Weekly Outlook: 2014, February 02 - 09

**newdigital** · 02-02-2014, 11:52 AM

USD/JPY weekly outlook: February 3 - 7

The dollar was lower against the yen on Friday as steep declines in the euro and a broad based selloff in emerging economies bolstered safe haven demand for the yen.

USD/JPY ended Friday’s session down 0.69% to lows of 101.99, and finished the week 0.63% lower.

The pair is likely to find near-term support at 101.60 and resistance at 102.92, Friday’s high.

Safe haven demand for the yen was boosted after data on Friday showed that the annual rate of euro zone inflation slowed in January, fuelling expectations that the European Central Bank may need to tighten policy in order to support the recovery in the region.

The annual rate of euro zone inflation slowed to 0.7% in January, Eurostat said, after a 0.8% gain in December. Analysts had expected the inflation rate to tick up to 0.9%.

It was the fourth consecutive month the inflation rate came in at less than 1% and was well below the ECB’s target of 2%. The ECB unexpectedly cut rates to a record low 0.25% when inflation fell to a four-year low of 0.7% in October.

The common currency fell to two-month lows against the yen, with EUR/JPY dropping 1.07% to 137.75, extending the months losses to 1.89%.

The yen received an additional boost after data on Friday showed that the annual rate of core inflation in Japan accelerated to 1.3% in January, the highest level in five years.

Risk aversion was also supported by fears over the outlook for emerging markets, amid fears over the impact of cuts to the Federal Reserve’s stimulus program and worries over a possible slowdown in China.

On Wednesday the Fed said it would scale back its monthly asset purchase program by another $10 billion to $65 billion, citing improvements in the labor market.

Data released on Thursday showed that the U.S. economy grew 3.2% in the fourth quarter, in line with expectations.

On Friday, U.S. data showed that consumer spending rose 0.4% in December, above expectations for an increase of 0.2%.

A separate report showed that the University of Michigan’s consumer sentiment index ticked down to 81.2 in January from 82.5 in December, but was better than the preliminary reading of 80.4 and forecasts for a reading of 81.0.

In the week ahead, investors will be keenly anticipating Friday’s U.S. nonfarm payrolls report for January after December’s report showed that the economy added far fewer jobs than expected.

Interest rate decisions by the ECB, the Bank of England and the Reserve Bank of Australia will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, February 3

The Institute of Supply Management is to produce data on manufacturing activity, a leading economic indicator.

Tuesday, February 4

The U.S. is to produce data on factory orders, a leading indicator of production.

Wednesday, February 5

Japan is to publish data on average cash earnings.

The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Meanwhile, the ISM is to publish a report service sector activity.

Thursday, February 6

The U.S. is to publish the weekly report on initial jobless claims as well as data on the trade balance.

Friday, February 7

The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

**newdigital** · 02-02-2014, 12:59 PM

USD/CAD weekly outlook: February 3 - 7

The U.S. dollar rose to fresh four-and-half year highs against the Canadian dollar on Friday as the selloff in emerging markets prompted investors to stage a broad retreat from riskier assets.

USD/CAD hit highs of 1.1224, the strongest level since July 2009, before retracting some of those gains to settle at 1.1125, 0.27% lower for the day. For the week, the pair gained 0.10%.

The pair is likely to find support at 1.1075 and resistance at 1.1224.

The Canadian dollar came under pressure as the selloff in emerging markets prompted a broad based flight to safety on Friday, with investors fleeing equities, bonds and currencies perceived as risky.

Emerging markets have been hard hit by a combination of concerns over the impact of cuts to the Federal Reserve’s stimulus program and fears over a possible slowdown in China. The Turkish lira and the South African rand tumbled after surprise rate hikes did little to shore up the currencies.

On Wednesday the Fed said it would scale back its monthly asset purchase program by another $10 billion to $65 billion, citing improvements in the labor market.

The Canadian dollar found support after data released on Friday showed that the Canadian economy expanded 0.2% in November, in line with expectations but slowing slightly from growth of 0.3% in October.

In the U.S., data on Friday showed that consumer spending rose 0.4% in December, above expectations for an increase of 0.2%.

A separate report showed that the University of Michigan’s consumer sentiment index ticked down to 81.2 in January from 82.5 in December, but was better than the preliminary reading of 80.4 and forecasts for a reading of 81.0.

The reports came one day after data showed that the U.S. economy grew 3.2% in the fourth quarter, in line with expectations.

The data fuelled hopes that the recovery in the world’s largest economy could withstand cuts to the Fed’s stimulus program and turmoil in emerging markets.

In the week ahead, investors will be keenly anticipating Friday’s U.S. nonfarm payrolls report for January after December’s report showed that the economy added far fewer jobs than expected. Canadian data on trade and employment will also be closely watched.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, February 3

Canada is to release data on raw materials price inflation.

In the U.S., the Institute of Supply Management is to produce data on manufacturing activity, a leading economic indicator.

Tuesday, February 4

The U.S. is to produce data on factory orders, a leading indicator of production.

Wednesday, February 5

Canada is to produce data on building permits.

The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Meanwhile, the ISM is to publish a report service sector activity.

Thursday, February 6

Both the U.S. and Canada are to publish data on the trade balance, and the U.S. is also to publish the weekly report on initial jobless claims. Canada is to publish its Ivey PMI.

Friday, February 7

Canada is to publish data on the change in the number of people employed and the unemployment rate.

The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

**newdigital** · 02-02-2014, 02:30 PM

AUD/USD weekly outlook: February 3 - 7

The Australian dollar weakened against its U.S. counterpart on Friday, as demand for the greenback remained supported after the Federal Reserve announced plans to further taper its monthly bond-buying program.

AUD/USD fell to 0.8694 on Friday, the pair’s lowest since January 27, before subsequently consolidating at 0.8752 by close of trade, down 0.5% for the day but 0.78% higher for the week.

The pair is likely to find support at 0.8694, Friday’s session low and resistance at 0.8824, Friday’s high.

On Wednesday, the Fed said it would scale back its monthly asset purchase program by another USD10 billion to USD65 billion a month, citing improvements in the labor market.

The central bank said it will keep a close eye on economic indicators before deciding to wind down its stimulus program even further.

Data released on Thursday showed that the U.S. economy grew 3.2% in the fourth quarter, in line with expectations.

On Friday, U.S. data showed that consumer spending rose 0.4% in December, above expectations for an increase of 0.2%.

Concerns over a slowdown in China’s manufacturing sector and ongoing turmoil in emerging markets also weighed on growth-linked assets, such as the Aussie.

The Australia dollar fell sharply against the yen on Friday, with AUD/JPY plunging 1.08% to settle at 89.38 at the close.

Data from the Commodities Futures Trading Commission released Friday showed that speculators increased their bearish bets on the Australian dollar in the week ending January 28.

Net shorts totaled 65,723 contracts, up 1.7% from the previous week’s total of 64,584 net shorts.

In the week ahead, investors will be keenly anticipating Friday’s U.S. nonfarm payrolls report for January after December’s report showed that the economy added far fewer jobs than expected.

An interest rate decision by Reserve Bank of Australia will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, February 3

Australia is to produce data on building approvals, a leading indicator of future construction activity.

In the U.S., the Institute of Supply Management is to produce data on manufacturing activity, a leading economic indicator.

Tuesday, February 4

The RBA 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 produce data on factory orders, a leading indicator of production.

Wednesday, February 5

The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Meanwhile, the ISM is to publish a report service sector activity.

Thursday, February 6

Australia is to release data on retail sales and the trade balance, the difference in value between imports and exports. The nation is also to release private sector data on business confidence.

The U.S. is to publish the weekly report on initial jobless claims as well as data on the trade balance.

Friday, February 7

The RBA is to publish its monetary policy statement, which outlines economic conditions and the inflation outlook from the bank’s perspective.

The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

**newdigital** · 02-02-2014, 03:19 PM

NZD/USD weekly outlook: February 3 - 7

The New Zealand dollar tumbled to a four-month low against its U.S. counterpart on Friday, as the broad based selloff in emerging markets spurred safe haven demand.

NZD/USD fell to 0.8063 on Friday, the pair’s lowest since September 11, before subsequently consolidating at 0.8088 by close of trade, down 0.97% for the day and 1.53% lower for the week.

The pair is likely to find support at 0.8063, Friday’s low and resistance at 0.8164, the high from November 29.

The New Zealand dollar came under pressure as the selloff in emerging markets prompted investors to stage a broad retreat from riskier assets. The Turkish lira and the South African rand tumbled after surprise rate hikes did little to shore up the currencies.

The New Zealand dollar fell sharply against the yen on Friday, with NZD/JPY plunging 1.6% to hit 82.56 at the close.

Emerging markets have been hard hit by a combination of concerns over the impact of cuts to the Federal Reserve’s stimulus program and fears over a possible slowdown in China.

On Wednesday, the Fed said it would scale back its monthly asset purchase program by another USD10 billion to USD65 billion a month, citing improvements in the labor market.

The kiwi was also lower after the Reserve Bank of New Zealand left rates on hold earlier in the week, disappointing some market expectations for a rate hike.

The RBNZ left the cash rate at a record low of 2.5% on Thursday, saying the country’s "economic expansion has considerable momentum" and added that a return of interest rates to more normal levels can be expected "soon."

Data from the Commodities Futures Trading Commission released Friday showed that speculators increased their bullish bets on the New Zealand dollar in the week ending January 28.

Net longs totaled 9,685 contracts as of last week, up 11% from net longs of 8,556 contracts in the previous week.

In the week ahead, investors will be keenly anticipating Friday’s U.S. nonfarm payrolls report for January after December’s report showed that the economy added far fewer jobs than expected.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, February 3

The U.S. Institute of Supply Management is to produce data on manufacturing activity, a leading economic indicator.

Tuesday, February 4

The U.S. is to produce data on factory orders, a leading indicator of production.

New Zealand is to publish data on the change in the number of people employed and the unemployment rate.

Wednesday, February 5

The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Meanwhile, the ISM is to publish a report service sector activity.

Markets in New Zealand are to remain closed for a national holiday.

Thursday, February 6

The U.S. is to publish the weekly report on initial jobless claims as well as data on the trade balance.

Friday, February 7

The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

**newdigital** · 02-02-2014, 04:34 PM

EUR/USD weekly outlook: February 3 - 7

The dollar rose to 10-week highs against the euro on Friday as a slowdown in the annual rate of euro zone inflation in January fuelled fears over the threat of deflation in the euro area.

EUR/USD hit 1.3478, the weakest since November 22 and was last down 0.49% to 1.3488. For the week, the pair lost 1.35%.

The annual rate of euro zone inflation slowed to 0.7% in January, Eurostat said, after a 0.8% gain in December. Analysts had expected the inflation rate to tick up to 0.9%.

It was the fourth consecutive month the inflation rate came in at less than 1% and was well below the ECB’s target of 2%. The ECB unexpectedly cut rates to a record low 0.25% when inflation fell to a four-year low of 0.7% in October.

A separate report showed that the rate of unemployment in the euro zone was unchanged at 12% in December for the third successive month.

The common currency fell to two-month lows against the yen, with EUR/JPY dropping 1.07% to 137.75, extending the months losses to 1.89%.

Demand for the dollar was also underpinned as the selloff in emerging markets prompted a broad based flight to safety on Friday, with investors fleeing equities, bonds and currencies perceived as risky.

Emerging markets have been hard hit by a combination of concerns over the impact of cuts to the Federal Reserve’s stimulus program and fears over a possible slowdown in China. The Turkish lira and the South African rand tumbled after surprise rate hikes did little to shore up the currencies.

On Wednesday the Fed said it would scale back its monthly asset purchase program by another $10 billion to $65 billion, citing improvements in the labor market.

Data released on Friday showed that U.S. consumer spending rose 0.4% in December, above expectations for an increase of 0.2%.

A separate report showed that the University of Michigan’s consumer sentiment index ticked down to 81.2 in January from 82.5 in December, but was better than the preliminary reading of 80.4 and forecasts for a reading of 81.0.

The reports came one day after data showed that the U.S. economy grew 3.2% in the fourth quarter, in line with expectations.

The data fuelled hopes that the recovery in the world’s largest economy could withstand reductions to the Fed’s asset purchase program and turmoil in emerging markets.

In the week ahead, investors will be keenly anticipating Friday’s U.S. nonfarm payrolls report for January after December’s report showed that the economy added far fewer jobs than expected.
Thursday’s rate decision by the ECB will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, February 3

In the euro zone, Spain and Italy are to publish data on manufacturing activity.

In the U.S., the Institute of Supply Management is to produce data on manufacturing activity, a leading economic indicator.

Tuesday, February 4

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

The U.S. is to produce data on factory orders, a leading indicator of production.

Wednesday, February 5

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. Spain and Italy are to publish data on service sector activity.

The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Meanwhile, the ISM is to publish a report service sector activity.

Thursday, February 6

Germany is to publish data on factory orders.

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 publish the weekly report on initial jobless claims as well as data on the trade balance.

Friday, February 7

Germany is to publish reports on industrial production and the trade balance.

The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

**newdigital** · 02-02-2014, 05:01 PM

GBP/USD weekly outlook: February 3 - 7

The pound ended the week lower against the broadly stronger dollar on Friday as indications that the U.S. recovery is gaining momentum and increased risk aversion underpinned dollar demand.

GBP/USD fell to lows of 1.6429, the weakest since January 21 and was last down 0.29% to 1.6434. For the week, the pair lost 0.83%.

Cable is likely to find support at 1.6325 and resistance at 1.6566, Thursday’s high.

The dollar strengthened broadly on Friday as the selloff in emerging markets prompted a broad based flight to safety, with investors fleeing equities, bonds and currencies perceived as risky.

Emerging markets have been hard hit by a combination of concerns over the impact of cuts to the Federal Reserve’s stimulus program and fears over a possible slowdown in China. The Turkish lira and the South African rand tumbled after surprise rate hikes did little to shore up the currencies.

On Wednesday the Fed said it would scale back its monthly asset purchase program by another $10 billion to $65 billion, citing improvements in the labor market.

Data released on Friday showed that U.S. consumer spending rose 0.4% in December, above expectations for an increase of 0.2%.

A separate report showed that the University of Michigan’s consumer sentiment index ticked down to 81.2 in January from 82.5 in December, but was better than the preliminary reading of 80.4 and forecasts for a reading of 81.0.

The reports came one day after data showed that the U.S. economy grew 3.2% in the fourth quarter, in line with expectations.

The data fuelled hopes that the recovery in the world’s largest economy could withstand reductions to the Federal Reserve’s asset purchase program and turmoil in emerging markets.

Earlier in the week, data showed that the U.K. economy grew 0.7% in the final three months of 2013, in line with expectations and slightly down from growth of 0.8% in the previous quarter. On a year-over-year basis the economy expanded 2.8%.

On an annual basis, U.K. gross domestic product was 1.9% in 2013, up from just 0.3% the previous year, the fastest annual rate of growth since 2007.

In the week ahead, investors will be keenly anticipating Friday’s U.S. nonfarm payrolls report for January after December’s report showed that the economy added far fewer jobs than expected.

Thursday’s rate decision by the Bank of England and U.K. data on service sector activity will also be in focus.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, February 3

The U.K. is also to publish data on manufacturing activity, a leading indicator of economic health.

In the U.S., the Institute of Supply Management is to produce data on manufacturing activity, a leading economic indicator.

Tuesday, February 4

The U.K. is to publish data on construction sector activity, a leading economic indicator.

The U.S. is to produce data on factory orders, a leading indicator of production.

Wednesday, February 5

The U.K. is also to release data on service sector activity, a leading economic indicator.

The U.S. is to release the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. Meanwhile, the ISM is to publish a report service sector activity.

Thursday, February 6

The BoE is to announce its benchmark interest rate.

The U.S. is to publish the weekly report on initial jobless claims as well as data on the trade balance.

Friday, February 7

The U.K. is to produce data on manufacturing and industrial production, as well as a report on the trade balance.

The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate.

**newdigital** · 02-03-2014, 04:44 AM

Gold Prices Start The Week Soft As Chinese Celebrate Year Of The Horse

old prices could struggle during a relatively quiet Asian session as Chinese markets are closed in recognition of the new year, said analysts.

In electronic trading, Comex April gold futures opened Sunday evening at $1,242 an ounce, a gap lower from Friday’s electronic closing price of $1,245.60 per ounce. Prices have managed to rally from the weak open and as of 6:47 p.m. EST, April gold is at $1243.40 an ounce.

Analysts at ANZ Bank in Australia said that although Chinese markets are closed for the next week, they are expecting physical demand to remain low for at least two weeks and as a result are forecasting lower prices.

“With the Chinese absent, the market is likely to struggle to hold rallies,” they said in a research note.

Gold analysts will continue to watch global equity markets and use it as a barometer for gold demand. Global equities, especially emerging markets, ended the first month of the year in negative territory. The S&P 500 index ended January down almost 3%. In other major markets, Japan’s Nikkei dropped 8.5% and Hong Kong’s Hang Seng dropped 5.5% in the first month of the year.

**Taylor Woods** · 03-12-2020, 07:19 AM

Up until now, we have been discussing forex prices as a solitary quote. In reality, there are in reality two quotes at each cost: the bid price and the ask price. The bid price is the price at which the trader chooses to sell. It is additionally the price at which the broker is happy to buy. The ask price is the price at which the trader chooses to buy. It is likewise the price at which the broker is eager to sell. The difference between the bid price and the ask price is known as the spread. The spread is the transaction expense that the broker charges for executing an exchange.