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Euro regains ground to $1.28 after another sharp fall in early Thursday trading

March 28, 2013 in Forex Analysis

Economic news (28 March 2013) – The euro declined sharply again in early London trading, after managing to slightly recover overnight, following Wednesday’s four-month low against the dollar. During Thursday’s early session, the single currency quickly dropped below $1.28, soon after data showed the number of German unemployed people has increased by 13K. However, the report on the Business Confidence in Italy, released shortly after that, gave support to the euro, and it was trading at 1.2812 against the dollar.

The single currency came under huge pressure this week amid financial turmoil inCyprus, renewed political uncertainty inItaly, and negative economic data from the Eurozone.

The Italian bond auction yesterday added more fuel to the situation, as borrowing costs increased to a five-month peak due to investors’ demand for a higher risk premium, given the political insecurity.

Across theAtlantic, the seasonally adjusted pending home sales index for February fell by 0.4% to a reading of 104.8, worse than a forecast for a 0.2% drop.

According to analysts, the euro is currently in a shaky position on the charts, amid the latest jitters in the Eurozone, and its movement is very responsive to any type of economic data.

 

Technical analysis

EUR/USD

At yesterday’s session the euro fell sharply from 1.2860 to 1.2750. This morning the currency pair was trading at 1.2765-1.2800.

Should the euro overcome the resistance zone at 1.2780-1.2810, its aim will be reaching and testing the 1.2835-1.2850 zone. If successful, the upward trend will continue to 1.2880-1.2910. If the euro falls below the 1.2770-1.2750 support zone, the next support is expected to be at the 1.2730-1.2715 area. In case of a breakdown, the downward trend will continue to 1.2700-1.2675.

Source: dfmarkets.co.uk

 

Disclaimer: The Content of these charts and analyses does not constitute any form of advice or recommendation by Delta Financial Markets to buy, sell (or refraining from making) any trade or investment. You may wish to seek independent advice before entering into transactions.

Delta Financial Markets shall not be held liable by you or any others for any decision made or action taken by you or others based upon reliance on or use of information or materials obtained or accessed through use of these technical analyses and charts. DF Markets assumes no responsibility for errors, inaccuracies or omissions in these materials, nor shall it be liable for damages arising out of any person’s reliance upon the information on this page. DF Markets shall not be liable for any special, indirect, incidental, or consequential damages.

 

Yen advances sharply on Kuroda first press conference

March 21, 2013 in Forex Analysis

21 March 2013 – Today’s highlight on the Japanese economic scene is the first press conference of the newly elected BOJ Governor Haruhiko Kuroda, being held at the moment. The Japanese currency is experiencing a sharp increase, trading at $95.45 at the time of writing.

Earlier today, the yen climbed modestly against the dollar, trimming its overnight losses as the country’s Ministry of Finance posted a narrower trade deficit gap for February.

The better-than-expected results pushed the Japanese currency a bit higher, trading at around $95.76 in early Thursday, up 0.2% from its yesterday’s low of $96.05.

Despite the figure being colored in green, the report showed a trade deficit for eighth consecutive month, making it the longest stretch of poor trade performance from Japan in more than 30 years. Data revealed that exports dropped by 2.9% for February, much worse than the forecasted 1.9%, while imports increased by 11.9% thus generating an overall trade deficit of -777.5bn yen ($8.1bn, £5.3bn).

This adds up to the challenge faced by the Japanese government in its attempts to battle deflation and spur the economy as exports are one of the main driving forces in the country’s growth.

In order to make Japanese goods more affordable on the foreign market and boost exports, the country’s government has pressed more aggressively on weakening the yen, resulting in nearly 20% depreciation against the dollar since November.

Analysts commented that a weak yen has made many Japanese manufacturers moving production overseas, while at the same time demand for the Japanese goods, particularly in key market places as Europe and China, has been dropping.

According to them, Japanese exports will not experience a strong recovery in the near term, regardless of yen’s weakening and the trade deficit is likely to continue for the near time as well.

Investors will watch very closely the new BOJ governor actions as he is particularly vocal advocate of more aggressive easing measures when necessary, which is in line with the position of the Japanese government.

 

Source: dfmarkets.co.uk

 

Disclaimer: The Content of these charts and analyses does not constitute any form of advice or recommendation by Delta Financial Markets to buy, sell (or refraining from making) any trade or investment. You may wish to seek independent advice before entering into transactions.

Delta Financial Markets shall not be held liable by you or any others for any decision made or action taken by you or others based upon reliance on or use of information or materials obtained or accessed through use of these technical analyses and charts. DF Markets assumes no responsibility for errors, inaccuracies or omissions in these materials, nor shall it be liable for damages arising out of any person’s reliance upon the information on this page. DF Markets shall not be liable for any special, indirect, incidental, or consequential damages.

The pound offsets some of yesterday’s losses ahead of UK bond auction

March 13, 2013 in Forex Analysis

 

 

The pound offsets some of yesterday’s losses ahead of UK bond auction

 

Economic news (13 March 2013) – In today’s early session the sterling managed to recover slightly from its yesterday’s tumbling against the dollar when it reached a fresh low of $1.4837, unseen since June 2010. The pound was trading higher at $1.4953 at the time of writing as markets anticipate the sale of UK government bonds maturing in 2052.

 

During Tuesday trading the sterling was put yet again under huge pressure after the release of economic data indicating that January UK industrial and manufacturing production output fell much more-than-expected. The UK Bureau of National Statistics report left market makers surprised as it revealed a decline by 1.2% in industrial production for January, while the manufacturing report registered a fall of 1.5%. It is indicated that one of the main reasons for this decline is the closure of a North Sea oil platform and the subsequent loss in revenue which erased the growth accumulated during the previous month.

 

The pound has already become the worst currency performer this year on fears that the UK may enter into an unprecedented triple-dip recession. Some analysts say the decline is highly likely to continue as BoE signals for further quantitative easing if the UK economic data remains weak.

Analysts also commented that investors are more reluctant to sell the pound against the euro rather than the dollar on signs that the US economy is likely to recover more quickly than that of the Eurozone.

 

Technical analysis

GBP/USD

At yesterday’s session the pound moved in the range of 1.4830-1.4910. This morning the currency pair was trading at 1.4925-1.4950.

Should the pound successfully overcome the resistance zone at 1.4930-1.4950, its aim will be reaching and testing the 1.4970-1.5000 zone. If successful, the upward trend will continue to 1.5020-1.5040. If it falls below the 1.4920-1.4990 support zone, the next support zone is expected to be at 1.4850-1.4820. In case of a breakdown, the downward trend will continue to 1.4800-1.4780.

 

Source: dfmarkets.co.uk

Disclaimer: The Content of these charts and analyses does not constitute any form of advice or recommendation by Delta Financial Markets to buy, sell (or refraining from making) any trade or investment. You may wish to seek independent advice before entering into transactions.

Delta Financial Markets shall not be held liable by you or any others for any decision made or action taken by you or others based upon reliance on or use of information or materials obtained or accessed through use of these technical analyses and charts. DF Markets assumes no responsibility for errors, inaccuracies or omissions in these materials, nor shall it be liable for damages arising out of any person’s reliance upon the information on this page. DF Markets shall not be liable for any special, indirect, incidental, or consequential damages.

 

 

GOLD: Broader Bias Remains Lower.

March 10, 2013 in Forex Analysis

GOLD: While GOLD may have traded flat the past week, it continues to look weak and vulnerable. This suggests further downside towards the 1,554 level. A violation will pave the way for a run at the 1,530.00 level with a breach aiming at the 1,500.00 level, its psycho level. We expect a price hesitation to occur here if tested but if broken we could see further weakness towards the 1,478.05 level. On the upside, resistance resides at the 1,600.00 level and then the 1,669 level where a break will aim at the 1,695 level. A violation of here will call for a run at the 1,730 level. All in all, GOLD remains vulnerable to the downside medium term.

USD/CHF And The Upcoming Resistances

March 10, 2013 in Chart Alert

The break over 0.9512 was a significant move as it does not even represented the break over the psychological 0.9500 level but suggests a decisive break of the same.

The next critical resistance zone will be o.9635/0.9657. Any break over 0.9657 should bring further gains towards 0.9800 or more for USD/CHF.

USD/CHF weekly chart

USD/CHF breaks above the first critical resistance - weekly chart

The above mentioned 0.9635 is slightly over the 61.8% retracement of the downward move from 0.9972 to 0.9022 and we can not ignore the possibilities of a strong resistance and a fall from that zone.

USD/CHF and retracement levels

USD/CHF 61.8% retracement - weekly chart

 

You may also like to check the daily analysis for USD/CHF.

AUD/USD And Possible Supports And Resistances

March 10, 2013 in Chart Alert

AUD/USD has been in a very volatile sideways range since September 2010 i.e. close to two and a half years. The low of this range was 0.9537 if we exclude a brief break of this range during October 2011 when the pair had touched a low of 0.9387. The high was 1.1080.

Since July 2012 another sideways range has been in the place for AUD/USD within the above mentioned range. Recently there was a slight break below that range. The next key supports to be watched are 1.0100 and then 0.9969. These supports also bring in the psychological support of 1.0000 level A break below these is critical to expect any deeper moves towards 0.9600.

AUD/USD weekly chart

AUD/USD weekly chart - the volatile range

You may also like to check the daily analysis for AUD/USD.

The Two And Half Years Old Support Turns Into Resistance For GBP/USD

March 10, 2013 in Chart Alert

GBP/USD has been in a very volatile side ways range since July 2010 i.e. over two and a half years. The low of this range was 1.5233 and the high was 1.6746. The currency pair recently broke below this range when it went as low as 1.4885 during the last week. This break made the bearish outlook strong for GBP/USD but what has made this bearish outlook even stronger is the fact that the support of 1.5233 has turned into resistance. The recent upward consolidations have found resistance below this previous support when the pair fell before testing this level and from 1.5222.

GBP/USD weekly chart

GBP/USD- Support turning into resistance

 

Please also check the the daily analysis for GBP/USD.

EUR/USD Gets Another Bearish Signal

March 9, 2013 in Chart Alert

EUR/USD’s move below 200-day moving average gad given a strong bearish signal as was indicated in this EUR/USD chart alert. However, the pair had gone into a very volatile sideways mode since then. The upward jump found resistance below 22-day EMA and then price fell below the 200-day EMA again. The new bearish signal was when 5-day EMA moved below the 200-day moving average line. Please note that this crossover is still in the early stage but during the past such signals were generally followed by  roughly 300 to 1000 pips moves. There are always some false signals and exceptions.

In case the 22-day EMA resistance holds and no reversal of the above mentioned crossover (5-day EMA line moving over 220-day SMA) takes place during the next week then some quite deeper moves can be expected.

In the following chart the while line is 200-day SMA, Green is 5-day EMA, yellow is 22-day EMA and Red is 55-day EMA.

EUR/USD daily chart

EUR/USD- 5 day EMA moves below 200 day moving average

Lets also have a look on the possible resistance zones for EUR/USD, based on Fibonacci retracement levels and past price action and resistances:

EUR/USD and possible resistance levels

Sterling on its way for a second consecutive day of losses

March 4, 2013 in Forex Analysis

Economic news (4 March 2013) – The British pound depreciated further against the dollar in early Monday trading, extending its Friday losses when it dropped to its lowest level in nearly three years. On Friday the sterling fell below the psychologically important $1.500 mark for the first time since July 2010, reaching an intraday low of $1.4998.

The release of the UK construction data on Monday morning revealed another disappointing result for the British economy as the PMI Construction dropped to 46.8, falling behind forecasts for a reading of 49.0. Following the news, the British currency sharply declined to its Friday low of $1.4998, before gaining some ground and trading at $1.5040 at the time of writing.

The British pound has now become the worst currency performer, surpassing even the deliberately weakened yen as its value is down 7.7% against the dollar and 6.5% against the euro. The latest big sell-offs were triggered by a series of negative economic data from the UK which was released on Friday. The very discouraging figure of the U.K. Manufacturing PMI was particularly in focus as it dropped below the important 50.0 mark, with an actual value of 47.9, much lower than the forecasted one of 51.0.

This year has been ‘rough’ for the sterling so far, putting it under huge pressure amid fears for the health of the UK economy, the increasing national debt and downgrading the country’s AAA credit rating. Though BoE officials said they are comfortable with the pound’s decline in order to boost exports, investors are very cautious about the sterling’s value.

Some analysts commented that there is still imminent fear for the British economy to enter into an unprecedented triple-dip recession.

Looking ahead of the week, the BoE monthly rate decision on Thursday will attract investors’ attention and cause more volatility in the pound’s charts movements. Market makers expect no change to be made, however speculations about further monetary easing by the central bank have increased lately.

Source: dfmarkets.co.uk

 

Disclaimer: The Content of these charts and analyses does not constitute any form of advice or recommendation by Delta Financial Markets to buy, sell (or refraining from making) any trade or investment. You may wish to seek independent advice before entering into transactions.

Delta Financial Markets shall not be held liable by you or any others for any decision made or action taken by you or others based upon reliance on or use of information or materials obtained or accessed through use of these technical analyses and charts. DF Markets assumes no responsibility for errors, inaccuracies or omissions in these materials, nor shall it be liable for damages arising out of any person’s reliance upon the information on this page. DF Markets shall not be liable for any special, indirect, incidental, or consequential damages.

 

AUDUSD: Weakens, Targets The 1.0100 Level & Below.

March 4, 2013 in Forex Analysis

AUDUSD: As indicated in our weekly outlook, AUDUSD extended its broader medium term weakness during Monday trading today. With the pair now holding below the 1.0200 level and testing a low of 1.0114 level, there is risk of further downside pressure. The immediate support resides at the 1.0100 level where a break will target its big psycho level at the 1.0000 level. A breather could occur here and turn it higher. Its daily RSI is bearish and pointing lower supporting this view. On the upside, the pair will have to return above the 1.0200 level to reduce its present downside pressure. This if seen will call for a run at the 1.0250 level and then the 1.0300 level. Further out, resistance comes in at the 1.0374 level. All in all, the pair remains vulnerable to the downside on further weakness.

EUR/USD Breaks Below The 200-Day Moving Average Support

March 3, 2013 in Chart Alert

On last Friday EUR/USD not only broke below 1.2997 but also broke the 200-day moving average support. Though the weekly closing was slightly above the 200-day SMA but the today’s trading session started with another break below that support.

During mid-November 2012 the 200-day SMA level had proved to be a very strong support and the price had gone as high as 1.3711 from there. The breaks of the above mentioned supports suggest that we can see some further deeper declines towards 1.2876. On the upside resistance should come near 1.3068/1.3085. Please check the daily chart of EUR/USD.

EUR/USD daily chart with 200-day SMA

EUR/USD breaks below 200 day moving average support