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Forex Forum to Share, Discuss, Communicate and Trade Forex • Daily Fundamental ForexTime ( FXTM )
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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Wed Dec 21, 2016 4:22 am
by FXTM Official
Forextime.com Daily Market Analysis

Kiwi struggles after weak trade data

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The New Zealand dollar continues to be volatile for traders despite the upbeat rhetoric from the government of New Zealand and also the Reserve Bank of New Zealand. Trade Balance data today was anything but positive though as it came in at -705M (-500M exp), putting further pressure on the NZDUSD which has been under intense pressure from bears in the recent weeks. This combined with the recent drop in global dairy auctions will put pressure back on the New Zealand economy, and it will be interesting to see the view point of the Reserve Bank of New Zealand regarding this as trade balance has always been high on its agenda. However, there has been some slight wins as the housing market looks to be cooling off after enacting aggressive measures and the NZDUSD has started losing some of its value which will certainly help turn around further trade balance issues. The key focus from here will be tomorrows GDP data, with many expecting it to be a robust figure for the quarter - despite the recent natural and market events which have caused some worries.

The NZDUSD continues to be an interesting trade with long trending runs and also large patches of ranging, but so far it has been all trend with no range as of late - a common theme across all commodity currencies since the Trump victory. The trade balance data today had little effect on the NZDUSD and the markets seemed to be positive to it; it's the USD strength though which is causing issues for commodity currency bulls. Support was certainly found at 0.6881 and traders will be looking to see if the daily candle closes out as a hammer which could indicate a swing here as USD traders may be looking to take a breather and unwind. If that is the case then resistance can be found at 0.6948 and 0.7000 as the next levels higher, however this is against the trend at present and I would expect fierce pressure around these levels from kiwi traders.

Across the 'ditch' and the Australian dollar continues to find itself under some pressure as well against the USD, but one trade that has been quite interesting has been the trading around the AUDJPY after yesterdays Bank of Japan holding fire. Recently, the AUDJPY trended up sharply before hitting and forming a strong trend line on the daily chart which is quite bearish in nature since 2014. The clear respect of this trend line will be key for a number of traders strategies, and as the Yen continues to look to get weaker the AUDJPY may see another attempt to take a higher level here.

The move higher on the daily chart as of today shows a strong candle trying to engulf all the recent loses after finding support at 84.754, and I would expect a further rise to also find resistance at 86.188 before looking to play of the trend line yet again.



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By Alex Gurr, Guest Analyst
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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Wed Dec 28, 2016 4:17 am
by FXTM Official
Forextime.com Daily Market Analysis

US consumer confidence lifts bulls higher

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US markets were buoyed today by the ever increasing consumer as consumer confidence lifted to a high not seen since 2001, as it breached through 113 (exp 108) showcasing the strength of the US economy. US dollar bulls will be happy to see this as a cherry on top moment for them leading into 2017 and the likelihood of stimulus from the new Trump president. The rest of the coming week is likely to be light on the fundamentals as one would expect this time of year, however, there is still pending home sales and unemployment claims coming up and this should provide some movements. Non-farm payroll in the new year before the presidential appointment will also set the tone for the year ahead and will be closely watched to also see how the FED could kick of the new year as well.

For market movements today the S&P 500 failed to deliver on the back of the big uptick on consumer confidence. This is due in part by many in the market viewing the FED raising rates as having a negative effect on equity markets. The movement higher today though touched on strong resistance at 2272 and this looks likely to be the market level that everyone looks to beat in the short term in the new year. Obviously if we do see a pullback on the charts and the S&P trending downwards, I would expect that the 20 day moving average to act as dynamic support which it has done previously.

Gold has also been another victim of the US bull run as of late, but it had as light resurgence as of late with the market pushing higher and coming up just short of dynamic resistance at the 20 day moving average. Previous resistance at 1143 was not enough to stop the charge, but this could be on the back of low liquidity in the market for commodity trading; hence the drop shortly after the rally. Despite all of this a strong level of support has formed at 1127 and it's likely we could possible see some ranging as a result of this over the coming week so watching key levels could be ideal for precious metal traders.

Finally, the USDCAD is one trade that is worth paying close attention to as it struggles to gather momentum in the marketplace. Oil prices recently were slightly up, but so far the CAD has registered any sort of movement against the USD - the big test will instead be on Thursday with US oil inventories which is expected to show a strong draw down in the market, the question will be if oil prices do indeed rally again strongly will they be strong enough to match the market and cause change. For now the trend is certainly bullish and resistance can be found at 1.358. It will be interesting to see if the USDCAD can continue the bullish momentum and look to extend before the year closes out.



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By Alex Gurr, Guest Analyst

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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Thu Dec 29, 2016 4:38 am
by FXTM Official
Forextime.com Daily Market Analysis

Oil bears pounce on initial data

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Oil markets continued to be a weird mix as of late as the market expects -2.06M barrels from tomorrows reading, however private inventory data readings are initially suggesting there is the biggest build up of crude oil in over 6 weeks, leading to many rethinking tomorrows prediction. So far oil has slipped slightly as a result and this was on the back of a weakening in the USD. Predictions so far have been that OPEC will look to impose its tightening in order to bolster the market, but if the market is still showing signs of a build up it may require further action in the future to up the price of oil - something that most members will not be looking forward to the idea of.

Oil on the charts has been very bullish in recent weeks on the back of all the noise from OPEC and the market certainly believes prices will increase in the long run. So far the level that many are looking to beat and is acting as stiff resistance in the market is at 54.96 and looks likely to face further technical pressure unless there are any major fundamental announcements. Beyond this level the next leg could be found at 60.12 which also acts as a major psychological level for the most part. Any movements lower are likely to touch the 20 day moving average and in this case I would anticipate it to act as dynamic support as we have previously seen.

NZDUSD traders will be watching the events of today after it appeared that the NZDUSD was able to find some footing after recent bearish movements in the previous week. The surge today looked quite strong, but it was all on the back of USD selling and had little to do with the current economic outlook for New Zealand for the most part. While I would anticipate the NZ economy bouncing back, the stage is certainly focused on the US economy for the most part and any bullish movements should be treated as something not to focus to intently on. Commodity prices for the NZ economy continue to remain subdued and it seems this won't change in the short term just yet, but they will eventually recover and aid the current economy.

Technically speaking the NZDUSD is always a tricky one to play with, but the rise upwards towards resistance at 0.6948 is looking quite bullish in the short term. However, it would seem unlikely that it could push through psychological barrier of 0.70 which has always been a big ask for traders. Further legs back down are likely to find strong support at 0.6874, but the market is pricing in further moves lower I feel, but it could take further strong US data to really get it pushing towards the 0.65 mark.


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By Alex Gurr, Guest Analyst
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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Thu Jan 05, 2017 3:41 am
by FXTM Official
Forextime.com Daily Market Analysis

Fed outlook turns hawkish

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The US economy was thrown back into the spotlight today as the FOMC minutes were released and the dovish FED of the past certainly looked a thing of the past, with some of the most upbeat and hawkish minutes that have been seen in a long time. Almost all of the officials present in the meeting expected that with Trumps appointment growth was expected to pick up in line with his expansionary policies. One thing that also stood out was the FED's own expectation around inflation with expectations that it will increase to the magic 2% mark in the medium term, and the recent lift in quarterly inflation was further credit to this theory. Regardless of the trump effect the FED looks to be singing the same tune as the market and that can only be positive for the bulls in the short term. The real question will be around what Trump can actually do with congress in order to get the US economy moving again and the economy expanding further - even when it's almost at full capacity when it comes to employment.

Regardless of how you viewed the FOMC minutes, the recent economic data out of the US has been positive with the construction spending m/m lifting to 0.9% (0.5% exp) and ISM manufacturing PMI also lifting to 54.7 (53.8 exp). All of this has boded well for traders and the markets have responded accordingly with the S&P 500 lifting back up to a strong level of resistance in anticipation of tomorrows economic data due out on the employment sector and the services sector as well. Even with resistance currently sitting at 2272 the expectation of further highs is fresh on traders' minds and they will be looking to push the boundaries further in the current climate. A push upwards to 2300 is very much on the cards if the market sees further positive US economic data tomorrow.

One thing that is also worth watching out for in tomorrow's trading is oil markets, previously they have been moving quite rapidly in the low volume trading and volatility is certainly ever traders friend. The recent build up in private storage showed that perhaps oil markets still needed a little more time to correct and we saw prices fall accordingly down to the 20 day moving average before finding dynamic support. Expectations are for a decline in overall oil inventories, but after the recent private reading the market may have altered its expectations.

Technically speaking though oil is looking very strong with resistance sitting tight at 54.46, to get past this level we would need to see a large drawdown in crude oil inventories, and this may be a bit of an ask just after Christmas. Any further falls are also likely to struggle past the 20 day moving average, and even more so the 50 day moving average which is acting as dynamic support for market movements at present.


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By Alex Gurr, Guest Analyst

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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Tue Jan 10, 2017 7:55 am
by FXTM Official
Forextime.com Daily Market Analysis

Asian equities retreat as investors shift to cautious mode


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After a strong start for the year, equity markets started to cool down in the second trading week of 2017. Most Asian major indices are in red today, as Wall Street failed to make new highs and the Dow retreated further from the key psychological 20,000 mark, while oil suffered a steep selloff on Monday.

Investors who built their positions based on Trump’s victory are likely to start cashing out for the time being and shift their focus on fundamentals with the earning season kicking off later this week when U.S. big banks release their fourth quarter results. I’m not confident to call a correction yet, but certainly many investors got ahead of themselves betting on fiscal stimulus, and while business usually tends to under promise and over deliver, this doesn’t seem to be the case with the U.S. new President.

Although Kuwait’s Oil Minister Essam Al-Marzouk who is chairing the committee to oversee compliance of OPEC’s output assured the markets that OPEC and non-OPEC members will abide to the planned cuts, still both oil benchmarks dropped 4% on Monday. This clearly indicates that it’s not just an OPEC game, and the expected increase in U.S. and Canadian supplies are likely to threaten the oil rally. Data from the U.S. on Friday showed rig counts rose for ten consecutive weeks and it’s just about some time for this to translate into additional production, suggesting that downside risk may remain in play, and rather than just focusing on implementations of OPEC production cuts, investors should be looking at the bigger picture on whether supply will meet demand in the second half of 2017.

The U.S. dollar fell for a second day, extending its slide from the 14-year high hit on January 3. The pull back in the dollar came despite hawkish speeches from Fed officials suggesting that the central bank is getting closer to achieving its dual mandate. Both Fed presidents, Charles Evans and Patrick Harker aren’t ruling out three rate hikes in 2017, while Eric Rosengren called for stepping up the pace of interest rates hikes to prevent inflation from overshooting. However, traders are still not yet completely convinced and pricing in only two hikes for 2017 according to CME’s Fed Watch. With no tier one economic data on the calendar until Friday, U.S. bond yields will remain to be the key driver for the greenback.

The Pound remained under pressure after Monday’s steep selloff on comments from UK’s Prime Minister Theresa May which intensified fears of “Hard Brexit”. Although the pound looks undervalued, the risk of further selloff may remain in play as we get closer to triggering article 50. Meanwhile comments from Scotland’s First Minister on BBC that she’s not bluffing about her vow to hold a second referendum on Scottish independence if Britain leaves the single market is another factor to worry about on the medium-term.


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By Hussein Sayed, Chief Market Strategist (Gulf & MENA)

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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Thu Jan 12, 2017 8:27 am
by FXTM Official
Forextime.com Daily Market Analysis

President-elect leaves dollar bulls unimpressed

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The long-awaited first press conference by President-elect Donald Trump left many investors with more questions than answers as he failed to justify the current premium priced in the dollar and equity markets.

We already knew that Trump wants to build a border wall with Mexico, bring back U.S. production onshore, and that he’s willing to be the best job creator America ever knew, but what’s his plans on corporate tax reforms? How and when is he planning to spend on roads, bridges, and other infrastructure projects? Is he going to impose tariffs on imported goods from China, Mexico and the rest of the world? Unfortunately, no updates were revealed.

Thus, the greenback was dragged, falling against all major currencies on Wednesday with the dollar index falling to lowest levels since Dec 14 at 101.28. The selloff continued until early Thursday suggesting that dollar bulls are no more willing to price any additional premium until we get more clarity on his promised fiscal plans.

The continued fall in U.S. treasury yields is another factor dragging the dollar. U.S. 10 year yields have been in a down trend since Dec 14, losing 11.8% in value after spiking 42% since the election results were revealed.

U.S. stocks were less impacted, and managed to close higher despite the volatility and sharp selloff in pharma stocks which were attacked by Trump. Whether the rally can be sustained will depend on two factors, earning growth and actions from Trump’s administration as his words and tweets are clearly starting to show less influence.

The combination of dollar weakness, lower U.S. yields and doubts in Trump's policies offered gold a boost, with the yellow metal posting a high of 1,199. So far gold has recovered 6.8% from December lows, and trader higher in 11 out of 13 days. Fed Chair Janet Yellen’s speech will probably decide whether we’re going to see a break and hold above 1,200 today.



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By Hussein Sayed, Chief Market Strategist (Gulf & MENA)

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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Tue Jan 17, 2017 4:36 am
by FXTM Official
Forextime.com Daily Market Analysis

Sterling slides on Theresa effect

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The heightened hard Brexit fears have triggered a steep Sterling selloff during the early trading hours of Monday with the GBPUSD tumbling to a fresh three-month low at $1.1983. Although the cause behind the renewed selling pressures on the Pound was attributed to reports of Theresa May standing firm and moving forward with her hard Brexit plans during Tuesday's pending speech, the frightening low buying sentiment continues to play a critical part. It is becoming quite clear that the persistent Brexit woes and ongoing uncertainty have left the Pound vulnerable to extreme losses with anxiety over a rigid divorce from the European Union exposing the currency to further downside risks in the future.

Sterling bears have received ample inspiration from the visible lack of clarity the UK government has provided on the Brexit steps and this continues to grate on investor sentiment. With fears on the rise over a tougher EU exit negatively impacting the UK economy, the rising risk aversion, and diminishing buying sentiment may ensure Sterling remains depressed this month. While most anticipate Theresa May to provide some clarity on Tuesday on how the UK plans to move forward with the hard Brexit scenario, there is a threat of the Sterling sinking deeper into the abyss if investors are left empty-handed instead.

If this messy Brexit episode explodes out of control this quarter, there is a possibility of the Bank of England adopting a dovish stance which may spark a divergence in monetary policy between the Fed and BoE. As of now, Sterling weakness remains a recurrent theme with sellers exploiting the technical bounces to drag prices lower. Technical traders may observe how the GBPUSD reacts to the 1.2150 dynamic support which has the ability to transform into a resistance if the selling momentum persists.

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Dollar attempts to stabilize

The lingering impacts of last week’s market shaking Dollar selloff can still be seen on the Dollar Index with prices hovering around 101.65 as of writing. Dollar bullish investors have lost their inspiration to propel the Greenback higher following the lack of clarity on fiscal policies at Trump's news conference. With the initial driver behind the Dollar’s appreciation pinned on the hopes of Trump boosting US growth via fiscal spending, this new cloud of uncertainty could obstruct the Dollar’s upside gains in the short term. The next major event risk for the Greenback this week will be Trump’s inauguration ceremony on the 20th which could cause price sensitivity to intensify as anxious investors are kept on edge.

Commodity spotlight – Gold

The rising Trump fueled uncertainty, persistent Brexit woes and a weak Dollar have elevated Gold prices closer to $1210 during trading on Monday. This yellow metal has unexpectedly regained its safe-haven glimmer in the first trading month of the New Year with further gains expected in the short term if uncertainty becomes a dominant theme. With anxiety and risk aversion set to heighten this week ahead of the inauguration ceremony in the United States, investors may flock to safe-haven assets which should keep Gold buoyed. From a technical standpoint, Gold could explode into further gains towards $1230 if bulls manage to conquer the $1210 resistance level.

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By Lukman Otunuga, Research Analyst
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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Wed Jan 18, 2017 4:07 am
by FXTM Official
Forextime.com Daily Market Analysis

Aussie dollar cracks major levels

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The Australian dollar swung heavily today as US bulls finally looked to sell off in the wake of economic uncertainty around the United Kingdom. Volatility was most certainly the key player for the day, and traders took full advantage. Yesterday there were strong comments that the AUD was currently overvalued, but it would seem that the market had other ideas as it raced up the charts knocking out some key levels along the way. The market is further poised for today consumer sentiment, which will give some indication if the Trump effect has spread to Australia in the wake of recent events. Expectations have previously been very low and I would expect this to be the theme going forward but with the possibility of a surprise in economic data as we have previously seen.

For the AUDUSD traders resistance was not a problem today as it smashed through 0.7531 on the charts and looked to climb even higher, coming up just short of 0.7567. The 0.7567 level is very strong and I would expect to see some stiff resistance unless we see some positive fundamental data come out in the next few hours. In the event of a pullback I would expect that the 100 day moving average could act as dynamic resistance if it is a strong pullback, otherwise I would anticipate that former resistance level at 0.7531 looking to hold out in the long run.

One of the interesting things about a stronger USD has been the flow on effect to metals, none more so than silver which has so far seen a solid bullish trend appear in the short term and has briefly pushed through resistance at 17.133. The strong sell off today in USD certainly had a big impact in helping making this progress, but the real test is set to come as it sizes up resistance at 17.308, which I would expect to be a very strong level. The 200 day moving average is also intersecting with this strong level of resistance and has previously acted as a strong dynamic level for market movements. However, the trend is certainly your friend and this could be the case as silver looks to climb higher in the build up to Trumps inauguration on Friday.

Lastly, the NZDUSD has managed to also climb up the charts, but recent reports around the dairy auction paint a messy picture that shows that New Zealand's economy may not be as strong as recent economists had predicted. The jump higher today to resistance at 0.7222 has shown there is strong demand during patches of weakness, however this level has proved time and time again to also fight back and push prices lower.



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By Alex Gurr, Guest Analyst

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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Thu Jan 19, 2017 8:32 am
by FXTM Official
Forextime.com Daily Market Analysis

Trump vs Yellen & Draghi vs Weidmann

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The U.S. dollar has been on a roller-coaster this week. After dropping by more than 1% on Tuesday the dollar index recovered 0.9% from its lows. The steep drop in the currency came after comments from Donald Trump suggesting that the dollar is too strong, and this led some traders to believe the recent rally could have come to an end, but comments from Fed Chair Janet Yellen on Wednesday brought back hopes to the bulls.

Ms. Yellen did not specify the timeline or the pace of projected interest rates hikes, but she indicated the Fed will raise rates few times a year until 2019 and warned of a nasty surprise if the central refrained from acting. Although there’s no precise definition of “few” but reasonably means two to three times a year, which leave many central banks behind.

Recent economic data supports Yellen’s views as inflation rose in 2016 at fastest pace in five years. U.S. CPI jumped 0.3% in December to breach the 2% benchmark, and if oil prices held above $50 the trend is not likely to reverse. This leaves only the Fed's preferred gauges of inflation, the PCE and Core PCE Price Index below 2%. However, there is a high risk of these indices overshooting the Fed’s target if fiscal policies came into play and the Fed will be left with little options but to fasten the pace of monetary policy tightening, thus keep supporting the dollar.

On the shorter run, Trump will remain the center focus for traders and his inauguration on Friday will play a major role in the dollar’s direction. It’s highly unlikely to reiterate that the strong dollar is hurting the economy, but if his speech contains more of protectionist policies than stimulus measures, it could harm the dollar, at least in short term.

The European Central Bank is meeting today and most likely keep monetary policy unchanged after the central bank extended and reduced the monthly bond purchases to €60 from €80 in their last meeting. Although it might be considered a non-event, we’ll be carefully listening to Draghi to see if the recent improvement in Eurozone data especially when it comes to inflation, will force the ECB to start considering unwinding their QE policies.

PMI’s across the Eurozone reached 5.5 years high in December and inflation climbed to 1.12, the highest since August 2013. Meanwhile German inflation jumped to 1.7%, thanks to higher oil prices. This will undoubtedly create a battle between Bundesbank's Weidmann and Draghi on when to end the loose monetary policy. Of course, Mr. Draghi has his reasons, especially that political risks will intensify in the next couple of months with presidential elections in France, Germany and Netherland’s, but once we’re over it, I believe the ECB will start ending their untraditional QE policies. This suggests the Euro is likely to remain under pressure until probably mid-2017.



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By Hussein Sayed, Chief Market Strategist (Gulf & MENA)
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Re: Daily Fundamental ForexTime ( FXTM )

PostPosted: Mon Jan 23, 2017 5:20 am
by FXTM Official
Forextime.com Daily Market Analysis

The Week ahead: Politics to take center stage

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Donald Trump is finally in power, a new era has arrived, and his policy plans in the first couple of weeks will override fundamentals. Markets spent more than two months pricing in growth policies promises, lowers corporate taxes, and deregulations, now it is time to deliver as markets will no more move on words but actions.

U.S. dollar bulls were not really impressed in the new Presidents’ inauguration speech, as it was focused more on protectionism and lacked any concrete plans to drive growth. Repealing Obamacare, building a Mexican border wall, and withdrawing from the Trans Pacific Partnership are not the kind of news investors want to hear, they need to know when pro-growth fiscal policies will come into play and more importantly whether congress will approve them.

The days and weeks ahead will likely see volatility increase in equities, fixed income, and currency markets. Investors are already buying exchange-traded products that track volatility, this explains the level of expected uncertainty going forward.

The week ahead will also see U.S. earnings season move into high gear with more than 20% of S&P 500 companies reporting fourth quarter results including Alphabet, Amazon, Microsoft, McDonald’s, Verizon, Johnson & Johnson, Boeing, EBay, and AT&T. According to Factset, 61% of the companies that reported results so far managed to beat profit estimates, while only 47% managed to beat on revenues.

On the U.S. economic data front, all eyes will be on Friday’s U.S. Q4 GDP release. Growth is anticipated to slow significantly from Q3 3.5% to only 2.2%, as net trade expected to turn negative. Homes sales, services PMI’s, trade balance, and durable goods are also on the agenda for next week.

It will also be an interesting week for sterling as U.K.’s supreme court will eventually deliver its ruling on Tuesday on whether Prime Minister Theresa May can activate the process for Brexit without parliamentary approval. We highly expect that the court will rule in favor of Parliament’s approval to trigger article 50, but any spike in sterling likely to be short lived.



More Info @ http://www.forextime.com/market-analysis

By Hussein Sayed, Chief Market Strategist (Gulf & MENA)
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