EUR/USD Technical Analysis: Support Met Below 1.36 Mark
The Euro fell against the US Dollar as expected
after the pair produced a bearish Evening Star candlestick pattern
below the 1.37 figure. A daily close below support is at 1.3583, the
23.6% Fibonacci expansion, targets the 1.3502-12 area marked by the June
5 low and the 38.2% level. Alternatively, a turn above rising trend
line support-turned-resistance at 1.3653 clears the way for a challenge
of the 38.2% Fibonacci retracement at 1.3689.
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Something Interesting in Financial Video July 2014
newdigital, 2014.07.09 08:45
Trading Video: Equities Threaten a Turn, Dollar Not Yet Impressed
Discontent is stirring amongst
the contented speculators. Low volatility and an appetite for yield go
hand-in-hand, but even die-hard bulls doubt its much longer lived. Given
the breadth of opportunity, market participants are itching for the
swell of trend and abundance of opportunity that comes along with a
shift in speculative appetites. Yet, we have seen too many starts to be
drawn in without confirmation. Global equities made the biggest
contribution to a risk interest with heavy selling particularly in
Europe. However, that is only the first level of a risk-derived move.
Volatility measures, FX participation and fundamental moorings are
necessary to alter such a remarkable trend. Will we finally find it? We
discuss what to watch and what to trade in today's Trading Video.
2014-07-09 18:00 GMT (or 20:00 MQ MT5 time) | [USD - FOMC Meeting Minutes]
[USD - FOMC Meeting Minutes] = It's a detailed record of the FOMC's most recent meeting, providing
in-depth insights into the economic and financial conditions that
influenced their vote on where to set interest rates.
Acro Expand : Federal Open Market Committee (FOMC).
Fed’s Asset Purchase Could End In October – FOMC Minutes
Minutes of the Federal Open Market Committee's June meeting show
that officials have decided to end their asset purchasing program in
October if the economy continues to show economic growth.
“If the economy progresses about as the
Committee expects, warranting reductions in the pace of purchases at
each upcoming meeting, this final reduction would occur following the
October meeting,” the minutes said.
However, the minutes also mentioned three times
that the Federal Reserve’s quantitative easing program is not on a
The minutes showed that the committee remains
optimistic that the U.S. economy will recover in the second half of the
year, despite lowering its economic growth forecast at its June
monetary policy meeting. According to projections released at the June
meeting, committee members see 2014 growth between 2.1% to 2.3%,
compared to their March forecast of 2.8% to 3.0%
“Members judged that the economy had sufficient
underlying strength to support ongoing improvement in labor market
conditions and a return of inflation toward the Committee's longer-run 2
percent objective,” the minutes said. “Most participants viewed the
risks to the outlook for the economy, the labor market, and inflation
as broadly balanced.”
2014-07-10 02:00 GMT (or 04:00 MQ MT5 time) | [CNY - Trade Balance]
if actual > forecast = good for currency (for AUD in our case)
[CNY - Trade Balance] = Difference in value between imported and exported goods during the previous month. Export demand and currency demand are directly linked because foreigners
usually buy the domestic currency to pay for the nation's exports.
Export demand also impacts production and prices at domestic
Acro Expand : Customs General Administration of China (CGAC).
This led to China’s June trade surplus narrowing to $31.6 billion from $35.92 billion in May, and below consensus estimates of $36.9 billion.
On the news, AUD/USD dipped over 0.2% and found some support at the 0.9397 level.
There’s a bit of optimism with China’s customs office expecting exports
growth to accelerate in the third quarter. Imports could also pick up
based on improving signs of manufacturing and service activities over
the past two months.
Still, there are concerns that the recovery has been patchy,
particularly with the soft property sector and worries that the earnings
season underway might turn out to be disappointing.
There is also some expectation that the government will have to do
more to jumpstart the recovery with further stimulus measures to meet
its 7.5% growth target. That argument got some backing when China’s
June’s CPI was released yesterday, which came in at 2.3% year-on-year.
This was down from 2.5% in the previous month and under the 2.4% market
China’s exports growth will also hinge on the recovery of other key
economies especially the Euro Zone. The global outlook became a bit more
uncertain after the International Monetary Fund warned earlier this
week that global investment spending was still lacklustre.
We’ll get a better picture next week with the release of China’s Q2
GDP on Wednesday 16 July. This will perhaps be the clearest indication
so far on how well China’s mini-stimulus measures have helped and how
much more is needed since their roll-out back in April. The market
consensus forecast for Q2 GDP is 7.4% growth, unchanged from Q1 which
was the slowest in six quarters.
Indonesia will also be keenly watching China’s recovery story.
Regardless who wins the election, the new president will take over a
slowing economy with weakening fundamentals. With economic reforms a
long term process, Indonesia’s outlook and policy decisions in the
interim could hinge closely on China’s demand for commodities.
2014-07-08 01:30 GMT (or 03:30 MQ MT5 time) | [USD - Wholesale Inventories]
if actual < forecast = good for currency (for USD in our case)
[USD - Wholesale Inventories] = Change in the total value of goods held in inventory by wholesalers. It's a signal of future business spending because companies are more
likely to purchase goods once they have depleted inventories.
U.S. Wholesale Inventories Rise 0.5% In May, Slightly Less Than Expected
Wholesale inventories in the U.S. rose by slightly less than
anticipated in the month of May, according to a report released by the
Commerce Department on Thursday.
The report said wholesale inventories increased by 0.5 percent in May after jumping by a revised 1.0 percent in April.
had expected inventories to climb by about 0.6 percent compared to the
1.1 percent increase originally reported for the previous month.
inventories of durable goods surged up by 1.0 percent in May, the
increase was partly offset by a 0.3 percent drop in inventories of
Meanwhile, the Commerce Department said
wholesale sales rose by 0.7 percent in May after soaring by 1.3 percent
in the previous month.
The report said sales of durable goods edged up by 0.2 percent, while sales of non-durable goods jumped by 1.1 percent.
inventories and sales both rising, the inventories/sales ratio for
merchant wholesalers was unchanged compared to the previous month at
The Commerce Department noted that wholesale inventories in
May were up by 7.9 percent compared to the same month a year ago, while
wholesale sale were up by 6.6 percent year-over-year.
USD Continues to Carve Lower-Highs; Broader EUR/USD Range in Focus
Reserve Bank of Australia (RBA) Minutes, which are
due out next week, may trigger another decline in the AUD/USD should the
central bank continue to toughen its verbal intervention.
Trading the News: Canada Net Change in Employment
Another 20.0K rise in Canada employment may trigger fresh monthly lows
in the USD/CAD as it limit’s the risk of seeing the Bank of Canada (BoC)
further embark on its easing cycle.
Why Is This Event Important:
An upbeat job report may spur a material shift in the policy outlook as
BoC Governor Stephen Poloz scales back his willingness to deliver
another rate cut, and the central bank may adopt a more neutral tone for
monetary policy as the rise in employment highlights an improved
outlook for growth and inflation.
The pickup in household spending along with the expansion in building
activity may pave the way for a positive employment print, and a pickup
in job growth may heighten the appeal of the Canadian dollar as it
raises the BoC’s scope to normalize monetary policy sooner rather than
However, the data print may fall short of market expectations as
businesses confidence wanes, and a dismal jobs report may generate a
larger correction in the USD/CAD as it drags on interest rate
How To Trade This Event Risk
Bullish CAD Trade: Core Inflation Rises 1.5% or Greater
USDCAD M5 : 39 pips price movement by USD - Non-Farm Employment Change news event
Employment increased 25.8K in May after the Canadian economy shed 28.9K
jobs the month prior, while the jobless rate unexpectedly up ticked to
an annualized 7.0% from 6.9% in April. Despite the better-than-expected
print, the U.S. Non-Farm Payrolls (NFP) played a greater role in driving
the USD/CAD as the exchange rate climbed to a daily high of 1.0947, but
we saw the dollar-loonie consolidate ahead of the weekend as the pair
closed at 1.0925.
Forex: Daily EUR/JPY, EUR/USD Stochs, MACD Point to Sells: Friday, July 11, 2014
2014-07-11 12:30 GMT (or 14:30 MQ MT5 time) | [CAD - Employment Change]
if actual > forecast = good for currency (for CAD in our case)
[CAD - Employment Change] = Change in the number of employed people during the previous month. Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity.
U.K. CB Leading Index Rises At Stable Rate In May
U.K 's leading index, a measure of perceptions on future economic
conditions, increased at a stable rate in May, results of a survey by
the Conference Board showed Friday.
The Conference Board leading
economic index rose 0.5 percent month-on-month in May, the same as in
April. The index came in at 111.0 in May.
Six among the seven sub-indices contributed positively to the rise in the overall index.
Conference Board Coincident Economic Index, measuring the current
economic activity, came in at 106.9 and was unchanged month-on-month in
May. This follows the 0.3 percent increase in April and March.
six-month growth rate of the Leading Economic Index for the U.K has
decelerated in each of the last five months, pointing to slower growth
performance for the second half of 2014 compared to the first," Bert
Colijn, senior economist at The Conference Board, said.
"The slowing growth outlook is partially exacerbated by concerns about the short-term weakness in growth in emerging markets and the Euro Area."