Weekend Edition with John O'Donnell (based on fxstreet article)
John O'Donnell Sits in for Merlin. He discusses the global
credit purge cycle within the Online Trading Academy core strategy.
Learn how to prosper in the months and years ahead in the global capital
markets deflationary trends.
Barclays - 'we recommend remaining short EURUSD' (based on efxnews article)
Barclays made a forecast for this week concerning EUR/USD related to funbdamental factors such as the following:
Let's evaluate this forecast concerning the technical point of view:
Forum on trading, automated trading systems and testing trading strategies
Sergey Golubev, 2014.01.06 18:38
BTMU Forecasts for EUR/USD: 1.060 in December 2015 (based on efxnews article)
This pair is on bearish market condition for
ranging between Fibo resistance level at 1.1713 and Fibo support level
at 1.0850. Symmetric triangle pattern was formed by the price to be
broken with 1.0807 resistance level for the bearish trend to be
continuing, and the next bearish targets in this case are 1.0520 and
According to the forecast made by Bank of
Tokyo-Mitsubishi UFJ, this triangle pattern will be broken from above to
below together with 1.0807 target by the end of this year, and we may
see good bearish breakdown possibilities in the beginning of 2016: the
price will break 1.0520/1.0461 support levels by March 2016, and EUR/USD
will be at 1.000 in Jun'16.
Many int'l institutions made a prediction for the EUR/USD to be 1.000
or less than that at year-end but this is the first forecast which was
clarified the values of this pair in detailed timing way: we will see
the EUR/USD to be 1.000 in June 2016 only.
Goldman Sachs about Next Week's FOMC: 'the first hike is not likely to come until December' (based on efxnews article)
Goldman Sachs made some forecast concerning USD related to the FOMC meeting which will be held next week on Thursday:
Just to remind about next week's FOMC metting:
2015-09-17 19:00 GMT (or 21:00 MQ MT5 time) | [USD - FOMC Statement, Federal Funds Rate]
if actual > forecast (or previous data) = good for currency (for USD in our case)if hawkish > expected = (for USD in our case)
[USD - FOMC Statement] = It's the primary tool the FOMC uses to communicate with investors about
monetary policy. It contains the outcome of their vote on interest rates
and other policy measures, along with commentary about the economic
conditions that influenced their votes. Most importantly, it discusses
the economic outlook and offers clues on the outcome of future votes.
[USD - Federal Funds Rate]
= Interest rate at which depository institutions lend balances held at
Federal Reserve to other depository institutions overnight. Short term
interest rates are the paramount factor in currency valuation
- traders look at most other indicators merely to predict how rates
will change in the future.
Credit Agricole for EUR/USD: 1.12 by the end of Q3, 1.06 by the end of the year, and 1.04 by the end of Q1 of 2016 (based on efxnews article)
Credit Agricole made an other forecast for EUR/USD: 1.12 by the end of
Q3, 1.06 by the end of the year, and 1.04 by the end of Q1 of 2016. It
means that old forecast (made few day ago) was updated for 1.12 target
for this pair by the end of September. This correction was made because
of fundamental factors changed: Credit Agricole is expecting dovish ECB
(ECB Meetings) and
hawkish Fed (FOMC).
Just to remind the general rules for fundamental news events concerning the speeches:
That means that Credit Agricole is expecting more bearish for EUR/USD in the medium term forecast:
USD trading strategy going into next week's FOMC meeting - Morgan Stanley (based on efxnews article)
Morgan Stanley estimated thew probability for Fed hike in September
vs December meetings, and it was stated that a 30% chance only of a hike
in September, so there is more chance to expect this events in December
this year. And in this case, it may be more opportunity for EUR and JPY
with related to USD: those pairs may be in bullish condition during the
September 17th meeting for example.
Thus, there are 3 basic scenarios concerning Fed hike:
Base-Case: December. "The Fed has entered its
pre-meeting silent period, which means there are no speakers on the
agenda to move market expectations of the first hike before the
September 17th meeting. Comments from the Fed thus far suggest the
central bank wants to make the first hike as well flagged as possible
and avoid surprising the market. With markets pricing in less
than a 30% chance of a hike in September, it therefore is unlikely that
the Fed will hike now. Indeed, our US economists have maintained their
view for a December hike."
Get It Done: "A hike next Thursday would lead to
accelerated EM weakness, in our view. Current account surplus and net
foreign asset-supported FX such as EUR and JPY may rally should the Fed
hike; these currencies have developed an increasingly tight inverse relationship with the performance of risky assets."
Or Wait: "The Fed delaying action would be in line with current market pricing. In this scenario, USD
would likely soften somewhat and the Fed would remain data-dependent in
the statement and in the Chair’s press conference. Nonetheless, USD
dips still represent buying opportunities as the reason for USD strength is mainly USD-supportive repatriation flows."
Any USD downside should stay limited from the current levels - Credit Agricole (based on efxnews article)
EUR/USD Forecast Sep. 14-18 (based on forexcrunch article)
to enjoy a nice recovery, ending the week on a positive note. Is it set
for more gains? The big event of the week in Europe are the ZEW survey
and inflation data. Here is an outlook for the highlights of this week
and an updated technical analysis for EUR/USD.
Talk from the ECB on QE wasn’t news for the euro and didn’t really
have a negative effect. Data-wise, we had little in the way of
surprises, but the strong German trade balance reminded us that the euro
is bid. In the US, we had some good JOLTs news but disappointing
consumer confidence ahead of the big event: the all important Fed meeting coming now. Will the mounting tension result in an explosion of the pair?
September FOMC Forecast by Nomura (based on efxnews article)
Nomura is expecting the first Fed hike in December and explaining about it: the FOMC will not raise rates this week during September FOMC:
As we know - some int'l financial institutions are still expecting for Fed hike to rise this week so that is why the opinion of Nomura Holdings is important for us here.