EUR/USD Intra-Day Technical Analysis - 'ready to go'

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Sergey Golubev, 2015.09.01 15:17

What Fed Officials Are Saying About a September Rate Increase (based on wsj article)

"Federal Reserve officials made clear in recent days they have not agreed on when to start raising short-term interest rates, and the possibility of a September move remains on the table. The odds of a rate increase next month have appeared to diminish amid worries about China’s economic slowdown and turmoil in financial markets. Some officials want to see more economic data before deciding, while others think they’ve waited long enough. The most powerful decision maker, Chairwoman Janet Yellen, has not commented on the topic in the past few days. Here are some key quotes from those who have."

• Fed Vice Chairman Stanley Fischer: "I will not and indeed cannot tell you what decision the Fed will reach by Sept. 17."
• New York Fed President William Dudley: "At this moment, the decision to begin the normalization process at the September [Federal Open Market Committee] meeting seems less compelling to me than it did several weeks ago."
• St. Louis Fed President James Bullard: "I’m willing to respect the volatility in markets and see how it shakes out here. But just sitting here today, I’m not seeing how this is going to change the forecast and therefore I think the contours of monetary policy are about the same today as they were a couple weeks ago."
• Cleveland Fed President Loretta Mester: "I think the economy can support a modest increase in interest rates. I want to take the time I have between now and the September meeting to evaluate all the economic information that's come in, including the recent volatility in the markets and the reasons behind that. But it hasn't so far changed my basic outlook that the U.S. economy is solid and it could support an increase in interest rates."
• Kansas City Fed President Esther George: "In my own view, the normalization process needs to begin and the economy is performing in a way that I think it is prepared to take that."
• Atlanta Fed President Dennis Lockhart: "We are sort of anxious to get going, but given the events of the last several weeks, a risk factor has arisen” …“It has to be considered an open question whether we move now or wait a little while."
• Minneapolis Fed President Narayana Kocherlakota: "It’s definitely premature to be thinking about the removal of accommodation in the form of lifting off, at least based on my current outlook for inflation."

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Sergey Golubev, 2015.09.01 18:11

Trade Ideas For EUR/USD, AUD/USD - UBS (based on efxnews article)

EUR/USD: "has traded bid since yesterday and it looks like 1.1200 is going to act as a base. We expect selling interest to show up on any move closer to 1.1400, so play the intraday moves and fade a 70 to 80 pip move in either direction, with stops at 1.1150 and 1.1425." 

AUD/USD: "continues to trade sideways.We still see AUDUSD heading lower, but are a bit cautious as the pair seems to struggle below 0.7100. This could be due to seasonal demand, and we will have to see if the sharp bounce in oil will support other commodities. Sell rallies between 0.7180 and 0.7250, with a stop above 0.7325."

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Sergey Golubev, 2015.09.02 07:40

Deutsche Bank: bullish condition for EUR/USD during and immediate after NFP (based on efxnews article)

BNP Paribas made the forecast for NFP to be more than 220K on Friday: "Our economists expect an above-consensus 230K increase in jobs and a steady unemployment rate of 5.3%."

By the way, Deutsche Bank is expecting for NFP to be significantly below 220K expectation:

• "To be clear, we do not believe that underlying momentum in the labor market has meaningfully deteriorated. As we have previously noted, August employment has historically tended to disappoint consensus expectations. The last four August payroll reports were all weaker than expected; they were on average 55k below consensus."
• "The data are even more compelling if we go back further in time. Since 1988, when our sample begins, August nonfarm payrolls have disappointed the financial markets in 21 of the last 27 years, or 78% of the time. The average forecasting error has been -61k. The range of misses, though, has been large. The median forecast error has been -42k."

So, we can expect the following concerning EUR/USD for example:

• BNP Paribas - bearish condition for this pair during and immediate after this high impacted news event.
• Deutsche Bank - bullish condition for this pair during and immediate after this high impacted news event.

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Sergey Golubev, 2015.09.02 17:31

Trade Ideas For EUR/USD by UBS (based on efxnews article)

EUR/USD: "The market seems rangy and uncertain at the moment, but the ECB meeting on Thursday and US jobless figures on Friday may provide some clarity. Fade 70 to 80 pip moves in either direction today, with stops at 1.1145 and 1.1425."

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Sergey Golubev, 2015.09.03 15:15

• past data is -45.2B
• forecast data is -43.2B
• actual data is -41.9B according to the latest press release

if actual > forecast (or previous data) = good for currency (for USD in our case)

[USD - Trade Balance] = Difference in value between imported and exported goods and services during the reported month. Export demand and currency demand are directly linked because foreigners must buy the domestic currency to pay for the nation's exports. Export demand also impacts production and prices at domestic manufacturers.

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"The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that the goods and services deficit was $41.9 billion in July, down $3.3 billion from $45.2 billion in June, revised. July exports were $188.5 billion, $0.8 billion more than June exports. July imports were $230.4 billion, $2.5 billion less than June imports."

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EURUSD M5: 166 pips price movement by USD - Trade Balance news event: