1.6315 on the back of increased US optimism and the balance of power is starting to shift in favor of the bears.
Technical Outlook
The level located at 1.6315 is very important for the pair’s movement from a four hour chart perspective as it rejected price several times before being broken. This makes its break an important event and shows us the strength the US Dollar has compared to the Pound. Further price declines are possible and we expect an encounter with the support located at 1.6250 after a re-test from below of the broken level of 1.6315.
Fundamental Outlook
The United Kingdom didn’t schedule any news releases for today and we expect price action to be mostly driven by the technical aspect.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
EUR/USD
Forex News: Yesterday the pair had a calm trading day compared to the wild moves generated a day before by Fed’s decision to decrease the monetary stimulus from $85 billion to $75 billion per month, a fact which was perceived as bullish for the US Dollar.
Technical Outlook
The pair traded in a narrow 40 pip range almost the entire day, sitting on the support located at 1.3650 after a clear break of 1.3710. Yesterday’s price action doesn’t offer a lot of clues about future direction but the latest momentum belongs to the bears both from a technical and a fundamental point of view and we anticipate a break to the downside of 1.3650.
Fundamental Outlook
Early at 07:00 am GMT the German Producer Price Index is released, showing the change in prices charged by producers compared to the previous months. The indicator has inflationary implications and usually better than expected numbers strengthen the Euro. For today’s release an increase is expected from the previous -0.2% to 0.0%.
The US Final Gross Domestic Product is announced at 1:30 pm GMT with no change anticipated from the previous 3.6%. This is the economy’s most important performance gauge so higher values indicate increased activity and consequently a stronger greenback.
GBP/USD
United Kingdom’s Retail Sales came out with the expected value and the event didn’t generate strong moves. The pair traveled mostly sideways, above and below 1.6380.
Technical Outlook
The strong move to the upside experienced Wednesday failed to break the resistance located at 1.6440 and although price pierced through it, a retracement lower soon followed, making things uncertain once again. The US Dollar benefits from the recent monetary stimulus reduction so moves lower are expected, probably a touch of 1.6315 support. To the upside, first resistance is represented by 1.6440.
Fundamental Outlook
The United Kingdom will announce the Final Gross Domestic Product at 09:30 am GMT but no change is anticipated from the previous 0.8%; however, better than anticipated values are usually beneficial for the Pound and may take the pair higher. The US Final GDP will directly affect the pair as well.
We hope you had a profitable trading week and we wish you a relaxing weekend.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
The Forex Market: Sluggish movement as the countdown to Christmas begins
EUR/USD
The Forex Market: Friday the Euro managed to make up for some of the losses suffered earlier in the week and the pair touched the resistance located at 1.3710 in what proved to be a day mostly controlled by the bulls.
Technical Outlook
After a false break of 1.3650, price rose to touch 1.3710 and at the moment the pair is showing rejection at this level. The latest direction is down so we consider Friday’s rise just a retracement after the sharp fall seen last week. For today, we anticipate another attempt at breaking 1.3650, but also a slow day based on the lack of major economic releases.
Fundamental Outlook
At 1:30 pm GMT the US Personal Spending indicator is released, showing the change in consumer spending which is a major part of the American economy; the anticipated value is 0.5% compared to the previous 0.3% and usually better numbers strengthen the US Dollar, suggesting a thriving economy.
GBP/USD
The pair moved mostly sideways during Friday’s trading session but a sudden move up pierced through the resistance located at 1.6380.
Technical Outlook
Friday’s move up was quickly reversed and this shows us that lower prices are very probable. But for price to move lower the first barrier located at 1.6315 must be broken; if this will occur today, the door will be open for another attempt at breaking 1.6250 support, but we don’t expect such a move to be completed today. To the upside, the first resistance is located at 1.6380 and it may be revisited before price decides to move to the downside.
Fundamental Outlook
The United Kingdom didn’t schedule any economic indicators for today so the only influence will come from the US event mentioned earlier and from technical factors.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
Forex News: Christmas Eve brings a potentially flat market
EUR/USD
Forex News: Yesterday lacked strong movement or important news releases and as a result, we experienced a slow but bullish day nonetheless.
Technical Outlook
Price movement was capped yesterday by the resistance located at 1.3710 and support located at 1.3650 and neither bulls nor bears managed to take control and break an important level. We anticipate a rejection lower off the current level and a move towards support but a break above resistance may trigger additional moves to the upside.
Fundamental Outlook
Today is the busiest day of the week, with two significant economic indicators being released: at 1:30 pm GMT the US Durable Goods Orders are released and anticipated to increase from the previous 0.4% to 0.9%. Such an increase would indicate improving economic conditions and possibly a stronger greenback. Later in the day, at 3:00 pm GMT the US New Home Sales come out, with an expected increase from the previous 444K to 449K. Same as for the other indicator, higher numbers usually strengthen the US Dollar, driving the pair lower.
GBP/USD
The pair moved in a narrow range of less than 50 pips, a fact which was expected due to the lack of major economic releases and the approaching of Christmas day.
Technical Outlook
The sideways movement between 1.6315 support and 1.6380 resistance doesn’t offer any hints about future direction and we can only assume that a break of either level will generate an extended move in that direction. A lot will depend on the US releases scheduled today and price direction will be mostly influenced by their outcome.
Fundamental Outlook
The United Kingdom scheduled at 09:30 am GMT the release of the British Bankers’ Association Mortgage Approvals. The indicator offers insights into UK’s housing market because usually a home is purchased with the help of a mortgage. The expected figure is 44.5K, an increase from the previous 42.8K and better than expected numbers normally strengthen the Pound. The US events will have a direct impact on the pair.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
Forex News: Trading in a market still influenced by the winter holidays
EUR/USD
Forex News: Yesterday the market was closed in celebration of Christmas Day and as anticipated, no economic indicator or significant news came out.
Technical Outlook
Even if the market is open today, the volume will be low and irregular price movement is likely to be experienced. We expect a move close to 1.3650 but not a break of this level. Keep in mind that a technical prediction cannot be very accurate due to the low volume we mentioned.
Fundamental Outlook
Most European Banks are still closed today and the only notable event is the release of the US Unemployment Claims. The indicator comes out at 1:30 pm GMT with an expected increase from the previous 379K to 382K. Higher unemployment levels suggest a contracting economy and usually weaken the US Dollar so for today’s release, lower numbers may strengthen the greenback and drive the pair south.
GBP/USD
Christmas day brought us an untradeable market and no other special financial events took place, so price action will pick up where it left off.
Technical Outlook
We anticipate a bounce off 1.6380 resistance and a move lower towards the support located at 1.6315 but low volume and irregular price action are almost a certainty and this makes technical analysis very difficult and less reliable. Nonetheless, price will move today but we don’t expect any significant developments.
Fundamental Outlook
Today the United Kingdom didn’t schedule any news releases and price direction will be mostly influenced by the US Unemployment Claims numbers. British Banks are closed today as well.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
EUR/USD
Forex News: The US Unemployment Claims came out with a lower than anticipated value, strengthening the US Dollar and reversing an initial move higher but for the entire day price moved just about 40 pips.
Technical Outlook
The pair made an attempt to touch 1.3710 resistance but the bulls didn’t have enough steam to maintain such a high price and the direction soon reversed. Although the distance traveled during yesterday was rather small, the latest momentum seems to be bullish and moves close to 1.3710 may be seen today. However, we don’t anticipate a break of this level and we favor a bounce lower if it is touched.
Fundamental Outlook
Today no major indicators are released and low volume is still present.
GBP/USD
The Pound strengthened against the US Dollar yesterday although better data came out of the United States but we attribute this mostly to the winter holidays than to technical or fundamental reasons.
Technical Outlook
The resistance located at 1.6440 is threatened as price came very close to it yesterday but in the past we have seen price move above this level only to return below it soon after so we anticipate the same thing to happen today. A real break of this important level is less likely and we favor a move towards the support located at 1.6380.
Fundamental Outlook
No significant economic or financial indicators were scheduled by either the United States or the United Kingdom so we anticipate a slow day, still influenced by low trading volume.
We hope you had a good week and we wish you a relaxing weekend.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
Forex News: Ending the trading year with mixed market direction
EUR/USD
Forex News: Friday was by no means a calm day as anticipated and low volume combined with comments about a potential ECB rate increase and probably position adjusting for the end of year performed by major banks created a massive move up followed by a significant drop.
Technical Outlook
After the failed attempt at breaking 1.3830 resistance, the momentum belongs to the bears and we anticipate a move into the support located at 1.3710. The next important level is located at 1.3650 but technical analysis is less reliable during this time of the year and irregular movement is a distinct possibility.
Fundamental Outlook
At 3:00 pm GMT the US Pending Home Sales are released, with an anticipated increase from the previous -0.6% to 1.1%. Usually, better than expected values for this indicator strengthen the greenback and take the pair lower but given the current market conditions, the effect is hard to predict.
GBP/USD
Friday was a wild day for the GBP/USD pair as well, with price traveling almost 170 pips to the upside and then dropping about 120 pips. This movement was mostly generated by increased UK optimism regarding economic growth and by low volume in the market.
Technical Outlook
We have a new high located at 1.6577 but the bulls couldn’t maintain such a price and the resistance level of 1.6550 (better observed on a zoomed out chart) is still intact. More than that, price was pushed lower after the failed break and we consider that continued moves to the downside have a high probability of occurring. The levels to watch are 1.6550 as resistance and 1.6440 as support.
Fundamental Outlook
The United Kingdom didn’t schedule any economic or financial indicators for today so price direction will be influenced by the US event mentioned earlier and will be made difficult by the end of year low volume.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
Forex News: Price action stops in anticipation of the New Year
EUR/USD
Forex News: Yesterday’s only important economic indicator – the US Pending Home Sales – came out with a worse than expected value and as a result the US Dollar lost strength and price moved to the upside for almost the entire day.
Technical Outlook
European Banks and most brokerages around the world are closed today in observance of New Year’s Eve so price action will stall and not much action will be seen. Trading will resume on the second day of next year.
Fundamental Outlook
The only economic indicator of the day is released by the US in the form of the Consumer Confidence which is scheduled at 3:00 pm GMT and expected to increase from the previous 70.4 to 76.5. The effect of this release is hard to predict given the special circumstances of the day.
GBP/USD
The pair had a bullish movement throughout the day on the back of worse than anticipated US data and price came close to the resistance located at 1.6550 but a break of this level was out of the question.
Technical Outlook
As mentioned before, movement in the market will be almost nonexistent and most brokerages, including ours are closed.
Fundamental Outlook
The United Kingdom didn’t schedule any news releases for the day and although the US Consumer Confidence is released, it will not have a significant effect on the market.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
Forex News: First trading day of the year still affected by low volume
EUR/USD
Forex News: Yesterday we had a non-trading day as the market was closed in celebration of New Year’s Day and no economic or financial indicators were released.
Technical Outlook
The latest period has been difficult to trade due to the winter holidays which brought low volume and irregular movement. Price resumed its action today but the direction is still uncertain due to the reasons mentioned above. The main levels of immediate interest remain 1.3710 as support and 1.3830 as resistance.
Fundamental Outlook
The United States will release at 3:00 pm GMT the Manufacturing Purchasing Managers’ Index which is a survey derived from the opinions of about 400 purchasing managers from the manufacturing sector. The expected figure is 56.8, a small decrease from the previous 57.3 and since this is a leading indicator of economic health, better than expected numbers usually strengthen the greenback.
GBP/USD
The 1st of January brought the market to a stop and just like all other pairs, the GBP/USD had no movement.
Technical Outlook
Price made a double top at 1.6577 which is a strongly bearish chart pattern and the main resistance located at 1.6550 is still holding although it was pierced two times during the latest period. First support is located at 1.6440 but the market is hard to predict as low volatility is still present and surprising moves may still be experienced.
Fundamental Outlook
At 09:30 am GMT the United Kingdom releases the Manufacturing Purchasing Managers’ Index which is expected to decrease almost insignificantly from 58.4 to 58.3. Better than expected values are beneficial for the Pound and normally help the pair climb but today’s release may have a hard to predict influence over the market.
Written by: Bogdan Giulvezan
The article above is based on the writer’s 4-year experience and it does not constitute trading advice or investment recommendations, just a personal opinion and view of the market.
