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Forex Forum to Share, Discuss, Communicate and Trade Forex • Daily Market Analysis from ForexMart (Fundamentals}
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Re: Daily Market Analysis from ForexMart (Fundamentals}

PostPosted: Fri Aug 26, 2016 4:08 am
by dwang
COZfx: USD/CAD pares losses after upbeat US data

COZforex: The US dollar pared losses against its Canadian counterpart on Thursday, after the release of upbeat US data, although caution ahead of Federal Reserve Chair Janet Yellen’s speech on Friday limited the greenback’s gains.

USD/CAD eased off 1.2899, the session low, to hit 1.2927 during early U.S. trade, steady for the day. In technical analysis, COZFX strategist Nigel Boynton said: USD/CAD was likely to find support at 1.2854, Tuesday’s low and resistance at 1.2997, the high of August 12.

The Commerce Department said durable goods orders rose by 4.4% last month, compared to expectations for an advance of 3.3%.

Core durable goods orders, which exclude volatile transportation items, rose 1.5% last month, compared to forecasts for a 0.5% gain.

At the same time, the US Department of Labor said the number of individuals filing for initial jobless benefits in the week ending August 20 decreased by 1,000 to a five-week low of 261,000 from the previous week’s total of 262,000.

But the greenback remained under pressure as market participants were waiting to see if Yellen will restate the hawkish view of the economy expressed by Fed officials last week or echo the minutes of the Fed’s July meeting, which indicated that officials are divided on when to raise rates.

Meanwhile, sentiment on the commodity-related Canadian dollar was fragile as oil prices fell to one-week lows after data on Wednesday showed that US stockpiles rose unexpectedly last week.

(COZ forex UK)

Fundamental Analysis for USD/JPY: August 26, 2016

PostPosted: Fri Aug 26, 2016 12:15 pm
by Andrea ForexMart
The USD/JPY pair remained within its range while the markets are awaiting Janet Yellen’s speech within today. Aside from the Fed’s statement release, investors are also anticipating the release of Japan’s inflation data, which is expected to cause volatility in the yen’s current value. The BoJ might not be able to extend additional support to either the Japanese economy or to assist inflation rates while employers refuse to have a wage increase, causing stagnation in the country’s economic cycle. The IMF has also recently noticed that Abenomics was not able to use its three-arrow plan in order to boost the economic status in Asia.

The index of Nikkei 225 increased by 10% since June and the JPY has also increased in relation to the USD. This might become a problem for stocks since a strengthening yen would not attract exporters as it can decrease their foreign profits especially when converted to their local currencies. Investors are also worried that the Bank of Japan might dominate financial markets after the BoJ doubled its purchases of Tokyo-based shares, which can cause distortions in prices. This will also make it harder for investors to separate functional companies from non-functional ones, and can also cause misallocation of capital and can reduce incentives which are needed by companies to attain shareholder needs.

The Bank of Japan has previously attempted to revitalize the Japanese economy and put a stop to years of deflation by way of purchasing large amounts of assets, thereby flooding the economy with cash. This has mostly included corporate bonds, JGBs, and ETFs.

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AUD/USD Fundamental Analysis: August 26 2016

PostPosted: Fri Aug 26, 2016 12:48 pm
by Andrea ForexMart
The Aussie and the US dollar hover to the range bound periods raised with 11 points at 0.7624. The quantitative measures indicated a low level but will experience a slight effect because of the grand news of Yellen on her Jackson Hole speech. The Australia and New Zealand Banking Group reported that AUD strengthened which influence the economic growth while exports from the region like coal and iron ore are consistent to have the largest volume of supply among countries all over the world.

Subsequent to the unsatisfactory rate of the AUD yesterday due to a lower-than-expected results of the infrastructures, Australian dollar still gained positively.

Australian reports have noted the statement from one of the largest government owned company of the continent, QIC Global Liquid Strategies with the head of the pension managers, Ms. Katrina King said that at US 77 cents, AUD is seen to be overvalued by 10% evaluated by the RBA's newly-developed in-house economic modeling.

While Mr. Roy Teo, an analyst from said that the ABN Amro Bank NV ended their recommendations during the closing of the third quarter since they perceived that the AUD will be bearish with a target price of 72 cents. Reports from Bloomberg issued a forecast from the RBA about the ease of movement on November and expecting the AUD to finished with 74 cents on year end.

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Fundamental Analysis for AUD/USD: August 31, 2016

PostPosted: Wed Aug 31, 2016 9:37 am
by Andrea ForexMart
The AUD/USD pair went up by a few trading points but had limited gains as the US Dollar continued to increase its value. The release of the housing data yesterday caused building permits to go above as expected. In July 2016, the volume of approved houses went up by 0.2%, necclinching an eight-month steady increase, according to the Australian Bureau of Statistics.

In the area of New South Wales and Victoria, the total number of approved houses surged in July by up to 2.4% but has seen a drop in the area of Queensland, Tasmania, and Australian Capital Territory. The AUD is presently trading at 0.7571, a drop from its previous weekly high. Meanwhile the USD is steadily increasing after the Fed statement in Wyoming.

After the non-farm payrolls data were released last Friday, the USD index rallied as the market adjusts into a steady holding pattern.

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Fundamental Analysis for USD/JPY: September 1, 2016

PostPosted: Thu Sep 01, 2016 8:32 am
by Andrea ForexMart
The USD went up slightly higher than the JPY during Wednesday’s session as investors are waiting for the latest updates on the economic status of the United States. The USD/JPY pair is currently trading at 103.259 points, going up by +0.30% or 0.304. Volatility and volume levels were on a below average level since majority of the currency players in the market are staying on the sidelines prior to the release of the US Non-Farm Payrolls report on Friday, which will be determining the frequency and timing of the oncoming Fed rate increases.

Tuesday’s trading session saw an increase in the USD/JPY pair, after the consumer confidence report in August showed an increase at 101.1, its highest in a year. However, newfound concerns regarding the overall state of the Japanese economy arose as the release of industrial production figures for Japan surprised economists who were expecting two consecutive monthly gains, insinuating the possibility that the Japanese economy might be failing to sustain its progress for the third quarter.

Traders and investors are now waiting for the US ADP Non-Farm Employment Change Report, which is expected to show an increase in jobs offered by the private sector. A below average data could further weaken the USD/JPY, but the onset of the release of the Non-Farm Payrolls Report on Friday might help in alleviating possible losses.

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Fundamental Analysis for EUR/USD: September 2, 2016

PostPosted: Fri Sep 02, 2016 9:00 am
by Andrea ForexMart
The EUR/USD pair went down by 6 points today as the unemployment rates in the European Union went up and the USD continued to strengthen. The PMI data for the eurozone also came out lower than expected at 51.7 points. The EUR is currently trading at 1.1151, indicating that the pair is currently at the bottom rung of its trading range.

The US jobs data showed an additional 177,000 jobs in the private sector last month, with a significant number of firms and industries adding up their payrolls. On the other hand, last week’s Fed statement are hinting at a possible interest rate hike in September, and if the payroll data comes out stronger than expected, investors should expect an increased volatility in the market.

During the past five years, the August data for US Non-Farm Payrolls has always been erratic, and it is expected to miss again for this period. Traders are then warned of sudden price moves among all asset classes due to the said positions, regardless of whether the data comes out as positive or negative.

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Fundamental Analysis for EUR/GBP: September 6, 2016

PostPosted: Tue Sep 06, 2016 8:19 am
by Andrea ForexMart
The EUR/GBP traded higher by 3 points, going up at 0.8403. However, the pair still remains at the bottom rung of its trading average since the GBP has been bouncing back during the past sessions, especially since UK economic data reports has shown that the Brexit vote did not have that much of an adverse effect to the economy in contradiction to the initial speculations. Financial institutions such as the IMF has also stated that they are now reevaluating the situation since the Bank of England’s foresight has prevented further damage to the UK economy.

Meanwhile, the EUR went slightly higher at 84 pence. However, this is not far from Friday’s all-week low of 83.76 points. The construction and manufacturing surveys for the eurozone showed a major comeback, while the manufacturing PMI data recovered from July’s three-year low and traded at 53.3 points in August, its highest trading point reached in 10 months. On the other hand, the construction PMI data went up to 49.2 points from July’s 45.9 points, going over the speculations indicated in economic polls.

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Fundamental Analysis for NZD/USD: September 7, 2016

PostPosted: Wed Sep 07, 2016 9:30 am
by Andrea ForexMart
The NZD/USD pair weakened in relation to the USD, trading at 0.7231 points after the Reserve Bank of Australia held fast to its interest rates and monetary policies. The NZD might increase after the release of data from the GlobalDairyTrade auction tonight, where there is an expected surge in the prices of milk powder. Traders and speculators are now monitoring the data for wholesale trade for the second quarter, as well as an update on the RBA’s interest rates.

On the other hand, borrowers are expecting even lower interest rates following low inflation rates. Statistics New Zealand released a report last Monday showing that the Consumer Price Index went up by 0.4% as of June 30. The RBA is predicting that inflation rates would go up by 0.6%, and economists are now expecting the bank to cut down its cash rates by up to 2%.

Westpac has also stated that based on the market prices of financial products, there is now an 80% chance of the RBA cutting down the OCR by up to 70% prior to the release of rates.

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Fundamental Analysis for USD/JPY: September 8, 2016

PostPosted: Thu Sep 08, 2016 10:44 am
by Andrea ForexMart
The USD continued to plummet against the JPY during Wednesday’s trading session, dropping by -0.55% or 0.564 points to trade at 101.445 points. This drop in rates was mostly caused by a negative-leaning US economic data, which reduced the probability of a Fed rate hike within the month, and protective sell stops are also being triggered by every new low encountered.

The Institute for Supply Management’s data release for the non-manufacturing purchasing managers’ index also fell at 51.4 points last August, the largest drop seen for the data since November 2008, especially since traders and speculators were expecting 55.4 points. Traders are speculating that the fragile economic data can be used by Fed to refrain from increasing its interest rates.

The labor market conditions data from the Fed also plummeted in August at -0.7 points following a positive data surge in July. On the other hand, the JPY continues to rise following reports that BoJ policymakers had varying opinions prior to the bank’s meeting on September 20-21. The said meeting is expected to tackle the bank’s stimulus program and conduct a thorough assessment of the said program. Analysts are speculating that the BoJ’s move to review its stimulus program may be a sign that its policymakers are beginning to doubt the effectiveness of the nation’s economic stimulus program.

The US is also expected to release its most recent job openings report, with investors expecting data to come out at 5.58M, which is a bit lower from the previous data release of 5.62M. Meanwhile, the Fed is also expected to release its most recent Beige Book data. In addition, Esther George from FOMC will also be releasing a statement on Wednesday, which might have an impact on the market especially if there is a discontinuation of the expected interest rate hike in September.

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Fundamental Analysis for GBP/USD: September 9, 2016

PostPosted: Fri Sep 09, 2016 8:38 am
by Andrea ForexMart
The GBP/USD pair increased by 30 points to trade at 1.3370, hitting its highest trading point since the Brexit vote. The GBP was able to gain strength due to the weakening of the USD and strong economic data. The Bank of England previously underwent criticism from Brexit supporters after the central bank stated that the UK economy would soon face a massive slowdown and a recession after the Brexit vote. Post-Brexit data has shown that the UK economy did not wholly suffer the drastic post-Brexit changes that was initially forecasted by analysts and spectators. However, economists are still speculating that it will not be long before Britain goes into an economic slowdown.

The Bank of England Governor Mark Carney defended the bank’s moves against critics who were saying that the BoE has moved too rashly with regards to its handling of the Brexit shock, particularly in August where the bank cut down on its interest rates, eased lending policies, and expanded its bond-buying mechanisms. Carney has since then stated that the BoE has always expected that the main economic sectors would be able to recover from the referendum’s sudden impact in July, and this was shown in the recently published PMI data during the past few days.

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