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Daily Market Analysis from ForexMart (Fundamentals}

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EUR/USD Fundamental Analysis: July 24, 2017

Postby Andrea ForexMart » Mon Jul 24, 2017 9:35 am

Draghi sounded dovish during the latest press conference and he was aware of the rally of the euro since the economic data favor the currency. Although the Draghi is trying to bring the price down as expressed in his speech, the market has reacted oppositely and bought the currency even more and push the price of the EUR/USD pair towards 1.15 level. Soon after, the news regarding the business transaction of Trump investigation, a selloff in the dollar occurred that influenced the price to move towards 1.16 region. The week closed above the said region.

In the upcoming week, we are heading towards the end of the month where the economic news and events dry up and hence we do not have much news in the coming week apart from the FOMC statement. But considering how bullish the EURUSD pair has been, we believe that the next target for the pair would be the 1.18 region.

As the last day of the week and the end of the month approaches, the pair will mostly persist in a neutral stance for today. There are less economic events except for the FOMC statement recently. The next target of the pair would be at 1.18 region for short term. Once this has been achieved, a correction could follow suit as it has been beyond its highs for the year and the highest since 2015. The number of short positions for the dollar will most likely increase that poses a lot of risks and uncertainty especially for dollar bears who would immediately exit the market once it goes up.
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GBP/USD Fundamental Analysis: August 3, 2017

Postby Andrea ForexMart » Thu Aug 03, 2017 8:10 am

The main focus for today will be on the sterling pound as there are an expected economic releases and other data from the United Kingdom for this day. We await for the UK inflation hearings along with the rate announcement of the Bank of England to be issued. Also, BOE Governor Mark Carney will conduct his speech, therefore these events would likely cause high volatility for the GBP/USD.

The central bank of England was hawkish during their last meeting which led few markets to think that rate hike is possible sooner or later. There are three BOE members who agreed for a rate increase which triggered confidence for some markets, however, this only accounts a small portion of the market because the majority still believes that the bank will maintain its benchmark.

This is considered a logical approach regarding the continuous financial circles of Britain which could be a turmoil caused by the Brexit procedures. Moreover, a lot of things remain unclear, particularly the results of the referendum process in determining if it will a soft or hard Brexit. Due to many uncertainties, it is absurd for the BOE to make an increase and most likely, they want to see first the effect of the Brexit negotiations prior making such decisions.

The pound-dollar resume to consolidate yesterday and the range near the highs of its range are expected for this very important day. In case that the BOE decided to kept rates steady, the Cable is anticipated for further correction. The 1.3250 level serves as the ceiling at this moment.


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EUR/USD Fundamental Analysis: August 30, 2017

Postby Andrea ForexMart » Thu Aug 31, 2017 4:29 am

The rates are still maintained despite high volatility during the Tuesday trading session. The volatility is not surprising as the market reacted to the speeches from Draghi and Yellen on Friday. The speeches finished late for the day when the U.K. market closed as well as on Monday which is a holiday in the U.S.

Volatility is already anticipated which is what happened yesterday. Furthermore, the monthly end currency flow added to it. It supported the pair to move higher over the 1.20 level as it moved towards 1.2070 prior to the U.S. session. Higher global risk also partly contributed to the movement which directly involves the U.S. as the DPRK persists to threaten with different missile tests. Nevertheless, the situation has been handled pretty well and the same time supported the dollar to strengthen in the later in the day.

There was a correction seen that further pushed the pair towards the 1.20 level that closed the day when it started. The movement occurred quite fastly as traders are anxious on how long the trend will last. They are also cautious and trying to see how long before the ECB will intervene in the event of strong euro. These have had a big impact on euro and there will most likely be choppiness for short-term.

For today, the preliminary GDP data and the ADP report from the U.S. are anticipated to be released today which could greatly affect the pair and monitor its impact on the increase of rates. This would also determine if it big enough for the Fed to proceed with a quick rate hike by the end of the year. Hence, volatility is already anticipated and the holiday period is about to end as the EUR/USD pair would have a big change in action for short-term.
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Re: Daily Market Analysis from ForexMart (Fundamentals}

Postby Andrea ForexMart » Thu Sep 07, 2017 7:39 am

EUR/USD Fundamental Analysis: September 7, 2017

As the week begins, the EUR/USD was seen consolidating and trading in a tight range which continues in the past 24 hours. But it is possible to change its course after the next 24 hours since the markets will draw their attention towards the single European currency, also with the plan of the European Central Bank in the near term.

The euro-dollar pair hovered at the level of 1.19 in the following day, however, there are no hints of any specific trend. Generally, markets appeared to be in a consolidation mode because traders and investors are waiting for the situation to become normal and calm again.

The tension and global risks remain high as the market somewhat predicts for an approaching attack from the Democratic People's Republic of Korea. With this, the dollar weighed down with a lot of pressure since Monday.

However, the focus for this day could possibly be in the euro due to the announcement made by the ECB about interest rates which is followed by a press conference. The central bank planned to maintain the rates steady and this is what M. Draghi expected to say during the press con. Hence, this will determine the direction of the EUR in the short term.

The ECB is now very cautious about the strengthening of the euro as the bank failed to reverse or change the fundamentals and planning to put euro in a bid in order to limit the currency’s strength. If Draghi did not do so, then it is expected the EUR/USD will move under the 1.19 handle and drove near 1.18 in the near term. Otherwise, the pair will return to its highs at 1.2070 again.

Ultimately, there are no major releases from the United States or from the euro region. Therefore, the focus will turn to the developments in Korea, as well as to the ECB.
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Daily Market Analysis from ForexMart

Postby Andrea ForexMart » Thu Sep 07, 2017 8:09 am

USD/JPY Fundamental Analysis: September 7, 2017

The U.S. dollar against the Japan yen was traded lower during the beginning of Wednesday session. Yet, the market has bounced off and almost kept the rate as it reached low levels at 108.441. For the week, the trading situation gives a similar outlook after the missile launch by North Korea over Japan.

The USD/JPY pair was seen positioning at 108.724 and declined by 0.078 or -0.07% at 10.21 GMT. The USD/JPY pair closed the session at 0.884 down by -0.81% on Tuesday.

The Forex pair dropped with the current tension with North Korea as well as the rhetorics from Fed speakers. Traders are getting anxious prior to the monetary policy decision of the European Central Bank on Thursday.

Investors keep on reacting to the happenings in the North Korea and the price movement of the safe haven assets. Moreover, the stock market compellingly suggests that traders are concerned with the minimal progress towards the lowering the threat of a nuclear war.

Traders have been anxious with the issue on North Korea especially since the next nuclear test will happen on Sunday. Across the globe, this act was being contradicted as the price movement in the stock market where more investors are being disappointed since there is lack of progress in controlling the situation.

The USD/JPY pair will most likely continue trading with the influence of the U.S. Treasury yields and opinion of investors. The price action of the U.S. Treasury yields which is supported by the economic data and Fed speakers. Reactions of investors are influenced by the geopolitical events about North Korea.

Some minor U.S. data such as Trade Balance, Final Services PMI and the Fed Beige Book and the major report on the ISM Non-Manufacturing PMI will be released on Wednesday. The anticipated figure will be 55.8 and increased from 53.9.

The whole report may not be that relevant and move the pair. Also, the investors will center its attention on North Korea since this is unpredictable. Fears of uncertainty are reflected for the first time with investors who are taking off setting positions in the stock a market and place the money in safe haven assets. Traders should monitor for another stock sell-off for today.
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Re: Daily Market Analysis from ForexMart (Fundamentals}

Postby Andrea ForexMart » Fri Sep 22, 2017 5:34 am

EUR/USD Fundamental Analysis: September 22, 2017

The EUR/USD had a mixed performance during the daytime trading on Thursday, showing some choppiness without any hints on how to handle the dollar recovery. It happened after the FOMC meeting in which the Federal Reserve did not exclude chances for a rate increase in December and decided to begin the program to cut balance sheets. These combined announcements enabled to maintain the bid under the greenbacks, however, the trend of the EURUSD pair remained choppy to a certain extent.

Moreover, the single European currency weakened and moved below the 1.19 mark during the morning session, afterward, it started to recover and moved upwards since the US dollar weakened again over other selected currencies. With this, the euro was able to drive higher than the 1.19 level and currently trading in the 1.2950 area which continues to gain strength. It appeared that the pair would retrace its losses in the near term while the dollar bulls still having a tough time to generate strength recovery.

The USD failed to become well-composed in the past couple of days, as it loses its bullish gains. While the EUR successfully recovered due to the discussion about the continuous QE tapering in the market which is very visible to everyone.

In the near term, the euro is expected to remain in the bid as the pair test the range highs at 1.2070. The time for the dollar has not happened yet, therefore, bulls should be willing to wait for strong signals sent by the Fed regarding the rate hike, together with the ECB’s tapering talk and from that, we could expect for a reversal of fortune.

Ultimately, there are no major economic releases for today except the speech of ECB President Mario Draghi which is anticipated during London hours. According to forecasts, Draghi will tackle about the monetary policy while the market is still searching for some insights about tapering, however, the ECB president is known for his inclination not to touch the monetary policy during this kind of meetings. Furthermore, it remains unclear if this will brought an impact towards the euro-dollar pair.
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Re: Daily Market Analysis from ForexMart (Fundamentals}

Postby Andrea ForexMart » Wed Sep 27, 2017 8:21 am

GBP/USD Fundamental Analysis: September 27, 2017

The British pound has been competing with the surge of the dollar and a basket of currencies is already behind of the currency. The performance of the British currency has been better than other currencies as reflected in the past few weeks as it was supported by the Bank of England and the U.K. government which keeps it from collapsing.

The central bank supports the currency which allows the probability of a rate hike for the year. It seems that the bank would not disturb the economy with the ongoing process of Brexit that flows at a faster pace than in their last meeting. Although, they noted that they would interfere when necessary. It has improved the confidence of the U.K. economy which also pushes the currency at a slower but steady in the past few weeks.

The U.K. government aptly proceeds with the Brexit process through their parliament which helped the situation and supported the pound to rise stronger over time. Although the U.K. Prime Minister May lengthened the timeline for Brexit in the new few years. In the meantime, her approach implies that the both the nation and the investors trust the economy.

Today, there is no major economic news from the U.K. anticipated but the durable goods data will be released from the U.S. The greenback is presumed to hold the current rates because of the expected announcement in the afternoon from Trump to implement a new tax system. Consequently, the GBP/USD pair will be put under pressure.
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Re: Daily Market Analysis from ForexMart (Fundamentals}

Postby Andrea ForexMart » Mon Oct 02, 2017 8:24 am

GBP/USD Fundamental Analysis: October 2, 2017

The GBP/USD pair showed some choppiness in the past couple of days without any definite direction. The British pound was able to recover in the previous weeks, considering the fact that it is one of the strongest currency in the market. However, the Sterling was also affected by the dollar buying, forcing the Cable pair for a correction over the 1.35 level to trade beneath the 1.34 region in the past few days. Previously, the pound-dollar pair failed to broke the 1.3420 area after certain attempts which the pair did during the USD weakening.

In case that this pattern keep on going, it would likely cause further weakness in the GBP and could push the pair downwards. Moreover, we are waiting for a bundle of data from the United States later this week, which could possibly manage the greenback well bid in the near-term. These events when combined would likely place the sterling in the pressured area in the short-term.

On one side, the sterling pound was supported by the Bank of England (BOE), as the bank did not lose the possibility for a rate hike despite the ongoing Brexit process. Primarily, the market expected that the BoE will remain quiet during this kind of precarious scenario but the most recent meeting of the UK central bank clearly announced that they will only take action if necessary. This has provided support to the GBP, considering that British government showed optimistic views regarding the retention of the free market access to the European Union.

Ultimately, the manufacturing PMI data from the United Kingdom and the United States which could probably enough volatility. While it is essential for the bulls to break 1.3420 mark in the near-term for the completion of an upward trend.
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Re: Daily Market Analysis from ForexMart (Fundamentals}

Postby Andrea ForexMart » Thu Oct 26, 2017 5:50 am

EUR/USD Fundamental Analysis: October 26, 2017

The EUR/USD climb higher due to various reasons including the result of the meeting of the ECB, the scheduled statement and the press conference later this day. The dollar also weakened across the market which pushed euro to move higher. Moreover, today is a significant day for the week.

The statement and announcement from the ECB are anticipated after the press conference of Draghi. As the market expects the release of the statement, the ECB would give their hints and plans related to QE tapering during the press conference. If they were able to give a definite plan and timeline, it would be a big help for the euro which is already presumed to rally after. The data from the eurozone gives out positive data and for this reason. Hence, the ECB does not have a reason to postpone the tapering but the pace of the program is still in question.

Draghi is exerting oneself not to appear hawkish in the past few months to avoid pushing the euro too high. It is yet to be known today is the policy is to be sustained. It will not be an easy task for him since the euro will most likely go up since there is no definite timeline of the QE tapering from the central bank. Other than that, the data from the U.S. in the past 24 hours has also been positive as the data on durable goods came out stronger than anticipated. As for the dollar, the GDP data would be significant which will be released from the U.S. tomorrow.

For today, consolidation is anticipated during the first half of the day while the traders are already preparing for the ECB release in the afternoon. Volatility will also be present in the trading following the announcement and the press conference. It is recommended to wait on the sidelines until everything has settled down.
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Re: Daily Market Analysis from ForexMart (Fundamentals}

Postby Andrea ForexMart » Mon Oct 30, 2017 6:25 am

USD/CAD Fundamental Analysis: October 30, 2017

The U.S. dollar against the Canadian dollar closed the week high which makes the next week trading to be awaited by traders. Initially, the dollar has been moving steadily but the negative data the previous week pushed the pair to climb above towards 1.26 level with risks imposing the possibility for a breakout towards the level of 1.27.

The movement of the trend was driven by the retail sales data from the Canada which was published in the previous week that gave out a week data and has further escalate doubts to the BOC which has an inclination to increase its rates in short-term. The loonies may have declined but with the incoming Monetary policy statement from the BOC and press conference would open the possibility to become hawkish again. Although, they have been clear in the past that the central bank would not raise their rates for the remaining months in 2017 and presumably even in the early months of the following year. This lessens the hope for it and frustrated the market which resulted to a sell-off in the loonies.

On the other side, the dollar has held steady and was further pushed by a positive GDP data that may have raised the possibility of a rate hike in December. The pair moved towards the 1.28 level and even further towards 1.29 by the end of the week. However, the prices were affected by the reports on who will be the succeeding Fed Chair with chances to be Powell. At the same time, the oil prices soared which assisted in strengthening the Canadian dollar and drove the price to close for the week.

For this week, the Canadian dollar is anticipated to rally in the beginning which includes settlement of payments in oil in the present time of the year. In the latter part of the week, the labor data from the U.S. and Canada are to be released which would have an impact on the prices of the pair. Moreover, if the results of the data are good, the USD/CAD pair would rally and this would confirm the next Fed rate hike in December.
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