Weekly Outlook: 2014, April 27 - May 04

IBEX forecast for the week of April 28, 2014, Technical Analysis

The IBEX tried to rally during the week, but as you can see found enough trouble just above the €10,500 level to pull things back down and form a shooting star. The shooting star suggests that the market could pull back from here overall, and as a result we are on the sidelines. We are actually looking for support somewhere near the €10,000 level, and if we get the right supportive candle, we are more than willing to buy this market. We would also do the same if we break the top of the shooting star from this past week as it would show a significant break up momentum.

EUR/USD forecast for the week of April 28, 2014, Technical Analysis

For the second week in a row, the EUR/USD pair fell, but bounced enough to form a small hammer. With that being the case, we believe that this market will continue to grind sideways, and as a result this market looks as if it is not ready to do anything at the moment. Because of this, we are not interested in a longer-term trade in the EUR/USD pair, but do recognize that there is a potential uptrend line coming soon, so buying is possible, but not at this moment in time.

NZD/USD forecast for the week of April 28, 2014, Technical Analysis

The NZD/USD pair went back and forth during the course of the week, but eventually changed very little. The market looks as if it’s still well supported at the 0.85 handle, and as a result we feel that this market will more than likely find buyers in the general vicinity. Going forward, we fully anticipate that this market will try to get to the 0.90 handle, and we do not have the right supportive candle to get involved. However, if we break down below the 0.85 handle, we think this market will more than likely head to the 0.83 level.

USD/CAD forecast for the week of April 28, 2014, Technical Analysis

The USD/CAD pair continue to go higher during the week, but as you can see didn’t have much of a range. At this moment time, we believe that this market will continue to the 1.13 level, but it may take it’s time to get there. With that being the case, we feel that this market can only be bought, and as far as selling is concerned it’s almost impossible based upon the supportive hammer from two weeks ago. If we can get above the 1.13 level, we feel that the market goes to the 1.15 over time.

USD/JPY forecast for the week of April 28, 2014, Technical Analysis

The USD/JPY pair fell during the course of the week, but as you can see had a very small trading range. Because of this, we feel that this market is still stuck in the consolidation area, and as a result we really don’t have much of an opinion at the moment. However, you can see that there is an uptrend line that we are approaching, therefore we are looking for a supportive candle in order to start buying as we think the market will continue to try and reach the 103 level, followed by the 105 level given enough time. Selling is not an option.

Forex - Weekly outlook: April 28 - May 2

The dollar ended the week lower against the safe haven yen and Swiss franc on Friday as fresh tensions over hostilities in eastern Ukraine underpinned safe haven demand.

USD/JPY touched one-week lows of 101.96 on Friday before settling at 102.18, ending the week down 0.48%. USD/CHF ended Friday’s session at 0.8814 after falling to lows of 0.8803 earlier and ended the week down 0.42%.

Concerns over the conflict between Russian and Ukraine escalated on Friday after U.S. Secretary of State John Kerry warned that Washington was ready to step up sanctions on Russia. The West is accusing Russia of leading a separatist revolt in eastern Ukraine after it annexed Crimea last month.

The yen held gains despite data on Friday showing that Japanese inflation remained unchanged for a third successive month in April. The weak data fuelled expectations that the Bank of Japan will implement a fresh round of monetary stimulus this year, which would weigh on the yen.

Elsewhere, the euro was flat against the dollar on Friday, with EUR/USD settling at 1.3833. For the week, the pair rose 0.30%.

The euro’s gains were held in check after European Central Bank President Mario Draghi reiterated warnings on Thursday that the strong euro could trigger further monetary easing. He also said the ECB could launch a "broad-based" asset purchase program if the medium-term inflation outlook deteriorated.

In the U.S., data on Friday showed that consumer confidence rose to a nine-month high in April, adding to signs that the economy is improving.

The University of Michigan reported that its consumer sentiment index came in at 84.1 this month, up from 80 in March and the preliminary reading of 82.6. Analysts had expected the index to rise to 83.0.

In the week ahead, investors will be focusing on Friday’s U.S. jobs report for April and the outcome of the Federal Reserve’s two-day policy meeting on Wednesday. Wednesday preliminary April inflation report for the euro zone 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, April 28

• Japan 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 private sector data on pending home sales.

Tuesday, April 29

• Markets in Japan are to remain closed for a holiday.
• New Zealand is to publish data on the trade balance, the difference in value between imports and exports.
• In the euro zone, Germany is to release preliminary data on consumer price inflation and a report by market research group Gfk on consumer climate, while Spain is to release data on the unemployment rate.
• The U.K. is to release preliminary data on first quarter gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health.
• The U.S. is to a report compiled by the Conference Board on consumer confidence.
• Later Tuesday, Bank of Canada Governor Stephen Poloz is to speak; his comments will be closely watched.

Wednesday, April 30

• New Zealand is to release data on building consents and business confidence.
• Japan is to publish data on average cash earnings and industrial production. At the same time, the Bank of Japan is to announce its benchmark interest rate and publish its monetary policy statement, which outlines economic conditions and the factors affecting the bank’s decision. The announcement is to be followed by a press conference.
• In the euro zone, Germany is to publish reports on retail sales and unemployment change. Spain is to release preliminary data on first quarter growth. The wider euro zone is to release preliminary data on consumer price inflation.
• Switzerland is to publish its KOF economic barometer.
• Canada is to publish the monthly report on GDP growth.
• The U.S. is to release preliminary data on first quarter GDP, as well as the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to release data on manufacturing activity in the Chicago region.
• Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement.

Thursday, May 1

• Markets in China, the euro zone and Switzerland will remain closed for the Labor Day holiday.
• China is to release official data on manufacturing activity.
• The U.K. is also to produce a report on manufacturing activity, in addition to data on net lending.
• The U.S. is to publish the weekly report on initial jobless claims. At the same time, Fed Chair Janet Yellen is to speak at an event in Washington; her comments will be closely watched.
• Later Thursday, the Institute of Supply Management is to release a report on manufacturing activity.

Friday, May 2

• Markets in China are to remain closed for the Labor Day holiday. Japan is to publish data on household spending and Australia is to release data on producer price inflation.
• The euro zone is to produce data on the unemployment rate, while Spain and Italy are to release reports on manufacturing activity.
• Switzerland is to publish its SVME purchasing managers’ index, while the U.K. is to release data on construction sector activity.
• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate, and a separate report on factory orders.

Forex - NZD/USD weekly outlook: April 28 - May 2

The New Zealand regained ground against its U.S. counterpart on Friday but held near a three-week low struck in the previous session as traders continued to weigh uncertainty surrounding developments in Ukraine.

NZD/USD fell to 0.8547 on Thursday, the pair’s lowest since April 4, before subsequently consolidating at 0.8580 by close of trade on Friday, up 0.18% for the day but still 0.11% lower for the week.

The pair is likely to find support at 0.8531, the low from April 4 and resistance at 0.8636, the high from April 24.

Concerns over the conflict between Russian and Ukraine escalated on Friday after U.S. Secretary of State John Kerry warned that Washington was ready to step up economic sanctions against Russia.

Meanwhile, ratings agency Standard & Poor’s cut its rating on Russia on Friday, citing the potential for “additional significant outflows” of capital due to escalating hostilities with Ukraine.

The West is accusing Russia of leading a separatist revolt in eastern Ukraine after it annexed Crimea last month.

Market players also continued to monitor U.S. data for further indications on the strength of the economy and the future course of monetary policy.

Data on Friday showed that consumer confidence rose to a nine-month high in April, adding to signs that the economy is improving.

The University of Michigan reported that its consumer sentiment index came in at 84.1 this month, up from 80 in March and the preliminary reading of 82.6. Analysts had expected the index to rise to 83.0.

Elsewhere, in New Zealand, the Reserve Bank raised interest rates by 0.25% earlier in the week and increased its growth estimate for the quarter ending in March.

In a widely expected move, the RBNZ raised its benchmark interest rate to 3.00% from 2.75%.

The central bank also said that gross domestic product is estimated to have grown 3.5% in the year to March, compared to the previous month's estimate of 3.3%.

Commenting on the decision, RBNZ Governor Graeme Wheeler said the strong kiwi is helping to contain inflation, though current levels may not be sustainable.

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 April 22.

Net longs totaled 20,175 contracts as of last week, compared to net longs of 18,213 contracts in the previous week.

In the week ahead, investors will be looking ahead to Wednesday’s monetary policy announcement by the Federal Reserve amid speculation the central bank is likely to continue to scale back its stimulus program.

The U.S. will also release the monthly non-farm payrolls report for April later in the week as well as a preliminary estimate on first quarter economic growth.

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

Monday, April 28

• The U.S. is to release private sector data on pending home sales.

Tuesday, April 29

• New Zealand is to publish data on the trade balance, the difference in value between imports and exports.
• The U.S. is to a report compiled by the Conference Board on consumer confidence.

Wednesday, April 30

• New Zealand is to release data on building consents and business confidence.
• The U.S. is to release preliminary data on first quarter GDP, as well as the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to release data on manufacturing activity in the Chicago region.
• Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement.

Thursday, May 1

• China is to release official data on manufacturing activity. The Asian nation is New Zealand’s second-biggest trade partner.
• The U.S. is to publish the weekly report on initial jobless claims. At the same time, Fed Chair Janet Yellen is to speak at an event in Washington; her comments will be closely watched.
• Later Thursday, the Institute of Supply Management is to release a report on manufacturing activity.

Friday, May 2

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

Forex - AUD/USD weekly outlook: April 28 - May 2

The Australian dollar ended Friday’s session at a three-week low against its U.S. counterpart, as heightened tensions between Russia and Ukraine dampened demand for riskier assets.

AUD/USD fell to 0.9252 on Thursday, the pair’s lowest since April 4, before subsequently consolidating at 0.9269 by close of trade on Friday, up 0.06% for the day but 0.68% lower for the week.

The pair is likely to find support at 0.9230, the low from April 4 and resistance at 0.9301, the high from April 24.

Concerns over the conflict between Russian and Ukraine escalated on Friday after U.S. Secretary of State John Kerry warned that Washington was ready to step up economic sanctions against Russia.

Meanwhile, ratings agency Standard & Poor’s cut its rating on Russia on Friday, citing the potential for “additional significant outflows” of capital due to escalating hostilities with Ukraine.

The West is accusing Russia of leading a separatist revolt in eastern Ukraine after it annexed Crimea last month.

Market players also continued to monitor U.S. data for further indications on the strength of the economy and the future course of monetary policy.

Data on Friday showed that consumer confidence rose to a nine-month high in April, adding to signs that the economy is improving.

The University of Michigan reported that its consumer sentiment index came in at 84.1 this month, up from 80 in March and the preliminary reading of 82.6. Analysts had expected the index to rise to 83.0.

Elsewhere, in Australia, data released earlier in the week showed that consumer price inflation in Australia rose 0.6% in the first quarter, below expectations for a 0.8% increase, after a 0.8% rise in the three months to December.

Data from the Commodities Futures Trading Commission released Friday showed that speculators increased their bullish bets on the Australian dollar in the week ending April 22.

Net longs totaled 16,370 contracts, compared to net longs of 8,097 in the preceding week.

In the week ahead, investors will be looking ahead to Wednesday’s monetary policy announcement by the Federal Reserve amid speculation the central bank is likely to continue to scale back its stimulus program.

The U.S. will also release the monthly non-farm payrolls report for April later in the week as well as a preliminary estimate on first quarter economic growth.

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

Monday, April 28

• The U.S. is to release private sector data on pending home sales.

Tuesday, April 29

• The U.S. is to a report compiled by the Conference Board on consumer confidence.

Wednesday, April 30

• The U.S. is to release preliminary data on first quarter GDP, as well as the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to release data on manufacturing activity in the Chicago region.
• Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement.

Thursday, May 1

• China is to release official data on manufacturing activity. The Asian nation is Australia’s biggest trade partner.
• The U.S. is to publish the weekly report on initial jobless claims. At the same time, Fed Chair Janet Yellen is to speak at an event in Washington; her comments will be closely watched.
• Later Thursday, the Institute of Supply Management is to release a report on manufacturing activity

Friday, May 2

• Australia is to release data on producer price inflation.
• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate, and a separate report on factory orders.

Forex - USD/CAD weekly outlook: April 28 - May 2

The U.S. dollar pushed higher against the Canadian dollar on Friday as renewed concerns over hostilities between Russia and Ukraine fuelled risk aversion, dampening demand for the Canadian dollar.

USD/CAD ended Friday’s session at 1.1038, up modestly from Thursday’s close of 1.1019. For the week, the pair eked out a gain of 0.17% in rangebound trade.

The pair was likely to find support at 1.0999, the low of April 22 and resistance at 1.1075.

Concerns over the conflict between Russian and Ukraine escalated on Friday after U.S. Secretary of State John Kerry warned that Washington was ready to step up economic sanctions against Russia.

Meanwhile, ratings agency Standard & Poor’s cut its rating on Russia on Friday, citing the potential for “additional significant outflows” of capital due to escalating hostilities with Ukraine.

The West is accusing Russia of leading a separatist revolt in eastern Ukraine after it annexed Crimea last month.

The pair traded in a relatively narrow range all week, with the greenback supported by indications that the U.S. economy is recovering. The loonie, as the Canadian dollar is also known, remained softer as the Bank of Canada’s dovish stance weighed.

In a speech on Thursday, BoC Governor Stephen Poloz said interest rates will stay low for longer, while inflation will remain below the central bank’s 2% target for at least another two years.

In the U.S., data on Friday showed that consumer confidence rose to a nine-month high in April, adding to signs that the economy is improving.

The University of Michigan reported that its consumer sentiment index came in at 84.1 this month, up from 80 in March and the preliminary reading of 82.6. Analysts had expected the index to rise to 83.0.

In the week ahead, investors will be focusing on Friday’s U.S. jobs report for April and the outcome of the Federal Reserve’s two-day policy meeting on Wednesday. Wednesday’s Canadian data on economic growth 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, April 28

• The U.S. is to release private sector data on pending home sales.

Tuesday, April 29

• The U.S. is to a report compiled by the Conference Board on consumer confidence.
• Later Tuesday, BoC Governor Stephen Poloz is to speak; his comments will be closely watched.

Wednesday, April 30

• Canada is to publish the monthly report on gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health.
• The U.S. is to release preliminary data on first quarter GDP, as well as the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to release data on manufacturing activity in the Chicago region.
• Later in the day, the Federal Reserve is to announce its federal funds rate and publish its rate statement.

Thursday, May 1

• The U.S. is to publish the weekly report on initial jobless claims. At the same time, Fed Chair Janet Yellen is to speak at an event in Washington; her comments will be closely watched. Later Thursday, the Institute of Supply Management is to release a report on manufacturing activity.

Friday, May 2

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

Forex - USD/CHF weekly outlook: April 28 - May 2

The dollar ended the weak lower against the firmer Swiss franc on Friday as escalating tensions over the crisis in eastern Ukraine underpinned demand for traditional safe-haven assets.

USD/CHF ended Friday’s session at 0.8814 after falling to one-week lows of 0.8803 earlier and ended the week down 0.42%.

The pair was likely to find support at 0.8775 and resistance at 0.8855, Thursday’s high.

Concerns over the conflict between Russian and Ukraine escalated on Friday after U.S. Secretary of State John Kerry warned that Washington was ready to step up economic sanctions against Russia.

Meanwhile, ratings agency Standard & Poor’s cut its rating on Russia on Friday, citing the potential for “additional significant outflows” of capital due to escalating hostilities with Ukraine.

The West is accusing Russia of leading a separatist revolt in eastern Ukraine after it annexed Crimea last month.

In the U.S., data on Friday showed that consumer confidence rose to a nine-month high in April, adding to signs that the economy is improving.

The University of Michigan reported that its consumer sentiment index came in at 84.1 this month, up from 80 in March and the preliminary reading of 82.6. Analysts had expected the index to rise to 83.0.

In the week ahead, investors will be focusing on Friday’s U.S. jobs report for April and the outcome of the Federal Reserve’s two-day policy meeting on Wednesday. Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, April 28

• The U.S. is to release private sector data on pending home sales.

Tuesday, April 29

• The U.S. is to a report compiled by the Conference Board on consumer confidence.

Wednesday, April 30

• Switzerland is to publish its KOF economic barometer.
• The U.S. is to release preliminary data on first quarter GDP, as well as the ADP report on private sector job creation, which leads the government’s nonfarm payrolls report by two days. The U.S. is also to release data on manufacturing activity in the Chicago region.
• Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement.

Thursday, May 1

• Markets in Switzerland are to remain closed for the Labor Day holiday.
• The U.S. is to publish the weekly report on initial jobless claims. At the same time, Fed Chair Janet Yellen is to speak at an event in Washington; her comments will be closely watched. Later Thursday, the Institute of Supply Management is to release a report on manufacturing activity.

Friday, May 2

• Switzerland is to publish its SVME purchasing managers’ index.
• The U.S. is to round up the week with the closely watched government data on nonfarm payrolls and the unemployment rate, and a separate report on factory orders.