Market analysis and trade recommendations by FBS

[riki143]

MARKET NEWS

 

Sep. 23: MARKET VIDEO REVIEW

 

Dollar index holds below a 4-year peak set on Monday. Asian shares rose on Tuesday on good news from China. Euro steady above a 14-month low.

 

• AUD up to $0.8920: China’s HSBC Flash Manufacturing PMI at 50.5 vs. 50.2.
  
• AUD: Moody’s: positive about Australian financial and economic strength
  
• EUR at $1.2850 ahead of PMIs
  
• USD: Federal Reserve Bank of New York President William Dudley said that a sharply stronger dollar could hamper Federal Reserve efforts to spur growth and lift inflation.
  
• USD: FOMC member Kocherlakota is also dovish, wants higher inflation.
  
• USD: bombing attacks against Islamic State targets in Syria
  

 

http://www.youtube.com/watch?v=C7a2zx2OhOE

 

More:

http://www.fxbazooka.com/en/news/show/1759

[riki143]

MARKET NEWS

 

Sep. 23: key option levels

 

FXBAZOOKA.com - Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

 

Here are the key options expiring today:

 

EUR/USD: $1.2860, $1.2870, $1.2900 (large), $1.2950 (large), $1.2950 (large), $1.2980, $1.3000 (large);

 

GBP/USD: $1.6220 (large), $1.6350, $1.6400 (large), $1.6425;

 

USD/JPY: 107.10, 107.20, 108.00, 108.30, 108.50;

 

USD/CHF: 0.9250, 0.9330/35 (large), 0.9370, 0.9450;

 

AUD/USD: $0.8800 (large), $0.8900 (large);

 

USD/CAD: 1.0850 (large), 1.0900 (large), 1.0940/50, 1.1000 (large);

 

NZD/USD: $0.8200 (large), $0.8320 (large).

 

More:

http://www.fxbazooka.com/en/news/show/1760

[riki143]

Forex Analytics

 

Trading plan for Sep. 24

 

By E.Belugina and K.Iukhtenko

 

https://www.youtube.com/watch?v=iADTMk1_O2g

 

EUR/USD corrected up to $1.2900. Tomorrow watch German Ifo business climate data at 08:00 GMT. So far data from Germany have been discouraging, and we have little reason to expect a bullish release this time. If the reading is significantly lower, euro will fall to $1.2810. The next resistance is at $1.2930 and if this level is broken in case of the positive news, euro will probably rise to $1.3000 – a place to enter short positions.

 

GBP/USD rose to the upper border of the Tuesday’s $1.6300/6400 range in the early US trade. Daily close above this mark would provoke further growth with a target of $1.6520/30. This is the 55-week moving average that capped the post-referendum rally. Support is seen in the $1.6300/6275 area.

 

USD/JPY bounced from the 108.20 support. This is the lower boundary of the September ascending channel. We review the current dips as a good buying opportunity with a target of 110 yen and a stop at 107.60.

 

AUD/USD spiked up on Tuesday: initially Aussie rose to $0.8930 on good data from China, but then reversed down on concerns about Australian economy and geopolitical tensions. The pair recoiled down from resistance line and may test $0.8835 on the downside. Resistance is at $0.8930 and $0.8985. The pair may be moved by the RBA Financial Stability Review (01:30 GMT).

 

More:

http://www.fxbazooka.com/en/analitycs/show/2426

[riki143]

MARKET NEWS

 

Sep. 24: MARKET VIDEOREVIEW

 

• EUR/USD is at $1.2850 ahead of German Ifo business climate (08:00 GMT).
  
• USD: New Home Sales (14:00 GMT).
  
• Japanese PM Abe: watching impact of weak JPY on regional economies; considering a supplementary budget for 2014
  
• USD/JPY down to 108.50
  
• GBP/USD hovers above $1.6400
  
• AUD: CB leading index of Australia advanced 0.5% in July vs. 0.2% in the previous month.
  
• AUD: in its Financial Stability Review the RBA cautioned that the soaring housing prices could pose risks to the economy.
  
• Fonterra cut cuts forecast payout to farmers for current season due to global uncertainty
  
• NZ August trade deficit less than expected (472M vs. 1125M exp.)
  
• NZD/USD found support at $0.8030
  

 

https://www.youtube.com/watch?v=zw-06_sYQJM

 

More:

http://www.fxbazooka.com/en/news/show/1765

[riki143]

MARKET NEWS

 

Sep. 24: key option levels

 

FXBAZOOKA.com - Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

 

Here are the key options expiring today:

 

EUR/USD: 1.2900 1.1915 1.2950 1.3120 1.3225 1.3250 (large);

 

GBP/USD: 1.6250 1.6300 1.6400;

 

USD/JPY: 107.00 (large), 107.45;

 

USD/CHF: 0.9150 0.9335;

 

AUD/USD: 0.8900 0.9000 0.9010 0.9020 0.9100;

 

USD/CAD: 1.0955 1.1000 1.1050.

 

More:

http://www.fxbazooka.com/en/news/show/1766

[riki143]

Forex Analytics

 

Trading plan for Sep. 25

 

By Elizaveta Belugina & Kira Iukhtenko

 

EUR/USD hit our target at $1.2790 (61.8% Fibo of the 2012-2014 advance). Euro was hit by weaker German Ifo index and the data leaked by French TV that the number of people looking for work fell by 11.1K in August, while analysts expected an increase by 16.5K. A close at/below this level will be a bearish sign. From the technical point the attention should be now at $1.2750. Resistance is at $1.2830, $1.2860 and $1.2900. Tomorrow watch US durable goods data at 12:30 GMT.

 

Bullish impulse was not strong enough: GBP/USD retraced down from the $1.6400 resistance. The pair broke the support of a short-term triangle (H1) to the downside. Cable met some buying interest around the $1.6350 mark. Break lower will open the way to the $1.63000/6275 area. Great Britain will release CBI realized sales at 12:00 GMT on Thursday. The BOE Governor Mark Carney will deliver a speech later in the day, at 14:20 GMT.

 

USD/JPY dips were bought around 108.40. On the daily chart the price is forming to long-shadowed candles that signal a forthcoming bullish reversal. The pair gains ground in the early US trade, testing this week’s resistance to the upside. Next bullish targets lie at 109.00 and 109.45.

 

AUD/USD once again recoiled down from resistance. Despite the fact that Aussie is oversold on the daily chart, traders keep selling Aussie on rallies. Tomorrow during the Asian session the pair will be moved by the speech of the RBA Governor Glenn Stevens (02:30 GMT) – the outcome of this event is difficult to predict, but the base scenario is AUD-negative. On the downside we target $0.8810. On the upside strong resistance is at $0.8930.

 

http://www.youtube.com/watch?v=KnCCEGydQnQ

 

More:

http://www.fxbazooka.com/en/analitycs/show/2439

[riki143]

MARKET NEWS

 

Sep. 25: MARKET VIDEOREVIEW

 

 

http://www.youtube.com/watch?v=0oXb69V01GA

 

USD: high on the expectations that the Fed will raise interest rate next year as the US data improves.

 

NZDfell below $0.80: RBNZ Governor Graeme Wheeler called the NZD level unjustified, invoking one of the central bank’s criteria for intervention.

 

AUD: the RBA Governor Stevens said that the RBA is open to using macro prudential tools (this will decrease the pressure on the central bank to raise rates in order to limit house price growth).

 

EUR at new lows: Draghi repeated that the ECB would keep its monetary policy loose for an extended period.

 

More:

http://www.fxbazooka.com/en/news/show/1769

[riki143]

MARKET NEWS

 

Sep. 25: key option levels

 

FXBAZOOKA.com - Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

 

Here are the key options expiring today:

 

EUR/USD: $1.2800 (large), $1.2850 (large), $1.2860 (large);

 

GBP/USD: $1.6300 (large), $1.6395/1.6400 (large), $1.6450 (large), $1.6500;

USD/JPY: 108.80 (large), 109.25 (large), 109.50 (large);

 

USD/CAD: 1.1000 (large), 1.1060 (large), 1.1100, 1.1200 (large);

 

AUD/USD: $0.8850, $0.8960, $0.9140;

 

NZD/USD: $0.8100, $0.8155, $0.8200;

 

EUR/GBP: 0.7870, 0.7935, 0.7960, 0.7965.

 

More:

http://www.fxbazooka.com/en/news/show/1770

[riki143]

Forex Analytics

 

Trading plan for Sep. 26

 

https://www.youtube.com/watch?v=1-whF9KrgIg

 

According to the data released on Thursday, US durable goods orders sharply declined. However, the decline was in line with expectations and the core reading was positive, so the greenback wasn’t strongly affected by the news. On Friday America will release revised GDP and consumer sentiment data – forecasts are positive.

 

Still USD/JPY was capped around 109.35 and is trading directly at the support line of the uptrend channel (108.85) which looks vulnerable. The pair may correct down to 108.25.

 

EUR/USD breached 2013 lows at $1.2750. The level of $1.2500 looks like the reasonable level for this pair. GfK German Consumer Climate is due tomorrow at 06:00 GMT. On the downside support is now at $1.2660. A close in the $1.2750 area could give the euro a lift to resistance at $1.2830.

 

GBP/USD recovered from the lows in the $1.6280 area above $1.6300 as the Bank of England’s Governor Mark Carney sounded rather favorable about the first rate hike in the UK which is expected in Q1, 2015. Still we are bearish as long as the pair stays below $1.6370. Next resistance is at $1.6460. Below $1.6280 we’ll target $1.6165.

 

EUR/GBP survived a selloff and is testing support line from 2008 in the 0.7790 area. The next support is at 0.7750.

 

More:

http://www.fxbazooka.com/en/analitycs/show/2452

[riki143]

MARKET NEWS

 

Sep. 26: MARKET OVERVIEW

 

USD/JPY pared earlier losses and rose back to 109.00 on Friday after Japan’s welfare minister said reforms for the country’s giant pension fund would continue as planned, bolstering speculation it’s moving closer to boosting overseas asset purchases (JPY-negative). Japanese inflation figures came out lower (JPY-negative).

 

NZD/USD continued declining and hit a new one-year low in the $0.7890 area as the market is still under the impact of the RBNZ comments that kiwi dollar is at unsustainable and at unjustified levels. The pair breached key support levels and the downtrend channel and may be subject to more declines.

 

AUD/USD slid to $0.8750. Aussie’s under pressure as the RBA is expected to fight the housing price bubble without raising interest rates. Resistance is at $0.8830, support is at $0.8660.

 

EUR/USD is little changed at $1.2745. The market is waiting for the release of German Gfk consumer confidence and import prices at 06:00 GMT. Revised US GDP data is expected at 12:30 GMT.

 

More:

http://www.fxbazooka.com/en/news/show/1772

[riki143]

MARKET NEWS

 

Sep. 29: FOREX NEWS

 

USD: Strong on better GDP data (4.6% annualized growth in Q2).

 

CFTC: Speculators increased USD bets.

 

NZD: RBNZ confirmed an intervention admitting it sold 521 million NZD in August. There's the risk of more interventions in future.

 

NZD: Prime Minister John Key said that 65 cents is a ‘just right’ level for kiwi.

 

EUR: Under pressure ahead the German CPI release later today (time is not specified) and the ECB’s meeting on Thursday.

 

China: Lower industrial profits.

 

More:

http://www.fxbazooka.com/en/news/show/1773

[riki143]

MARKET NEWS

 

Sep. 29: key option levels

 

FXBAZOOKA.com - Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

 

Here are the key options expiring today:

 

EUR/USD: $1.2750 (large), $1.2800, $1.2950 (large);

 

GBP/USD: $1.6250, $1.6300, $1.6325, $1.6450;

 

USD/JPY: 108.30, 109.00 (large), 109.25/30, 110.00 (large);

 

AUD/USD: $0.9000 (large);

 

USD/CAD: 1.1075 (large), 1.1105 (large), 1.1125, 1.1200 (large).

 

More:

http://www.fxbazooka.com/en/news/show/1774

[riki143]

Forex Analytics

 

Trading plan for Sep. 30

 

https://www.youtube.com/watch?v=FFxLJxu7ys8

 

EUR/USD tested levels above $1.2700 after it renewed low in the $1.2660 area. There was a minor recovery as, despite forecasts, German consumer prices didn’t contract, but came unchanged compared with the previous month. There’s scope for a bit more correction up as big traders may take some profits on USD. Resistance is at $1.2740, $1.2790 and $1.2830. Note though that the euro area’s flash inflation data is due at 09:00 GMT. This may turn out to be EUR-negative as it will remind traders of the looming ECB meeting on Thursday. Support is at $1.2640 and $1.2600.

 

GBP/USD was consolidative in the $1.6250/15 area. The pair breached support line last week, and we’ll view recoveries to $1.6280 as selling opportunities with the first target at $1.6160. There will be a bunch of important data released in the UK tomorrow at 08:30 GMT.

 

USD/JPY reached new high at 109.74, but didn’t hold there. Support is at 108.60. Tonight Japan will release industrial production and retail sales data. Further support is at 107.40. Later the pair is still expected to renew maximums at 110.00, 110.30 and 110.60.

 

The selloff in NZD/USD inspired by the Reserve Bank of New Zealand continued. The oversold pair is trying to get higher. There’s resistance at $0.7800 and $0.7970 (bottom of the previous channel). The pair will have some support at $0.7680/7700, but the market will expect more interventions from the RBNZ and remain bearish. Watch ANZ Business Confidence (00:00 GMT) and HSBC Final Manufacturing PMI (01:45 GMT). For AUD/USD resistance is at $0.8780 and $0.8830.

 

More:

http://www.fxbazooka.com/en/analitycs/show/2476

[riki143]

MARKET NEWS

 

Sep. 30: MARKET VIDEO REVIEW

 

• Risk sentiment: Most Asian markets softer amid uncertainty over Hong Kong. HSBC Final Manufacturing PMI for September revised down from the flash reading of 50.5 to 50.2.
  
• USD: pared its best quarterly gain since 2008 as technical indicators signaled the rally has been too fast.
  
• AUD: rose to $0.8767 as Australian investor lending now at the highest since March 2008.
  
• NZD: ANZ business confidence 13.4 vs. 24.4 expected.
  
• EUR: above lows, but below $1.2700, waiting for inflation data at 09:00 GMT.
  
• JPY: contradictive data, industrial production & household spending disappoints.
  
• USD/JPY down from recent highs around 109.50
  
• Japan PM Amari: economy tries to recovery from slump.
  

 

http://www.youtube.com/watch?v=EPy6mr3-wQg

 

More:

http://www.fxbazooka.com/en/news/show/1775

[riki143]

Forex Analytics

 

Trading plan for Oct. 1

 

EUR/USD fell to $1.2570 as the euro zone’s core inflation surprised to the downside. There are no signs that euro’s planning to stop its freefall, while US dollar enjoys broad strength. Support is at $1.2587, $1.2550 and $1.2500. Resistance is at $1.2660, $1.2715 and $1.2750. On Wednesday the pair will be focused on the data due in the US – ADP Non-Farm Employment Change (12:15 GMT) and ISM Manufacturing PMI (14:00 GMT). The approaching ECB’s meeting will keep pressuring euro.

 

GBP/USD recovered back above $1.6200 after hitting Sep.16 low of $1.6160 on Tuesday. Break below the $1.6275 area was a strong bearish signal that confirmed a local peak at $1.6520. Fix below $1.6160 will open the way to $1.6060 (Sep.10 low). Don’t miss the UK manufacturing PMI on Wednesday at 8:30 GMT. The index is expected to have grown from 52.5 to 52.6 in August, but is still remains far below the yearly highs.

 

USD/JPY hit a new 6-year high of 109.85. Global demand remains elevated, so we expect our initial target of 110.60 to be hit on the current week. Short-term support lies at 109.10. Japan will release Q3 Tankan indices tonight – forecasts are downbeat, so USD/JPY could get more growth fuel.

 

AUD/USD recoiled down from the downtrend channel resistance in the $0.8770 area, but was getting support on the downside. The key support is at $0.8700. Watch whether Australian retail sales data and Chinese official PMI will surprise the market. Risk sentiment isn’t positive and we don’t recommend longs until the current downtrend is breached.

 

https://www.youtube.com/watch?v=regpk1lvJ8M

 

More:

http://fxbazooka.com/en/analitycs/show/2491

[riki143]

MARKET NEWS

 

Oct. 1: MARKET VIDEOREVIEW

 

Risk sentiment: Asian stocks fell because of continued civil unrest in Hong Kong. Chinese markets are closed for National Day. Chinese manufacturing data offered investors some relief with the official Purchasing Managers' Index was unchanged at 51.1 in Sep.

 

AUD/USD fell to 8-month low: retail sales grew less than expected (+0.1% vs. the forecast of +0.4%).

 

NZD/USD: under pressure, upside capped at $0.7820

 

EUR: on the downside, just above $1.2600 ahead of the ECB’s tomorrow meeting and amid concern inflation will keep slowing.

 

GBP/USD: bearish at $1.6180. Watch the UK Manufacturing PMI at 8:30 GMT.

 

JPY: Tankan Large Manufacturing Index is at maximum since Q1, Tankan Services Index is down for 2 consecutive quarters, lowest since Sep. 2013.

 

USD/JPY rose to 110 yen: dollar strengthened ahead of the ADP employment report (12:15 GMT).

 

https://www.youtube.com/watch?v=bYVYRkGIlq4

 

More:

http://www.fxbazooka.com/en/news/show/1780

[riki143]

MARKET NEWS

 

Oct. 1: key currency options

 

FXBAZOOKA.com - Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

 

Here are the key options expiring today:

 

EUR/USD: $1.2600 (large), $1.2650 (large), $1.2700 (large), $1.2750 (large), $1.2775 (large), $1.2800 (large);

 

GBP/USD: $1.6200, $1.6225;

 

USD/JPY: 109.00, 109.60 (large), 110.00 (large);

 

USD/CHF: 0.9450;

 

AUD/USD: $0.8850;

 

USD/CAD: 1.1100, 1.1145/60, 1.1200;

 

EUR/GBP: 0.7775 (large), 0.7850 (large), 0.7900 (large).

 

More:

http://www.fxbazooka.com/en/news/show/1781

[riki143]

MARKET NEWS

1 October 2014

 

GBP: Manufacturing PMI disappoints

 

UK manufacturing PMI came at a 17-month low of 51.6 in August versus 52.6 forecasted. July reading was revised down to 52.2. Pace of UK growth is clearly slowing down in the second half of the year.

 

GBP/USD dipped to $1.6160 support on the news, but met buying interest and recovered into the $1.6180 area.

 

More:

http://www.fxbazooka.com/en/news/show/1782

[riki143]

MARKET NEWS

1 October 2014

 

EUR: Barclays lowered growth outlook

 

- Most euro area member states disappointed in Q2 with declines in Germany and Italy and stagnation in France. Although Germany is expected to return to moderate growth in the second half of the year, the situation remains worrying in Italy and France, where PMI indices dropped below 50 in August, and even further in France in September according to the flash estimate.

 

- The Russia-Ukraine conflict is likely to keep affecting the European economy.

 

- Barclays revised down euro area growth forecasts to 0.7% for 2014 and 1.1% for 2015, down by 0.4pp and 0.5pp than June projections.

 

More:

http://www.fxbazooka.com/en/news/show/1783

[riki143]

Forex Analytics

 

Trading plan for Oct. 2

 

EUR/USD was consolidating around $1.2600 forming lower highs and higher lows on the hourly chart. Euro’s under pressure before the ECB’s tomorrow meeting. The markets are nervous as the situation remains uncertain: the ECB has already done much, but so far it has failed to encourage inflation. One thing which is clear is that the ECB is interested in lower euro. Mario Draghi is expected to unveil the details of the ABS purchase program, and traders will be focusing on its size. The possible sum of 500B euro sum was rumored. If the market thinks that what the ECB will announce won’t be enough, euro will fall on the expectations of additional stimulus. On the other hand, the bigger the sum, the bigger is the risk of a relief rally. Technical outlook remains bearish with resistance at $1.2660, $1.2715 and $1.2760. Target $1.2500 and $1.2460 on the downside.

 

GBP/USD remains supported at $1.6160 in the early US trade. The cable is forming a long-legged candle for a second day in a row – this could be a bullish reversal signal if confirmed. We need to see a daily close above $1.6200 to buy with a target of $1.6270. On the other hand, fix below $1.6160 would open the way to $1.6060. Watch the UK construction PMI on Thursday – the index is projected to slip from 64.0 to 63.7. However, this is still an elevated level, confirming economic strength.

 

US Treasury yields keep on falling, giving some hope to the USD/JPY bears. The pair retraced from the daily high at 110.08 into the 109.50 area on Wednesday despite the increase of ADP nonfarm payrolls. Break below the 109.10 support could bring the pair down to 108.40. However, demand for the JPY will likely remain limited ahead of the US labor data on Friday, so we maintain a buy-on-dips strategy.

 

The dips of AUD/USD are being bought. A rise above $0.8770 will trigger an increase to $0.8830 (a place to sell). Inability to rise above $0.8770 will lead to another decline. Support is at $0.8680. Watch Australian building approvals and trade balance data. Consensus forecasts aren’t very good.

 

More:

http://www.fxbazooka.com/en/analitycs/show/2504

[riki143]

MARKET NEWS

 

Oct. 2: MARKET REVIEW

 

USD: down on the speculation its recent gains have been too fast, and after weaker data from America released yesterday.

 

AUD/USD: up to $0.8815 as Australian building approvals rose by 3.0% vs. 1.1% expected.

 

AUD, NZD: property restrictions in China have been eased (positive factor).

 

GBP/USD: up to $1.6250 ahead of the UK construction data (08:30 GMT).

 

EUR/USD: up to $1.2670. The market’s waiting for the ECB meeting and press conference (11:45 and 12:30 GMT).

 

JPY: strengthened as a safe haven on the concerns about global growth and Ebola health scare in the United States.

 

More:

http://www.fxbazooka.com/en/news/show/1784

[riki143]

MARKET NEWS

2 October 2014

 

What to expect from the ECB?

 

The European Central Bank will announce its latest decision on rates and monetary policy at 11:45 GMT, with the ECB president Mario Draghi taking press questions 45 minutes later.

 

Further rate cuts are very unlikely: the main refinancing rate is expected to stay at 0.05%, while the deposit rate - at -0.2%.

 

Market attention will be focused on the details of the asset-backed securities and covered bonds purchases programs that will likely start this month. The most important questions for the markets are how much and what exactly the ECB is going to buy.

 

According to the most recent Reuters forecast, the ECB will spend around 200 billion euros for asset purchases till the end of the year. Some experts don’t expect the overall volume to overcome 100 billion euros. The insufficient amount of stimulus won’t be enough to change the inflationary expectations and trigger the economic recovery. As a result, we could see EUR/USD falling further on increased economic uncertainty. Large amount of asset purchases could add to market optimism and support the pair - at least in a short term.

 

As we understood from the TLTRO (targeted long-term refinancing operations), announced in earlier September, the amount matters. The ECB offered banks to take cheap loans, but the demand was much lower than expected (only 82.6 billion euros). The markets became worried as the ECB ability to support the economy came under question. This time the ECB will likely sound more decisive and dovish to convince the markets. However, the unknown ECB officials said the initial amount of buying will be modest.

 

At the same time, the composition of the asset purchases is also important. Draghi is not really worried about the asset quality these days: he proposed buying some “junk” securities of Greece and Cyprus. The news could offer some support to the single currency.

 

The pressure on the ECB to launch full quantitative easing (QE) is mounting. However, the regulator doesn’t seem to be ready for such cardinal measures.

 

More:

http://www.fxbazooka.com/en/news/show/1785

[riki143]

Forex Analytics

 

Trading plan for Oct. 3

 

EUR/USD rose to $1.2690, but then returned down to $1.2650. The ECB kept rates unchanged. The most important piece of information from Mario Draghi’s press conference is that purchases of covered bonds will start in the middle of October, while ABS will be bought from Q4, 2014. The ECB gave no estimates of the size of the programs, but said that they will last 2 years. The market will be now digesting this information. The main question is: has the ECB done enough or it will have to do a full-blown QE in future? As the central bank has stressed that the medium-term inflation forecast has declined, expectations of more from the ECB may remain. Technically watch for support at $1.2600 – a slide below this level will confirm the continuation of the downtrend. Resistance is at $1.2700, $1.2715 and $1.2760. Today’s data from the US was mixed. Tomorrow watch the NFP and American unemployment rate at 12:30 GMT – traditional source of volatility.

 

GBP/USD extends the downside in the early US trade, approaching the $1.6100 support. Intraday rallies were capped at $1.6175. The cable kept on falling despite the outstandingly strong UK construction PMI release (8 month high of 64.2). Tomorrow will bring us probably the most awaited release – Service sector PMI at 8:30 GMT. The index is expected to have declined from 60.5 to 59.1. However, even is the figure comes out stronger, we doubt that the current bearish trend could be paused. Hold a short position with a target of $1.6070.

 

USD/JPY extends the decline from the 110 mark, hitting 108.30 in Europe. The pair found some support in this area, but we expect the short-term sales to continue. Break below 108.20 will open the way to 107.30 and 106.80. The picture remains bearish below 109.00 yen. On Friday all eyes will be glued to the US NFP release – strong figures will clearly push the pair higher.

 

More:

http://fxbazooka.com/en/analitycs/show/2512

[riki143]

Forex Analytics

3 October 2014

 

EUR/USD: 12th week of declines

 

EUR/USD fell for 12th week in a row.

 

The meeting of the European Central Bank wasn’t a big market mover. President Mario Draghi said only that the ECB will start purchasing covered bonds in the middle of October, while ABS will be bought from Q4. The ECB gave no estimates of the size of this private debt purchasing programs, but said that they will last at least 2 years.

 

On the one hand, many market players doubt that the ECB will manage to expand its balance sheet enough to weaken the currency. This provided support to EUR/USD. On the other hand, some traders are worried that if the measures, which have already been announced, don’t work, the ECB will have to do a full-blown QE in future. This is keeping euro under pressure. So, the situation remains uncertain.

 

The fundamentals in the euro area are still weak and weaker than in the US. Inflation in the region experienced further decline in September: the headline reading fell to 0.3%, while the core figure declined to 0.7%. Draghi confirmed that the medium-term inflation outlook worsened. The US, on the contrary, showed an improving labor market.

 

As a result, the outlook for the pair remains bearish. Note that EUR/USD approached $1.2500 (74.6% Fibo of the advance from 2012-2014). This level may provide some support ahead of $1.2460 and $1.2400. Resistance is at $1.2660 and $1.2750. We’ll close out medium-term short position at $1.2500 and will sell on recoveries. The main event in the euro area’s economic calendar next week is Mario Draghi’s speech on Thursday.

 

More:

http://fxbazooka.com/en/analitycs/show/2527

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MARKET NEWS

 

Oct. 6: MARKET REVIEW

 

USD index at 4-year high on solid U.S. payroll gains, Japanese stocks bounced

 

Bank holiday in Australia and China

 

EUR, GBP, AUD: consolidate around the Friday’s close

 

NZD/USD dipped to $0.7710, but recovered

 

USD/JPY dipped to 109.50

 

More:

http://www.fxbazooka.com/en/news/show/1797