Weekly Outlook: 2014, November 30 - December 07

The NZD/USD pair fell during the course of the week as you can see, but we continue to simply consolidate in this general vicinity we feel that this market is essentially bounce around in this area, and it’s only a matter time before we break down. However rain now we do not have negative candle or rallied to start selling, so we are on the sidelines simply waiting for a little bit more directionality when it comes to candles. We believe that the 0.80 level should be massively resistive still.



the source

The GBP/USD pair tried to rally during the course of the week, but as you can see struggled to keep the gains in ended up forming a shooting star. The shooting star of course is a sign that the market will continue to go lower, but at the end of the day we feel that the market should continue to go lower that being the case it appears that the market is ready to head down to the 1.55 level, and possibly even 1.50 level. Rallies at this point time should continue to be selling opportunities.



the source

The EUR/USD pair rose initially during the course of the week, but found quite a bit of resistance at the 1.25 level to turn back around and form a shooting star. The shooting star is at the bottom of a downtrend, so having said that the market looks as if ready to continue going lower. That being the case, we still believe that the market goes all the way down to the 1.2050 level, which is the longer-term target for us. We have no interest whatsoever in buying this market until we get above the 1.30 handle.



the source

The dollar gained ground against a basket of other major currencies on Friday as a steep drop in oil prices fuelled fears over the risk of deflation in Japan and the euro zone and pressured commodity exposed currencies lower.

Oil prices tumbled following Thursday’s decision by the Organization of the Petroleum Exporting Countries to keep production quotas unchanged, fuelling fears over a global supply glut.

The US Dollar Index, which measures the greenback against a basket of six major currencies, was up 0.45% to 88.41 late Friday, not far from the four-year highs of 88.52 set on Monday.

USD/JPY was up 0.73% to 118.59 in late trade, nearing the seven-year peaks of 118.96 struck on November 20.

EUR/USD dipped 0.11% to 1.2451 late Friday, approaching Monday’s two year lows of 1.2359.

In the euro zone, data on Friday showed that the annual rate of inflation slowed to a five year low of 0.3% in November. The weak data was seen as increasing the likelihood that the European Central Bank will implement quantitative easing measures.

The slump in oil prices drove the Russian rouble to record lows against the dollar and the euro, with USD/RUB up 2.04% to 50.28 and EUR/RUB advancing 2.23% to 62.60 in late trade.

The commodity linked Canadian dollar fell to three-week lows against the greenback, with USD/CAD rising 0.74% to 1.1414, while the Norwegian krone fell to its lowest level in five years, with USD/NOK up 1.5% to 7.03.

The selloff in oil overshadowed data Friday showing that Canada’s gross domestic product expanded at an annual rate of 2.8% in the third quarter as exports rose 2.2%. Economists had forecast third quarter growth of 2.1%.

Demand for the dollar continued to be underpinned by expectations that the Federal Reserve is moving closer to raising interest rates, as central banks in Japan and the euro zone are easing monetary policy to spur growth and stave off the threat of deflation.

In the week ahead investors will be focusing on the outcome of a policy meeting of the ECB on Thursday, which is to be followed by the U.S. jobs report for November on Friday. Central banks in the U.K., Canada and Australia are also to hold policy setting meetings next week.

Monday, December 1

• China is to release official data on manufacturing activity, as well as the HSBC manufacturing index.
• The U.K. is to publish its manufacturing index as well as data on net lending to individuals.
• In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Tuesday, December 2

• Australia is to release data on building approvals and the current account. Later in the day, the Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
• In the euro zone, Spain is to release data on the change in the number of people employed.
• The U.K. is to publish a report on construction sector activity.

Wednesday, December 3

• Australia is to publish a report on GDP, the broadest indicator of economic activity and the leading indicator of economic growth.
• China is to release official data on service sector activity, as well as the HSBC services index.
• The U.K. is to release what will be a closely watched report on service sector growth.
• The euro zone is to release data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
• The U.S. is to release the ADP report on private sector job creation.
• The Bank of Canada is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
• Later Thursday, the ISM is to publish a report on U.S. service sector activity.

Thursday, December 4

• Australia is to publish data on retail sales and the trade balance, the difference in value between imports and exports.
• The U.K. is to publish private sector data on house price inflation.
• The Bank of England is to announce its benchmark interest rate.
• Later in the day, the ECB is to announce its benchmark interest rate. The announcement is to be followed by a press conference with President Mario Draghi.
• The U.S. is to release the weekly report on initial jobless claims.
• Canada is to publish its Ivey PMI.

Friday, December 5

• In the euro zone, Germany is to release data on factory orders.
• The Swiss National Bank is to publish data on its foreign currency reserves. This data is closely scrutinized for indications of the size of the bank’s operations in currency markets.
• Canada is to publish data on the change in the number of people employed and the unemployment rate, as well as a separate report on the trade balance.
• The U.S. is to round up the week with the closely watched government report on nonfarm payrolls, the unemployment rate and average earnings, as well as a report on factory orders.

the source

The dollar ended the week close to seven-year peaks against the yen on Friday as tumbling oil prices added to concerns over the risk of deflation in Japan and the diverging monetary policy stance between the Federal Reserve and the Bank of Japan continued to pressure the yen lower.

USD/JPY was up 0.73% to 118.59 in late trade, not far from the seven-year peaks of 118.96 struck on November 20.

Oil prices tumbled on Friday following Thursday’s decision by the Organization of the Petroleum Exporting Countries to keep its production quotas unchanged, fuelling fears over a global supply glut.

The U.S. dollar index, which measures the greenback against a basket of six major currencies, was up 0.45% to 88.41 late Friday, not far from the four-year highs of 88.52 set on Monday.

The yen has weakened broadly since the Bank of Japan unexpectedly expanded its stimulus program on October 31. In contrast the Fed wound up its asset purchase program last month and is weighing whether or not the economy is strong enough to start raising interest rates next year.

Japan’s Prime Minister Shinzo Abe dissolved parliament earlier this month, clearing the way for elections to be held on December 15 to seek a fresh mandate for his economic policies, which call for a weaker yen. The decision came after data showing that Japan’s economy unexpectedly fell into recession in the third quarter.

The euro also gained ground against the yen, with EUR/JPY up 0.65% to 147.66 late Friday.

In the euro zone, data on Friday showed that the annual rate of inflation slowed to a five year low of 0.3% in November. The weak data was seen as increasing the likelihood that the European Central Bank will implement quantitative easing measures in a bid to spur growth and stave off the threat of deflation.

In the week ahead investors will be focusing on the outcome of a policy meeting of the ECB on Thursday, which is to be followed by the U.S. jobs report for November on Friday.

Monday, December 1

• In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Wednesday, December 3

• The U.S. is to release the ADP report on private sector job creation. Later Thursday, the ISM is to publish a report on U.S. service sector activity.

Thursday, December 4

• The U.S. is to release the weekly report on initial jobless claims.

Friday, December 5

• The U.S. is to round up the week with the closely watched government report on nonfarm payrolls, the unemployment rate and average earnings, as well as a report on factory orders.

the source

The Canadian dollar slumped to three-week lows against the U.S. dollar on Friday as a selloff in world oil prices overshadowed stronger-than-expected data on Canadian third quarter growth.

USD/CAD rose to highs of 1.1444, the most since November 7 and was last up 0.74% to 1.1414. For the week, the pair gained 1.64%.

The US dollar index, which measures the greenback against a basket of six major currencies, was up 0.45% to 88.41 late Friday, not far from the four-year highs of 88.52 set on Monday.

Oil prices tumbled on Friday following Thursday’s decision by the Organization of the Petroleum Exporting Countries to keep its production quotas unchanged, fuelling fears over a global supply glut.

The steep declines in oil prices overshadowed data Friday showing that Canada’s economy grew at a stronger rate than forecast in the last quarter, boosted by rising exports and increased consumer spending and business investment.

Statistics Canada reported that gross domestic product expanded at an annual rate of 2.8% in the third quarter, outstripping economists forecasts for growth of 2.1%.

Exports were up 2.2% and household spending rose 0.7%, while business investment in residential structures rose 3.0%, the fastest pace since the first quarter of 2012 the report said.

In the week ahead, investors will be focusing on the outcome of a policy meeting of the Bank of Canada on Wednesday, which is to be followed by jobs report for both the U.S. and Canada on Friday.

Monday, December 1

• In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Wednesday, December 3

• The BoC is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
• The U.S. is to release the ADP report on private sector job creation, while the ISM is to publish a report on U.S. service sector activity later in the day.

Thursday, December 4

• The U.S. is to release the weekly report on initial jobless claims.
• Canada is to publish its Ivey PMI.

Friday, December 5

• Canada is to publish data on the change in the number of people employed and the unemployment rate, as well as a separate report on the trade balance.
• The U.S. is to round up the week with the closely watched government report on nonfarm payrolls, the unemployment rate and average earnings, as well as a report on factory orders.

the source

The Australian dollar ended Friday's session close to a four-year low as sliding commodity prices weighed on growth-linked assets.

AUD/USD fell to 0.8477 on Wednesday, the pair's lowest since July 2010, before subsequently consolidating at 0.8503 by close of trade on Friday, down 0.46% for the day and 1.94% lower for the week.

The pair is likely to find support at 0.8477, the low from November 26, and resistance at 0.8614, the high from November 27.

Oil prices tumbled following Thursday’s decision by the Organization of the Petroleum Exporting Countries to keep production quotas unchanged, fuelling fears over a global supply glut.

London-traded Brent prices lost $2.43, or 3.35%, to settle at $70.15 a barrel on Friday, while New York-traded crude futures plummeted $7.54, or 10.23%, to close at $66.15 a barrel.

The US Dollar Index, which measures the greenback against a basket of six major currencies, was up 0.45% to 88.41 late Friday, not far from the four-year highs of 88.52 set earlier in the week.

AUD/USD has been under pressure in recent weeks amid indications a strengthening U.S. economic recovery will force the Federal Reserve to start raising interest rates sooner and faster than previously thought.

In contrast, minutes of the Reserve Bank of Australia’s most recent meeting indicated that rates were likely to remain on hold for some time to come.

In the week ahead investors will be focusing on the outcome of a policy meeting of the Reserve Bank of Australia on Tuesday, which is to be followed by the U.S. jobs report for November on Friday.

Monday, December 1

• China is to release official data on manufacturing activity, as well as the HSBC manufacturing index. The Asian nation is Australia's largest trade partner.
• In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Tuesday, December 2

• Australia is to release data on building approvals and the current account.
• Later in the day, the Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.

Wednesday, December 3

• Australia is to publish a report on GDP, the broadest indicator of economic activity and the leading indicator of economic growth.
• The U.S. is to release the ADP report on private sector job creation, while the ISM is to publish a report on U.S. service sector activity.

Thursday, December 4

• Australia is to publish data on retail sales and the trade balance, the difference in value between imports and exports.
• The U.S. is to release the weekly report on initial jobless claims.

Friday, December 5

• The U.S. is to round up the week with the closely watched government report on nonfarm payrolls, the unemployment rate and average earnings, as well as a report on factory orders.

the source

The New Zealand dollar declined against its U.S. counterpart in holiday-thinned trade on Friday, as tumbling oil prices weighed on appetite for riskier assets.

NZD/USD hit 0.7765 on Tuesday, the pair\'s lowest since November 11, before subsequently consolidating at 0.7842 by close of trade on Friday, down 0.36% for the day and 0.5% lower for the week.

The pair is likely to find support at 0.7765, the low from November 25, and resistance at 0.7925, the high from November 27.

Oil prices tumbled following Thursday’s decision by the Organization of the Petroleum Exporting Countries to keep production quotas unchanged, fuelling fears over a global supply glut.

London-traded Brent prices lost $2.43, or 3.35%, to settle at $70.15 a barrel on Friday, while New York-traded crude futures plummeted $7.54, or 10.23%, to close at $66.15 a barrel.

The US Dollar Index, which measures the greenback against a basket of six major currencies, was up 0.45% to 88.41 late Friday, not far from the four-year highs of 88.52 set earlier in the week.

Demand for the dollar continued to be underpinned amid indications a strengthening U.S. economic recovery will force the Federal Reserve to start raising interest rates sooner and faster than previously thought.

In the week ahead, the U.S. is to release the U.S. jobs report for November on Friday as market players attempt to gauge the strength of the world\'s biggest economy and its impact on the Fed\'s monetary policy.

Monday, December 1

• China is to release official data on manufacturing activity, as well as the HSBC manufacturing index. The Asian nation is New Zealand\'s second-largest trader partner.
• In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Wednesday, December 3

• The U.S. is to release the ADP report on private sector job creation, while the ISM is to publish a report on U.S. service sector activity.

Thursday, December 4

• The U.S. is to release the weekly report on initial jobless claims.

Friday, December 5

• The U.S. is to round up the week with the closely watched government report on nonfarm payrolls, the unemployment rate and average earnings, as well as a report on factory orders.

the source

The pound fell against the dollar on Friday, closing in on 14-month lows as a selloff in oil prices fuelled fears over disinflation, bolstering demand for the greenback.

GBP/USD touched lows of 1.5614 and was at 1.5640 late Friday, off 0.61% for the day, and not far from the 14-month trough of 1.5588 reached on November 19.

Oil prices tumbled on Friday following Thursday’s decision by the Organization of the Petroleum Exporting Countries not to cut output quotas, fuelling fears over a global supply glut.

The move sparked fears over the impact of growing deflationary pressures on the global economic recovery.

The U.S. dollar index, which measures the greenback against a basket of six major currencies, was up 0.45% to 88.41 late Friday, not far from the four-year highs of 88.52 set on Monday.

Elsewhere, sterling fell to one week lows against the euro on Friday, with EUR/GBP up 0.46% in late trade despite data showing that the annual rate of euro area inflation slowed to a five year low of 0.3% this month.

The weak data was seen as increasing the likelihood that the European Central Bank will implement quantitative easing measures in a bid to spur growth and stave off the threat of deflation.

In the U.K., data on Friday showed that the housing market continued to slow this month. Mortgage lender Nationwide reported that house prices rose by 0.3% after a 0.5% increase in October. That brought the annual rate of house price inflation down to 8.5% from 9.0% last month.

Earlier in the week, official data confirmed that U.K. third quarter growth was in line with the preliminary estimates released in October.

The U.K. economy grew 0.7% in the July-to-September period and expanded 3.0% on a year-over-year basis.

In the week ahead, investors will be focusing on surveys of the U.K. services, manufacturing and construction sectors, while Friday’s U.S. jobs report for November will also be closely watched.

Monday, December 1

• The U.K. is to publish its manufacturing index as well as data on net lending to individuals.
• In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Tuesday, December 2

• The U.K. is to publish a report on construction sector activity.

Wednesday, December 3

• The U.K. is to release what will be a closely watched report on service sector growth.
• The U.S. is to release the ADP report on private sector job creation, while the ISM is to publish a report on U.S. service sector activity later in the day.

Thursday, December 4

• The U.K. is to publish private sector data on house price inflation.
• Later Thursday, the BoE is to announce its benchmark interest rate.
• The U.S. is to release the weekly report on initial jobless claims.

Friday, December 5

• The U.S. is to round up the week with the closely watched government report on nonfarm payrolls, the unemployment rate and average earnings, as well as a report on factory orders.

the source

The euro ended the day lower against the dollar on Friday after data showed that euro zone inflation slowed to five year low this month and tumbling oil prices fuelled concerns over the outlook for the global economic recovery.

EUR/USD dipped 0.11% to 1.2451 late Friday, closing in on Monday’s two year lows of 1.2359.

Eurostat reported that the annual rate of euro area inflation slowed to a five year low of 0.3% this month, down from 0.4% in October.

The report said that falling energy prices were the main factor pressuring inflation lower. Energy prices have fallen 2.5% on a year-over-year basis and look likely to continue to drop in the wake of Thursday’s decision by the Organization of the Petroleum Exporting Countries not to cut output quotas.

The move fuelled a broad based selloff in oil prices and added to fears over the impact of growing deflationary pressures on the global economic recovery.

The weak inflation data was seen as increasing the likelihood that the European Central Bank will implement quantitative easing measures in a bid to spur growth and stave off the threat of deflation.

A separate report showed that the rate of unemployment in the euro area was unchanged at 11.5% last month.

The US dollar index, which measures the greenback against a basket of six major currencies, was up 0.45% to 88.41 late Friday, not far from the four-year highs of 88.52 set on Monday.

Elsewhere, the euro gained ground against the yen and the pound, with EUR/JPY up 0.65% to 147.66 and EUR/GBP rising 0.46% to 0.7958 in late trade.

The yen has weakened broadly since the Bank of Japan unexpectedly expanded its stimulus program on October 31.

Japan’s Prime Minister Shinzo Abe dissolved parliament earlier this month, clearing the way for elections to be held on December 15 to seek a fresh mandate for his economic policies, which call for a weaker yen. The decision came after data showing that Japan’s economy unexpectedly fell into recession in the third quarter.

In the week ahead investors will be focusing on the outcome of a policy meeting of the ECB on Thursday, which is to be followed by the U.S. jobs report for November on Friday.

Monday, December 1

• In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Tuesday, December 2

• In the euro zone, Spain is to release data on the change in the number of people employed.

Wednesday, December 3

• The euro zone is to release data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
• The U.S. is to release the ADP report on private sector job creation, while the ISM is to publish a report on U.S. service sector activity later in the day.

Thursday, December 4

• The ECB is to announce its benchmark interest rate. The announcement is to be followed by a press conference with President Mario Draghi.
• The U.S. is to release the weekly report on initial jobless claims.

Friday, December 5

• In the euro zone, Germany is to release data on factory orders.
• The U.S. is to round up the week with the closely watched government report on nonfarm payrolls, the unemployment rate and average earnings, as well as a report on factory orders.

the source