2014-04-29 12:00 GMT (or 14:00 MQ MT5 time) | [EUR - German CPI]
if actual > forecast = good for currency (for EUR in our case)
Germany HICP Inflation Accelerates Less Than Expected
Germany's EU measure of inflation accelerated for the first time in
five months in April, but the figure came in below economists'
The harmonized index of consumer prices rose 1.1
percent annually in April, following a 0.9 percent gain in March,
preliminary figures from Destatis showed Tuesday.
forecast an inflation figure of 1.3 percent. The March inflation was the
lowest since June 2010, when the rate was 0.8 percent.
Month-on-month, the HICP dropped 0.3 percent in April. Economists had expected a 0.1 percent decline.
overall consumer price index climbed 1.3 percent in April, which was
faster than the 1 percent rise in the previous month. Economists were
looking for an inflation figure of 1.4 percent. Consumer prices fell 0.2
percent from the previous month, while economists had forecast a 0.1
Destatis is set to release the final inflation numbers for April on May 14.
April inflation figures for
Eurozone are due to be released on Wednesday. In March, Euro area
headline inflation fell to a worrying 52-month low of 0.5 percent, way
out of the ECB's target of "below, but close to 2 percent'.
European Central Bank Vice President Vitor Constancio said the bank
does not have any target in mind for April inflation. He also asserted
that a single figure alone cannot prompt a policy change.
The bank is set to hold the next rate-setting session on May 8.
The central bank has several instruments at its disposal and it will use them if there is a need, Constancio reiterated.
Natural Gas Plummets Ahead of Inventories Data
Natural gas futures dropped from a two-month peak in New York as
investors speculated that government data to be released on Thursday
would show a drastic surge in stockpiles of the commodity used for
heating in the wake of dwindling demand following mild weather.
Gas plunged as deep as 1.6%. *Data from the Energy Information
Administration may show that gas stockpiles added 77 billion cubic feet
within the week ended April 25, according to median estimates from eight
analysts in a Bloomberg survey.
“Tomorrow’s storage injection will be well above the five-year average.
“Temperatures are going to moderate after the weekend, and that’s
eroding the bullish case for gas,” said John Kilduf of New York-based
Again Capital LLC.
June delivery natural gas declined 6.3 cents or 1.3% to $4.768 per
million British thermal units as of 10:05 am on the New York Mercantile
Exchange. Trading volumes for all the futures was 26% lower than the
100-day average. The futures have advanced 13% year-to-date and 9% in
April. Gas rose to $4.831 per million Btu on Tuesday, the highest
exchange rate since February 26.
On May 7, New York may hit a low of 55 degrees Fahrenheit, 4 lower more
than ordinary, and a high of 66, according to forecast by AccuWeather
Inc. Chicago temperatures are likely to hit 70 degrees, 3 higher than
An estimated 49% of US homes depend on gas for heating, as per official data. Power plants take in 31% of gas consumption.
As Investing reports, the spring and fall periods witness the lowest
demand of natural gas, since mild temperatures mean households don’t
consume a lot of gas for heating and air conditioning.
Players in the market will be keenly following tomorrow’s official
pronouncements regarding natural gas stockpiles. The supplies might hit
3.422 trillion cubic feet by the end of October, after losing 392
billion since the previous year.
2014-05-01 08:30 GMT (or 10:30 MQ MT5 time) | [GBP - Manufacturing PMI]
if actual > forecast = good for currency (for GBP in our case)
UK Factory Growth At 5-month High
The U.K. manufacturing sector expanded at the fastest pace in five
months during April, led by faster growth in output and new orders,
survey data from Markit Economics showed Thursday.
adjusted Markit/Chartered Institute of Purchasing & Supply
Purchasing Manager's Index climbed to 57.3 in April from 55.8 in March,
which was revised from 55.3. Economists had forecast a score of 55.4.
output growth hit an eight-month high with gains across the consumer,
intermediate and investment goods sectors. New order growth climbed to
its highest in three months, led by improved demand from both domestic
and export markets.
grew for the twelfth successive month and the pace of increase equaled
February's near 3-year peak. Firms expanded capacity to met higher
production in the face of rising demand.
Input prices fell for a
second straight month, but the latest fall was only moderate and slower
than that signaled in the previous month. Output prices rose for the
tenth successive month as companies raised prices due to strong demand
and efforts to improve operating margins.
Traders Join Exodus as Forex Probes Add Pressure on Costs (based on bloomberg article)
The foreign-exchange market is losing a slew of traders from big
banks as a probe into alleged manipulation of benchmark rates widens and
pressure mounts on the industry to reduce costs.
More than 30
traders from 11 firms have been fired, suspended, taken leaves of
absence or retired since October, when regulators said they were
investigating the market, according to data compiled by Bloomberg.
London-based Barclays Plc (BARC) and Zurich-based UBS AG (UBSN) have been the worst-hit, each suspending at least half a dozen employees, the data show.
“That’s a considerable percentage of the workforce,” said Brad Bechtel, managing director at Faros Trading LLC in Stamford, Connecticut,
who estimated the world’s largest banks have 80 to 160 voice traders
for spot rates in the currencies market. “That explains the lack of
liquidity in the market, and why what would normally be considered a
small trade can actually push the market around more than normal.”
around the world are investigating allegations traders colluded to rig
key foreign-exchange benchmarks used by investors and companies by
pushing through trades before and during the 60-second windows when the
WM/Reuters rates are set. At the same time, banks are trying to fight
shrinking margins by replacing humans with computers, accelerating a
longer-term shift in trading onto electronic platforms.
About 200 traders at smaller firms focus on spot exchange rates, Bechtel estimated in an e-mail.
UBS gained less than 1 percent to 18.40 Swiss francs today in Zurich. Barclays rose 0.8 percent to 252.2 pence in London.
are examining whether bank traders communicated with dealers at other
firms and timed trades to influence benchmarks and maximize profits.
Some exchanged information on instant-message groups with names such as
“The Cartel,” “The Bandits’ Club,” “One Team, One Dream” and “The
Mafia.” No firms or traders have been accused of wrongdoing by
EUR/USD Fundamental Analysis May 2, 2014 Forecast
is trading at 1.3880 inching higher on Thursday having ridden out two
days of worse than expected news on Eurozone inflation and the US
economy that have not fundamentally altered perceptions of the policy
outlook in either. The US dollar weakened on disappointing GDP numbers
and seemed to ignore the continuing tapering by the Federal Reserve.
year’s dominant trend on major currency markets is the euro’s continued
strength in the face of a steady reining in of US monetary policy
stimulus and expectations the European Central Bank would be forced at
some stage to do the opposite. A number of analysts had predicted low
euro zone inflation on Wednesday, following lower than forecast figures
out of Germany a day earlier, might be enough to turn the single
currency significantly weaker.
Policymakers at the euro zone’s
central bank have talked aggressively about their willingness to take
action to head off a debilitating cycle of falling prices and demand,
and as such have outright opposed any further gains for the euro.
they face substantial barriers to delivering the sort of decisive
policy action that would weaken the currency at a time when capital is
flooding back into the euro zone’s peripheral economies and stock
FxEmpire provides in-depth analysis for each currency and
commodity we review. Fundamental analysis is provided in three
components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.
Economic Data May 1, 2014 actual v. forecast
China – Labor Day
AIG Manufacturing Index
Chinese Manufacturing PMI
Nationwide HPI (YoY)
Nationwide HPI (MoM)
Core PCE Price Index (MoM)
Fed Chair Yellen Speaks
Initial Jobless Claims
ISM Manufacturing PMI
(Kitco News) - Gold prices ended the U.S. day session moderately lower Thursday. A lack of fresh, bullish news for the gold market is allowing the technical traders to dominate—and the near-term technical posture for gold remains bearish. Also, generally upbeat U.S. economic data released Thursday fell in favor of the bearish camp of gold traders. June gold was last down $10.70 at $1,285.00 an ounce. Spot gold was last quoted down $6.00 at $1,285.75. May Comex silver last traded down $0.079 at $19.04 an ounce.
Dollar in limbo before jobs data; sterling pauses after rally
Dollar index hovering above 3-week lows, focus on U.S.
Forecasts centre on 210,000 nonfarm payrolls in April
Sterling holds near 5-year peak after upbeat UK data
The dollar hovered above
a three-week low against a basket of major currencies on Friday,
as investors stayed on the sidelines ahead of a closely watched
U.S. jobs report and appeared unmoved by clashes between
Ukrainian forces and pro-Russian separatists.
The dollar index held steady at 79.543, having fallen
to 79.414 on Thursday, its lowest since April 11. Investors had
sold the greenback after data on Wednesday showed the U.S.
economy stalled in the first quarter.
Major currencies showed limited reaction to the latest
developments in Ukraine, where government forces launched a
"large-scale operation" to retake Slaviansk, pro-Russian
separatists holding the town in eastern Ukrain said on Friday.
Jitters over a crisis that has provoked the biggest
confrontation between Russia and the West since the Cold War
have at times weighed on risk sentiment and lent some support to
safe haven currencies such as the yen, but on Friday the
market's focus was locked on the U.S. employment report.
The dollar held steady against the yen at 102.36 yen.
The greenback has been range-bound versus the yen since early
February, having traded roughly between 101 yen to 104 yen over
"I think a low print on nonfarm payrolls will see
... dollar/yen test the bottom of that range," said Jeffrey
Halley, FX trader for Saxo Capital Markets in Singapore.
The euro eased 0.1 percent to $1.3862, having backed
off slightly from Thursday's three-week peak near $1.3890.
According to a Reuters poll, U.S. nonfarm payrolls probably
added 210,000 jobs in April, that would leave hiring well above
its first-quarter average of 177,667 jobs per
"We would expect confirmation of above 200,000 jobs growth
to erase some of the concerns raised by the weak reading on Q1
GDP, and this should be consistent with some recovery in the
dollar," analysts at BNP Paribas wrote in a note to clients.
"Most forecasts fall between 200,000 and 235,000, and it
would likely take a result significantly outside that range to
generate more dramatic FX moves."
Sterling held steady at $1.6886, taking a breather
after reaching a near five-year high of $1.6921 on Thursday, in
the wake of upbeat UK economic indicators.
Data on Thursday showed British manufacturing surged last
month and house prices rose at the fastest pace since June
The pound, which is up 0.5 percent on the week, faces
resistance on monthly charts at around $1.6950, the top of the
cloud on the monthly Ichimoku chart -- a popular technical
A clear breach of that level would be a bullish technical
signal. On the other hand, there are some signs of short-term
overheating, with sterling's 14-day relative strength index now
at above 70 and in overbought territory.
(Additional reporting by Masayuki Kitano in Singapore; Editing
by Simon Cameron-Moore)
EURUSD Forex Signals: Trading the Non-Farm Payrolls Report
EUR/USD forex signals show that the pair is trading inside a
symmetrical triangle on its 4-hour time frame as traders can’t quite
establish a clear direction on the pair. Price is testing the top of the
triangle around the 1.3875 levels but stochastic is reflecting selling
A selloff from its current levels could take the pair back to the
bottom of the triangle at the 1.3775 area. Consolidation around the
current levels could be seen for the most part of the day as traders
await the results of the non-farm payrolls report for April.
Recall that the US dollar reacts to fundamentals during this release,
as a strong jobs figure tends to support the currency while a weak
reading leads to a selloff. The past report has printed a bleak result
but there could be a stronger showing this time around. The consensus is
at a 216K rise in employment, which could push the jobless rate down to
6.6% from 6.7%.
In this case, EUR/USD might selloff to the bottom of the triangle and
an even stronger figure could lead to a breakdown. Take note that the
chart pattern is roughly 300 pips in height, which suggests that the
resulting selloff could be of the same size.
The fundamental bias for the EUR/USD pair is still to the downside,
given the divergence in monetary policy plans of the Fed and the
European Central Bank. Keep in mind that the ECB will make its policy
announcement next week and that officials are already considering
negative deposit rates or further easing measures. Meanwhile, the FOMC
statement earlier this week turned out to be relatively upbeat as the
Fed decided to push through with its taper and give optimistic comments
on the US economic recovery.
If the NFP turns out to be a downside surprise though, EUR/USD forex signals
might indicate a strong upside break from the triangle resistance and
rally until the previous highs near the 1.4000 major psychological
How to Trade Short-Term (Day-Trade)
So, first and foremost before we get into the process of short-term
trading, I want to specify that this is often the most difficult way for
new traders to get started. Preferably, new traders will start with
longer-term charts and approaches that may be more forgiving, and as
they gain experience and comfort they can then elect to move into faster
The Biggest Challenge of Short-Term Trading
The biggest challenge of short-term trading is the same as the Top
Trading Mistake. Too few traders looking to scalp actually do so
correctly, under the incorrect presumption that trading on really
short-term charts gives them enough control to trade without stops
While keeping your finger on the trigger may give you more control, it
means absolutely nothing if prices gap against your position or if a
really big piece of news comes out that completely de-rails your trading
plan. So, even though you may be watching price action on a five or
fifteen-minute chart, protective stops are still needed.
Further to this point, traders need to be able to focus on winning more
when they are right than they lose when they are wrong. To put this
another way, just because one is trading very short-term, it doesn’t
mean that they can ignore The Number One Mistake Forex Traders Make.
This can be a huge challenge on really short-term charts where near-term
price movements are unpredictable. But it’s not impossible. In this
strategy, I’ll attempt to show you a way to do this.
An additional concern is variance. Per statistical analysis, the less
information that is being analyzed in a data set, the less ‘reliable’
that information becomes. If we’re looking at longer-term charts, such
as the daily or the weekly charts, quite a bit of information is going
into the formation of each individual candle. On a very short-term
chart, the opposite is true. Significantly less information goes into
each candle, and thereby each candle is less reliable as a forecast of
future candle formations.
With all of the above being said, trading on short-term charts is still
possible. It just requires that traders utilize even more control and
discipline over their trading approaches and risk management. For new
traders that often struggle with risk management, or staying
disciplined; the results can be disastrous. But if those boxes are
checked, traders can look to exert the upmost of control over their
approach with shorter time frames.
But just because we’re trading on shorter-term charts, does that mean we
want the entirety of our analysis to be performed on those time frames?
Absolutely not. We can still incorporate analysis from longer time
frames into our approaches in an effort to get the best probabilities of
The indicators that I add are the 8 and 34 period exponential moving
averages, based on the hourly chart but plotted on the 5-minute chart
Multiple time frame analysis can help traders see the ‘bigger picture’
These indicators act as a compass for the strategy, helping to see
what’s taking place with a longer-term time horizon. If the faster 8
period moving average (based on the hourly chart) is above the slower 34
period moving average (also based on the hourly chart), then the
strategy is looking to go long, and to only go long. As long as the
hourly 8 period EMA is above the hourly 34 period EMA, only buy
positions are entertained.
The hourly moving averages work like a compass, showing traders which direction to trade the trend
Once the trend has been identified, and the bias has been obtained, the
trader can then look for entries in the direction of that trend; looking
for momentum to continue on the 5-minute chart as it has been displayed
by our hourly-moving averages.
And when looking to buy, we ideally want to ‘buy low’ or ‘sell high.’
So, just because the trend is up and we’re looking to buy, it doesn’t
mean we want to blindly do so. We still need a ‘trigger’ for the
position, and for this, we can incorporate another exponential moving
The trigger for this strategy is another 8 period exponential moving
average, but this one is built on the shorter-term five-minute chart.
When price crosses the 8-period five-minute EMA in the direction of the
trend, the trader can look to buy in anticipation of the
‘bigger-picture’ trend coming back in force.
The ‘trigger’ in the strategy is when price crosses the 8-period five-minute EMA in the direction of the trend
The large benefit behind the strategy is that just by the very act of
price moving in the trend-side direction over the shorter-term EMA,
traders are buying or selling short-term retracements in the direction
of the momentum.
The most attractive part of the strategy is that it allows for traders
to ‘buy cheaply’ in anticipation of bullish momentum, or to ‘sell
expensively’ in anticipation of bearish momentum.
When prices make those short-term retracements, they create swings in
price action. And per price action logic, of up-trends making
‘higher-highs’ and ‘higher-lows,’ traders can look to place the stop for
their long position below the previous ‘higher-low’ so that if the
up-trend doesn’t continue – the trader can exit the position for a
Stops for long positions go below the prior period’s opposing-side swing
In the case of short positions, traders would want to look to place
stops for short positions above the previous ‘lower-high,’ so that if
the down-trend does not continue, the short position could be closed in
an effort of mitigating the damage as much as possible.
In my opinion, this is the most attractive part of this type of
strategy. It allows traders to attempt to avoid The Number One Mistake
that Forex Traders Make even though very short-term charts are being
used to trigger positions.
If momentum does continue in the trend-side direction, the trader could
be in a very attractive position as prices continue to move in their
If the trend does continue, should the trader just sit on their limit
order and wait for the sound of the cash register to ‘cha-ching?’
No way. When trading on short-term charts, things can change VERY quickly, and it’s the day-trader’s job to manage that risk.
When the position gets in the money by the amount of the initial stop (a
1-to-1 risk-to-reward ratio), the trader can look to move the stop to
break-even so that, worst-case scenario should prices and momentum
reverse, the trader puts themselves in a position to avoid taking a
At this point, the trader can also begin ‘scaling out’ of the position.
Since a 1-to-1 risk-to-reward has been realized, the trader is actively
attempting to avoid The Top Trading Mistake; and should momentum
continue in the trend-side direction, the trader stands to profit
As prices continue in the direction of the trader’s position, additional
pieces of the trade can be closed or ‘scaled out’ as prices move in
The goal is to get the ‘average out’ from the strategy as large as
possible, and if momentum is to continue, this strategy can allow the
trader to do just that.
After the stop has been moved to break-even, and the initial risk is
removed from the position; traders can even look to add-to the trade
with new positions or new lots in an attempt to build a larger position
with a significantly smaller amount of risk.