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[OctaFX_Farid]

Gold erases gains



FXStreet (Mumbai) - The strength in the US equity markets coupled with recovery in the US Treasury prices has pushed Gold prices to the previous sessions close at USD 1232.80/Oz levels.

The yellow metal declined from a high of USD 1244.30 hit earlier today to trade just 0.10% up for the day at USD 1234/Oz levels. The haven demand for the yellow metal declined as equity markets in the US posted solid gains. The DJIA currently trades 1.42% higher at 17,891.50, while the S&P futures trade 1.285 higher at 2048.45 levels. Meanwhile, the US 10-yr Treasury yields have recovered losses to trade 2.1 basis points higher at 1.933%. The strength in the Treasury yields has pushed the USD index up by 0.32%.

The yellow metal may fall into the red, if the equity markets extend rally, thereby pulling up the Treasury yields.

Gold Technical Levels

The metal has an immediate resistance located at 1238.3, above which gains could be extended to 1244.87 (200-DMA) levels. Meanwhile, support is seen at 1230.00 and 1224.42 (5-DMA) levels.





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Jan 13,2015
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[OctaFX_Farid]

Yen surges on weak US retail sales - MP


FXStreet (Barcelona) - Kenny Fisher, Currency Analyst at MarketPulse, notes that USD/JPY responded sharply to the weak US retail numbers, as the pair has fallen about 120 points so far.

Key Quotes

USD/JPY has sustained sharp losses on Wednesday. In the European session, the pair is trading in the mid-116 range. The yen has taken advantage of awful US retail numbers. Core Retail Sales fell by 1.0%, while Retail Sales dropped 0.9%.

In Japan, todays highlight is Core Machinery Orders, with the markets expecting a strong gain of 4.8.

USD/JPY has posted losses in the Asian and European sessions, braking below two support levels.

116.69 is a weak resistance line. 117.94 is stronger. 115.56 is a strong support level.

Current range: 115.56 to 116.69





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Jan 14,2015
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[OctaFX_Farid]

US engine spluttering? - ING


FXStreet (Guatemala) - Rob Carnell, analyst at ING Bank noted commented further on the recent retails sales disappointments from the US.

Key Quotes:

"While these retail sales figures are a little worrying, and follow a substantial shift back in the market’s implied tightening by the Fed this year from late last year, we are reserving judgment on what this means. It is not unusual for US data to wobble like this."

"However, if we do not see a strong recovery in the January figures, it will be time to review whether the US economy is as strong as the 3Q14 figures suggested, and whether extrapolating that strength into 2015 is such a good idea."

"More worryingly, with the US about the only beacon of growth globally, if even this engine is spluttering, then a more substantial market correction than we have already seen may well be on the cards."





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Jan 14,2015
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[OctaFX_Farid]

United States EIA Crude Oil Stocks change came in at 5.389M, above forecasts (0.417M) in January 9


Read more in Forex News





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Jan 14,2015
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[OctaFX_Farid]

EUR/GBP consolidates near 6-year lows


FXStreet (Córdoba) - EUR/GBP is falling for a sixth day in a row on Wednesday, having scored a fresh 8-month low during the European session, weighed by growing speculation of QE after an adviser to European Court of Justice said the ECB can legally buy large quantities of sovereign bonds.

EUR/GBP dropped its its lowest level in over 6 years at 0.7732 before recovering some ground and settling in a range within a touching distance of lows. At time of writing, the pair is trading at 0.7740, recording a 0.31% loss on the day.

EUR/GBP technical levels

As for technical levels, EUR/GBP could find immediate supports at 0.7732 (Jan 14 low), 0.7693 (Oct 20 2008 low) and 0.7664 (Mar 14 2008 low). On the flip side, resistances are seen at 0.7780 (daily high) and 0.7800 (psychological level).





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Jan 14,2015
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[OctaFX_Farid]

Crude gains on weak US dollar


FXStreet (Mumbai) - Crude prices in the US gained strength as the USD weakened sharply post the release of the dismal Advance retail sales data in the US.

WTI Crude for February delivery traded 0.37% higher at USD 46.06/barrel. Prices gained 1% at one point of time as the US dollar weakened across the board. The USD index dropped to 91.81, before recovering to trade 0.25% lower for the day at 92.21.

Meanwhile, Crude trimmed gains after the data showed oil supplies in the US rose more than expected. The US Energy information Administration (EIA) said in its weekly report that oil inventories rose by 5.4 million barrels in the week ended January 9, compared to expectations for an increase of 0.5 million barrels. The bearish supply report is likely to cap gains arising out of weakness in the US dollar.

WTI Crude Technical Levels

The immediate resistance is seen at 46.79, above which gains could be extended to 47.41 levels. Meanwhile, support is seen at 45.98 and 45.23 levels on the hourly chart.





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Jan 14,2015
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[OctaFX_Farid]

S&P 500 VIX futures rise to three-month high


FXStreet (Mumbai) - The sharp fall in the equity markets triggered by panic sell-off in commodities today pushed the S&P 500 VIX futures to 21.93, a level last seen in mid-October 2014.

The VIX futures currently trade 4.47% higher at 21.08 levels, compared to the previous session’s close at 20.18 levels. On Technical grounds, the VIX futures have breached the resistance seen at 20.55. A rise above technical resistance indicates a high possibility of further sell-off in equity markets. Moreover, the VIX futures have slowly gained from the low of 13.40 hit on Dec. 5 on concerns of rout in Crude prices and renewed concerns of 'Grexit' that hit markets at the year end.

S&P 500 VIX Technical Levels

The immediate resistance is seen at 21.92, above which gains could be extended to 22.69 (Oct. 15 high). Meanwhile, support is seen at 20.55 (Jan. 6 high) and 20.00 levels.





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Jan 14,2015
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[OctaFX_Farid]

USD/JPY continues on a southernly journey


FXStreet (Guatemala) - USD/JPY is currently trading at 116.87 with a high of 117.98 and a low of 116.07 and down 0.82% on the day.

USD/JPY has been on the offer again and lost yet another handle. The pair's downtrend has been exacerbated by the poor performance in US data in respect of the retails sales. US retail sales dropped 0.9% in December, vs -0.1% consensus. Excluding auto sales it fell 1.0% against 0% expected.

USD/JPY now moves into the 116 territory and brings the December low's back in as a very viable target for the bears at 115.56. With plenty of focus on slowing global growth factors and risk associated with political uncertainty in various countries, volatility is likely to remain the theme and risk-off scenarios will support the Yen at times along a bumpy ride. That ride however is expected to return the major back into the 120's on the basis of a stronger dollar in 2015 and the divergence between the two opposing Central Banks. However, there is still room to the downside as Karen Jones, chief analyst at Commerzbank noted, "We note that the daily Elliot wave count is suggesting that we are likely to see a retracement towards 113.80/111.40.".





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Jan 14,2015
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[OctaFX_Farid]

Inflation and monetary policy trends in EM - BBH


FXStreet (Guatemala) - Analysts at Brown Brothers Harriman explained that while low DM bond yields have captured the attention of the markets, they note that EM bond yields have also fallen significantly.

Key Quotes:

"US 10-year yields near 1.80% are new cycle lows, while most EM 10-year local currency yields are at the low end of recent (3-month) trading ranges".

"Mexico is near 5.6%, for example, while India is near 7.75%. South Africa and Turkey too are right at the low end of recent ranges. Notable exceptions are Brazil (at 12.1%, just below the middle of its 3-month trading range) and the Philippines (at 4.3%, near the top of that range)".

"The same holds true for EM dollar-denominated debt (see report: Broad Trends in EM Bonds). Here, the notable exceptions are Russia and Venezuela".

"What’s driving this rally? Pretty much the same factors driving the DM rally: lower commodity prices coupled with slow global growth, which are feeding into global deflationary impulses. Most central banks are grappling with inflation that is below target".

"As a result, we think most EM central banks will swing dovish in 2015".





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Jan 14,2015
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[OctaFX_Farid]

GBP/USD gathering pace - FXStreet


FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet noted how the GBP/USD has gathered momentum.

Key Quotes:

"There was no news in the UK to affect the pair, driven at the time being by self dollar weakness".

"The technical picture in the short term supports further advances particularly if price breaks 1.5275 resistance, as indicators head strongly higher above their midlines moving away from a mild bullish 20 SMA".

"In the 4 hours chart the upward potential seems even stronger, supporting the shorter term view"..





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Jan 14,2015
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[OctaFX_Farid]

EUR/USD recovery falters at 1.1845


FXStreet (Córdoba) - EUR/USD recovery from fresh 9-year lows was capped by the 1.1845 zone during the American session, confining the pair to a phase of consolidation over the last hours.

EUR/USD fell below 1.1747 level at which the euro first traded on Jan 4, 1999 and hit a fresh 9-year low of 1.1726 before finding support. Disappointing US retail sales hurt the dollar and helped EUR/USD to regain the 1.18 mark but momentum was lacking. At time of writing, the pair is trading at 1.1805, 0.29% above its opening price.

EUR/USD levels to watch

As for technical levels, immediate resistances could be found at 1.1845 (Jan 14 high) and the 1.1870/80 zone (Jan 12 high/10-day SMA) ahead of 1.1900 (psychological level). On the other hand, supports are seen at 1.1726 (9-year low Jan 14) and 1.1700 (psychological level).





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Jan 14,2015
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[OctaFX_Farid]

EUR/JPY back off the lows of the 137 handle


FXStreet (Guatemala) - EUR/JPY is currently trading at 137.82 with a high of 138.94 and a low of 137.01 and down 0.63% on the day.

EUR/JPY has been falling on a number of counts and makes new territory on the lower end of the 137 handle with 137.20 coming in as a fragile support. The ECB is around the corner and officials are sounding more and more dovish in respect of timings action required in the economy for looser policy while the Yen is carrying the risk off benefits and has recently surged higher vs the greenback on disappointments from the US calendar as well. Karen Jones, chief analyst at Commerzbank explained the Elliott wave count on the intraday chart is suggesting we allow for a retracement into the 141.45/142.56 band prior to another leg lower.





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Jan 14,2015
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[OctaFX_Farid]

EMU: production rises unexpectedly in November - KBC


FXStreet (Guatemala) - Analysts at KBC noted that Euro zone industrial production rose unexpectedly in November.

Key Quotes:

"Showing its third consecutive monthly gain".

"Production increased by 0.2% M/M, while a flat outcome was expected. Also the previous month’s figure was upwardly revised, from 0.1% M/M to 0.3% M/M".

"The breakdown shows that strength was based in durable consumer goods (1.9% M/M) and to a lesser extent also in intermediate goods (0.3% M/M) and non‐durable consumer goods (0.5% M/M)".

"Energy production fell by 0.9% M/M and output of capital goods dropped slightly, by 0.2% M/M. National data are however very mixed. Production rebounded sharply in Ireland (4.6% M/M) and rose slightly in Italy (0.3% M/M), the Netherlands (0.5% M/M) and Luxembourg (0.3% M/M). In Germany, production was stable, but output dropped in Greece, Spain and France".

"Compared with the same period last year, euro zone production is down by 0.4%, confirming that activity remained poor in the euro area. While the data are a positive for fourth quarter growth, it is needless to say that activity in the euro area remains sluggish due to poor external demand and the slow recovery in the euro area"





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Jan 14,2015
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[OctaFX_Farid]

USD/JPY remains below 117.00 after US data





FXStreet (Córdoba) - USD/JPY edged a few pips higher but remained capped by the 117.00 level, following the latest string of mixed US data.

US initial jobless claims rose by 19,000 to a 4-month high of 316,000 in the week ending Jan 9, above the 295,000 expected and marking its first reading above 300,000 since Thanksgiving. On the other hand, producer price index rose by 1.0% in December beating the 1.0% expected and NY Empire State manufacturing index climbed to 9.95 vs 5.00 of consensus, outweighed the negative employment reading.

USD/JPY climbed to an hourly high of 116.93 but lacked momentum to regain the 117 mark. At time of writing, the pair is trading at 116.85, still 0.38% below its opening price.






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Jan 15,2015
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[OctaFX_Farid]

EUR/USD fall in reaction to QE might be short-lived – Growth Aces





FXStreet (Barcelona) - The Growth Aces Team expects the medium-term EUR/USD outlook to be bullish, and further add that the fall in the pair in anticipation of QE might be short lived.

Key Quotes

“The EUR/USD traders are waiting now for U.S. CPI data tomorrow. Lower-than-expected reading will probably strengthen the EUR/USD and this could be a good opportunity to get short ahead on the EUR/USD.”

“Our baseline scenario assumed that a fall of the EUR/USD in reaction to the QE programme will be short-lived and profit-taking could lift the rate soon. We expected the medium-term outlook for the EUR/USD is slightly bullish due to possible delaying rate hikes by the Fed. However, this scenario is under threat after today’s decision of the SNB. There is a risk that a strong crisis in Europe that may be the consequence of the SNB decision may make investors turn into safe-haven assets. This means that the EUR may depreciate further against the USD."






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Jan 15,2015
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[OctaFX_Farid]

US equities to see early buying





FXStreet (Mumbai) - The stock markets in the US are likely to open higher on mixed bag of US data. The action in the major index futures indicates early buying is likely to be seen on Wall Street.

At the time of writing, the DJIA futures traded 0.26% higher at 17,409.50, while the S&P 500 futures traded 0.21% higher at 2011.00. Meanwhile, the NASDAQ futures and the Russell 2000 futures are trading 0.14% and 0.24% higher at 4151.10 and 1176.80 levels respectively. Consequently, the S&P 500 VIX futures are trading 0.49% lower at 20.53 levels.

On the data front, the labor department data showed producer prices fell by slightly less than expected in the month of December. Meanwhile, initial jobless claims climbed to 316,000 in the week ended January 10th, an increase of 19,000 from the previous week's revised level of to 297,000. Elsewhere, New York Federal Reserve released a report showing a rebound in regional manufacturing activity in the month of January.

In overseas trading, the European markets witnessed a high volatility after the Swiss National Bank surprised markets by abandoning the EUR/CHF floor at 1.2, while it reduced interest rates to -0.75%. Earlier today, most stock markets across the Asia-Pacific moved back to the upside.






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Jan 15,2015
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[OctaFX_Farid]

GBP/USD wavers around 1.5200





FXStreet (Córdoba) - GBP/USD has had a quiet day considering the turbulence in FX markets triggered by Swiss National Bank decision to abandon the franc cap.

Cable fell to a low of 1.5156 as immediate reaction, but it managed to erase intraday losses and climbed to fresh daily highs at the 1.5265 area. GBP/USD has steadied a few pips above 1.5200, where it trades little changed on the day, despite GBP/CHF strong slump toward the 1.2740 zone, level last seen in 2011.

GBP/USD technical outlook

“The 1 hour chart shows price below its 20 SMA as indicators head lower around their midlines, while in the 4 hours chart the price holds above a bullish 20 SMA whilst indicators continue to aim higher after bouncing from their midlines, keeping the downside limited for now”, said Valeria Bednarik, chief analyst at FXStreet.

Bednarik locates immediate resistance levels at 1.5220, 1.5275 and 1.5320, while she sees supports at 1.5180, 1.5145 and 1.5100.






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Jan 15,2015
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[OctaFX_Farid]

Gold at day's high after dismal US data




FXStreet (Mumbai) - Gold prices rose to a day high of USD 1264.30/Oz levels before settling slightly lower, after the regional manufacturing index in the US showed sharp decline in the activity.

The yellow metal hovers at USD 1261.51/Oz levels; up 2.11% for the day. The Philadelphia Federal Reserve manufacturing activity index declined to 6.3, missing the expected print of 18.7, and down from December’s 24.3. Earlier today, the labor department data also showed initial jobless claims rose sharply to 316K for the week ended Jan. 10, beating the estimate of 290K. Moreover, with the exception of New York Fed’s general business conditions index, all other data releases have been dismal, which supports gains in the yellow metal.

Gold may extend gains if the US stock markets extend slump later in the day.

Gold Technical Levels

The immediate resistance is seen at 1272.40, above which gains could be extended to 1282.90 levels. Meanwhile, support is seen at 1255.10 and 1244.40 levels.






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Jan 15,2015
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[OctaFX_Farid]

Silver restricted around Dec 2014 highs




FXStreet (Mumbai) - Silver advanced today, tracking the gains in Gold prices, although the metal once again finds itself stuck around the December 2014 high of USD 17.33.

Silver currently trades 0.77% higher for the day at USD 17.11/Oz levels, compared to the previous session’s close at USD 16.84/Oz levels. The metal has seen failure near Dec 2014 highs for the third consecutive session today. On the other hand, Gold prices have been able to rise above the 200-DMA levels today; trading 2% higher for the day. Moreover, Silver being a semi-industrial metal, has been unable to extend gains due to the weakness seen in other industrial metals.

Silver Technical Levels

The immediate resistance is seen at 17.21, above which the prices could test 17.33 (Dec. 10 high). Meanwhile, support is seen at 16.81 (5-DMA) and 16.5460 (100-DMA) levels.







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Jan 15,2015
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[OctaFX_Farid]

Natural Gas declines after inventory data




FXStreet (Mumbai) - Natural gas prices in the US trade declined from the session highs after the data in the US showed a larger than expected drawdown in the inventories during the last week.

The February futures traded 1.76% higher at USD 3.29/mmBtu, compared to the previous session’s close at USD 3.233/mmBtu. Gas prices eased from the session high of USD 3.35 hit ahead of the data , in anticipation of a drop in the inventories. Thus, we are witnessing a classic “buy the rumor, sell the fact” trade as prices inched lower after the data confirmed a larger drop in the inventories. The EIA data showed inventories dropped 236 billion cubic feet (Bcf), beating the estimated drop of 224 Bcf, and higher than the previous week’s drop of 113 Bcf.

Natural Gas Technical Levels

The immediate resistance is seen at 3.349, above which gains could be extended to 3.4 levels. Meanwhile, support is seen at 3.236, under which Natural gas could fall sharply to 2.97 levels.








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Jan 15,2015
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[OctaFX_Farid]

Swiss deflationary risks have increased- Rabobank




FXStreet (Guatemala) - Jane Foley, Senior Currency Strategist at Rabobank explained that the press release that accompanied today’s move from the SNB makes the point that the euro has depreciated considerably against the US dollar and this, in turn, has caused the Swiss franc to weaken against the US dollar.

Key Quotes:

"In these circumstances, the SNB concluded that enforcing and maintaining the minimum exchange rate for the Swiss franc against the euro is no longer justified."

"While there is sense in the central bank maintaining an optimistic spin to provide some support to inflation expectations, it is difficult to accept that the SNB wasn’t forced into today’s decision."

"Switzerland’s effective exchange rate has continued to push higher since the middle of last year in reflection of the downward pressure on EUR/CHF."

"Even assuming that the SNB may have to intervene some more to help EUR/CHF stabilise, the deflationary risks facing Switzerland appear to have increased."

"In an environment in which low interest rates are no longer proving an effective tool to counter deflation, the failure of the SNB’s floor should be lamented by policy-makers who appear to be increasing running out of policy tools."






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Jan 15,2015
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[OctaFX_Farid]

EUR/USD drops to 1.1540




FXStreet (Edinburgh) - EUR/USD accelerated its downside following further US data releases on Friday, meandering around multi-year lows near 1.1540.

EUR/USD looking for direction

The pair quickly left behind the post-SNB lows in the 1.1570 region, unable to pick up pace despite both the Industrial Production and Capacity Utilization in the US economy came in below consensus. Industrial Production contracted 0.1% inter-month in December while the Capacity Utilization decreased to 79.7% during the same period, vs. 80% expected and previous. The Reuters/Michigan index is due next, with surveys expecting an improvement to 94.1 for the present month, up from 93.6.

EUR/USD key levels

At the moment the pair is losing 0.64% at 1.1544 and a breach of 1.1505 (low Nov.12 2003) would expose 1.1445 (low Nov.11 2003). On the flip side, the initial barrier lines up at 1.1647 (hourly high Jan.16) followed by 1.1792 (high Jan.15) and finally 1.1805 (200-h MA).







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Jan 16,2015
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[OctaFX_Farid]

Reuters/Michigan consumer sentiment index jumps to 98.2




FXStreet (Córdoba) - Reuters/Michigan consumer sentiment index rose to 98.2 in January, according to preliminary estimates, recording its highest level in more than 10 years.

The index rose 4.6 from a final December reading of 93.6, also beating market’s consensus of 94.1.





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Jan 16,2015
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[OctaFX_Farid]

GBP/USD heading for weekly lows?




FXStreet (Guatemala) - GBP/USD is currently trading at 1.5113 with a high of 1.5237 and a low of 1.5112 and down 0.39% on the day.

GBP/USD is weak, or rather, the greenback is strong. The pair has been making fresh lows this month and penetrating the 1.51 handle for the low of 1.5034 made on the 8th and attempts to the upside have been capped at 1.52671.

The recent turmoil in markets post the SNB has seen the dollar start to benefit as analyst begin to predict that the outcome of the events are likely dollar favourable while positive data underpins a bullish bias in the currency. Earlier today, CPI was released at 0.8% vs 0.7% consensus and the recent release of the Michigan Consumer Sentiment beat expectations at 98.2 vs 94.1 expected.





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Jan 16,2015
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[OctaFX_Farid]

US divergent growth factors - BNP




FXStreet (Guatemala) - Alexandra Estiot, analyst at BNP Paribas explained factors around the US growth outlook.

Key Quotes:

"Plunging oil prices and a surging dollar are holding down inflationary pressures".

"In the past, these trends have had divergent effects on growth: positive for falling oil prices and negative for a stronger dollar".

"The United States has become the leading fossil fuel producing country. Consequently, it is no longer all that easy to evaluate the consequences of declining crude oil prices. Moreover, many of its trading partners will be
hard hit by falling commodity prices".

"All in all, these effects, though only temporary, will have a bigger impact on prices than on growth".





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Jan 16,2015
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