Daily Analysis

[HFblogNews 10]

Date : 10th September 2015.

 

CURRENCY MOVERS OF 10th September 2015.

 

 

EURUSD, Daily

 

EURUSD moved further into the pivotal support yesterday as I expected. The 4h lower Bollinger Bands where able to support price and sent the pair rallying higher. There were good sized rallies in all the euro pairs which suggest that institutional money was flowing into EUR, but there seems to be no news event that could explain the rally. Euro pairs run into resistance levels and have been reacting lower over the last few hours. In EURUSD this is reflected in the pair once again trading lower from 1.1214 area. Even though there is a slight upward bias I expect low volatility to remain as the pair is bound by nearby support and resistance levels. The downside is limited by 1.1018 – 1.1093 and the upside by 1.1208 – 1.1332 candle. S&R levels beyond these are 1.1018 and 1.1334. Intraday price finding support at an area near 4h 50 period SMA. This same level used resist moves higher over the last few days.

 

A big NZD dive was the main action in pre-Europe trade in Asia after the RBNZ cut its growth outlook for the New Zealand economy and called for more currency weakness. This followed its expected decision to cut the official cash rate to 2.75% from 3.0%. NZDUSD dove just over 2% in making a three-day low at 0.6256. AUDNZD rallied strongly, with the RBNZ’s guidance contrasting a strong employment report out of Australia, which saw employment rise by 17.4k, above the 5.0k median forecast.

 

The data saw AUDUSD rebound to the 0.7020 area from a low at 0.6946. Elsewhere, USDJPY rebounded smartly from a test of 120.00, which was seen as Japanese stock markets corrected some of yesterday’s outsized gains. Yen losses were sparked by remarks from Japanese politician Yamamoto, who called the BoJ to expand QQE at its upcoming Oct 30 meeting. His remarks came as Japanese data showed PPI remaining in deep deflationary territory, and machine orders showing another contractionary quarter in capital expenditure. USDJPY spiked to a peak of 121.35 before settling to the 120.65-70 area. EURUSD, meanwhile, re-established itself above 1.1200.

 

UK house prices are surging, with the August RICS house price balance rising to a 15-month high of 53 from 44 in the previous month, while the August Halifax price index jumped by a large 2.9% m/m to bring the y/y measure up to +9.0% from July’s 7.9% rate. RICS doubled its forecast for price rises to 6% from 3%, reporting that properties for sale are at a three-year low. The demand-supply imbalance, coupled with robust economic momentum and record employment records, along with historically low mortgage rates and a government scheme to subsidize house purchases, are underpinning the market.

 

Bank of Canada Holds Rates Steady as Economy Underpinned The BoC left the 0.50% policy rate unchanged, as economic growth and inflation have been consistent with their outlook. Most tellingly, the dynamics of Canada’s GDP growth projected in July remain intact, with economic activity underpinned by household spending and a firm recovery in exports. But downside risks remain, notably in the form of uncertainty related to China and emerging markets. The Bank has moved back to the sidelines, and we expect the current ultra-accommodative rate setting to remain in place through 2016.

 

 

Currency Pairs, Grouped Performance (% change)

 

Reserve Bank of New Zealand cut rates for the third time in three months. The current rate is 2.75%, down 0.25% from the previous 3% rate. This sent NZD down by as much as 2.0% against AUD at the time of writing. According to the RBNZ the economy is adjusting to the sharp decline in export prices, and the consequent fall in the exchange rate. The bank also commented on global environment: Global economic growth remains moderate, but the outlook has been revised down due mainly to weaker activity in the developing economies. Concerns about softer growth, particularly in China and East Asia, have led to elevated volatility in financial markets and renewed falls in commodity prices. The US economy continues to expand. Financial markets remain uncertain as to the timing and impact of an expected tightening in US monetary policy.

 

AUDNZD has rallied strongly and the pair is approaching the upper Bollinger Bands and a pivotal resistance in the daily time frame. EURNZD rallied to a similar resistance in a 4h chart and has turned lower. GBPNZD chart is almost an identical copy of EURNZD while NZDUSD trades near support.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• China’s CPI improved to a 2.0% y/y pace in August from the 1.6% y/y pace in July and 1.4% clip in June. The pick-up to the fastest CPI growth rate in a year during August would appear modestly encouraging given the government’s efforts to boost growth (which should presumably eventually lift prices). But a lack of supply for pork drove prices of that key meat product higher, lifting total CPI and undercutting a demand driven explanation for the CPI jump in August. Meanwhile, August PPI remained weak at a -5.9% y/y clip after the -5.5% y/y rate in July. That’s the worst pace of annual decline in six year, reflecting the plunging fortunes of China’s factor sector.

 

• Bank of England meeting: BoE MPC’s September meeting, which is now replete with the instant release of the minutes, will be the main event for sterling markets this week. With the August PMI surveys signalling the weakest growth for over two years, and signs that retail sales are slowing, along with concerns about global market volatility, we expect the minutes to reveal a more dovish tone than was the case at the early August meeting. The MPC should leave the repo rate at 0.5% — where its been since March 2009, and where its likely to remain until Q2 next year — and the QE total at GBP 375 bln. The vote is likely to be 8-1 in favour of holding the repo rate unchanged, with last month’s sole dissenter McCafferty, likely to persist with his vote for a 25 bp hike.

 

• U.S. Initial Jobless Claims Preview: Initial claims data for the week of September 5th are out on Thursday and should show a drop back to 267k (median 275k) after a bounce to 282k in the week of August 29th. Despite the slightly lower August payroll headline of 173k, claims have continued along a tight path. We expect September claims to have 275k, matching the August average but exceeding July 272k average.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 11th September 2015.

 

CURRENCY MOVERS OF 11th September 2015.

 

 

EURUSD, Daily

 

EURUSD, Daily Yesterday’s slight upward bias accelerated a bit during the New York session but the pair has not been move beyond the 1.1208 – 1.1332 area which I suggested will limit the upside. Currently EURUSD is trading near a pivotal resistance at 1.1320 and has reacted lower from just below the resistance level. After edging higher for a few days the pair is now taking a breather and moving sideways. Significant daily support and resistance levels are: 1.1214 and 1.1334. Intraday support and resistance levels are at 1.1244 and 1.1320. ECB’s Coere: Growth too weak to boost jobs. The Executive board member said ECB bond purchases will continue as long as necessary, as growth remains too weak to create sufficient jobs. In the text of a speech published on the ECB website, Coeure said France still has some way to go on growth and that he sees “room for manoeuvre” on Greece once trust is restored. Italian refinancing costs fall. Italy sold EUR 4 bln of 2022 bonds with a coupon of 1.45% at an average yield of 1.37%, down from 1.60% at the previous auction on July 13. It also sold EUR 1.5 bln of 2046 bonds with a coupon of 3.25% at an average yield of 2.96%, down from 3.24% in July. Finally EUR 2.25 bln of 2018 bonds with a coupon of 0.25% were sold at an average yield of 0.24%. The BoE left policy unchanged as widely expected and the minutes, released at the same time, showed an 8-1 majority in favour of steady policy, with McCafferty continuing his dissent in favour of a rate hike. However, while Sterling and yields spiked in the wake of the initial announcement, indicating lingering hopes for a more dovish statement and a reversal to a unanimous vote, yields quickly headed south again, as the statement indicated that the tightening bias is being eroded by rising concerns about the global growth outlook. So while the tightening bias remains intact for now, the BoE, is effectively taking a wait and see stance. Expectations of a dovish BoE statement were based on mixed confidence data and rising concerns about the global growth outlook. The BoE’s minutes also noted the dip in the Markit/CIPS composite PMI for August to the lowest level since May 2013. However, while bank staff lowered their estimate of Q3 GDP growth to 0.6% from 0.7%, the minutes noted that “the composite expectations index from the Markit/CIPS surveys had been steady, retail sales indicators had remained solid and consumer confidence had risen a little in August from already high levels”. In addition “the RICS survey had suggested a supportive balance of demand versus supply, and mortgage approvals in July had been a little stronger than expected”. US reports revealed a disappointing round of July wholesale trade figures yesterday that trimmed our Q2 GDP growth estimate back to an unrevised 3.7%, though we still assume 3.0% GDP growth in Q3. The August trade price report revealed huge export price declines, with big drops for both the commodity and core export and import aggregates that were reminiscent of the plunge back in January in the face of a dollar pop, oil price declines, and a weak global economy. As such, we see little potential for improvement in the monthly trade deficits despite lower oil prices given weak export valuations. We did see a welcome 6k initial claims drop to a lean 275k, though we expect a restrained 205k September nonfarm payroll rise as the inventory overhang and factory sector restraint continues to put pressure on the economy.

 

 

Currency Pairs, Grouped Performance (% change)

 

Money has been flowing out of CHF today. EURCHF clocked a new post-January high of 1.0988 in early European trade. A steadier tone in global stock markets this week has been conducive of CHF declines. Swiss policymakers have also been successful in undermining the Swiss currency’s traditional status as a safe haven, with deeply negative deposit rates having caused a steady drip feed of yield-searching Swiss fund outflows. USDCHF is trading near the upper daily Bollinger Bands after rallying for three weeks. EURCHF has broken out of a sideways move and is currently challenging the 50 week SMA. AUDCHF is in a down trend in daily and is currently struggling with a resistance at 0.6930. CHFJPY is likewise in a daily downtrend and has reacted lower today after a two day contra trend rally.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• German August HICP inflation was confirmed at 0.1% y/y, in line with expectations and the preliminary reading. National CPI was confirmed at 0.2% y/y and the breakdown, which was released for the first time, confirmed that lower energy prices are the main reason behind the low headline rates. Prices for light heating oil dropped 6.2% m/m and -27.6% y/y and petrol prices were down 4.2% m/m and 9.5% y/y, with CPI excluding household energy and petrol actually standing at 1.1% y/y in August, up from 1.0% y/y in July. This is still firmly below the ECB’s 2% limit for price stability, but with German labour costs rising markedly despite relatively muted productivity growth, underlying trends are picking up, despite the fresh drop in HICP.

 

• US Michigan Consumer Sentiment: The first release on Michigan Sentiment is out on Friday and is expected to decline to 91.5 (median 94.0) from 91.9 in August. The already released September IBD/TIPP poll declined to 46.9 from 48.1 in July. There is heightened downside risk to the release from recent market volatility.

 

• US PPI: August PPI is out Friday and should reveal a 0.1% (median -0.1%) decline for the headline with the core index up 0.1% (median 0.1%). This follows respective July figures of 0.2% for the headline and 0.3% for the core. After some rebound in May and June oil prices resumed their decline in July and August which could weigh on the release.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 14th September 2015.

 

GOLD TRADING NEAR SUPPORT AREA AFTER THREE DOWN WEEKS.

 

 

Gold, Daily

 

Gold still in downtrend as confirmed by downward price channel and yet another lower high in the weekly picture. This was once again formed at levels that used to support price and at 38.2% Fibonacci level identified in the previous report. Price rallied to the level in response to a strong move lower in US stock market. Since then price of gold has moved down for three weeks and is now trading close to the top of the two weeks’ sideways range (1104) from the end of June and the lower 1.5 sd Bollinger Band. Over the last two days price has been moving sideways at this 1103 – 1104 support, a level that resisted price advances at the end of July. Price is also trading at the lower daily Bollinger Bands while Stochastics are oversold. Daily support levels are at 1080 and 1103 while resistance levels are at 1117 and 1147.30.

 

 

Gold, 240

 

In 4h picture Gold is also trending lower. This is indicated by price moving inside a downward price channel and the 50 period SMA. Current price action is taking place at the lower end of the channel and at the lower Bollinger Bands. Stochastics has created a higher low after price formed a hammer candle on Friday. There is support in 1093 – 1098 bracket while the nearest resistance area is between 1109 – 1115.

 

 

Gold, 15 min

 

In 15 min chart the price of gold has moved below a rising trendline after reversing at 1108 – 1108.80 resistance. Price action suggests that the current range between 1106 and 1108 should be resolved to the downside and towards a 50% Fibonacci level at 1103 while the next support level is at 1101.

• US Michigan Consumer Sentiment: The first release on Michigan Sentiment is out on Friday and is expected to decline to 91.5 (median 94.0) from 91.9 in August. The already released September IBD/TIPP poll declined to 46.9 from 48.1 in July. There is heightened downside risk to the release from recent market volatility.

 

Conclusion

 

Trading should be range bound this week before the Fed announcement on Thursday. However, once the market participants know what the result is it support and resistance levels further away will become relevant. After moving lower for three weeks it is not likely that price will have another significant down move this week. Fed’s not expected to hike rates (only 28% probability for September rate hike) and price is trading relatively near levels that attracted buyers the last time. However, gold is in a long term downward trend. It is therefore likely that the demand at support levels will be eventually absorbed. Regression channel analysis in 4h chart indicates that gold is trading at the lower end of its likely range. This is confirmed by the Bollinger bands. Shorts should therefore factor this into their trading and be more careful as price might not have similar swings to the down side that I had last week. As the price is in downtrend and there are resistance levels fairly close by I expect gold will move further into the support area between 1080 and 1103 but the moves can be short lived and lead to a rally. If it takes place I expect the move run into a resistance at 1134 – 1153 area.

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 15th September 2015.

 

CURRENCY MOVERS OF 15th September 2015.

 

 

EURUSD, Daily

 

EURUSD moved sideways yesterday creating a spinning top candle. This took place at 1.1334 resistance that we identified in the previous TCM report. A spinning top that takes place at a resistance after a move higher is a reversal sign. Stochastics Oscillator is oversold and rolling over which supports the view that price reversal is likely to take place. Intraday support is currently at 1.1282, while there is resistance at 1.1328. The next support level is at 1.1214. The Fed meeting being so near price movements are likely to remain small.

 

FOMC Forecast revisions at this week’s FOMC meeting should reveal sharp reversals of the June FOMC revisions for GDP and the jobless rate, as growth prospects should be boosted despite global market volatility. We expect all the 2015 GDP forecasts to be raised by 0.4%-0.6% after June’s downward bumps of 0.4%-0.8%, while all but the lowest jobless rate estimates are lowered 0.1% across the 2015-2017 period after 0.1%-0.2% June boosts in the lower end estimates. There is a possibility that policymakers low-balled their estimates in June to facilitate upward revisions at this month’s meeting that would help to justify rate lift-off. The 2015-16 PCE chain price estimates were also low-balled in June, but the ensuing oil price plunge eliminated the need for revisions. The core PCE chain price figures have tracked official projections, though forecast ranges may be narrowed. We expect big downward bumps in the high-end Fed funds estimates, as officials “tap down” rate expectations in keeping with a “one and done” 2015 rate strategy. See our policy outlook page for a table of our assumptions for the Fed’s revised forecasts.

 

French August CPI came in below expectations at a six-month low of 0% y/y, ebbing from the +0.2% rate seen in July. The median forecast had been for a rise of 0.2%. The EU harmonized figure slipped to +0.1% y/y from 0.2% in the previous month, where it had been expected to remain. The data follows a string of disappointing data out of France, while recent energy price declines will be further feeding disinflationary conditions.

 

RBA minutes (Sep 1 meeting) indicated policy remains neutral, but officials warned that international economic developments (mainly from China) had raised financial market volatility and global risks. On the other hand, the depreciation of AUD due to declining commodity prices, was expected to support growth. The minutes also indicated officials weren’t sure on which assets Chan had been sold as authorities worked to devalue the yuan, or which assets were being purchased by those looking to take capital out of the country. AUD-USD is slightly lower non the dovish minutes.

 

Canada ran a surprise C$1.9 bln surplus in the previous fiscal year, according to the Finance Department’s Annual Finance Report for FY2014-15 that ended on March 31. The Harper government had projected a C$2.0 bln deficit in the April budget outlook. The unexpected surplus was due to better than expected revenue growth. The challenge, of course, is for the current fiscal year, for which the government projected a C$1.4 bln surplus.

 

 

Currency Pairs, Grouped Performance (% change)

 

The fact that the BoJ maintained a steady, but accommodative policy stance has moved funds into JPY as it is up against all the major currencies after the Asian session. Many still see additional stimulus from the BoJ next quarter.

 

USDJPY is rolling over after creating a pin bar and spinning top in the daily time frame last week. AUDJPY is reacting lower from a resistance at 86.05. EURJPY is also falling after pivoting just below 137. At the time of writing price is trading below yesterday’s low.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• BoJ rates and policy decision: the bankmaintained a steady, but very accommodative policy stance, as expected. The vote was 8-1. The Bank indicated it would continue to increase the monetary base by about JPY 80 tln annually via asset purchases. The statement noted that the “economy has continued to recover moderately, although exports and production are affected by the slowdown in emerging economies.” Many still see additional stimulus from the BoJ next quarter.

 

• US Retail Sales Preview: August retail sales are out Tuesday and we expect the headline to grow 0.4% (median 0.2%) for the month with the ex-autos aggregate up 0.4% (median 0.2%) as well. This follows respective July figures of 0.6% and 0.4% in July. Vehicle sales jumped for the month with a rise to 17.7 mln in August from 17.5 mln in July and, as discussed in today’s editorial, chain store sales also edged up for the month.

 

• U.S. Industrial Production Preview: August industrial production data is out Tuesday and the headline is expected to fall 0.2% (median -0.2%) following a 0.6% bounce in July. The capacity utilization rate should fall to 77.7% (median 77.8%) from 78.0% in July. The August employment report revealed weak hours worked data for mining and manufacturing that will weigh on the release, on top of which we expect a decline in utility production for the month.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 16th September 2015.

 

CURRENCY MOVERS OF 16th September 2015.

 

 

EURUSD, Daily

 

EURUSD closed yesterday below the previous day’s spinning top candle low. This is further confirmation for the bearish view that I had yesterday. Yesterday’s analysis pointed to a reversal and provided a resistance to trade against. This 1.1328 resistance worked to a pip yesterday as price moved to 1.13287 after the publication of this report yesterday. The pair has rallied to the spinning candle low in the Asian session today and reversed lower once again. EURUSD has since penetrated 4h lower Bollinger Bands (20) and trades near 50 period SMA in 4h chart. The next resistance area is at 1.1285 to 1.1300, roughly coinciding with 23.6% Fibonacci retracement at 1.1305 while next significant daily support is found at 1.1190 with 61.8% Fib level nearby at 1.1196. The 50% retracement level coincides with a daily high at 1.1230 (from 8th September) and could cause a small rally.

 

Several ECB officials have been voicing their opinions on the bank’s QE program. ECB’s Constancio: ECB has scope to expand QE if necessary. The ECB’s Vice President highlighted that compared to the programs introduced by Fed, BoE and BoJ, the ECB’s asset purchase program has been relatively small.ECB’s Nowotny: QE extension or expansion possible. The Austrian central bank head said in an interview with Die Presse, that the asset purchase program has had a number of positive effects while highlighting that the low inflation in the Eurozone is a big problem for the ECB. Interestingly, he didn’t blame lower oil prices, but the dramatic deterioration in the economic outlook for emerging markets, adding that the main problem isn’t so much China as countries like Brazil. ECB’s Weidmann warns cheap money doesn’t help to boost sustainable growth and production potential, but in an interview with Germany’s Sueddeutsche Zeitung, he warned again that it increasingly harbours risks also to financial stability. Weidmann was recently appointed as new head of the BIS, which in its latest annual report also warned that markets remain too reliant on central bank stimulus, in contrast to the IMF, which is calling for ever more easing measures to support world growth.

 

The lack of major negative surprises in today’s data keeps the FOMC on course to announce a 25 bp rate hike on Thursday. Though it remains a close call. While the Fed is mostly meeting its mandate on economic growth (we’re forecasting a 3.0% GDP growth rate for the second half of 2015) and the labor market, the renewed downturn in commodities may reduce confidence that the 2% inflation goal will be met anytime soon. And various exogenous factors, including worries over slowing growth abroad and increased volatility in the financial markets, add to the dovish, no hike case. Unfortunately the FOMC has conditioned the markets to react bearishly to hints of normalization such that there will never be a “good time” to commence liftoff. There’s been no need for the Fed to maintain its emergency policy stance all these years, and a 25 bp hike should have only limited impact, especially if policymakers continue to indicate a gradual path for the future.

 

US reports yesterday revealed a largely expected round of August retail sales and July business inventory figures that had no net impact on our GDP estimates of 3.0% growth in Q3 after an unrevised 3.7% figure in Q2, with real consumption growth of 3.0% in Q3 after a Q2 growth boost to 3.4% from 3.1% that was previously signaled by strong QSS data. We also saw a weak round of September Empire State figures that extended August weakness, alongside a big 0.4% August industrial production drop after a 0.9% (was 0.6%) July surge that reflected an even bigger than expected vehicle sector gyration around retooling. Today’s figures did little to alter the sales and inventory outlook, beyond reinforcing the view that factories face big headwinds from an inventory overhang and a vehicle sector drop-back after a July pop, and a petro-sector recession that’s been aggravated by further oil price declines.

 

 

Currency Pairs, Grouped Performance (% change)

 

The US Fed has started its two day meeting in which they are to decide whether to lift the interest rates from the zero level. There has been movement in AUD today. Currency has moved most against USD, EUR and GBP. AUDUSD is rallying and trying to move above 50% Fibonacci level and towards a 0.7219 resistance that coincides with a 61.8% retracement level and proximity of downward weekly regression channel. EURAUD is rolling over inside a topping formation and towards a support level at 1.5566. The pair is now trading below 1.5770 resistance. GBPAUD has reached a support provided by both 50 day SMA and the lower Bollinger Bands (20). This level is also a weekly high from six weeks ago. With this in mind and Stochastics oversold the current reversal signs in intraday resolutions should lead to a rally higher.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• EMU final Aug HICP: The headline reading was expected to be confirmed at 0.2% y/y, but there is some risk of a downward revision, after yesterday’s weaker than expected French number. Lower energy prices are driving the annual rate down again, but the gap between the headline number and the core measure is widening. Even the latter remains far below the ECB’s 2% limit for price stability, but with the labour market starting to improve and economic heavyweight Germany posting sizeable increases in unit labour costs, underlying trends are picking up, even if energy price developments could push the headline rate back into negative territory in coming months.

 

• Canada Manufacturing: should rise 1.0% in July after the 1.2% gain in June. A 2.2% gain in exports provides a compelling reason to forecast another solid gain in manufacturing shipments during July. An as-expected gain in shipments would provide further support for the Q3 rebound scenario, supportive of no change in BoC policy for an extended period.

 

• US CPI: August CPI data should reveal a flat (median unchanged) headline with a 0.2% core increase. This would leave overall CPI up 0.2% y/y with the core index up 1.8% y/y. The drop in gasoline prices has weighed on price measures and we expect this to be the case in the CPI release where gasoline prices look poised to decline by 2% for the month. This effect was already visible in the month’s PPI data where we saw a flat headline for August as well.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 17th September 2015.

 

CURRENCY MOVERS OF 17th September 2015.

 

 

EURUSD, Daily

 

After moving lower EURUSD as expected but then rallied quite strongly and turned a down day into a close above the opening price for the day. The rally started after the pair reversed below my 1.1230 support at 1.1214 and was intensified by the US CPI figures. The headline CPI came in at disappointing -0.1% while the core CPI remained unchanged at 0.1%. A negative print on August CPI gave the Fed a last minute reminder that it continues to be well shy of its inflation mandate. This gave the markets a reason to sell the USD almost across the board. Only USDJPY bucked the trend yesterday. EURUSD then ran into a resistance slightly above my 1.1305 resistance and is trading sideways underneath it at the time of writing. This created a pin bar and a higher low in the daily chart. A pin bar that creates a higher low is a positive indication in this context and this has encouraged traders to push the price higher today. There however is a pivotal resistance ahead (1.1328 – 1.1373) while support levels are at 1.1230 and 1.1196. This being the Fed day I don’t expect the markets to push through the resistance before the rates announcement.

 

EURCHF is fractionally lower following the SNB announcement of unchanged policy and renewed pledge to intervene in the currency market if needed to counter franc appreciation. The central bank continues to class the franc as being “significantly overvalued.” EUR-CHF dipped to the 1.0950 from pre-announcement levels around 1.0975, which is little more than a 0.2% decline, and the cross remains well within the range it posted yesterday. Swiss policymakers have had success in undermining the franc’s status as a safe haven, with deeply negative deposit rates having caused a steady drip feed of yield-searching Swiss fund outflows. The franc is trading nearly 6.5 % lower than levels seen a couple of months ago, and the cross last week traded above 1.1000 for the first time since the SNB abandoned its former cap on the franc in January.

 

ECB and SNB – Waiting for the Fed: ECB council members continued to sound dovish as the focus shifts to tomorrow’s FOMC announcement. If the Fed delays the start of the tightening cycle it will make additional easing moves by the ECB more likely and that in turn would likely see the SNB follow suit with additional steps. Officials may be eager to stress that China’s exchange rate adjustment was not the start of a global currency war, but at least in Europe, it would well start to look like one.

 

FOMC Forecast revisions to be released at Thursday’s FOMC meeting should reveal sharp reversals of the June FOMC revisions for GDP and the jobless rate, as growth prospects should be boosted despite global market volatility. We expect all the 2015 GDP forecasts to be raised by 0.4%-0.6% after June’s downward bumps of 0.4%-0.8%, while all but the lowest jobless rate estimates are lowered 0.1% across the 2015-2017 period after 0.1%-0.2% June boosts in the lower end estimates. We believe policymakers low-balled their estimates in June to facilitate upward revisions at this month’s meeting that would help to justify rate lift-off. The 2015-16 PCE chain price estimates were also low-balled in June, though we do expect 0.2%-0.3% downward bumps for 2015. The core PCE chain price figures have tracked official projections, though forecast ranges may be narrowed. We expect big downward bumps in the high-end Fed funds estimates, as officials “tap down” rate expectations in keeping with a “one and done” 2015 rate strategy.

 

 

Currency Pairs, Grouped Performance (% change)

 

New Zealand’s Q2 GDP grew at a 0.4% pace (q/q) following the 0.2% clip in Q1. The increase in Q1 undershot projections and leaves another quarter of disappointing growth for New Zealand’s economy. On an annual basis, GDP slowed to a 2.4% y/y pace from the revised 2.7% y/y clip in Q1 (was +2.6%). Growth has slowed considerably this year from the 3.5% y/y rate seen in Q4 of 2014. The slowing in annual growth is supportive of further rate cuts from the RBNZ.

 

The result has been that money has flowed away from the NZD benefitting especially USD, EUR and GBP. NZDUSD is down slightly at the levels it opened yesterday morning while EURNZD is trying to move up after forming a doji candle yesterday. GBPNZD is trading near a pivot high candle after yesterday’s rally and the advance today in the Asian session. All in all price action seems to be muted as markets wait for the Fed.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• The SNB Interest Rate Decision.: The Swiss central bank did the expected and maintained the central Libor target and the deposit rate at -0.75%. The SNB sees growth picking up gradually in the second half and headline inflation in positive territory at the beginning of 2017. The statement highlighted that the CHF remains overvalued and confirmed the central bank’s commitment to intervene in forex markets if necessary. The statement highlighted growing uncertainty about developments in China and risks to the world growth outlook. The SNB will be watching Fed and ECB decisions carefully in coming months and if the ECB widens its QE program, the SNB could well react or pre-empt a move by cutting the deposit rate again even before the next policy review in December.

 

• US Housing Starts: August housing starts are out today and we expect the headline to decline 3.0% to a 1,170k (median 1,160k) pace from 1,206k in July. The July headline marked a high back to October of ’07. Also in the report is the latest data on permits, which we exepct to climb to 1,135k from 1,130k in July and completions, which are seen at 1,010k from 987k. Early data on housing for August remained firm with the NAHB at 61.

 

• US Initial Jobless Claims: Claims data for the week of September 12th are published today and should reveal a 282k (median 275k) headline from 275k last week. Claims are continuing to strike a firm path and we expect the September average to be 275k which would be steady from August, though above the 272k July average. This continued strength supports our September forecast for a 205k non-farm payrolls.

 

• The Fed Interest Rate Decision.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 18th September 2015.

 

CURRENCY MOVERS OF 18th September 2015.

 

 

EURUSD, Daily

 

In yesterday’s report I drew attention to EURUSD creating a pin bar and a higher low. This indicated further bullishness for euro but the upside was capped by the 1.1328 – 1.1378 resistance area. As expected, the pair didn’t move beyond the resistance before the Fed announcement yesterday. The decision to hold the rates at zero propelled EURUSD to the session high of 1.1441. Today, Stochastics are in the overbought region while the price is approaching the upper daily Bollinger Bands. In the weekly picture, price is inside the upper Bollinger Bands and right below the 50 week SMA. This is a reason for some caution for the euro bulls. The price is approaching the 1.1463 – 1.1520 resistance area after we’ve seen some follow through for yesterday’s upward momentum. The nearest support levels are 1.1374 and 1.1388.

 

FOMC left rates unchanged, citing concerns over global weakness. The key sentence in the statement was: “Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” The Fed again noted weakness in net exports, and the fact that market based inflation measures had moved lower. It’s also “monitoring developments abroad,” while it sees balanced risks on the economy and labor market. The FOMC again indicated it will be appropriate to raise rates when it sees further improvement in the labor market and is “reasonably confident” that inflation will move back to the 2% target over the medium term. Lacker dissented in favor of a 25 bp hike. The Fed did reiterate that the economy is expanding at a moderate rate, housing has improved further, and the underutilization of labor resources has diminished.

 

Yellen said U.S. monetary policy is directed toward achieving the dual mandates set out by Congress. Of course policy changes have many cross currents, and capital flow implications. The exchange rate is one of a number of channels through which policy works. There are effects on the exchange rate, and yes the Fed needs to take those into account. The risk of a government shutdown played NO role in the Fed’s decision not to hike rates. Yellen said there is rationale for a rate hike now, but noted that financial conditions have tightened to some extent, and the situation abroad has become “more uncertain of late.” She added though, that the she doesn’t want to overplay the impact of overseas developments. She also reiterated that the path of policy is more important than the timing of the first move, and that most members still see a hike this year. The decision won’t depend on any particular data. In answering the first question, she said we can’t expect uncertainty to be fully resolved, but the Fed wanted to take a little more time to assess conditions. She has no recipe for what the FOMC wants to see before tightening. On the possibility for October, all meetings are “live.” So October remains a possibility, and the Fed would call a press conference if needed.

 

Fed funds futures are on the move higher after the FOMC remained on hold. Though prices in the futures market are still gyrating, the market is currently pricing in a 25 bp hike for December with a little better than 50-50 probability. We suspect improved market stability and less angst over global developments will open the door for an October hike, though soft inflation should make December a better bet.

 

 

Currency Pairs, Grouped Performance (% change)

 

As the Fed decided not to raise rates the dollar weakness drove other currencies higher. This was especially the case with the commodity price sensitive AUD. Commodities are priced in USD and therefore a lower yielding dollar makes some commodities like Gold more attractive and in general cheaper to buy. This has supported the AUD today.

 

AUDUSD is trading at a resistance created by 50 day SMA, the 61.8% Fibonacci level, and a historical resistance area between 0.7216 and 0.7276. The pair formed a daily shooting star candle yesterday and is at the time of the writing challenging the high of the candle. GBPAUD is back to the pin bar it created day before yesterday. This is a level where a historical support coincide with 50 day SMA and the lower Bollinger Bands.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• Canadian CPI: We expect CPI to expand at a 1.0% y/y pace in August, a slowdown from the 1.3% y/y clip in July. CPI is seen falling 0.2% on a month comparable basis in August after the 0.1% gain in July. Gas prices fell 3.5% in August compared to July, which is expected to drive the decline in month comparable CPI. The BoC’s core CPI index is seen rising 0.2% in August, similar to the action seen in past months of August. Annual core CPI growth is expected to expand at a 2.0% y/y rate in August following the 2.4% clip in July. The expected core CPI figure would, of course, leave the measure at the BoC’s 2.0% midpoint. However, Governor Poloz has maintained that run-up is transitory and not reflective of a tightening in supply conditions.

 

• The US CB Leading Indicator: The August index of leading economic indicators (LEI) is expected to grow 0.2%. We expect yields to help support the headline. The six-month annual gain hit 8.8% in July last year, the highest reading since 10.7% seen in April of 2010. The Conference Board’s preferred recession threshold for the LEI is a six-month annualized reading below -3.5% and a six-month diffusion average below 50%. We wouldn’t read much into this index, as the historical swings “line up” with back data due to repeated “best fit” revisions of the index figures rather than a real-time correlation. The Conference Board revises the index in January, given the massive divergence since 2009 between index levels and reported GDP growth.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 22nd September 2015.

 

CURRENCY MOVERS OF 22nd September 2015.

 

 

EURUSD, 240 min

 

In the last Currency Movers report I pointed out several technical factors that should cause the bulls to be cautious. And they sure did! EURUSD tumbled down from the 1.1463 resistance identified in the report. Today the pair is trading above 1.1151 support level we identified in the chart in September 18th analysis. Today’s low has been 1.1153. Stochastics is now getting oversold while price is trading near lower Bollinger Bands and the 50 day SMA. We have a pin bar in the 240 min chart as buyers are trying to step in but there has been no follow through. The resistance at 1.1210 has been holding them back. This suggests price should move further into support and closer to the 50 day SMA before it can attempt a turnaround. As the pair is at support it is likely that the weakness is soon overdone and we’ll first see a slowdown in the rate of decline and then a counter-move to the down move that took place over the last two days. If this takes place the 1.1280 looks like a realistic target for the move after which I’m expecting further decline. Significant daily support and resistance levels are at 1.1093 and 1.1280.

 

Yesterday’s dollar-driven decline in EURUSD came at the wake of hawkish remarks from Fed’s Bullard and, to a lesser extent, Lacker. Bullard, presently a non-FOMC voter, said that there is a “powerful case to be made” for rate lift-off. This contrasted with ECB’s Praet, who said in remarks after the European close that the central bank would “forcefully” react should the inflation environment worsen. There is a bearish case to be made for EURUSD despite the Fed’s relatively dovish guidance, as the dollar has yield advantage, particularly at the long end, and with the ECB likely to counter any euro strength with its own dovish guidance.

 

The September UK CBI industrial trends undershot expectations, unexpectedly dropping to a -7 reading in the headline total orders reading, down form 0 in August, though above July’s cycle low at -10. Export orders dove sharply to -24, down from -6 in August, while the expectations balance fell to a +9 reading, the lowest since October 2013. The strong pound, which is near seven-year highs in trade-weighted terms, is blighting the export performance, which continues to be the weak link in the manufacturing sector.

 

Praet: ECB would “forcefully react” if inflation objective pushed out further. Praet was careful not to sound too pessimistic about global headwinds, saying that the ECB doesn’t “want to create of course self-fulfilling expectations at the same time by conveying pessimistic messages” and repeated the central bank’s message from the last meeting that it is “too early to draw firm conclusions about the environment, it is too early to tell”, but he also stressed that the ECB doesn’t want to deny “that the situation can be very unfavorable in the European context”. The central bank is hedging its bets while watching global developments, but also forex markets. The currency may well be the decisive factor that could trigger further ECB easing, even if Draghi won’t admit that. Earlier in the day Praet still said that there are some signs that inflation has turned the corner, but the comments confirm that the ECB wants to send a dovish message and Draghi will have a chance to clarify the ECB’s stance at tomorrow’s testimony to the European Parliament.

 

SF Fed study says market based inflation expectations are poor predictors of future inflation. Remember the FOMC has been distinguishing between market based measures and survey based measures in its recent policy statements, noting that the former had moved lower while the latter had remained stable. The market based measures that were studied were TIPS break evens and inflation swap rates, while the authors looked at 2 types of survey measures, including the Philly Fed’s Survey of Private Forecasters and the Blue Chip Financial Forecasts, along with methods incorporating “no-change” forecasts based on current CPI values. According to the study published in the current FRBSF Economic Letter, “a simple constant inflation rate corresponding to the Federal Reserve’s 2% inflation target consistently performs best.” Maybe the FOMC shouldn’t worry too much about the softening in the market based measures?

 

 

Currency Movers Charts

 

Hawkish sentiment from the Fed officials was seen to move USD higher and EUR down after EURUSD turned lower from the level we identified in Friday’s report. This has brought the EUR pairs near support levels today. EURUSD is trading at a pivotal support while EURJPY has declined to daily Bollinger Bands near levels that attracted buyers on September 4th. EURAUD moved at first closer to a support at 1.5566 (also at Bollinger Bands) but rallied and created a 4h pin bar. EURGBP looks weaker as it is trading below resistance levels but has no clear support before 0.7170.

 

Safe haven currency JPY has gathered momentum today as global stock markets are down together with commodities such as Copper and Crude Oil. AUDJPY is falling after violating support at 85.82 and forming a shooting star candle three days ago.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• Australian House Price Index: The price index for residential properties for the weighted average of the eight capital cities rose 4.7% in the June quarter 2015. The index rose 9.8% through the year to the June quarter 2015.

 

• UK Public Sector Net Borrowing: UK government borrowing surpasses expectations in August data, rising to GBP 12.1 bln in the non-financial figure. The consensus forecast had been for GBP 9.2 bln, while borrowing was up by GBP 1.4 bln on August 2014. The picture looks better in the financial year to date (from April), with borrowing down GBP 4.4 bln over this period. While the deficit has halved under the government’s austerity program, net government debt still remains over 80% of GDP.

 

• US Housing Price Index: markets expect the Housing Price Index number to come in at 0.4%. Home price index rose 0.2% in June from May’s 0.5%. On an annual basis, prices are up 5.6% y/y.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 23rd September 2015.

 

CURRENCY MOVERS OF 23rd September 2015.

 

 

EURUSD, Daily

 

I stated in yesterday’s report that EURUSD should move further into support and closer to the 50 day SMA before it can attempt a turnaround. This is indeed what happened: this morning price hit the 50 day SMA and the Bollinger Bands. Apart from trading at Bollinger and SMA support the pair is at levels that turned it higher from on 4th September. However, the latest weekly pivot candle low is at 1.1214, which is relatively near to the current trading levels. This implies that any rally from the current levels might be short lived and therefore probably doesn’t encourage buyers to buy the EURUSD today. Draqhi speech (1pm GMT today) is not expected to contain specific measures but is still expected to have a dovish tune. I therefore expect that the pair will test the 1.1017 – 1.1087 support range today.

 

French PMIs unexpectedly improve, with the manufacturing reading rising above the 50-point no change mark to 50.4 from 48.3 in the previous month. The services reading rose to 51.2 from 50.6. It seems the French economy is finally back in expansion territory, although readings have been volatile and while there may be a cyclical recovery, helped by the stabilisation elsewhere in the Eurozone, France’s underlying problems remain largely unaddressed, which heralds further weakness ahead.

 

Eurozone composite PMI fell to 54.0 in September from 54.3 in the previous month. The manufacturing reading dropped to 52.0 from 52.3 and the services to 54.0 from 54.0. Readings are broadly in line with our forecast, but slightly below consensus. The overall numbers remain firmly above the 50 point mark, thus pointing to ongoing robust expansion across both sectors and in the overall economy, while the country breakdown showed France finally catching up and thus a more balanced picture. Growth may not be accelerating, but at least so far it is still consolidating, even as clouds gather on the horizon.

 

German PMIs decline, but remain at healthy levels. In contrast to the French PMI readings, the German numbers corrected more than anticipated, with the manufacturing reading falling to 52.5 from 53.3 and the services number dropping to 54.3 from 54.9. Despite the correction, the numbers still point to robust expansion in both sector and continue to look healthy compared to France. Domestic demand in particular is boosting the German recovery, with low unemployment and inflation leading to very strong gains in real disposable income. However, this is not really sustainable growth in the medium to long term and investment remains an issue, as is the slowdown in emerging market economies, which is hitting German exports. The emission scandal meanwhile is a further negative for automakers going ahead.

 

 

Currency Movers Charts

 

I highlighted in the September 18th report that AUDUSD was trading at a resistance and formed a daily shooting star candle. Those that traded accordingly have since enjoyed a great short trade. Today AUD is down against all the other major currencies as well. EURAUD formed a narrow bodied pin bar yesterday and has been rising higher today. GBPAUD has continued its turnaround and has moved to 2.1840 resistance that has now caused a reaction lower. AUDJPY has also been moving down after I highlighted it in my yesterday’s report. AUDCAD has been falling in line with the other AUD pairs but the fall has been helped by the Crude rising today almost by 0.90%.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• China PMI: Caixin/Markit flash manufacturing PMI fell to 47.0 in September from 47.3 in August. It’s a 3rd straight monthly decline, the 7th consecutive reading below the 50 expansion/contraction mark, and is the lowest level since March 2009. The output component dropped to 45.7 from 46.4, while the new orders component slid to the lowest print since November 2011. The drop is exacerbating concerns over slowing growth.

 

• French Q2 GDP was confirmed at 0.0% q/q, while the annual rate was revised up marginally to 1.1% y/y from 1.0% y/y reported initially. The stagnation in the second quarter has to be seen in conjunction with the strong first quarter, but nevertheless, the disappointing number also reflects chronic underperformance of the French economy, which is struggling to come to grips with its structural problems.

 

• ECB Draghi Speech: The ECB President will testify before the European Parliament today and expectations that he will deliver a very dovish statement are mounting. The ECB’s official line at the last meeting was that it’s too early to assess the impact of global headwinds for the inflation outlook, but that the ECB is ready to act again if the objective is being pushed further out. The central bank is hedging its bets while watching global developments, but also forex markets. In our view, the currency may well be the decisive factor that could trigger further ECB easing, even if Draghi won’t admit that. So for now, we expect a dovish statement, but no firm commitment of further measures.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 24th September 2015.

 

CURRENCY MOVERS OF 24th September 2015.

 

 

EURUSD, Daily

 

Draghi disappointed and wasn’t as dovish as expected. This helped the EURUSD rally. This morning the pair has been fighting the 1.1214 resistance today and even formed a 4h pin bar at the level but has now pushed itself through the level. The last week’s low at 1.1214 caused the resistance. As the pair is trading near the lower end of the weekly price range and encouraged by the turnaround at the support yesterday traders were able to push the price higher. Nearest support range is at 1.1017 – 1.1087 while the first resistances are at 1.1261 and then 1.1388. The pair will face 4h Bollinger bands and the 50 period SMA at the same levels with the 1.1261 resistance.

 

Elsewhere EURCHF has reinstalled itself in the mid-1.09s after ECB’s Draghi didn’t produce the dovish sound-bites that many had expected at his testimony before the European parliament yesterday. The Swiss economy minister Schneider-Ammann also said yesterday that “we travel in the direction of purchasing power parity,” and that “his journey is not yet finished, as purchasing power remains significantly above 1.20 Swiss francs per euro.”

 

The SNB’s announcement of unchanged policy last Thursday, and a renewed pledge to intervene in the currency market if needed, had little impact. The central bank continues to class the franc as being “significantly overvalued,” though it has had some success in undermining the franc’s status as a safe haven, with deeply negative deposit rates having caused a steady drip feed of yield-searching Swiss fund outflows. The franc is trading some 6% lower than levels seen a couple of months ago.

 

German Ifo business confidence unexpectedly improved in September, driven, not by an improvement in the current conditions reading but a rise in the expectations number, the first since July. The current conditions index actually dipped. Overall readings remain at high levels and the diffusion index showed that optimists now outnumber pessimists across all sectors. The breakdown also reveals that sentiment remains driven by consumption and retail trade, with low unemployment, sizeable wage gains and low inflation boosting real disposable income.

 

German consumer confidence drops sharply. The Gfk consumer confidence reading for October fell to 9.6 from 9.9 in the previous month. The much weaker than expected number adds to concerns about the outlook, although the overall reading remains at a very high level in a long term comparison. The breakdown, which is available until September, shows a sharp decline in overall business expectations, which also depressed income expectations and the willingness to buy.

 

French Sep business confidence held steady at 100 in September, but manufacturing confidence improved on a marked rise in the own company production outlook to 14 from 8 in the previous month. The better than expected numbers tie in with the improvement in France’s PMI readings, released yesterday, which suggested a move back into expansion territory for both services and manufacturing sectors. Still, today’s survey also showed the reading for overall order-books falling further into negative territory, despite the fact that foreign order books remained stable.

 

 

Currency Movers Charts

 

Over the last five days GBP has lost a lot of ground against all the other competitors except AUD which has been the weakest of the lot. This has brought the GBPUSD to levels that could attract buyers. It is trading at weekly Bollinger bands and at a daily pivotal candle but the nearest resistance level is fairly close at 1.5330 while the nearest support level is at 1.5162. Other GBP pairs are also near support levels: GBPCAD bounced yesterday and formed a daily pin bar and GBPNZD has fallen to 4h Bollinger Bands and has pivotal support nearby.

 

AUDUSD is approaching daily Bollinger bands and support which indicates that it is time to close the shorts opened after the shooting stars were formed.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• US Initial Jobless Claims: Claims data for the week of September 19th should reveal an increase to 270k (median 271k) after a prior dip to 264k from 275k. Claims are continuing to strike a lean path as we head into fall and September looks poised to average 272k from 275k in August and 272k in July. This supports our forecast for further strength in September employment where we expect a 205k nonfarm payroll headline with the unemployment rate steady at 5.1%.

 

• US New Home Sales: August new home sales should reveal a 5.4% headline increase to a 515k (median 515k) pace in August following a 507k clip in July and a 481k pace in June. Major housing measures have eased in August with both existing home sales and starts dropping back from firm summer readings. However, sentiment remains strong and the NAHB climbed to 61 in August from 60 in July.

 

• US Durable Goods: August durable goods data is expected to show a 3.0% (median -0.5%) decline for orders with shipments down 0.5% and inventories up 0.2%. This follows respective July figures of 2.2% for orders, 1.0% for shipments and -0.1% for inventories. August saw a general slowing in other transport and industrial measures with industrial production down 0.4% for the month, Boeing orders falling to 52 from 101 and the ISM declining to 51.1 from 52.7.

 

• Fed Chair Yellen’s upcoming speech is keeping the markets nervous,/B] though we doubt she’ll change her tune or give any new policy clues. The FOMC has already lost some credibility by not hiking rates last week while citing concerns over China, global growth, and low inflation, and back tracking would further erode market trust. She should leave the door open for a rate hike next month, or in December by reiterating all meetings are in play, and stating the Committee is monitoring data and financial conditions. The Fed’s Lockhart speaks again shortly and is expected to repeat prior comments.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 29th September 2015.

 

CURRENCY MOVERS OF 29th September 2015.

 

 

EURUSD, Daily

 

EURUSD has been moving higher despite Yellen’s comments last week that the Fed is likely to raise rates by the end of the year. This suggests that the potential rate hikes are already priced in the EURUSD or alternatively markets just don’t believe the Fed will follow through and action on their promises. The move higher from the Bollinger Band support has lifted EURUSD near 1.1296 resistance where it has faced some supply and momentum has slowed down. There is support at 1.1210 that roughly coincides with a bullish pin bar high from Friday. The 50 Day SMA is pointing higher and has been supporting price while Stochastics point higher. EURUSD is ranging while many other EUR pairs are also in a range mode and currently at resistance. These include EURCAD, EURNZD, EURGBP and EURAUD. Either EUR has to slowly push through all these resistances or alternatively it needs to react lower and look for lower levels to bounce from and then have another attempt at the resistances. There is weakness in the EURUSD 1h picture at the time of writing. The 60 min chart created a lower high after a shooting star candle at resistance. The nearest support levels are 1.1212 and 1.1115 while the nearest resistance level is at 1.1296.

 

Fed’s Evans said an “extra-patient” approach to tightening is warranted in his prepared remarks on Thoughts on Leadership and Monetary Policy. Remember, Evans is a dove who sided with the consensus to delay tightening at the September 16, 17 meeting. He added “later liftoff…and a gradual subsequent approach…best position the economy for the potential challenges ahead” and warned that there are “substantial costs to premature normalization.” He wants to see upward movement in inflation before he pulls the trigger and worries that the slowdown in China and weaker energy prices could damp inflation. He did acknowledge that his view is somewhat more accommodative versus the Fed median estimate. According to Fed dove Evans: the Fed is closer to a rate hike and the Fed needs to communicate that, but China risk did influence the September decision. The Chicago Fed voter noted that more accommodation would be needed “if things were to weaken very much.” This is pretty much in line with earlier remarks arguing in favor of delay, but Evans has been one of the more outspoken doves for some time.

 

Atlanta Fed’s GDPNow was revised up to 1.8% for Q3 compared to the 1.4% previous estimate last week. As the Atlanta Fed states: “The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2015 is 1.8 percent on September 28, up from 1.4 percent on September 24. The model’s forecast of the growth rate of real personal consumption expenditures in the third quarter increased from 3.2 percent to 3.5 percent after this morning’s report on personal income and outlays from the U.S. Bureau of Economic Analysis.” That puts the model closer to the 2.5% consensus of Blue Chip economists than any time since early August, compared to our own GDP forecast of 3.0% for Q3. See the Atlanta Fed website for more detail.

 

US Dallas Fed manufacturing index edged up a bit to -9.5 in September, from -15.8 in August. But it’s still a 9th consecutive negative print and reflects the ongoing weakness resulting from the plunge in oil. The employment component fell to -6.1 from -1.4, a 5th consecutive sub-zero number. The workweek was -11.1 from 0.6, and wages slipped to 15.6 versus 18.2. New orders improved to -4.6 from -12.5. Prices paid were -0.3 from -8.0. Production, however, rose to 0.9 versus -0.8. The 6-month activity index rose to 4.8 from 3.4.

 

 

Currency Movers Charts

 

Negative news flow around the mining industry and Chinese economic weakness has once again pressured the AUD. One of the news items this morning was that mining giant Glencor’s shares are down over 70% year to date after the shares dropped 30% without any particular news item. The price of shares has come down together with the price of Copper and Steel. While AUD has lost ground money has flowed into JPY and EUR since yesterday’s close.

 

Over the last three days we’ve seen money flowing out of NZD, CAD and AUD while JPY, EUR and USD have attracted funds. This has lifted up trending EURNZD to a resistance just below 1.8000. AUDUSD moved to 0.6938 support as suggested in my report yesterday. USDJPY is trading at support and in daily Bollinger Bands at the bottom end of the recent trading range. AUDJPY is also trading at daily Bollinger Band support which suggests that the JPY move is getting overdone. CHFJPY also created a bullish pin bar yesterday and signals therefore a move higher in the pair.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• UK BoE Lending: We expect a rise in headline mortgage approvals of 69.8k in September (median 70.0k) after August’s 68.8k tally. The mortgage market is being underpinned by a strong labour market, rising real incomes, and something of a rush to secure a low-rate mortgage deal before the BoE pulls the rate hike trigger. Lending to non-financial businesses will be a focus as this has been a weak spot in the UK’s recovery story to date.

 

• Eurozone ESI: ESI Economic Confidence is expected to fall to 104.0 (median same) from 104.2 in the previous month. Italian and French national data were surprisingly strong and there is room for an upside surprise. Overall, the overall numbers remain at high levels, consistent with ongoing expansion. So far domestic demand remains underpinned by strong consumption, which in turn is boosted by stabilising labour markets and a pick up in wage growth, but downside risks have clearly increased, as external demand is threatened by the slowdown in emerging markets and as the emission scandal is hanging over European automakers.

 

• U.S. Consumer Confidence: September consumer confidence is out Tuesday and is expected to decline to 97.0 (median 97.0) from 101.5 in August. Other measures of confidence have already declined in September with Michigan Sentiment falling to 87.2 from 91.9 in August and the IBD/TIPP poll dropping to 42.0 from 46.9 in August.

 

 

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Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

I look forward to seeing you there!

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 30th September 2015.

 

CURRENCY MOVERS OF 30th September 2015.

 

 

EURUSD, Daily

 

EURUSD daily chart observations show a pause in the August price advance from 1.0850 to 1.1713 with current price lacking direction. The fact that price had stopped near the 260 period moving average around the 1.17 area gives reason that downward pressure on price is still present. Further moving average analysis spots a bullish double moving average cross of the 10 and 50 MA that accrued around mid August. Additionally, a bullish stochastic oscillator supports my technical view that price may attempt to make a new lower top sub 1.1460 before tracing out some range trading between 1.1460 and 1.1090. Traders may look to stand aside while price trades in a range or attempts to play the range between the relevant support and resistance levels indicated on the above EURUSD daily chart.

 

The German jobs market is looking healthy as the jobless rate was unchanged at 6.4% and wage growth is accelerating, which together with low inflation is pushing up disposable income and underpinning consumption. France has been underperforming Germany amid the lack of structural reforms and weak productivity growth, but latest confidence indicators suggest that despite the fundamental weakness in the French economy, there is somewhat of a cyclical recovery that is having a positive effect.

 

ECB’s Hansson: “Everything is possible” on QE. The Finnish central bank head said at a conference in Italy that “it is too early to discuss changes to the quantitative easing program”. He added that there are “moderate” inflation pressures in the Eurozone and that “a lot depends on how inflation will develop, if it slows or accelerates”. So for now the ECB remains in wait and see mode, while keeping the door to further easing wide open.

 

Asian stocks rallied. The Nikkei 225 closed with the solid 2.7% gain and Australia’s ASX 200 with an impressive 2.1% rise, while the Shanghai Composite was showing just over a 1% advance in late PM session.

 

U.S. Consumer Confidence Index in September rose to 103 from 101.3 in August. This points to a continuation of strong consumer spending.

 

 

Currency Movers Charts

 

The new Currency Movers Charts show the percentage change from previous day’s close to the current moment against the other major currencies.

 

The JPY is trading slightly higher across the board even through Japan Retail Sales shrank in July, the AUD is sharply lower as continued weakness in China and commodities prices will dominate the path of the AUD.

 

The EUR is showing some signs of strength as price trades in a recent range as the market wait for the U.S. jobs report data on Friday.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• GBP UK Q2 GDP data show an unexpected down revision to 2.4% y/y from the 2.6% provisional estimate, though the q/q figure is unchanged at 0.7% growth. The quarterly growth figure is an improvement on Q1′s 0.4%, though deteriorating global conditions and survey evidences point to a ebb in Q3 growth back to a 0.5% rate.

 

• EUR German retail sales: Dropped 0.4% m/m,less of a correction from the strong rise in July but against consensus expectations for a slight rise over the month. Retail sales cover less than 50% of overall consumption and are likely understating overall trends, although annual increases in retail sales also remain robust as low unemployment, sizable wage gains and low inflation boost real disposable income.

 

• USD Chicago Purchasing Manager’s Index Producer sentiment looks poised to improve slightly with the ISM-adjusted average holding at 51 from August and 53 in July and June.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 1st October 2015.

 

CURRENCY MOVERS OF 1st October 2015.

 

 

EURUSD, Daily

 

EURUSD price continues to lack direction within the daily chart and it is beginning to appear that a trading range may be forming between the 1.1460 and 1.1090 levels over the short term. This period of lackluster price action should remain as the market waits for the U.S. jobs data due out on Friday. Traders should look towards commodity prices for any signs of a bottoming which may contradict data that still points to slower global growth. The likelihood of a stronger USD and weaker EUR should remain as the main trend into the year end as fallout from the European automotive industry and the likelihood of further ECM QE increases.

 

Today’s mixed European PMI readings will give ECB policy makers something to argue about at the next council meeting, especially as downside risks are picking up in light of developments in the global economy and the fallout from the emission scandal for European automakers. The current mixed readings are clearly showing up in the EUR as price has yet to choose a direction with trader’s undecided on which side of the trade to take.

 

The global stock market rebound is still continuing for now, despite a dip in Japan’s Tankan index, and stabilization in China’s manufacturing PMI at contraction levels. The USD has been trading firmer against the EUR and GBP over the last 5 trading days on the back of a strong Wall Street close and follow-up gain in Asian stock markets. The AUD and CAD, meanwhile, rallied to one-week highs versus the USD, while the NZD hit a two-week peak.

 

 

Currency Movers Charts

 

The EUR is mostly weaker against the majors as the Eurozone manufacturing PMI suggests a slight slowdown in overall growth dynamics, but a more balanced picture across the Eurozone.

 

The GBP is trading mixed after the UK manufacturing PMI came in fractionally above market forecast.

 

The CHF is sharply lower in the wake of an unexpected dip in the Swiss SVME manufacturing PMI.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• GBP Manufacturing PMI: The UK manufacturing PMI is fractionally above forecast at 51.5 in September data. The survey this month indicates stabilization in the sector at moderate expansion, holding just above the two-year low point at 51.4, which was seen in June. Sterling has traded modestly higher in the wake of the data.

 

• USD Initial Jobless Claims: U.S. initial jobless claims are expected to be 270k (median 270k) in the week-ended September 26. Continuing claims are expected to fall to 2,213k for the week-ended September 19. Forecast risk: downward, as volatility concerns could give businesses pause.

 

• USD Manufacturing ISM: The September ISM is expected to rise to 52.0 from 51.1 in August. Forecast risk: upward, given strong component data in the early month reports. Market risk: downward, as weakening in data could impact rate hike timelines.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 2nd October 2015.

 

CURRENCY MOVERS OF 2nd October 2015.

 

 

EURUSD, Daily

 

EURUSD short-term trend remains flat and range bound with a price recovery towards the 1.1460 area looking unlikely as long as price remains below the 1.1280 level. Yesterday’s U.S. report revealed a disappointing September ISM drop and a downward bump in the construction spending though the three months ending in August was not enough to push the EURUSD to close above the lower end of the 1.12’s (61.8%). Potential trade setups for the short term are to enter short positions near 1.1280 for a 1.0930-1.0920 target; alternatively, on a clean break of 1.13, long positions could be opened for a 1.1460 initial target.

 

The European calendar yesterday was focused on manufacturing PMI readings. The overall Eurozone September manufacturing PMI was confirmed at 52.0, in line with the preliminary reading and down from 52.3 in the previous month. France is returning to growth and only Greece is in contraction territory, although, even the Greek manufacturing PMI has started to pick up again. So, pretty much a confirmation of what the ECB sees – ongoing growth, but with reduced momentum, even if the recovery is broadening somewhat.

 

The UK manufacturing PMI was slightly higher than expected at 51.5, which is only marginally down from August’s 51.6. The sector continues to expand, although it is holding just above the two-year low point at 51.4.

 

Bank of Japan sees little immediate need for adding stimulus according to Bloomberg headlines.

 

Fed Williams repeated his rate hike call for “sometime later this year” in his speech from Salt Lake City. The news shouldn’t sway the markets much ahead of today’s payrolls report.

 

NYMEX crude has fallen back to $45.20 lows, after peaking at $47.08 earlier. The move comes as the National Hurricane center shifts the path of the hurricane further East, and away from energy infrastructure on the northeastern coast.

 

 

Currency Movers Charts

 

The JPY is weaker as Japan’s Tankan survey of business sentiment this week found the index for large manufacturers to be slightly worse than expected. A pattern that has been persisting since mid-August with periodic bouts of demand for the safe haven of the yen having been interspersed with bouts of relative calm. In the background are expectations for the BoJ to expand its QQE program at its Oct-30 policy meeting.

 

The EUR has drifted modestly lower, to the 1.1160 area after failing to hold gains above 1.1200 on several attempts over the last day.

 

The GBP is mostly stronger as the U.K. construction PMI rose to 59.9 in the headline of the September survey, up from the 57.3 reading of the August survey and above the 57.5 median forecast. Residential construction rose at the quickest pace in a year, and job creation lifted to its best level in three months.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• EUR ECB Draghi’s Speech: Draghi is taking a “wait and see stance” and with core inflation actually trending higher, labour markets stabilizing, wage growth picking up and credit conditions also improving it is not hard to see why.

 

• USD Factory Orders: August factory orders are expected to fall 1.5% with inventories down 0.1%.Forecast risk: downward, given the weaker top-line durable goods numbers. Market risk: downward, as weaker data could impact rate hike timing.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 5th October 2015.

 

CURRENCY MOVERS OF 5th October 2015.

 

 

EURUSD, Daily

 

The EURUSD daily chart bull cross of the 10, 50 SMA moving average is proving to be a reliable indicator, as short term price action is holding above the 6 week lows since the cross was spotted. Short term bullish price momentum is expected to be maintained since price seems to be bouncing off the bottom end of the 1.1090 – 1.1460 expected trading range. Short term long position holders should be on alert for profit taking around the September 18th high (1.1460), while short traders should watch for a break below 1.1090 that could open up the way towards the 1.0920’s.

 

Growth worries will leave Fed, BoE on hold, while there is now an increase risk of European Central Bank and Bank of Japan stimulus after the September jobs data was a disappointment across the board. Data showed only a 142k payroll rise after 59k in downward revisions, a 0.2% hours-worked drop with a workweek downtick to 34.5, and a 13k payroll drop in the bellwether goods sector led by mining and factories that translated to a 1.0% hours-worked plunge. Hourly earnings were flat. The U.S. labor force dropped to a 5.05% new cycle-low, while the labor force participation rate plunged to a 62.4% 38-year low.

 

China is on a holiday through Wednesday and Australia is closed today for Labor Day.

 

The magnitude of slowing in the global economy is the biggest uncertainty facing investors and central banks at the moment. The disappointing U.S. jobs data, on the back of the FOMC’s decision to delay liftoff, decreases investor confidence. The upside is that consumer spending and record U.S. auto sales give a better picture of the U.S. economy. Investors will now focus on the upcoming data out this week for further short term direction.

 

 

Currency Movers Charts

 

The USD is weaker across the board and sold off immediately on the disappointing U.S. jobs report. The impact on the Fed rate-hike decision is more uncertainty and markets will increase in volatility with a growing feeling that the Fed has miscalculated.

 

The GBP is trading lower as the U.K. economy continues to look a little softer and expectations are that the BoE will not tighten monetary policy prior to a move by the Fed. The PMI fell slightly to 51.5 in September from 51.6 in August, which was revised up from 51.5. The reading has been running above 50 for thirty straight months. The pace of growth seen in the second and third quarters of this year have been weaker than seen earlier in the current growth sequence.

 

The CAD jumped immediately after the US employment numbers were released. The much smaller than expected numbers spooked the markets because the widely anticipated Fed rate hike now looks as though it will have to wait well into next year.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• GBP Services PMI:: Unexpectedly dove to a 29-moth low of 53.3 in the headline reading of the September survey. Total business activity and new business growth both came in at 29-month lows. Outstanding business activity consequently grew at only a fractional rate, and the long-term outlook fell to its weakest reading since August 2014. Input prices jumped, due to salary pressures, though output prices rose only slightly while overall price pressures remained weak by historical standards. The only bright spot was employment growth, with job creation the best since June.

 

• USD ISM Non-Manufacturing PMI: The U.S. ISM-NMI is expected to fall to 58.0 from 59.0 in August. The July spike set a new post-recession high. Forecast risk: downward, given weakness in earlier month releases. Market risk: downward, as a run of weak data could impact rate hike time-lines. The ISM-adjusted figure for the ISM-NMI tends to track that of the Philly Fed.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 7th October 2015.

 

CURRENCY MOVERS OF 7th October 2015.

 

 

EURUSD, Daily

 

It appears the FX market continues to play down a U.S. Fed rate hike this year. The EUR and the USD have been falling behind emerging and commodity related currencies as markets shift to a risk-on mode. This could be because of hopes that more stimulus will be generated by Europe and Asian policy makers. Technically, the EURUSD remains range bound with current price now testing the 1.1280 minor resistance. In the immediate short term, selling pressure may emerge near the 1.1280 area, with short traders possibly seeking a 1.11 target. However, a clean break over the 1.1280 resistance may entice the EURUSD bulls to commit to further long positions for a target just below the 1.1460′s.

 

Asian stock markets advanced with the Hang Seng outperforming and opening the way for further gains in Europe. Stock markets are benefiting from the recent weak data that pushes the odds that global monetary policy will remain accommodative for longer, therefore, cheap U.S. dollars should continue to flood the market with companies and investors betting on consumption to fuel corporate earnings.

 

The BoJ kept policy on hold. In Europe, the BoE starts its 2-day meeting and it’s widely expected that any change in policy is on hold for now. The U.S. and German production fell in August. This data of disappointing manufacturing orders fits in well with the markets view that the ECB could be moving towards further QE.

 

In the U.S. solid gains in consumption and business spending has been on the upswing, and inflation is still below the Fed’s 2% target. The Fed’s Williams said that he does not believe that there’s been a fundamental shift in the economic outlook, and he remains bullish on China.

 

 

Currency Movers Charts

 

The EUR is weaker against the majors as Europe looks to increase QE and stimulate growth after a softer GDP number for the quarter. The USD is slightly lower as the impact on the Fed rate-hike decision is more uncertainty and markets will increase in volatility with a growing feeling that the Fed has miscalculated. The GBP is not moving much, although downward bias may prevail now that the U.K. economy continues to look a little softer and expectations are that the BoE will not tighten monetary policy prior to a move by the Fed. The NZD is broadly higher as commodity markets hold ground, with Gold and Copper holding on to recent gains.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• EUR German Industrial Production: dropped 1.2% m/m. Initial expectations had been for a modest rise over the month, but with much weaker than expected orders numbers yesterday, a correction had always looked likely. Jul was revised up to 1.2% m/m from 0.7% m/m reported initially, but the three months trend rate nevertheless fell into negative territory.

 

• GBP Manufacturing Production: 0.5% actual came in higher by 0.10% than the 0.40% forecasted number.

 

• JPY BoJ Monetary Policy Statement: The BoJ announced unchanged policy, as was widely expected, maintaining bond and other asset purchases (QQE) at an annual rate of Y80 tln. In the statement the central bank remarked that the economy had “continued to recover moderately, although exports and production are affected by the slowdown in emerging economies.”

 

• CAD Building Permits: Building permit values are expected to rise 1.0% in August after the 0.6% dip in July. The Bank of Canada has assured that Canada is not at risk of a national housing bubble and that the soft landing remains in play.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 8th October 2015.

 

CURRENCY MOVERS OF 8th October 2015.

 

 

EURUSD, Daily

 

The FX markets have been relatively quiet and global equity markets trading mixed over the last 24 hours. U.S. and European markets were up yesterday, while Asian markets traded mostly lower in overnight trading in the wake of a week long holiday in China. Commodity prices have been correcting after yesterday’s price rally, this has seen the AUD and other commodity dependent currencies getting whipped as commodity prices adjust to the possibility of a further delay in the U.S. Fed rate hike.

 

The EURUSD is trading higher in European trading having now cleared the 1.1280 resistance level, as the IMF said that the U.S. Fed should wait for more signs to raise rates, with IMF’s Vinals saying that “wage and price pressures don’t justify a Fed rate rise and that waiting a couple of months is less risky than a premature lift-off.” The IMF also said that ECB policies are gaining traction while also warning that deleveraging in China will require great care and that it sees a “heightened” chance of global asset-market disruption.

 

For the moment, EURUSD daily traders will focus on whether today’s resistance (1.1280) in European session price break will hold and close above (1.1280), or if it will leave a less meaningful shadow for the day and close below (1.1280). EURUSD bulls will prefer to see a clean close on price above 1.1280 in order to keep alive any attempt to carry the pair towards the 1.1460 next key resistance level. I would also like to point out again that current price is still holding well above the daily 10,50 SMA bull cross event that accrued in mid August. This bullish moving average double crossover observation technically adds to support the case for EURUSD long holders, at least in the short term.

 

 

Currency Movers Charts

 

The EUR traded sharply higher in European trade as a technical upward break of the 1.1280 recent resistance area has been penetrated. The EUR has been moving upward even through recent German and France economic data have been on the weak side with a dive in German exports and an unsuspected dip in French business sentiment.

 

The AUD trades lower as expectations of continued weak growth in China and the rest of Asia point to softer growth in Australia. The CHF is higher across the board against the majors as the CHF is still the best risk off place in the market. The USD and the GBP are mostly softer ahead of the U.S. FOMC minutes and the BoE Governors speech later today.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• EUR German Trade Balance: German trade surplus narrowed as exports fell. Germany posted a trade surplus of EUR 19.5 bln in August, down from EUR 22.4 bln in the previous month. Exports dropped 5.2% m/m, after a 2.2% m/m rise in July. The fact that imports also dropped a strong 3.1% m/m, suggests that like in manufacturing data, the timing of the school holidays in the different German states may have distorted the numbers somewhat, but the fact that the drop in exports far outstrips the decline in imports and is in fact the strongest declines since the recession days of 2009 is worrying and ties in with other data showing a slowdown in activity. Exports were still up 6.6% y/y in the first eight months of the year, however, and the accumulated trade surplus widened to EUR 163.9 bln from EUR 136.0 bln in the first eight months of 2013.

 

• GBP BoE Interest Rate Decision: It is widely expected that the Bank of England will keep policy on hold; the focus today will be on the minutes.

 

• CAD Housing Starts: Starts are expected to slow to a 205k unit rate in September (median 204.0k) from the 216.9k pace in August. A pull-back in multiple starts after the 19.5% surge in August is expected to slow total starts in September. Forecast Risk: The economies of Canada’s energy producing regions have taken well publicized hits from the fall in energy prices. Expect slower activity in those markets to continue. However, mortgage rates are lean, which has boosted activity in other regions and helped maintain momentum in construction activity.

 

• USD FOMC Minutes: From Sept 16-17 meeting that a big focus given surprise rate lift-off delay. So far, the markets view that conditions for hike are approaching, but not there yet.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 9th October 2015.

 

CURRENCY MOVERS OF 9th October 2015.

 

 

EURUSD, Daily

 

There was no surprise in the FOMC minutes from the mid-September meeting with “several members” worried that downside risk to growth and inflation have increased due to uncertainties about the global economy. The fact that the FOMC members are downbeat adds to the odds that the FED will delay to at least year end. The U.S. Dow Jones finished with a solid higher close in the wake of the FOMC minutes, while Asian stock markets have rallied across in overnight trading, and most commodity prices are gaining. Crude Oil is trading above $50 for the first time since late July, and may aid support to commodity linked currencies.

 

Previous EURUSD price action closed just below the key resistance (1.1280), leaving a shadow on the daily. However, the EUR bulls seem to be gaining control of the market this morning as price has taken out yesterday’s high (1.1327) and now looks set to continue a push higher with short term bullish momentum now in play. EURUSD bulls should remain cautious of the failed upward break of the one year moving average August high near the 1.17’s, which supports that the longer term trend on the EUR remains to the downside.

 

EURUSD daily traders should understand that the pair still lacks direction over the very short term and price seems to be attempting to trace out a trading range between the 1.1090 – 1.1460 range.

 

The Bank of England left policy unchanged as expected; however, the meeting minutes sounded more to the side of holding current policy for an extended period as the BoE pointed out downside risks, all suggesting that the BoE is in no hurry to raise rates.

 

 

Currency Movers Charts

 

The EUR is trading higher against the majors in the wake of positive French production numbers, which normally is not a EUR mover, but today catches a USD bearish market following yesterday’s publication of the Fed’s minutes to its most recent policy meeting. The USD, JPY and the GBP are all suffering losses as commodity currencies trade stronger fueled by a general risk on investor sentiment after the FOMC minutes indicated an increased in the odds that the FED will delay any upward move in interest rates. The AUD , CAD and NZD are all benefiting from the stronger commodity markets and the fact that US Crude Oil is trading at its highest levels not seen since late July.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• EUR Italian Industrial Production: Dropped -0.5% m/m in August, after 1.1% m/m in July. The work day adjusted y/y rate fell back to 1.0% from 2.8% and output actually stagnated in the three months to August, which will raise renewed concerns about the health of the Italian economy.

 

• EUR French Industrial Production: Better than expected with manufacturing up 2.2% m/m and overall production 1.6% m/m. July data were revised down, but the numbers are nevertheless encouraging. The positive numbers tie in with the improvement in French PMI readings recently and confirm that the cyclical recovery in the Eurozone has finally reached France.

 

• USD Wholesale Inventories: August wholesale trade data is out later today and should reveal a 0.3% (median unchanged) decline for sales while inventories remain unchanged for the month. This would follow respective July figures of -0.3% for sales and -0.1% for inventories.

 

• CAD Bank of Canada Business Outlook: Due out later today, is expected to improve to 10.0 in Q3 from 8.0 in Q2 and a multi-year low 4.0 in Q1. An expected rebound in Q3 GDP following the declines in Q1 and Q2 is expected to lift sentiment.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 12th October 2015.

 

GOLD IS TRADING AT 1169 RESISTANCE.

 

 

Gold, Weekly

 

In my previous report I took the view that the price of gold has scope to move somewhat higher – even up to 1200 – 1232 range. I also wrote that we should see some bottoming action above the 1097 support and that could correct lower from the levels current at the time of the report. I said that if 1135 level breaks the next significant daily support level is in 1098 -1112 bracket. All this played out well. Price moved lower and after a wild swing higher moved to a support range I mentioned. After printing a weekly bar low at 1103 price has had a significant rally from this support range.

 

After creating two higher weekly lows the price of gold last week broke through and is now trading outside of medium term bearish channel. The width of the channel points almost exactly to the upper end of the long term bear channel at approx. 1260. This level roughly coincides with the 23.6% Fibonacci level at 1252. Gold is currently trading near 61.8% Fibonacci level and a previous support (now a resistance). At the same time Stochastics has moved right at the threshold of overbought territory. Price is getting close to the 50 week moving average while the upper Bollinger Bands are not very far from the current market price. The nearest resistance is at a pivotal weekly high at 1169 while nearest major weekly support is at 1103.

 

 

Gold, Daily

 

Price is trading near a resistance area between 1169 and 1187 created by a previous sideways move. While moving averages (30 and 50 SMA) indicate the short term trend is higher Stochastics is overbought while price is trading above the upper 2 standard deviation Bollinger Bands. The nearest potential support is at 1152 – 1154 region while the resistance area is wider, from 1169 to 1187. Since August the price of gold has formed a triangular formation and a projection from the triangle points to 1221 – 1232 resistance range.

 

 

Gold, 240 min

 

Price is trading near 1169 resistance and right at the top of a regression channel while Stochastics are in the overbought zone and moving sideways. This is a sign of momentum slowing down. At the same time price is trading outside the upper Bollinger Bands. Previous pivotal candle high at 1170 is very near to the current market price. The nearest 4h hour support level is at 1158.50 while the area between 1135 and 1143 is support range. Should this not hold, the next support range at 1104 – 1112 comes into play.

 

Conclusion

 

The higher lows in the weekly chart point to higher prices but there are several technical factors likely to slow the price down. Historical resistance at current levels, together with the proximity of 50 week SMA and the upper Bollinger Bands that coincide with 50% Fibonacci retracement are a challenge for the bulls. I expect this combination to turn the price of gold down to 1104 – 1125 support range. The 4h support range at 1104 – 1112 is a likely level to cause a rally should the price correct that far. Look for momentum reversal signals in the lower timeframes to confirm the analysis for both longs and shorts.

 

Janne Muta

Chief Market Analyst

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 13th October 2015.

 

CURRENCY MOVERS OF 13th October 2015.

 

 

EURUSD, Daily

 

With markets trading in quiet mode yesterday because of the bank Holiday’s in the U.S., Canada and Japan traders should expect to see price action pick up as traders get back to work after the extended weekend.

 

EURUSD daily still remains contained within the 1.1460 (Top) 1.1090 (Bottom) range, with current price now trading comfortability above the key support (1.1280) with the pair not showing any signs of leaving a new lower top from the 1.17 August high. I see upside potential in the immediate short term to be limited to around the 1.1440 – 1.1460 levels, before selling pressure emerges, however, since bullish price momentum still remains present there remains the risk for sellers of a price extension towards the 1.15 – 1.1530′s.

 

Asian stock markets are mostly lower in overnight trade as weaker than expected trade data out of China put pressure on commodities and overall market sentiment. The drop in Chinese imports added to the fall in oil prices yesterday. U.K. BRC retail sales came in much stronger than expected.

 

The USD traded weaker in quiet Monday trading with fresh losses against the EUR, AUD and NZD, while the JPY is still flat. The general weakness in the USD is a continuation of selling seen in the wake of last week’s release of the FOMC minutes, which have seen the odds for a Fed rate hike expectations shifted towards year end or even further out.

 

 

Currency Movers Charts

 

The USD over the last 5 day trading sessions has been to the downside sparked by the latest release of the FOMC meeting minutes which have seen the odds for a Fed rate lift-off by year-end lengthen. The GBP is lower across the board in the wake of lower trade balance that fell in August to GBP-3.27 billion from GBP-4.4 billion in July while the forecast was for a GBP 2.5 billion deficit. The AUD has been outperforming as higher commodity prices and hopes of more prolonged stays of ultra-accommodative monetary policy at the Fed and BoE give AUD buyers reason to support price.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• EUR German HICP: Was confirmed at -0.2% y/y, national CPI at 0.0% y/y, as expected. The breakdown, which was released for the first time, confirmed that lower energy prices are the main reason behind the negative headline rate. Prices for heating oil were down 27.9% y/y in September and petrol prices dropped 13.8% y/y. Excluding both household energy and petrol the annual rate stood at 1.1% y/y, still below the ECB’s 2% limit for price stability but far above the headline rate and the risk of a real deflationary spiral is very small, which means the ECB won’t need to react to the drop in headline inflation numbers, even if they keep easing speculation alive.

 

• GBP Consumer Price Index: The Consumer Prices Index (CPI) fell by 0.1%, compared to no change (0.0%) in the year to August 2015. A smaller than usual rise in clothing prices and falling motor fuel prices were the main contributors to the fall in the rate. The rate of inflation has been at or around 0.0% for most of 2015.

 

• EUR German ZEW Survey: Investor sentiment fell more than expected to 1.9 from 12.1. Market sentiment is swinging between concerns about the global growth outlook and hopes that monetary stimulus will remain in place for longer than previously thought and that this will prevent a substantial deceleration in growth.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 14th October 2015.

 

CURRENCY MOVERS OF 14th October 2015.

 

 

EURUSD, Daily

 

EURUSD daily price has been in a momentum driven mode since clearing to the upside the previous resistance now turned support (1.1280) level. This upward momentum on price has been done on the back of mostly disappointing Eurozone data; however, the market has interpreted last week’s release of the U.S. Feds FOMC meeting minutes as a reason to sell off the USD, therefore, proving short term support for the EUR. Moving forward, stochastic oscillator analysis is starting to look overextended, indicating that momentum may start to slow. Price is also nearing the 260 period (1 year) SMA leaving me with the technical view that the EURUSD remains at risk for a fall towards the 1.1280′s, unless we see a clean break above the 1.1460′s that could open up the way for the 1.1530′s.

 

On Tuesday, we saw that the German ZEW investor expectations drop was much more pronounced than anticipated, with optimists only marginally outnumbering pessimists now. The index has been falling steadily since March and the decline in investor sentiment clearly reflects growing concerns about the health of the global economy and the impact of slowing growth in emerging market economies on advanced countries. The expectations index for the U.S. dropped sharply in October, and the reading for the Eurozone also declined. The German ZEW decline was not a total surprise in the wake of the VW emission scandal, the refugee crisis and, of course, uncertainty about the global growth outlook.

 

Global stock markets were weaker on Tuesday, as disappointing trade news from China continues to influence investor sentiment, and signs of disinflation from Europe. Also, profit taking on U.S. markets added to the selling pressure after the Dow Jones posted a 7-week high last week.

 

 

Currency Movers Charts

 

AUD has been correcting lower in the wake of a 2 week advance, AUDUSD buyers have emerge around the 0.72 area and a potential 10,50 SMA bull cross may be forming on the daily. The NZD has been trading higher as the New Zealand economy continues to grow, supported by strong home sales. The USD is still softer as markets continue to add pressure for USD buyers with the impact of a delayed rate hike fresh on traders mind, as well as disappointing retail sales data.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• GBP Claimant Count Change: UK unemployment unexpectedly dipped to a new cycle low of 5.4% in the official ILO figure for August. This is below the BoE’s 5.5% NAIRU marker, which is the non-accelerating inflation rate of unemployment, below which the central bank expects inflation pressures to build. Other parts of the labour report showed the claimant count rising by 4.6k in September, which is worse than expected as the median forecast was for a 2.5k decline. The claimant count rate remained at cycle lows of 2.3%. Wage data was perky, though within expectations. The with-bonus figure rose 3.0% y/y in the three months to August, up from 2.9% previously. This is a strong rate of real improvement in households spending power, given that CPI is at -0.1% y/y, and the BoE will be monitoring this closely with unemployment now south of 5.5%.

 

• EUR Eurozone Industrial Production: Eurozone industrial production dropped 0.5% m/m in August, in line with median expectations and indications from national data last week. The annual rate dropped to 0.9% y/y from 1.7% y/y in the previous month. Confidence indicators continue to suggest ongoing expansion, but also a slowdown in growth momentum, and even if the broadening of developments is encouraging, the knock to the German economy from the emission scandal and the slowdown in emerging economies is also raising concerns about the outlook and adding to the arguments of the doves at the ECB.

 

• USD Retail Sales: U.S. retail sales rose 0.1% in September, and fell 0.3% ex-autos. The disappointing data will add to expectations of no Fed rate hike in 2015. The 0.2% headline August gain was bumped down to unchanged, though July’s 0.7% was bumped up to 0.8%. The 0.1% ex-auto gain from August was revised lower to -0.1%. Sales excluding autos, gasoline, and building materials edged up 0.1% after a 0.2% increase in August (revised down from 0.5%). Motor vehicles and parts climbed 1.7% last month. Gas station sales fell 3.2%. Small declines were registered in electronics, building materials, food, general merchandise and non-store retailers. Clothing rose 0.9%, as did sporting goods, with furniture prices up 0.6%. Health care costs were unchanged.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 15th October 2015.

 

CURRENCY MOVERS OF 15th October 2015.

 

 

EURUSD, Daily

 

EURUSD daily price is currently testing the upper end of my predicted price path range (1.1090 – 1.1460). Ideally, a solid close above the 260 period SMA (1 year moving average) could indicate a possible trend reversal on the EURUSD. The next major daily resistance is now at 1.1560, however there still remains the possibility of a failed upward break that could shift the control back to the short sellers for a retest of the 1.1340′s , 1.1280′s and the 1.1090′s in extension. From a technical standpoint the EURUSD continues to look overextended, the technical trader should be reminded that just because the stochastic oscillator is in overextended territory that does not indicate an immediate fall in price, on the contrary, it is not uncommon that in a strong uptrend that an oscillator could remain overextended while price continues to advanced. My conclusion for short term traders is to add long positions on dips for targets between the 1.1460’s and 1.1560’s.

 

In the event that the ECB can not meet its inflation objective, the European Central Bank may make a move to extend QE, according to the Bank of Spain deputy governor Restoy.

 

Crude overnight hit near $45.90, down from yesterday’s $46.91 peak , crude moved lower after the close on Wednesday, as the API reported a huge 9.3 mln bbl weekly stock build, the largest in six-months. Some of the inventory rise was attributed to falling refinery operating rates, as API reported a 5 mln bbl fall in gasoline supplies for the latest week.

 

Stock markets have been moving higher as weak economic data continues to hit the news wires, with U.S. negative data on ex-auto retail sales and PPI, a deterioration of Japanese manufactures, and the unexpected dip in Australian employment all giving some relief for stock investors since it adds to the possibility of a delay in a U.S. interest rate raise, while increasing the risk that the ECB will proceed with additional QE in order to boast the Eurozone.

 

 

Currency Movers Charts

 

The EUR fell following the mix of data, which revealed a 40-plus year low in jobless claims, a slightly hotter core CPI reading, and an improvement, though less than expected in the Empire State index headline.

 

Significant daily support and resistance levels for these pairs are:

 

 

Main Macro Events Today

 

• AUD Employment Change: Australian employment had an unexpected dip coming in at -5.1k while it was expected to come in at 7.2k.

 

• USD Consumer price Index: CPI sank 0.2% in Sep, in line with median -0.2%; core +0.2%, above med 0.1%. There were no revisions to August which posted a 0.1% headline decline, with the core rate edging up 0.1%. On an annual basis, the headline index was unchanged versus 0.2% y/y, while the ex-food and energy component rose to a 1.9% y/y from 1.8% y/y. Energy prices skidded another 4.7% following a 2.0% decline in August. Transportation costs dropped 2.3% from -1.3%. Food/beverage prices edged up 0.4% from 0.2%. Services costs rose 0.2% from 0.1%. Housing were up 0.3% from 0.2%. Apparel slipped 0.3%, reversing the 0.3% gain in August. Commodities were down 0.8% from -0.4%. Tobacco prices declined 0.1% following a 0.5% gain in August.

 

• USD Initial Jobless Claims: U.S. initial jobless claims fell 7k to 255k in the week ended October 10, matching the lowest since 1973.from a revised 262k in the prior week (was 263k). That brought the 4-week moving average to 265.0k from 267.25k (revised from 267.50k). Continuing claims fell 50k to 2,158k in the October 3 week, versus a revised 2,208k (was 2,204k), the lowest since December, 1973.

 

• USD Empire State Index: NY Empire State index rebounded to -11.36 in Oct, below median -8.0 vs -14.7.

 

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[sonam locus 10]

One of the biggest problem with Hotforex is their trading platform doesn’t works properly. Slow execution and poor customer support.

[HFblogNews 10]

Date : 16th October 2015.

 

CURRENCY MOVERS OF 15th October 2015.

 

AUDUSD, Daily

 

As expected the pair rallied from the 0.6938 support. AUD has now been trading at resistance and just recently failed to stay above the daily Bollinger Bands. The 100 period SMA has been limiting the upside in the occasions while the September pivotal high at 0.7280 has been supporting price yesterday and today. Price is now trading at 0.7263. A close below 0.7266 would make yesterday’s candle a pivot and a lower high. This looks likely. A break below 0.7200 would open a way to the 0.7020 support. If 0.7200 fails to support price look for reversals in 0.6938 – 0.7020 range for long trades and 0.7344 - 0.7382 for short trades.

 

 

 

AUDJPY, Daily

 

With AUDUSD rallying the AUDJPY moved higher as well. The pair hit resistance at 88.65 and reversed after trading outside the Bollinger bands. Now price action is taking place inside Bollinger Bands and the pair is fluctuating near 50 day simple moving average. There is some support at 86.08 but the 4h chart reveals a lower high after price reacted lower from a 30 period SMA and increases the chances price will break below this support. This would make the 82.88 – 84.29 a reasonable target level. Look for bullish reversals inside this range while 87.80 – 88.65 is a range for bearish reversals.

 

 

MACRO EVENTS & NEWS

 

 

FX News Today

 

Bund futures are outperforming and yields heading south, while Eurozone spreads narrow, as weak inflation numbers bolster hopes of further ECB easing. Pressure on Draghi to at least set the stage for a widening or extension of the QE program next week are mounting amid the uncertainty about the global growth outlook. Nowotny’s comments yesterday that even core inflation is clearly below target further fuelled speculation of additional measures, although the Austrian central bank head called for structural reforms rather than hinting at ECB action.

 

The Eurozone posted trade surplus of EUR 19.8 bln in August, down from EUR 22.4 bln in the previous month. Exports were up 6.0% y/y in August, versus nominal import growth of 3.0% y/y, although considering that lower oil prices are suppressing the nominal import bill, real import growth will have been higher.

 

Eurozone final CPI was confirmed at -0.1% y/y, in line with the preliminary number and down from 0.2% y/y in the previous month. The breakdown confirmed that the drop back into negative territory was driven by a sharp decline in energy prices, which were down -1.7% m/m and -8.9% y/y, versus -7.2% y/y in August. Core inflation remains much higher at 0.9% y/y, but as Nowotny highlighted yesterday, this is also considerably below the ECB’s 2% limit for price stability. So more arguments for the doves at the ECB although the amount of stimulus in the system is already substantial and while central bankers want to keep markets happy they also seem wary of additional action, especially as monetary policy alone can’t fix the Eurozone’s problems.

 

Main Macro Events Today

 

 

• Canada Manufacturing: We expect shipments, due today, to tumble 1.5% m/m in August after the 1.7% gain in July. A 3.6% plunge in exports values provides a compelling reason to forecast a pull-back in manufacturing shipments during August.

 

• US Industrial Production: September industrial production data is out Friday and we expect a 0.2% (median -0.2%) headline decline for the month which follows a 0.4% decline in August. This would bring capacity utilization down to 77.3% from 77.6% in August. The September employment report was weak and we saw declines in hours worked as well as employment in both manufacturing and mining which will likely weigh on the release.

 

• US Michigan Consumer Sentiment: The first release on Michigan Sentiment is out on Friday and should reveal a headline increase to 89.0 (median 88.4) from 87.2 in September. The already released IBD/TIPP poll for October improved to 47.3 from 42.0 in September and the Bloomberg Consumer Comfort survey is poised to average 45.0 for the month.

 

EURUSD UPDATE

 

 

EURUSD, Daily

 

EURUSD sold off in the wake of mixed U.S. data that highlighted a 40 year low in U.S. jobless claims, slightly better core CPI reading, and a small improvement in the Empire State index. The EURUSD market sell off yesterday was a standard knee jerk reaction to the headline positive jobless claims, which saw renewed interest in buying the USD. Technically, the sell off was expected, as momentum indicators have been signaling that buying interest in the EURUSD has been slowing with the stochastic oscillator reading as overextended. Price now sits around the 1.1370′s, and I expect this area to hold, unless today’s U.S. release of the UoM Consumer Sentiment comes in above expectations. The 1.1370′s also happens to be the 38.2% Fibo from the July low (1.0808) – August High (1.1713), so I would expect price support around current levels. My conclusion for the short term trader is to add long positions above 1.1370 for targets between the 1.1460′s and 1.1560′s.

 

Please note that times displayed based on local time zone and are from time of writing this report.

 

Click HERE to access the full HotForex Economic calendar.

 

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Janne Muta

Chief Market Analyst

HotForex

&

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFblogNews 10]

Date : 19th October 2015.

 

CURRENCY MOVERS OF 19th October 2015.

 

 

AUDUSD, Daily

 

AUDUSD 5-day change is lower against other major currencies in what seems to be a pause in the recent price rally from the September 29th low (0.6936) to the Oct 12th high (.7380). Daily technical observations spots a bullish 10,50 SMA cross, consecutive higher tops and bottoms on price from September 4th – October 12th (0.69 L / .7380 H ) and the fact that current price is trading above the 10,50 SMA brings me to the conclusion that price remains in a short term uptrend. If today’s low on price holds above the 0.7230 area this could create a lower top above last week’s low (0.72) that may open up the way towards 0.7380; my ultimate short term price objective near 0.7440. However, traders should be on alert for any break below the 0.72 support that may support a deeper price retracement from the September Low to October’s current high with relevant support in this case spotted around the 0.71-0.7110′s.

 

 

GBPAUD, Weekly

 

GBPAUD weekly chart analysis, price touched a six year high at 2.24 late August and since has made a series of lower tops on price. Current price is trading below both the tentative downward slopping trend line, and the 10 period SMA. Stochastic oscillator analysis spots a bullish cross below the 20 line indicating a possible pause in the current downward price direction. My conclusion for the weekly chart trader is to sell into any strength higher up from current price, ideally near the 2.14 area for a 2.03 target.

 

FXPAIR : GBPAUD

SUPPORTS: 2.03

RESISTANCES: 2.24

 

 

 

ECONOMIC WEEK AHEAD

 

 

Main Macro Events This Week

 

* United States: Housing releases dominate the economic calendar. The sector has disappointed with relatively moderate growth despite the improved job market and still low mortgage rates. This week’s reports aren’t likely to alter that assessment. The NAHB homebuilder sentiment index (Today) is projected steady at 62 in October, the best level since 2005. September housing starts (Tuesday) are seen edging up to a 1.130 mln pace, rebounding from a 7.1% cumulative decline in July and August. Existing home sales for September (Thursday) are projected rising 1.7% to a 5.40 mln clip to unwind part of the 4.8% August drop. The August FHFA home price index (Thursday) and weekly MBA mortgage numbers (Wednesday) are also slated. The only other report of note is the flash Markit manufacturing PMI for October. Chair Yellen (Tuesday) will give brief welcome remarks at a Labor Department event. Governor Brainard (Today) will discuss removing unnecessary regulation. Dudley and Powell (Tuesday) are speaking at a money market conference. And Governor Powell will also speak on market liquidity.

 

* Canada: The Canadian calendar is highlighted by the Bank of Canada’s rate announcement (Wednesday) and the Monetary Policy Report. We expect no change to the current 0.50% setting, alongside a cautiously constructive outlook for growth and inflation that is supportive of no change in rates for an extended period. The Federal election will be held today. As for economic data, the September CPI is seen slowing to a 1.2% y/y pace, but with a flat month comparable reading as a drop in gasoline prices competes with the typical seasonal jump in clothing prices. The Bank of Canada’s core CPI is expected to nudge higher to a 2.2% y/y rate in September following the 2.1% clip in August. Retail sales are expected to rise 0.2% in August after the 0.5% gain in July. Wholesale shipments (Tuesday) are seen rising 0.3% in August after the flat reading in July.

 

* Europe: All eyes will be on the ECB this week. Eurozone inflation is back in negative territory and uncertainty about the global growth outlook is rising, which is putting intense pressure on Draghi to extend or expand the QE program. However, the ECB has already provided an unprecedented amount of stimulus and the measures have eased credit conditions and bolstered confidence. Inflation is expected to pick up again toward the end of the year and with domestic demand robust, we don’t see the risk of a deflationary spiral. What the Eurozone needs are structural reforms, not an ever-easy policy stance. And in this situation, Draghi is likely to maintain the wait and see approach, at least for now, although his comments are likely to be sufficiently dovish to keep markets happy, even if a steady hand policy will likely disappoint some and push up yields, at least temporarily. The economic calendar this week focuses on preliminary PMI readings for October (Friday), which we expect to show a further slowdown in the pace of expansion in both services and manufacturing. The EMU’s manufacturing reading is seen falling to 51.7 from 52.0 and the services reading to 53.4 from 53.6 in the previous month. Preliminary Eurozone consumer confidence numbers for October are also expected to head south with growing concerns about the global growth outlook starting to spook consumers. The Eurozone also has BoP and current account data, Italian orders numbers and German PPI inflation.

 

* United Kingdom: The week ahead is pretty quiet, which will leave the focus of sterling markets on external data and developments and Chinese growth data. UK government borrowing (Wednesday) is the first data of note, followed by official retail sales data for September (Thursday).

 

* China: Growth was expected to slow to a 6.5% y/y pace, from the 7.0% clip seen in Q1 and Q2 but came in at 6.9%. The figure fell short of the 7.0% official forecast, but was so slight that the damage on global market sentiment remained negligible. Even the bigger drop was not expected to weigh on stocks due to the “good news is bad news” psychology and hopes of more PBoC stimulus. The better than expected data may not help sentiment much though, as the Chinese data are often viewed to be doctored. September industrial production (Today) is forecast to dip to 6.0% y/y from 6.2% in August. September retail sales (Today) are penciled in at 10.7% y/y gain, down slightly from the prior 10.8% outcome.

 

* Japan: In Japan, the September trade report (Wednesday) also is eagerly awaited for growth insights though balance is likely to be impacted significantly by weakness in imports (y/y) amid low energy prices. Indeed, the JPY 569.4 bln August deficit is expected to reverse sharply to a surplus of JPY 50 bln. The pace of export growth is seen holding steady, though the increasingly sluggish growth in the region may limit exports as well. The August all-industry index (Wednesday) is expected to fall 0.4% m/m, as compared to the prior 0.2% gain.

 

Click HERE to access the full HotForex Economic calendar.

 

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

 

Janne Muta

Chief Market Analyst

HotForex

&

John Knobel

Senior Currency Strategist

HotForex

 

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.