Press review - page 264

Sergey Golubev
Moderator
113476
Sergey Golubev  

Trade Idea: AUD/USD - Buy at 0.8075

Recent wave: Wave 4 ended at 0.8066 and wave 5 has possibly ended at 1.1081
Trend: Down

Original strategy :
Buy at 0.8075, Target: 0.8215, Stop: 0.8020

New strategy :
Buy at 0.8075, Target: 0.8215, Stop: 0.8020

Aussie's rebound after falling to 0.8033 earlier this week suggests consolidation above this level would be seen with mild upside bias for test of 0.8158 resistance, break there would signal low has possibly been formed, bring a stronger rebound towards resistance at 0.8216, once this level is penetrated, this would add credence to this view, bring retracement of recent decline to 0.8250-60 and later towards 0.8300-05 which is likely to hold from here.

In view of this, we are looking to buy aussie on dips. Below said support would signal recent decline has once again resumed and extend weakness in wave (5) to psychological support at 0.8000, however, oversold condition should prevent sharp fall below 0.7940-50 and reckon 0.7895-00 (50% projection of 0.8723-0.8088 measuring from 0.8216) would contain downside, risk from there has increased for a corrective rebound to take place later this month.

On the 4-hour chart, the move from 0.8066 is the wave 5 with i: 0.8860, ii: 0.8315, wave iii is an extended move ended at 1.0183, iv: 0.9706 and wave v has ended at 1.1081 (also the top of entire wave 5). The subsequent selloff is the major correction which is unfolding as ABC-X-ABC and 2nd A leg has ended at 0.8848, followed by a-b-c wave B which has possibly ended at 0.9758, hence, 2nd C wave is now in progress and should bring weakness to 0.8000 but reckon downside would be limited to 0.7890-00.
Sergey Golubev
Moderator
113476
Sergey Golubev  
2015-01-06 00:30 GMT (or 02:30 MQ MT5 time) | [USD - Non-Farm Employment Change]

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

[USD - Non-Farm Employment Change] = Change in the number of employed people during the previous month, excluding the farming industry. Job creation is an important leading indicator of consumer spending, which accounts for a majority of overall economic activity

==========

Total nonfarm payroll employment rose by 252,000 in December, and the unemployment rate declined to 5.6 percent, the U.S. Bureau of Labor Statistics reported today.
Job gains occurred in professional and business services, construction, food services and drinking places, health care, and manufacturing.

Employment in professional and business services rose by 52,000 in December. Monthly job gains in the industry averaged 61,000 in 2014. In December, employment increased in administrative and waste services (+35,000), computer systems design and related services (+9,000), and architectural and engineering services (+5,000).
Employment in accounting and bookkeeping services declined (-14,000), offsetting an increase of the same amount in November.
Sergey Golubev
Moderator
113476
Sergey Golubev  
AUD/USD Fundamental Analysis January 12, 2015 Forecast (based on fxempire article)

The AUD/USD is trading at 0.8142 up by 19 points as the US dollar eases. The currency should have fallen when retail sales printed below expectations but it saw little reaction.  The Aussie jumped above the 0.8100 level on Thursday following the release of surprisingly strong figures showing approvals for the construction of new homes had risen 7.5 per cent in November.  The currency was also being supported by lower oil prices while concerns over the Eurozone were driving investors towards the Aussie dollar. The euro was in rapid decline as investors seeking better returns favored the Aussie and kiwi currencies. Commodity currencies are beginning gain momentum as traders look for safe places to invest with the JPY worrisome at present.

This morning data showed a significant drop in China’s PPI index while CPI met expectations. Slowing consumer demand has been hurting Chinese companies already suffering from thinning margins, and it looks like the pain isn’t ending any time soon.

These numbers are key for tracking a potential global demand slow down, and economists are especially worried about that since deflation has taken hold in Europe officially. In China, economists like Societe Generale’s Wei Yao are especially watching PPI. PPI tells us how much money producers are getting for their goods.
Sergey Golubev
Moderator
113476
Sergey Golubev  

Forex Weekly Outlook January 12-16

Inflation data in the UK and the US, US retail sales, PPI and employment data, Philly Fed Manufacturing Index and Consumer sentiment are the main events on Forex calendar. Here is an outlook on the highlights of this week.

Last week, NFP report was better than expected showing a job gain of 252K in December. The solid increase indicates further strengthening in the US economy. The Unemployment rate fell 0.2% to a 6-1/2 year low of 5.6%, beating forecasts for a 5.7% reading. However, average hourly earnings which showed a 6 cents increase in November, dipped 5 cents in December. Long-term unemployed continued to shrink in December, but the labor force participation rate fell to 62.7% from 62.9% in November. Will wage growth in the US labor market continue improve in the coming months?

  1. UK inflation data: Tuesday, 9:30. UK consumer prices plunged to a twelve year low of 1% in November, reaching half the BoE’s inflation target. The reading was worse than expected caused by a sharp and continuous decline in oil prices. However the low oil prices were positive for consumers, boosting spending and supporting UK growth. The Bank’s monetary policy committee said in its November inflation is likely to fall below 1% in early 2015. UK consumer prices are expected to increase by 0.7%.
  2. US retail sales: Wednesday, 13:30. U.S. consumer spending edged up in November amid the holiday shopping season, boosted further by lower gasoline prices. Meanwhile, retail sales excluding automobiles, gasoline, building materials and food services rose 0.6% after an unrevised 0.5% gain in October. Economists expected core sales to rise a mere 0.1% last month. The shopping spree accelerated growth in the fourth quarter. Retail sales are expected to gain 0.2%, while Core sales are predicted to increase by 0.1%.
  3. Australian employment data: Thursday, 0:30. Australia’s unemployment edged up to 6.3% in November as more people looked for jobs. Economic activity weakened by sluggish Chinese demand. However the Australian job market added 42,700 positions in November, much better than the 13,700 increase posted in the prior month and the 15,000 addition forecasted by analysts. This rise suggests improvement in the Australian labor market. Policymakers are preparing for further easing measures in case the weakness in the job market and domestic demand continues. Economists expect job growth to increase by 5,300 while the Unemployment rate is expected to remain unchanged at 6.3%.
  4. US PPI: Thursday, 13:30. Producer Price Index fell 0.2% in November prompted by lower oil prices, following a 0.2% gain in the prior month. Analysts expected a smaller decline of 0.1%. On an unadjusted basis, producer prices increased 1.4% for the 12 months ended November, the slowest 12-month increase since February 2014. Core producer prices, excluding food and energy remained unchanged after a 0.4% rise in November. Producer Price Index is expected to drop 0.3% this time.
  5. US Unemployment claims: Thursday, 13:30. The number initial claims for unemployment benefits declined last week by 4,000 to 294,000 amid a sharp decrease in dismissals. Strong consumer spending had a positive effect on the labor market, despite a weakening in global economy. The four-week moving average a more solid measure of labor market trends, remained below the 300,000 mark for the 17th straight week. Jobless claims is expected to reach 299,000 this week.
  6. US Philly Fed Manufacturing Index: Thursday, 15:00. Factory activity in the U.S. mid-Atlantic region plunged to 24.5 in December from 40.8 in the previous month, indicating slower activity. New orders fell to 15.7 from 35.7. Employment conditions weakened to 7.2, down from 22.4 marking the lowest level since April. Philly Fed Manufacturing Index is predicted to reach 20.3 this time.
  7. US Inflation data: Friday, 13:30. U.S. consumer prices registered their biggest decline in nearly six years in November amid a slide in gasoline prices. Consumer Price Index plunged 0.3%, following flat reading in October. On a yearly base CPI increased 1.3% the smallest gain in nine months, after posting a 1.7% rise in October. While inflation declines, the US job market continues to strengthen including a big gain in weekly earnings. Meanwhile, Core CPI excluding food and energy prices gained 0.1% following a 0.2% rise in the previous month. The rise suggests oil prices are the main cause for the sharp declines. Analysts expect consumer prices to dip 0.3% while Core prices are expected to increase 0.1%.
  8. US Prelim UoM Consumer Sentiment: Friday, 14:55. U.S. consumer sentiment surged in December to a near eight-year high amid improved earnings and better job prospects. Consumer sentiment edged up to 93.8 from 88.8 in November. The survey’s one-year inflation expectation rose to 2.9 percent from 2.8 percent, while its five-year inflation outlook also rose to 2.9 percent from 2.6 percent last month. Economists expect consumer sentiment to rise further to 94.2 this time.
Sergey Golubev
Moderator
113476
Sergey Golubev  

AUD/USD Completes a Double Bottom; Watch for Resistance (based on forexminute article)

NFP Report was a bit crummy. Although the headline reading was slightly above forecast and the unemployment rate fell, labor participation also dropped to its lowest rate in 33 years, and average hourly earnings fell in December. This gave way to some correction against recent USD strength, and the AUD/USD rallied.

The 4H AUD/USD chart shows that a double bottom was formed after today’s NFP report. Now, we want to see confirmation. If price gets to 0.8215-0.8235, we should expect some resistance. If there is one, we should monitor the 0.8125 area. A bullish market should hold above this level. However, a break below 0.81 makes it unclear, and a break below 0.8087 is likely to signal bearish continuation, or at least a sideways instead of a bullish consolidation. This would put pressure on the 0.8035 low, with risk of breaking towards the 0.80 handle. On the other hand, a break above 0.8250 would signal a more bullish type of correction within a medium-term consolidation mode.

Sergey Golubev
Moderator
113476
Sergey Golubev  

USDJPY Fundamentals (based on dailyfx article)

Fundamental Forecast for Japanese Yen: Bullish

  • Japanese Yen could continue higher versus the US Dollar
  • Caution urged as USDJPY tests key trendline support


The Japanese Yen snapped a multi-week losing streak for the US Dollar as it rallied noticeably off of recent lows. A slowdown in global economic event risk may produce smaller moves ahead, but we’re watching key levels on the USDJPY as the risk of a larger JPY correction grows.

Traders sent the Japanese currency near fresh multi-year lows into the final trading days of 2014, but an important bounce in the New Year suggests conviction in the JPY-short trade (USDJPY-long) has faded. Price action seems remarkably similar to what happened exactly 12 months ago: the USDJPY topped on the first trading day of 2014 on its way to a four percent correction. A comparable move would send the Dollar to ¥115 before a resumption in the overall uptrend.

A relatively quiet week in both Japan and the US nonetheless suggests traders may wait until the following week’s highly-anticipated Bank of Japan policy meeting to force big Yen moves. Yet traders should keep a close eye on USDJPY price action as it trades at potentially significant price support, and a break below month-to-date lows near ¥118 could force a larger move towards December’s trough at ¥115.60.

A strong correlation between the Japanese Yen and the Nikkei 225/US S&P 500 tells us the next big USDJPY move could coincide with equity market turmoil. An important drop in the S&P Volatility Index (VIX) shows that few fear any such tumbles, but market conditions can and do change quite quickly.

Overall outlook for the Dollar and Japanese Yen in 2015 make a USDJPY-long position one of our favorite trades of the year. Yet a year is a long stretch of time in trading markets, and prices do not move in straight lines. We are cautious on fresh USDJPY-long positions given clear risk of a larger short-term correction—particularly ahead of the Bank of Japan meeting on January 20.

Sergey Golubev
Moderator
113476
Sergey Golubev  

USD/JPY Weekly Fundamental Analysis, January 12-16, 2015 – Forecast (based on fxempire article)

The USD/JPY ended the week at 118.47 falling 1.19 on Friday alone as the US dollar eased after the release of the jobs data.  The Japanese Yen snapped a multi-week losing streak for the US Dollar as it rallied noticeably off of recent lows. A slowdown in global economic event risk may produce smaller moves ahead, but we’re watching key levels on the USDJPY as the risk of a larger JPY correction grows.

Analysts also took that as a possible pointer to the Federal Reserve taking its time on raising interest rates this year, against some expectations prior to the report that an initial hike from the zero level could come as early as April.

In a reversal, the government now expects the economy to shrink around 0.5 percent in real terms for fiscal 2014, downgrading its July forecast of 1.2 percent growth, sources said Friday. The global plunge in oil prices could translate into annual economic gains of ¥7 trillion, Economic and Fiscal Policy Minister Akira Amari said Friday. “Oil prices are now less than half what they were at their peak. That stops money outflows.

Sergey Golubev
Moderator
113476
Sergey Golubev  

USD/JPY weekly outlook: January 12 - 16 (based on investing article)

The dollar fell against the yen on Friday after the latest U.S. jobs report showed that average earnings fell last month, suggesting that the Federal Reserve could keep rates on hold for longer.

The U.S. economy added 252,000 jobs in December the Labor Department said, more than the 240,000 forecast by economists. The unemployment rate ticked down to a six-and-a-half year low 5.6% from 5.8% in November. Economists had forecast a decline to 5.7%.

However, the report also showed that average earnings fell by 0.2% in December, missing expectations for a 0.2% increase and were up by just 1.7% from a year earlier.

The drop in average earnings prompted investors to take profits in the dollar, as markets pushed back expectations for the first hike in U.S. interest rates to late-2015 from mid-2015 before the report.

Following an initial move higher the dollar fell against the yen, with USD/JPY down 0.99% to 118.46 late Friday. The pair ended the week down 1.6%.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.39% to 92.18 late Friday, off the 12-year peaks of 92.76 reached in the previous session. The index still notched up a weekly gain, supported by weakness in the euro.

The euro ended the week at more than two-month lows against the yen, with EUR/JPY down 0.57% to 140.32 in late trade, the weakest since October 31.

In the euro zone, data on Friday showed that industrial output fell in both Germany and France in November, while German exports also fell. The weak data fuelled speculation that the European Central Bank will embark on full blown quantitative easing as soon as its next meeting on January 22.

Earlier in the week, data showed that consumer prices in the euro area fell in December for the first time in more than five years, adding to pressure on the ECB to step up measures to avert the threat of deflation taking hold in the region.

The single currency was also pressured lower by uncertainty over Greece’s future in the euro zone if far-left anti-austerity party Syriza win elections due to be held later this month.

In the week ahead, the economic calendar is light, but markets will be looking ahead to Wednesday’s report on U.S. retail sales, as well as Friday’s data on consumer sentiment and factory output.

Monday, January 12

  • In the U.S., Atlanta Federal Reserve President Dennis Lockhart is to speak.

Tuesday, January 13

  • Japan is to produce data on the current account.

Wednesday, January 14

  • The U.S. is to produce data on retail sales, in addition to reports on import prices and business inventories.

Thursday, January 15

  • The U.S. is to publish the weekly report on initial jobless claims as well as data on producer prices and manufacturing activity in the Philadelphia region.

Friday, January 16

  • Japan is to release data on tertiary industry activity.
  • The U.S. is to round up the week with a report on industrial production and preliminary data on consumer sentiment.
Sergey Golubev
Moderator
113476
Sergey Golubev  

USD/JPY Near 118 after U.S. Payrolls Disappoint (based on marketpulse article)

The dollar nursed losses early on Monday, having suffered a setback after an unexpected fall in U.S. wages tainted what was otherwise a robust report on the labor market.

Investors were quick to cut long dollar positions after wages posted their biggest decline in at least eight years in December, even as payrolls increased by a brisk 252,000.

The greenback dipped as far as 118.22 yen first thing on Monday, reaching a low last seen on Jan. 6. The euro edged up to $1.1857, pulling away from a nine-year trough of $1.1754 plumbed on Thursday.

Sergey Golubev
Moderator
113476
Sergey Golubev  

USDJPY Threatens Opening Range- Sub 118 Targets In View (based on dailyfx article)

  • USDJPY testing interim support 118.04/18 (near-term bullish invalidation)
  • Resistance 119.85 & 120.66/81- bearish invalidation
  • Weekly opening range to validate near-term scalp bias
  • Support break targets MLP (blue) & 116.93
  • Daily RSI Support & Resistance triggers pending
  • Event Risk Ahead: US Retail Sales tomorrow & CPI, Industrial Production & University of Michigan on Friday