Forex Forum to Share, Discuss, Communicate and Trade Forex

Weekly Commentary | Gdmfx | Technical

Here you may discuss about your Forex Broker and post your views and reviews about them.
Image

Weekly Commentary | Gdmfx | Technical

Postby GDMFX » Tue Jun 17, 2014 1:56 pm

FOREX TECHNICAL ANALYSIS: ECB AND BOE MONETARY POLICIES START TO DIVERGE. THE TWO CURRENCIES MOVE FURTHER APART


EUR/USD
Forex Technical Analysis: The Euro weakened throughout last week as the effects of the ECB decision to lower the interest rate and to introduce a negative deposit rate started to make their presence known. The pair broke 1.3585 support but the bears ran out of steam before touching 1.3480.

Image

Technical Outlook
The first major barrier to the downside is represented by the support level at 1.3480 while to the north, resistance sits at 1.3585 followed by 1.3680. We anticipate a touch of support, but a clear break will probably occur only if the move is backed up by fundamental factors. The Relative Strength Index is approaching the 30 level which indicates an oversold market and price will have a tough time traveling south while this condition is present.

Fundamental Outlook
The first important event of the week is scheduled Tuesday in the form of the German ZEW Economic Sentiment, a survey focused on the current and future economic conditions as seen by German analysts and institutional investors. The same day the American Consumer Price Index, which is an important gauge of inflation, is announced.

Wednesday all eyes will be on the US interest rate, the FOMC Economic Projections and the FOMC Press Conference, a cluster of events that will most likely have a huge impact on the market. The Eurogroup Meetings start Thursday and same day the United States will announce the Philly Fed Manufacturing Index, a leading indicator of economic health focused on the manufacturing sector. Friday lacks major events except the ECOFIN Meetings which take place in Brussels.


GBP/USD
The Pound was heavily influenced by Mark Carney’s comments regarding a potential rate increase which may come sooner than anticipated. The impact was tremendous and the pair skyrocketed towards the peak at 1.6996.

Image

Technical Outlook
The pair reached a critical point and at the moment is testing a multi-year high. A break of 1.6996 (1.7000) would open the door for a touch of 1.7040 (visible on a Weekly chart) but a move lower would create a Double Top on a Daily chart, a powerful bearish pattern. The bulls have regained almost total control of the pair but the Relative Strength Index is rapidly approaching an overbought state so we are likely to see price pause here or even retrace slightly lower.

Fundamental Outlook
The Pound will be affected Tuesday by the release of the Consumer Price Index and Wednesday a breakdown of the latest Interest Rate votes will be made public. However, the most important Pound affecting event of the week is scheduled Thursday in the form of the UK Retail Sales which account for a major part of the entire economy and have a strong impact on the pair’s movement. As always, the US events ahead will directly affect the pair.


--------------------
Site: www.gdmfx.com
Page: facebook.com/GDMFX.NZ
Skype: customersupport.gdm
Email: customersupport@gdmfx.com
User avatar
GDMFX
 
Posts: 2064
Joined: Tue Nov 06, 2012 7:02 am
Location: Auckland, New Zealand

Re: Weekly Commentary | Gdmfx | Technical

Postby GDMFX » Mon Jun 30, 2014 2:09 pm

FOREX TECHNICAL ANALYSIS: ECB PRESS CONFERENCE AND US NON-FARM PAYROLLS – INGREDIENTS FOR A BREAKOUT


EUR/USD
Forex Technical Analysis: The pair just finished a ranging week when price was confined between support and resistance and economic data didn’t have a strong impact; price movement was less than 80 pips for the entire week from high to low.

Image

Technical Outlook
Last week price slowly crawled upwards and 1.3500 support wasn’t threatened. The bullish push lacks strength and it looks like it won’t be able to break 1.3680 resistance if it gets there so we anticipate a bounce lower. However, if the bulls find the strength to break the mentioned level, the next barrier is located at 1.3785 which will be a high probability turning-point, especially if the Relative Strength Index will indicate an overbought condition at the time. To the downside, 1.3500 remains the main level of interest.

Fundamental Outlook
Monday’s main event is the Euro Zone Consumer Price Index which as we know is the main inflation gauge and shows the change in prices paid by consumers for goods and services. The ECB aims to keep inflation just under 2.0% so the current value of 0.5% is considered too low and further decreases can severely weaken the Euro.

Tuesday the US Manufacturing PMI will be released, showing the opinions of purchasing managers regarding economic health and business conditions in the Manufacturing sector. Wednesday Fed Chair Janet Yellen will speak at the International Monetary Fund in Washington DC and as we know, speeches of heads of central banks can create huge volatility so caution is recommended if trading at the time.

Thursday will be the week’s most important day as the European Central Bank will announce the Interest Rate and Mario Draghi will hold a Press Conference explaining the reasons behind the Rate decision and will possibly offer hints about future monetary policy direction. The same day the US Non Farm Payrolls will be released, showing the change in the number of new jobs created, excluding the farming sector. It is considered the most comprehensive measure of employment in the United States and it is almost always a strong market mover.

Friday the United States celebrate Independence Day so US banks will be closed and no economic data will be released. This is also the reason why the Non Farm Payrolls are not announced Friday, but a day earlier.


GBP/USD
The Pound had a mixed week as BOE Governor Mark Carney adopted a hawkish stance during his speech and reversed a previous move below 1.7000.

Image

Technical Outlook
The pair is close to the multi-year high located at 1.7063 and the Relative Strength Index is hovering close to the 70 level which indicates an overbought condition of the market. On top of this, the bullish momentum seems dampened and a bearish retracement might be in order unless positive economic data is posted by the United Kingdom. The first major support is located at 1.6750 but such a move is probably too much to happen during a single week considering that lately the pair lacks strong movement. Resistance sits at 1.7063 and a break would renew the uptrend, bringing in more buyers.

Fundamental Outlook
Three indexes will be released this week by the United Kingdom: Tuesday we have the Manufacturing Purchasing Managers’ Index, followed Wednesday by the Construction PMI and Thursday by the Services PMI. All three are leading indicators of economic health focused on their respective sectors and they usually have a hefty impact on the Pound, depending on the figures posted. The important US events will have a direct impact on the pair’s movement throughout the week.

--------------------
Site: www.gdmfx.com
Page: facebook.com/GDMFX.NZ
Skype: customersupport.gdm
Email: customersupport@gdmfx.com
User avatar
GDMFX
 
Posts: 2064
Joined: Tue Nov 06, 2012 7:02 am
Location: Auckland, New Zealand


Return to Rate Your Broker

 

Who is online on Forum

Registered users: Alexa [Bot], Baidu [Spider], Bing [Bot], Google [Bot], Google Adsense [Bot], Yahoo [Bot]

cron