Browsing all articles in Fundamental Analysis
May
29

USD/CAD D1 Technical May 29

USD/CAD mange to break 1.0390 level yesterday. Now pair will face its weekly resistance at 1.0445 level. W1 is showing group of sellers in this zone.  Bollinger bands are not providing clear signals due to overbought of USD/CAD.

So, it is important to watch price action on 1.0445 level. If pair get pull back from this level and H4 or D1 candle closure below 1.0390 level then it will clearly indicate bearish strength and USD/CAD will then start moving southward and first target will be 1.0300-0280 level respectively.

This scenario will be vanished. If pair manage to overcome its resistance and H4 or D1 candle chart closure above 1.0445 level. It will then indicate USD/CAD still have bullish strength which will take pair further upward.

High impact News of CAD can affect the trend of USD/CAD. News like BOC Rate Statement, Overnight Rate.

May
8

AUD/USD D1 Technical May 08

Aussies manage to hold its support level 1.0145 level yesterday. Now pair is expected to move towards northward, if 1.0145 level is not broken. Bollinger bands are not providing clear signals due to oversold of AUD/USD.

Price action on 1.0145 level should be watch. If pair manage to hold this level then Aussies will start moving towards north. On the contrary, break through support level and H4 closure below 1.0145 level will indicate pair is under pressure and Aussies will then continue its bearish trend which starts from 1.0580 level.

High impact News can affect the trend of AUD/USD. News like Employment Change, Unemployment Rate.

Nov
7

U.S Election affects on ECB & BoE

Essential U.S and global policy areas have been deadlocked ahead of the US Presidential and Congressional elections. Following Tuesday’s vote the political impasse will be announced and an upward movement is expected in markets, instability as risk premiums move to show a more sobering reality. The most probable results are a bit defensive and strengthen dollar, particularly as the Euro-zone again intimidates to implode over Greece. Market satisfaction over narrow forex ranges is also likely to be whacked, especially with concerns that liquidity levels have been critically compromised.

Recent ECB meeting, on Thursday, is doubtful to verify euro positive and the market is expected to refocus on Europe, after being sidelined by the US over the past quite a few weeks. During the current trading session services PMIs were all in contractionary area, with the Euro zone’s at 46; German and French PMIs were notably weak (48.4 and, respectively). Weak factory orders for Germany wii be announced today, a conspicuously unstable series; however it is difficult to disregard the weakness of  -3.3% m/m.

While markets will now look to Thursday’s BoE for domestically driven movement, expect the GBP to trade on broader market sentiment given the near term, two-way risk arising from US politics.   The outlook for BoE policy remains supportive of the GBP, however the recent disappointment in PMIs and now IP may add to a renewed desire for measures to ease the burden of ongoing structural adjustment.

Oct
29

AUD/USD D1 Technical October 29

AUD/USD is trapped in 1.0290 support and 1.0407  resistance. For today it has medium term bearish strength. So, 1.0290 level should be carefully watched. A break through 1.0290 will take Aussies further downside to target 1.0230 level.

Oct
11

EUR/USD: Fundamental Analysis OCTOBER 11

 

The USD erased its gains today straight from it’s the opening of the day and currently is trading near its high of the day just above 1.2930. The market was triggered by equity gains in the S&P 500. The S&P500 gained after consecutive losses of five days.

On the desks today were consumer prices and jobless claims reports from all over the globe. The GER Consumer Prices were on top of the lists as the CPI year over year, month over month, Harmonized Index of CP (YoY) and (MoM) all were released at par with the expectations. However the French Consumer Price Index (YoY) and (MoM) both showed contraction and were reported lower than the expectations disappointing the markets.

The market triggers of the day were the USD Jobless claims till Oct 6th which were reported at 339k from a previous of 369k whereas the markets had expected a 370k figure. Improvement was also seen USD continuing Jobless claims which decreased to 3.273 M from 3.288 M. in other reports the US export prices in the past month contracted to 0.8% from 0.9% but improved in the previous year from -0.9% to -0.5%. However increase was seen in the import prices in the past month which remained same to the previous fig of 1.1% where as the expectations was of 0.7%. in the past year the import prices improved from -2.2% to -0.6%.

The Euro is to strengthen on the strength of equities which are to gain as the US economy surprise investors with better than expected data.

 

Written By Maju

Oct
10

EUR/USD: Fundamental Analysis OCT 10

 

The S&P lost further ground for the fourth day as cooperate earnings remained the key concerns of the day. The Euro/Usd pair is currently trading at the opening of the day as currency traders’ watch for key triggers in the market such as the FED Beige Book.

German whole sales prices were seen to improve both in the month of September and also from the year. GER Wholesale Price Index (MoM) (Sep) rose to 1.3% from 1.1% and the GER Wholesale Price Index (YoY) (Sep) rose to 4.2% from 3.1%. The Euro zone Industrial sector surprised investors too as the French Industrial Output (MoM) (Aug) expanded to 1.5% from 0.6% whereas market expectations were only -0.2%. Better reports of improved Industrial sector were also reported from Italy as the Italian Industrial Output w.d.a (YoY) (Aug) was released at -5.2% and a figure which was better than the previous -7.2% and much better than the expected of -10.1%.  The Italian Industrial Output s.a (MoM)(Aug) was released at 1.7% than the previous of -0.1%.

The USD MBA mortgage Applications (oct) was reported from the US data desk at -1.2% a bitter data than the previous of 16.65. The Fed’s Beige book is in watch, as traders would take hints from them for future directions of the USD.

We had anticipated a further loss of the pair if it were to break below the 1.2800 level. As it seems the pair was not able to break and remained confined. Tomorrow we see another attempt of the par to today’s low and a break would open ways to further loss.

Written By Maju

Oct
9

EUR/USD; Fundamental Analysis OCT 9

Commodities were pushed higher as oil took a hike on Middle East concerns over stability. Investors lost confidence in equities as cooperate earnings were seen to reduce. The pair as we had speculated to follow the downtrend to 1.2900 and below if broken did mark those levels.

 The French Budget for august was the opener of the day for the Euro Zone which came out at a deficit of -97.7 B Euros from the previous of -85.5 B. Also disappointing was the French Trade balance which contracted to -5.3B Euro from -4.1 B Euro however the French Exports improved from 36.829 B Euro to 38.17o B Euro. An improvement was also reported in the French Imports as they improved to 43.456 B Euro from 40.891 B Euro. Another important indicator released today was the Italian Quarterly GDP for the second quarter which was released at -0.8% a weak data from the expectations of -0.7% however the Italian Yearly GDP from second quarter to second quarter remained at par with the previous data of -2.6%.

On the other hand US desk reports were light from the US zone. The NFIB Business Optimism Index (Sep) was released at 92.8 just shy of the previous 92.9. The Redbook Index (YoY) contracted to 1.6% from the 2.3%.and the Redbook Index (MoM) also contracted from -1.7% to 1.6%. The US data were not all disappointment as the IBD/TIPP Economic Optimism (MoM) (Oct) showed significant improvement from 51.8 to 54.0 whereas the market expectations were 52.3. With low confidence in the markets and investors still confused over the economic growth and recovery at hand the USD is to gain more tomorrow. Level as the 1.2800 is to be in target.

Written By Maju

Oct
8

EUR/USD; Fundamental Analysis OCT 8

Traders suspicious of the descend down of the EUR/USD pair as the selling streaks of Friday lost momentum. The pair bounced back of the 1.2934 mark and is currently trading at 1.2968.

The European authorities announced a 500 billion Euro fund to cure the allying economies of the eurozone. The authorities also expressed confidence in the growth and signified strength in recovery.

The economist desk from both the giant economies was light today. Germany had few although not market triggers. Improvement was seen in the German Trade Balance s.a for the month of August as the trade balance rose to 18.3 B euros, where as the market was expecting a reduction to 15.3 B from the previous figure of 16.3 B euros however the GER Current Account n.s.a (Aug) saw a contraction to 11.1 B Euro from 11.7 B and a market expectation of 13.0 B. The GER Exports for the month of August signified a reasonable expansion from 0.4% to 2.4% where the general consensus was of roughly -0.5%. the GER Imports did not show any change and was noted at 0.3% par with the earlier figures. Another green data was the GER Industrial Production s.a.w.d.a. (YoY) (Aug) whch was reported at 0.8% from -1.4%.

The Pair is currently in the downtrend and with no releases coming up form the US zone we anticiptate a futher loss on the pair till 1.2900 area and below if broken.

 

Written By Maju

Oct
3

EUR/USD: Fundamental Analysis OCT 3

 

The EUR/USD pair trades near the month open as traders decide where to go from here. Since the beginning of the month the pair is in tight range and is currently trading at 1.2900 zone. Grimm china data was over shadowed by better than expected US Markit services and employment data and pushed the US stocks higher.

From the Euro zone Market Services were the key indicators released for the major countries. The Italian Markit services PMI in September improved to 44.5 from 44.0 where as the markets were expecting a 43.5 release. However the French Markit Services PMI for September was released at 45.0 from 49.2. Contraction was seen in the German Services Industry as the GER Markit Services PMI was reported at 49.7 from 48.3. Meanwhile as a whole the EUR Markit Services PMI was released at 46.1 from 47.2 and the EUR Markit PMI Composite September was released at 46.1 from 46.3.

Also reported from the Euro zone were the retail sales reports. Retail sales were seen to improve in the month of august to 0.1%  from the previous month of -0.2% and slight improvement was also reported in the sales on yearly basis from -1.4% to -1.3%.

The US data desk reported significant improvement in the housing industry as the MBA Mortgage Applications rose to 16.6% from 2.8%. Also triggering the market was the news that the ADP Employment Change reduced to only 162K rather than the expectations of 143K from 189K of the previous. Along with the employment and the housing reports improvement was seen in the business sector of the US also as the ISM Non-Manufacturing PMI for September was released at 55.1 from a previous of 53.7.

US data certainly signifies some improvement this in turn would reflect in the equities and would boost more gains. As the equities gain the USD may see a weakness against its major counter parts.

 

Written by Maju.

Sep
27

EUR/USD: Fundamental Analysis SEPT 27

 

I thought it would be 1.2800 but it turned to be 1.2825. The EUR/USD bounced strongly just shy of the mark and is currently trading at 1.2920 but hey it’s Forex and anything can happen. Speculations that the Chinese banks are going to do more to save the ailing economy and that Spain pledges to cut its deficit triggered the bounce.

From the news desk there were some encouraging reports especially The GER Unemployment Change (Sep) which signified a reduction in the unemployment from 11k to 9 k where as the general consensus was 10k however the GER Unemployment Rate s.a. (Sep) remained same at 6.8% with the previous. GER Import Price Index (MoM) (Aug) showed improvement from 0.7% to 1.3% where as speculations were of only 0.8%. The imported goods prices had improved at a greater rate than the monthly figure a data release the GER Import Price Index (YoY) (Aug) reported which was released at 3.2% from the previous of 1.2% and the market expectations were at 2.7%.Other reports showed that the consumer confidence in the Europe improved from 24.6 to 25.9. The EUR Business Climate (Sep) however could not improve as it was released at -1.3 from the previous -1.18. The Business climate also shadowed the industrial and services sector of the region as the EUR Industrial Confidence (Sep) contracted to -16.1 from -15.4 and the EUR Services Sentiment (Sep) lowered to -12 from -10.8 where as speculations were of -11.0.

A couple of strong market moving indicators were released from the US of them the most important was the USD Durable Goods Orders (Aug) which fell to -13.2% from -3.3% and the market expectations were -5%. Also released from was the USD Gross Domestic Product Annualized for the second quarter. The GDP fell to 1.3% from 2% where as the market was expecting a figure of 1.7%. However the Job industry of the country showed some reasonable improvements. The USD Initial Jobless Claims (Sep 22) lowered to 359k form 385k and the USD Continuing Jobless Claims (Sep 15) reduced to 3.271 M from 3.275 M where as markets were expecting an increase to 3.285 M. The housing reports were not as encouraging as the Job loss reports and data showed the USD Pending Home Sales (MoM) (Aug) remained at -2.6% same as the previous and the USD Pending home sales (YoY) (Aug) decreased to 10.7% from 15.2% where the general consensus was only 14.2%.

Keeping in mind today’s bounce of the pair with dismal data from US and rumors from China the pair may have seen a low here. If the pair falls short of another attempt on 1.2825 than more gains can be expected tomorrow. Buying the pair on dips remains the strategy.

 

Written By Maju.