horizontal dynamo top1

All banners are advertisements only. FIB does not endorse or vouch for any advertisers.

horizontal navi rotating-eisntein


Page 17 of 19 FirstFirst ... 71516171819 LastLast
Results 161 to 170 of 189

Thread: GDMFX - Weekly Commentary

  1. #161
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    dynamo - First and lasp post every thread AXITrader aff
    WEEKLY ANALYSIS: US DOLLAR STRENGTH – A SHORT-LIVED AFFAIR OR THE START OF A DOWNTREND?


    EUR/USD


    Weekly Analysis: Last week the pair had a very slow start, with choppy and almost sideways price action; however, the last couple of days made up for the previous lack of movement and the bears managed to take the pair below support.



    Technical Outlook

    After pausing at the 50 days Exponential Moving Average, the pair started to show some determination, making us anticipate a continuation of the current bearish momentum. If this is the case, price will probably move towards the support zone created between 1.0525 and 1.0495, which is also the place where the last move up originated, so it’s an important zone for medium term price action. It must be noted that the Stochastic is below its 20 level and the Relative Strength Index is approaching its oversold level; if both oscillators enter oversold and price reaches strong support, we will probably see a bounce up.

    Fundamental Outlook

    The first notable release of the week is the German ZEW Economic Sentiment, scheduled Tuesday. The survey shows the opinions of about 275 German professional investors and analysts regarding current economic conditions as well as a 6-month outlook; it acts as a leading indicator of optimism, with higher numbers strengthening the currency but the effect is usually mild.

    The next releases are scheduled Thursday and will affect the US Dollar: the Producer Price Index (an indicator that shows changes in the price charged by producers for their goods) and the University of Michigan Consumer Sentiment, a survey of about 500 consumers that tries to gauge their opinions regarding current and future economic conditions.

    Friday we take a look at Unites States inflation with the release of the Consumer Price Index and the same day the U.S. Retail Sales come out, showing changes in the total value of sales made through retail outlets. German banks will be closed in observance of Good Friday, so we expect volatility to be affected.


    GBP/USD

    After another failed attempt to move above 1.2570 resistance, the pair started to drift lower last week, breaking support and shifting short term control towards the short side. However, from a longer term perspective, the pair is still in a range.



    Technical Outlook

    The resistance at 1.2570 remains an important level that stopped rising prices once again and triggered a bounce lower, through the 50 days Exponential Moving Average. Even if there are some signs of bearish pressure (bounce at resistance, break of 50 EMA), the control doesn’t clearly belong to either side and the pair lacks momentum. The first level of importance is located at 1.2300, which acts as psychological support (big, round number) but also technical support because price bounced off of it in the past. To the upside, 1.2570 remains the first key level.

    Fundamental Outlook

    The first release for the Pound is scheduled Tuesday in the form of the Consumer Price Index, which is the main gauge of inflation and usually has a strong impact on the currency, with higher values strengthening it.

    Wednesday we take a look at British jobs data with the release of the Claimant Count Change, an indicator that shows the change in the number of people who asked for unemployment related benefits, and usually weakens the Pound if it posts a higher number than expected.

    Friday UK banks will be closed in observance of Good Friday and this will probably trigger irregular movement on Pound pairs.

  2. Under 1st Post -dynamo
  3. #162
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: U.S. PRESIDENT TRUMP SAYS DOLLAR IS ‘TOO STRONG’. DO THE MARKETS AGREE?


    EUR/USD


    Weekly Analysis: The pair climbed last week, following a comment made by U.S. President Trump regarding a “too strong” US Dollar but most of the rise was erased a day after and the week ended with price close to the opening point.



    Technical Outlook

    It is clear now that price reacts to the resistance at 1.0680, as seen from last week’s bounce, but it must be noted that the sellers couldn’t take the pair below 1.0600 so there is not enough traction on either side. The beginning of this week will be affected by the Easter holidays and we will most likely see alternating periods of low and high volatility but strictly from a technical point of view, our bias is bearish as long as the pair remains below the 50 period Exponential Moving Average and below 1.0680 resistance.

    Fundamental Outlook

    Monday most European banks will be closed, celebrating Easter Monday and no major economic indicators will come out. Volatility will most likely be affected and price may move erratically, so caution is recommended.

    Tuesday the US Dollar will be affected by the release of the Building Permits, but the indicator lately has just a low-to-medium impact; Wednesday we take a look at European inflation with the release of the Final version of the Eurozone Consumer Price Index. Thursday lacks major releases and the week ends Friday with the German Services and Manufacturing PMIs as well as the U.S. Existing Home Sales. Overall we have a rather slow week ahead of us, without high impact market movers, so the main factor for direction will be the technical aspect.


    GBP/USD

    Last week was mostly controlled by the bulls but the resistance located at 1.2570 stopped the pair’s rise once again. Price remains in a range, without clear control from either side.



    Technical Outlook

    The rally was hindered by 1.2570 resistance but the short term momentum belongs to the bulls, so it’s very probable that we will soon see a break of the mentioned level. Until the pair moves outside the channel created by 1.2570 or and 1.2420, we expect to see choppy movement, characteristic to range-bound trading. For the time being, our bias is mostly neutral for this pair but given the US Dollar weakness seen last week, we anticipate a break of 1.2570 resistance.

    Fundamental Outlook

    UK banks will be closed Monday in observance of Easter and the week remains slow until Thursday when Bank of England Governor Mark Carney will deliver two speeches in Washington, one at the Institute of International Finance Policy Summit and the other at a Bank of France event. Friday the British Retail Sales are released, showing changes in the total value of sales made through retail outlets; this is usually a high impact indicator, which strengthens the currency if it posts numbers above expectations.

  4. #163
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: BRACE FOR A WILD WEEK: FRENCH ELECTION, ECB INTEREST RATE


    EUR/USD


    Weekly Analysis: Last week the bulls scored an important victory by moving the pair above the 50 days Exponential Moving Average but some of the gains were erased later in the week. Overall, price action was bullish, but key resistance (1.0800) was not broken.



    Technical Outlook

    Price is capped to the upside by the resistance at 1.0800 and to the downside by the 50 days EMA as well as several support levels. The last two days show candles with wicks in their upper and lower sides respectively, which is a sign of indecision but the focus early in the week will be on the French Presidential Election, which will generate increased volatility and possibly a strong move in one direction. For this reason, we recommend caution, especially during the first part of the week.

    Fundamental Outlook

    The first important release of the week is the German IFO Business Climate, scheduled Monday. This is a survey of about 7,000 businesses, derived from their opinions on current and future economic conditions. Also keep in mind that the French Presidential Election held on Sunday will probably have a strong impact on the Euro in the beginning of the week.

    Tuesday the focus shifts towards the US Dollar for the release of the U.S. Consumer Confidence survey and Wednesday is a slow day, without any major economic releases.

    Thursday will be the most important day of the week for the Euro as the European Central Bank meets to announce the interest rate. Soon after the announcement, ECB President Mario Draghi will hold a press conference, discussing the rate decision and answering journalists’ questions. Usually the conference creates strong volatility and possibly irregular price action.

    The trading week finishes Friday with a potential market-mover for the US Dollar: the U.S. Advance version of the Gross Domestic Product. Out of the three versions of the GDP (Advance, Preliminary and Final), this is the earliest and tends to have the strongest impact.


    GBP/USD

    British Prime Minister May called for a snap General Election that will take place in June and this was the highlight of last week, triggering a huge move to the upside that took the pair above the long time resistance at 1.2770.



    Technical Outlook

    After breaking the top of the channel that confined the pair for a long time, price stopped between 1.2850 and 1.2770 and remained there for the rest of last week. The bias is now bullish but it must be noted that the Relative Strength Index and Stochastic have both reached overbought and this is an early sign that a bearish pullback will soon occur. The French Presidential will have an impact on the markets and this pair will probably be affected as well, thus we recommend caution, especially early in the week.

    Fundamental Outlook

    The Pound has a very slow week ahead in terms of economic indicator releases. The only major indicator is the British Preliminary Gross Domestic Product, scheduled Friday. This is the main gauge of an economy’s performance and usually strengthens the currency if it posts higher than expected numbers.

  5. #164
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: US DOLLAR BIG MOVERS AHEAD: FED INTEREST RATE, NON-FARM PAYROLLS


    EUR/USD


    Weekly Analysis: After the gap seen a week before, the pair started to move almost sideways and both bulls and bears seem to have lost interest. Part of this slow directional movement can be attributed to the lack of major releases last week.



    Technical Outlook

    After breaking 1.0850 the pair established resistance around 1.0945 and remained between the two levels for the entire week. Now the Relative Strength Index and the Stochastic are both overbought, which is usually an early indication that price may be coming down in the near future. The weekly gap is not closed and usually price returns to where the gap originated, so we may see an extended move down but this is not a certainty; also, the time it takes for the gap to close is unknown. For now the levels to watch are 1.0945 as resistance and 1.0850 as support; a break of either one may trigger an extended move in that direction.

    Fundamental Outlook

    Monday most banks across Europe will be closed, celebrating Labor Day and this is likely to generate irregular volatility and choppy price action, so caution is advised. On the US Dollar side we have the Manufacturing PMI, which is a survey derived from the opinions of purchasing managers regarding business and economic conditions.

    Tuesday is a slow day but action picks up Wednesday when the Fed will announce the interest rate (no change expected from the current <1.00%) and the will release the FOMC Statement, which contains details about the reasons that influenced the rate decision.

    Thursday we have another slow day, without major releases and the trading week finishes Friday with the always important Non-Farm Payrolls, an indicator that tracks changes in the number of employed people, excluding the farming industry.


    GBP/USD

    The pair continued last week the bullish momentum started when British Prime Minister May called for a snap general election, and exited the horizontal channel that confined it for more than a week.



    Technical Outlook

    Although the pair paused and moved sideways for more than a week, we didn’t see a clear retracement to the downside and such a move is due, considering the overbought condition of the Relative Strength Index and Stochastic. The current up move may extend into the resistance at 1.3050 but once and if it gets there, we expect a bounce lower. Also keep in mind that 1.3000 is a big round number and price will probably react to it as well.

    Fundamental Outlook

    Monday UK banks will be closed in observance of May Day and the rest of the week the Pound will be affected by the release of three Purchasing Managers’ Indexes: Tuesday the Manufacturing PMI comes out, followed Wednesday by the Construction PMI and Thursday by the Services PMI.

    These are surveys of purchasing managers from the respective sectors, which act as leading indicators of economic health but usually the impact is low-to-medium; however, numbers above expectations tend to strengthen the Pound. Of course, the pair will be directly affected by the U.S. indicators released throughout the week.

  6. #165
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: FRENCH PRESIDENTIAL ELECTION: ROUND TWO


    EUR/USD


    Weekly Analysis: Last week the Fed decided to keep the rate unchanged as expected, they didn’t give strong hints about a June hike. The employment data released Friday was better than anticipated but the previous number was revised lower and overall the US Dollar weakened, allowing the pair to climb.



    Technical Outlook

    The previous week ended with price right on the psychological level at 1.1000. Usually the market reacts to big, round numbers and the Relative Strength Index is very close to overbought, so all this increases bearish pressure and might generate a move lower in the form of a pullback. However, it must be noted that the pair is in an uptrend, which was just renewed by the break of the previous high at 1.0945. If the psychological resistance at 1.1000 is broken easily, we expect the upside to prevail and the pair to move towards the next resistance, located at 1.1120.

    Fundamental Outlook

    Monday French banks will be closed in observance of Victory Day but the rest of Europe will do business as usual. The most important release of the day will be the German Factory Orders, an indicator that shows changes in the value of purchase orders placed with manufacturers. Keep in mind that Sunday the second round of the French Presidential Election takes place and we expect price action to be heavily affected throughout the beginning of the week.

    Tuesday and Wednesday there are no notable releases on the schedule but action picks up a little Thursday with the U.S. Producer Price Index, an indicator that tracks changes in the price charged by producers for their goods. It has inflationary implications because a higher producer price ultimately leads to a higher consumer price, but the impact is not always notable.

    Friday is a busy day for the US Dollar, with three important releases: the U.S. Consumer Price Index (a key gauge of inflation), the Retail Sales and the University of Michigan Consumer Sentiment, a survey that shows the opinions of about 500 consumers regarding economic and business conditions. Also Friday the G7 Meetings start, attended by central bankers from the 7 member states.


    GBP/USD

    Most of last week’s price action was ranging, with the pair trading closely above 1.2850. The strongest movement was seen Friday, on the back of U.S. employment data.



    Technical Outlook

    The previous resistance at 1.2850 was tested from above and price bounced higher, thus we can now consider this level support. The pair is making higher highs and higher lows, indicating that it is currently in an uptrend, so we expect to see a touch of the next level of importance, located at 1.3050; 1.3000 is also important because it is a big, round number. The pair is likely to retrace lower when one of these levels is touched, but after said retracement, the uptrend will probably continue if key support is not broken.

    Fundamental Outlook

    The Pound has a lackluster week ahead, except for Thursday when the Bank of England will release their Inflation Report but will also announce the Official Bank Rate, the rate votes of the MPC members and the Monetary Policy Summary, outlining the reasons behind the votes. There’s no change expected for the rate (currently 0.25%) but this cluster of events is likely to trigger increased volatility. UK representatives will attend the G7 Meetings that start Friday.

  7. #166
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: UPTRENDS LOSE MOMENTUM. US DOLLAR BACK ON TRACK?


    EUR/USD


    Weekly Analysis: Last week started strong for the bears, who managed to take the pair into 1.0850 support but most of the US Dollar gains were erased Friday on the back of disappointing U.S. data and rumors that the ECB may start to taper its quantitative easing.



    Technical Outlook

    This week we will probably see another test of 1.1000 zone, as current momentum seems to belong to the bulls. If this resistance area can be surpassed, the next destination will become 1.1100 – 1.1120 but we have a slow economic week ahead and this may generate ranging movement, without major advances to either side. To the south, the first notable zone of support is the confluence between 1.0800 level and the 50 days Exponential Moving Average. A break of this zone may trigger an extended move down.

    Fundamental Outlook

    The first notable event of the week is the release of the Eurozone Flash version of the Gross Domestic Product, scheduled Tuesday and followed later in the day by the U.S. Building Permits. Wednesday we take a look at Eurozone inflation with the release of the Final version of the Consumer Price Index, which although is the least important of the three versions, can still generate strong movement.

    Thursday we take a look at the U.S. Unemployment Claims, showing the number of people who asked for unemployment benefits during the previous week, but because this is a weekly indicator, it tends to have a low-to-medium impact. Friday is yet another slow day, without major economic releases, similar to the rest of the week.


    GBP/USD

    Price action was choppy last week, with a bearish bias that took the pair into the support at 1.2850. The Bank of England kept the rate unchanged and did not signal a hike in the near future.



    Technical Outlook

    The move up started in March is overextended and in need of a deeper retracement. If 1.2850 support can be broken early in the week, we expect a quick move into 1.2770 and possibly into the 50 days Exponential Moving Average but it must be noted that an uptrend is in place as long as the pair is trading above 1.2770 and the Moving Average. The first major upper barrier is represented by the level at 1.3050.

    Fundamental Outlook

    The Pound will be affected by three important releases this week: Tuesday the British Consumer Price Index comes out, showing changes in the price that consumers pay for the goods and services they purchase. The indicator acts as the main inflation gauge and usually has a strong impact on the Pound.

    Wednesday’s highlight is the Average Earnings Index, an indicator that shows changes in the price that businesses pay for labor and the last release of the week is the British Retail Sales, scheduled Thursday. Overall, we have a rather slow fundamental week all around but this doesn’t necessarily mean that volatility will be low.

  8. #167
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: WHAT GOES UP MUST COME DOWN. IS THE BULL-RUN CLOSE TO AN END?


    EUR/USD


    Weekly Analysis: The pair showed massive bullish movement last week, broke several resistance levels and climbed for approximately 280 pips. US Dollar weakness seen across the board was the main catalyst behind the move.



    Technical Outlook

    The immediate destination seems to be the resistance at 1.1240, where we expect to see a bounce lower, forming a retracement. However, we don’t expect this pullback to go below 1.1120 – 1.1100 and once support has been established, the chances of another push to the north will increase. If 1.1240 is broken, the next resistance is located 100 pips higher, at 1.1340. To the downside 1.1120 is the first support, followed by 1.1000 but currently the pair is in a clear uptrend so we favor the upside.

    Fundamental Outlook

    The pair has a slow start of the week, with the Eurogroup Meetings being Monday’s only notable event. Action picks up a bit Tuesday with the release of the German IFO Business Climate, a survey derived from a very large sample of about 7,000 businesses and focused on the respondents’ opinions on current business conditions as well as a 6-month outlook. On the US Dollar side we have the U.S. New Home Sales numbers, released later in the day.

    Wednesday ECB President Mario Draghi will speak in Madrid at the First Conference on Financial Stability, organized by the Bank of Spain. Later that day the FOMC will release the Meeting Minutes, containing details of their last interest rate vote but also, possible hints about future rate hikes.

    Thursday French and German banks will be closed in observance of Ascension Day and the trading week ends Friday with the U.S. Preliminary Gross Domestic Product, which is an economy’s main gauge of performance and an always-important indicator that can strongly affect the currency.


    GBP/USD

    The pair traded higher last week and climbed into 1.3050 resistance after a bounce off of 1.2850 support. The Pound benefited from positive economic data but also the US Dollar weakened against most of its counterparts and these facts combined generated the push into resistance.



    Technical Outlook

    The first touch of 1.3050 triggered a fast bounce lower, which seemed to have 1.2850 as target; however, all the Pound losses were erased the next day and now the pair is testing 1.3050 again. A break of this important level would score another victory for the bulls and would open the door for a move into 1.3430. Keep in mind that we are talking about almost 400 pips so even if the target is reached, it probably won’t happen in a week unless surprising events take place. To the downside, 1.2850 is the first support, followed by 1.2770 and the 50 days EMA.

    Fundamental Outlook

    The Pound will only be affected by two major events this week. The first is the Inflation Report Hearing, scheduled Tuesday, when Bank of England Governor Mark Carney will testify on economic situation and inflation before the Parliament's Treasury Committee. The other event is the release of the British Second Estimate version of the Gross Domestic Product, scheduled Thursday.

  9. #168
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: U.S. NFP DATA TO “MAKE OR BREAK” THE DOLLAR’S RECOVERY STARTED LAST WEEK


    EUR/USD


    Weekly Analysis: For the entire last week the pair consolidated below 1.1240 resistance and the bull run came to a halt, preparing the stage for a deeper move south. The economic scene didn’t present any market moving events and this contributed to the overall situation.



    Technical Outlook

    Several Daily candles pierced 1.1240 resistance but failed to close above it, thus showing clear signs of rejection and making us anticipate a move lower, which will have 1.1120 – 1.1100 as first target. Despite the failure at 1.1240, it must be noted that the pair is still in an uptrend a significant low hasn’t formed yet. This means that a potential break of 1.1240 will probably take the pair into the next resistance, located at 1.1340.

    Fundamental Outlook

    Monday ECB President Mario Draghi will testify about the economy before the Economic and Monetary Affairs Committee. This is potentially a big mover for the Euro and will probably generate increased volatility. U.S. Banks will be closed, in observance of Memorial Day.

    Tuesday the German Preliminary Consumer Price Index will be the highlight on the Euro side, while the US Dollar will be affected by the Consumer Confidence, a survey that acts as a leading indicator of consumer spending.

    Wednesday we take a look at European inflation with the release of the Flash Estimate version of the Consumer Price Index and Thursday U.S. jobs data is released in the form of the ADP Non-Farm Employment Change, a report that shows changes in the number of employed people, excluding the farming sector and Government.

    The week ends Friday with the most important U.S. jobs report: the Non-Farm Payrolls. Similar to the previous indicator, this one shows changes in the total number of employed people, excluding the farming sector but including Government jobs. Usually a number above expectations shows increased economic activity and strengthens the US Dollar.


    GBP/USD

    The Pound took a hit last week, dropping for more than 250 pips. Brexit concerns, including the approaching of the June 8 election and the ability of British Prime Minister May’s party to win that election, seem to be the main reason behind the drop.



    Technical Outlook

    After failing to break 1.3050 key resistance, the pair dropped into the 50 days Exponential Moving Average and into the support at 1.2770. The way price behaves here will be very important for medium term direction because we are dealing with a confluence zone (two or more technical elements meet in the same place or close vicinity) and a break would show increased bearish pressure, making 1.2570 – 1.2550 the next destination. To the upside, 1.3050 remains the main resistance but a move into this level would have to be backed by strong fundamentals.

    Fundamental Outlook

    The Pound has a slow week ahead, which starts with the Spring Bank Holiday on Monday. No high-impact indicators will be released until Thursday when the Manufacturing PMI comes out, followed Friday by the Construction PMI. Both are surveys of purchasing managers from the respective sectors and act as leading indicators of optimism and economic health. Higher numbers usually strengthen the Pound but the impact is not always high if the actual number comes close to the forecast.

  10. #169
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    WEEKLY ANALYSIS: A FULL WEEK AHEAD: BRITISH PARLIAMENTARY ELECTIONS, ECB RATE DECISION


    EUR/USD


    Weekly Analysis: Last week the bulls maintained control and managed to push the pair above 1.1240 resistance, helped also by a much worse than expected Non-Farm Payrolls reading.



    Technical Outlook

    After a retracement and a perfect bounce at 1.1120, the pair moved back into 1.1240 resistance and this time the level was broken decisively. This means that the uptrend has resumed and price is on its way to the next resistance, located at 1.1340 – 1.1350. It must be noted that the Relative Strength Index and Stochastic have spent a lot of time in the upper part of their channels and although this is normal during an uptrend, it can also mean that a deeper pullback may soon follow. If price moves below 1.1240, it will encounter strong support at 1.1120.

    Fundamental Outlook

    French and German banks will be closed Monday in observance of Whit Monday, and this will probably affect volatility, generating choppy price action. On the US Dollar side we have the ISM Non-Manufacturing PMI, a survey of purchasing managers from outside the manufacturing sector, which acts as a leading indicator of economic health and optimism.

    Tuesday and Wednesday are slow days for both currencies but action picks up Thursday when the ECB will announce their decision on where to set the interest rate and ECB President Draghi will hold the usual press conference, discussing the rate decision and answering journalists’ questions. Usually volatility surges during the press conference, especially if Draghi offers hints about future rate changes. The trading week will end with another day that lacks major releases on either side.


    GBP/USD

    The pair had a very choppy week but it showed that for the time being the US Dollar is not strong enough to break horizontal support or the 50 days Exponential Moving Average. The week lacked major economic releases and this contributed to the choppy action.



    Technical Outlook

    Most of last week’s daily candles are small and with large wicks, which is a sign of indecision from both sellers and buyers. For the time being the 50 days Exponential Moving Average and the support at 1.2770 are holding, also the US Dollar was weakened by disappointing Non-Farm Employment numbers and all this suggests that the pair will climb towards 1.3050. However, it must be noted that this week the British Parliamentary Elections will take place and this will heavily affect the Pound, so the technical aspect will be secondary.

    Fundamental Outlook

    The first event of the week is the release of the British Services PMI, scheduled Monday; usually this survey creates volatility only if the actual reading differs from expectations. Probably the biggest movement on Pound pairs will be seen Thursday when the UK Parliamentary Elections take place. Caution is recommended throughout the day.

    Friday the British Manufacturing Production is released, showing changes in the total value of goods generated by the manufacturing sector. Higher numbers usually strengthen the Pound but same as with the Services PMI, the impact is bigger if the actual reading differs from expectations.

  11. #170
    FIB Gold Elite


    GDMFX's Avatar
    Join Date
    Oct 2012
    Location
    Kuala Lumpur, Malaysia
    Reputation
    Array
    Posts
    2,173
    box - einstein 250x250
    WEEKLY ANALYSIS: POUND ON SHAKY GROUND AFTER BRITISH PARLIAMENTARY ELECTIONS, US DOLLAR SHOWS SIGNS OF RECOVERY


    EUR/USD


    Weekly Analysis: Last week the ECB announced they’ve reduced inflation expectations for 2017 and the years to follow. This was the main reason for a drop seen Thursday but other than that, price action was choppy and without clear direction.



    Technical Outlook

    The pair retraced after reaching a high at 1.1283 and moved below 1.1240, showing increased bearish pressure. The Relative Strength Index reached its 70 level several times during the last period, becoming overbought and showing bearish divergence (price is making higher highs while the oscillator is making lower highs). These facts, combined with the ECB stance on inflation, make us believe that the pair is headed lower, possibly into the 50 days Exponential Moving Average. The first hurdle is the support at 1.1120 but if price bounces higher from there, we may see another encounter with 1.1240.

    Fundamental Outlook

    The week starts slow, without any major indicators released on Monday but Tuesday action picks up with the release of the German ZEW Economic Sentiment and U.S. Producer Price Index. Both releases have the capacity to move the currencies strongly, but the impact is lower if the actual number matches expectations.

    Wednesday will be a big day for the US Dollar because 3 major releases are scheduled: the U.S. CPI (key inflation gauge), the U.S. Retail Sales and the Fed will announce the interest rate which is expected to increase to <1.25% from the current <1.00%. All this is likely to generate increased movement on all US Dollar pairs, so caution is recommended.

    Thursday is a slow day for both the US Dollar and Euro and the trading week ends Friday with the release of the European Final Consumer Price Index and the University of Michigan Consumer Sentiment, which is a survey that tries to gauge the confidence of consumers in economic conditions.


    GBP/USD

    The British Parliamentary Elections resulted in a hung Parliament, meaning that the Conservative Party won but didn’t manage to take enough seats to establish a majority. This triggered a sharp drop for the Pound and a break of several support levels.



    Technical Outlook

    Given the current political situation in the United Kingdom, the Pound is likely to continue to weaken and to head into the next support located at 1.2570. The pair is now trading below two important levels (1.2850 and 1.2770) and below the 50 days Exponential Moving Average so the bias is bearish from a technical standpoint as well as fundamental. However, this is still a high-risk pair and we recommend caution trading it.

    Fundamental Outlook

    The first important release for the Pound is the British Consumer Price Index, scheduled Tuesday. The indicator is the main gauge of inflation and shows changes in the price that consumers pay for the goods and services they purchase.

    Wednesday’s highlight is the release of the Average Earnings Index, an indicator that shows changes in the price paid for labor by businesses and Government. The last major event of the week for the Pound is the announcement of the BOE interest rate, along with a Monetary Policy Summary, scheduled Thursday. As always, the U.S. events will have a direct and possibly strong influence on the pair’s direction.

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
footer - open-an-account