Daily Market Analysis from ForexMart

USD/JPY Technical Analysis: September 13, 2017

The U.S. dollar moved sideways at the beginning of Tuesday session. Soon after, the pair rallied much higher. Currently, the level of 110 is being tested but there is still a gap that could raise some concerns. Nevertheless, this gap has been filled. However, traders should still be careful since there is a sign of “overbought” in the market. A pullback could happen after some time since the market is sensitive enough to react suddenly before going forward. Consequently, a breakout occurred at 110.25 level and the price will most likely move forward towards 111 level.

EUR/USD Fundamental Analysis: September 14, 2017

The EUR/USD further declined on Wednesday due to the widespread recovery of the dollar. As of this moment, the greenbacks continued trading in a strong manner despite the sluggish data presented by the US Producer Price Index (PPI). This did not really influence the USD since the market is starting to like it and drove much higher among other instruments. However, this made an impact to the euro-dollar pair and led to a downturn in the past 24 hours.

There are also assumptions that President Trump and his team are one of the reasons for the dollar crashing in the previous months, but his actions appeared to support the greens now. The partners of Trump seems to lack support and he even attempted to negotiate with the members of the opposing party to obtain some help in accomplishing his reforms and further plans. D. Trump is trying to drive the issue about debt ceiling until the end of the year, while there are rumors that the American leader is interacting with the Democrats to fulfill his healthcare program and tax reform.

The underlying question is about the efficacy of the plan as a whole and the effectiveness of the project’s other details. Moreover, the market and the USD are in favor with this which ended on buying the dollar with an advanced optimistic outlook. Hence, the EURUSD moved lower down to 1.19 mark and currently sits at the 1.1875 support which is quite weak.

Ultimately, there are no scheduled economic releases from Europe for today, except for the major CPI data from the United States. The figures are expected to provide an outlook regarding the current inflation in the US. If the results were strong, it will enable the continuous recovery of the dollar in the near term, pushing the pair close to the 1.18 area.

GBP/USD Fundamental Analysis: September 19, 2017

The trading has been sluggish but the pound still remains to be the tops in the volatility as it continues to move the market in the past 24 hours. Yesterday, the only major news was the speech of Carney and the market anticipates a hawkish decision which further boosts the GBP/USD pair during the first half of the day. However, it declined later on.

Although Carney has mentioned monetary tightening, the Bank of England still needs to take manage the economy. Yet, there are no specific dates which frustrate the market as the British currency dropped after the speech and move lower than 1.35 for the day. A rebound occurred overnight and traded higher than 1.35 although this could just be a form of a correction in a bigger uptrend that could still change.

Considering the upcoming data and the recent developments in the U.K., it is possible for the BOE not to give attention to the economy and the central bank will most likely react but only in the succeeding months. The BOE already said that they will have a reaction amid the uncertainty with the ongoing Brexit. These would result in a rate hike in the upcoming months. Both the central bank and the market are anticipating for the Brexit uncertainty would wear off in the next few months which hasten the decision of the bank.

Today, there is no major news from the U.K. or from the U.S. Hence, consolidation is already anticipated ranges between 1.35 and 1.36 for the day as the market manages ahead of the FOMC meeting tomorrow. The bullishness is presumed to persist for the GBP/USD pair for short-term and target for 1.38 and 1.39 levels.

EUR/USD Fundamental Analysis: September 25, 2017

On Friday, the EUR/USD had another range trading and consolidative day and attempted to break the 1.2000 level. However, a sudden strong selling beat the pair back which pushed the single European currency under the 1.20 region. This scenario was already anticipated since the elections in Germany is scheduled over the weekend, considering the fact that there is no one who would like to have large positions until the weekend.

The elections took place and the results were announced, showing already anticipated outcome which is the victory of Merkel’s party. However, something unexpected happened as the formation of a coalition started since many have said that Merkel is incapable to lead a government by herself only. Moreover, this could continue for some days or even weeks and the market is not in favor with this. There are only some instances where markets preferred some uncertainties and this situation could probably keep going and could lead for the euro sell-off.

During the trading session this morning, we saw some sell-off in EUR, but a retracement developed. As of this writing, the EURUSD appeared to be weak which might continue until the end of the day. The London session is much awaited due to a lot of news regarding the elections that the markets would receive, allowing the market to make its own decision about which way to go. Hence, the indecision and uncertainty brought an impact to the euro.

Ultimately, the ECB President Mario Draghi is expected to have his speech along with Germany’s election results which could possibly control the EUR trend for this day. According to projections, the euro-dollar pair will be under pressure throughout the day.

EUR/USD Technical Analysis: October 2, 2017

The EUR/USD moved higher after a slight increase in inflation of euro area which had a mixed performance over other countries in Europe. The unemployment rate in Germany further declined to its record low which supported the EURUSD to progress forward. European yields also rose relative to the Treasury yields.

The euro-dollar pair drove upwards and rebounded from the support at 1.1721 around the weekly lows. The resistance of the pair is at 1.1869 level close to the 10-day moving average. The EURUSD decline by 1.5 significant figures for the week. The momentum is negative which further decelerated. While the moving average convergence divergence (MACD) histogram printed in the red, showing an upward trajectory which leads to consolidation.

EUR/USD Technical Analysis: October 4, 2017

The EUR/USD bounced back after the report for wholesale price inflation came in better than expected. As the yields provided some support which made the single European currency to gain more attraction in relation to the US dollar, with the continuous boiling of the Catalonian issues.
The greenback was able to sustain its gains due to a stronger than expected results of same-store sales, as it jumped almost to 5%.

The euro-dollar pair rebounded yesterday, followed by testing of the support region at 1.1661 area near the August lows. The pair’s resistance touched the 1.1822 level which is close to the 10-day moving average. Whence, the 10-day moving average moved beneath the 50-day moving average which indicates a downtrend in the medium-term in place.

Moreover, the momentum preserved its negative position while the moving average convergence divergence (MACD) histogram is printing in the red accompanied by a descending trajectory. This further shows that exchange rate became lower.

GBP/USD Fundamental Analysis: October 10, 2017

The markets are generally dull yesterday in spite the Cable pair moved higher during the daytime trading session. Both Canada and the United States is a holiday and liquidity is expected to be low during the entire day, while Japan is a holiday as well. However, the bulls active in the pound market took advantage of the low liquidity in pushing the prices upwards.

Meanwhile, the British pound continues to struggle in the sluggish data causing the Bank of England to keep on hold in the near term. During the BoE’s meeting in the previous month, there are possibilities that the central bank would raise its rates in December this year, but the impact of political risks and weaker data prompt them to be on hold.

The Brexit process is excluded from the issues of political uncertainties rather the extension of the UK Prime Minister Theresa May from her position.

Currently, PM May is urging to resign even by her own party and it remains unclear how she will handle this issue as well as to maintain the focus on processing the Brexit referendum.

Moreover, there is a rising issue about the no-deal in the euro area which could negatively affect the Britain’s economy.

If these factors were combined, it could probably keep the GBP in the pressured area. For today, the UK manufacturing production data is scheduled to be released from the United States. When the liquidity became stable again, it is expected that the greenback will continue to decline but will support the GBP/USD pair to ascend.

GBP/USD Fundamental Analysis: October 13, 2017

The GBP/USD pair keep on trading in an up and down direction which seems directionless, by the weakness of the U.S dollar helps the Cable pair to boost amid this period.

The struggle of the British currency continues due to the risks linked with the Brexit process, however, the dollar weakening appeared to be massive which affected others in moving up over the greenback. Until now, the Brexit process is ongoing but it remains to be seen any major development.

The delay in the talks continues while other discussion also does not provide any progress so far. This trigger doubts if Brexit talks could possibly break down and further led to question if the United Kingdom will depart from the European Union even without any accomplished deal. This could be the possible thing to happen at this particular moment, which further resulted in lot of uncertainty.

Moreover, the position of PM Theresa May seems to be threatened since last week because most of her party are against her leadership technique. Albeit, she was able to surpass such mess, she remains involved in a complicated scenario. These combined events pushed the sterling pound under pressure but the weakening of the dollar made it acceptable.

Ultimately, the retail sales and CPI data from the United States are scheduled today while the United Kingdom has no major data for this day. These set of data should be monitored carefully by market participants because inflation is considered a major parameter by the Federal Reserve, particularly, in making the decision about the rate hike in December. In case the figures showed strong data, the GBPUSD is expected to wane.

EUR/USD Fundamental Analysis: October 17, 2017

The euro bucks pair failed to gain strength during the trading session on Monday, followed by expectations to drive higher amid sluggish US data issued on Friday. While the retail sales showed robust data as well, however, the CPI resulted to a lower than anticipated figures. This caused the EURUSD to test the 1.1870 range high but the pair continuously moved lower since that period.

The EUR/USD weakened until the end of the trading course last Friday and the activity happened yesterday was a mere continuation of that previous trend. On one side, the U.S. dollar was able to acquire further strength since there are no any hints about the next missile launch from North Korea sooner or later, but the markets are still expecting for such motion. Moreover, this supported the greens to stir gradually and firmly across the board in the morning. The momentum ascends during the American hours with a high possibility that John Taylor would replace Janet Yellen for the position as Fed Chair. Taylor is known to be hawkish and very supportive of Fed rate increase. He is also favored by President Trump as the hawkishness helped the USD to perk up versus its counterpart currencies. Also, this has pushed the pair downwards below the 1.1780 mark as of this writing.

Ultimately, the Germany ZEW economic sentiment is scheduled to release today and no other major news both from the European Union and the United States.

The strength of the greenbacks is predicted to resumed this day as the pair eventually turns towards the range lows at 1.1700 mark.

EUR/USD Fundamental Analysis: October 30, 2017

The single European currency resumed moving lower as witnessed on Friday amid the sluggishness prompted by the ECB, as the central bank suspended the QE tapering. The effect of their decision would likely continue to be felt by the euro in the near term.

A sudden recovery was seen after the US dollar lost its strength on Friday, however, the impact appeared to be very insignificant and the euro is expected to keep on moving lower within this week.

The EUR was hardly hit by the ECB’s decision to extend the tapering until September 2018, which was opposite to market’s expectations that the program will end without delay. The scheduled data from the European region will remain robust. Moreover, the investors who are large buyers of euro were quite surprised in the past few months from the time when the ECB touched on the QE tapering in the previous meetings.

Whereas, ECB President Mario Draghi soften the talks about the tapering plan in the previous months in order to limit the strength of the European currency. But the market is not in the mood to pay attention and keep on buying more during that period. On Friday, they were awakened from the truth when the bank clearly stated its mood not to stop QE, which weakened the EUR.
A slight rebound is expected today but the overall trend appeared to turn downwards.

Ultimately, there is no major economic release from the US or Eurozone and as the month ends, there is a possibility of a profit taking, adjustments on positions and month end currency flow. Also, consolidation is anticipated, coupled with a small relief rally which could probably be sold and temporary.