Eur/usd - page 290
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Yesterday EURUSD fell breaking below the 1.1097 the lower band of a daily resistance and closed near the low of the day. Today we might see a retest of the 1.1097 level before another push downward with the target at the 1.0955 a Fibonacci retracement (50.0).
Preview: ECB minutes - How much has Greece shaken the QE process?
ECB release the minutes from the June 2015 governing council meeting
At 11.30 gmt the ECB release their latest minutes following their June monetary policy meeting
In the last minutes they noted the differences in returns following the implementation of QE. Stocks were up 7.5-10% while returns from sovereign bonds were lower.
The ECB started buying bonds at the top of the market and then Greece took over. Yields have risen between 100-150% for countries like Spain, Italy and Portugal and over 2000% for Germany.
As yields rise the price of bonds fall so the ECB is well down on the value of their positions. They aren't it for the profit though but they may make mention of the situation in the minutes. What the move in yields has done is increase the amount of eligible paper and particularly from the preferred short end of the curve.
I wrote a post yesterday about whether the ECB was using QE as a form of OMT to help keep markets under control while the Greek mess unfolds. We may get a little clue to that from today's minutes if they discuss their buying patterns. The weekly numbers have been fairly stable so they probably won't divulge the day to day buying scorecard
FX will be in focus too and the ECB touched upon the flow action and currency hedging but there were no remarks on any negativity of the euro rising from the years lows. We've been even higher since then so the minutes may start to show increased concerns. If they do then that might help the euro lower. Some context is needed though and the ECB don't watch the 5 minute charts. The currency moves and that's a fact of life and moving in and around a 1000 pip range over an extended period won't see them panicking. Greece is a big reason for the moves also and so that can be used to brush any currency concerns under the table
Most of the minutes are just an extension of the monetary policy statement so there's a lot of guff in there. News and comments from the individual members will be thin on the ground. We know that all of them are currently onboard with QE irrespective of reservations and we're nowhere near the time where we start to see hawks or doves establish themselves. I expect we'll get an "steady as she goes" message as far as the general consensus and more of the "QE/TLTRO is transitioning well" type jargon
Trading wise there's unlikely to be any shocks from the minutes so there's probably little risk to the Euro. Comments on Greece and the ELA could introduce some price risk but that depends on how far they touch on it. The minutes right now are all about trying to nick a few little clues rather than looking for any big shifts in sentiment like we do with the Fed and soon the BOE
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EUR/USD: Pair Hovers Below $1.11, Machines Ready for Payrolls
The dollar was briefly lower ahead of the critical release on Thursday as investors were out of the market, waiting for the big number.
Traders await the payrolls numbers for June, which are expected to post 233,000 jobs created, down from 280,000 in May, but still decent growth. The unemployment rate is predicted to tick lower from 5.5% to 5.4%.
"The consensus expectation for the nonfarm payrolls is 233K. However, that survey was taken largely before the better-than-expected ADP and ISM data. Our own econometric model, which takes into account yesterday’s data, suggests 240K if we assume that today’s employment sub-index of the ISM for the services sector remains unchanged," analysts at Rabobank wrote on Thursday, ahead of the release.
Moreover, average hourly earnings will be published, with the yearly change expected to stay at 2.3% growth.
On Wednesday, the ISM manufacturing index for Junein the US ticked higher to 53.5, from 52.8 in May and beat analysts' expectations. Moreover, ISM prices paid remained below the 50.0 level, printing 49.5 for a second month.
As the US is celebrating the Independence Day on Friday, trading will be only mild on Friday and the main focus will be on the outcome of the Greek referendum on Sunday, on whether Greek citizens want to stay in the euro zone and accept the creditors' demands.
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EUR recorded second consequential reduction on Wednesday. The session started at a price of 1.1143 and around noon the pair reached the highest level for the day at 1.1165. Later the price went down at the end of the day the single currency finished at a price of 1.1052. If the downward trend continues, we can expect an attempt to break into the first support at 1.0953.
The US Non-farm payrolls today barely had an effect on the market. I suppose everyone is waiting for the Greek referendum on Sunday. I think EUR/USD will likely continue consolidating for now, though a drop to the support at 1.1000 is still possible.
still the resistance level 1.1120 stands until there is no break expect more drop on the EUR/USD but the volume on the pair is low.
EUR/USD almost unchanged as focus turns to Greek vote
The euro was almost unchanged against the U.S. dollar on Friday, as investors remained cautious ahead of the weekend's Greek referendum on whether or not the country's should accept its creditor's bailout terms.
EUR/USD hit 1.1100 during late Asian trade, the session high; the pair subsequently consolidated at 1.1093.
The pair was likely to find support at 1.1032, the low of July 1 and resistance at 1.1171, the high of July 1.
Hopes for a last minute deal between Greece and the euro zone were quashed on Wednesday after Greek Prime Minister Alexis Tsipras urged voters to reject the terms of an international bailout deal.
Greek voters are due to decide on Sunday whether to accept terms proposed by the institutions overseeing the country’s now-expired bailout, the European Central Bank, the International Monetary Fund and the European Commission, or reject them.
Tsipras has said a vote against the proposals would give him a stronger mandate to agree a third bailout Greece’s creditors. However, European leaders have said the referendum is ultimately a vote on whether to remain in the euro zone.
Greece became the first developed country to default on the IMF after its second bailout program expired late Tuesday.
Meanwhile, sentiment on the dollar remained vulnerable after a string of disappointing U.S. data on Thursday fuelled uncertainty over the timing of a rate hike.
The U.S. Commerce Department reported on Thursday that factory orders fell 1.0% in May, compared to expectations for a 0.5% decline.
Separately, the Labor Department reported that the economy added 223,000 jobs in June, compared to expectations for jobs growth of 230,000, although the unemployment rate ticked down to 5.3% last month, from 5.5% in June.
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On yesterday session the EURUSD made the retest of the 1.1097 level on a narrow range day although the nonfarm payrolls come out worse than expected. Today will be a light trading day due the US observed Independence Day (Bank holiday). A word of caution, the Greek referendum on Sunday can cause another Gap.
Euro Zone Shoppers Still Thrifty in May
Retailers in the 19-nation euro zone maintained growth in May, but the numbers have been increasing slowly.
Consumer spending at retailers ticked only 0.2% higher in the fifth month of the year on a month-on-month basis, the European Union statistics office Eurostat reported on Wednesday. Market analysts had expected 0.1% growth in retail activities.
On an annual basis, shopping appetites in the bloc increased by 2.4% in May, after edging up a revised 2.7% in the previous month, while independent economists had projected 2.3% sales growth. .
Price growth
Consumer price inflation in the euro zone remained in positive territory for the second straight month in June, data showed on Tuesday, but the headline gauge slowed a bit, meeting estimates.
The inflation rate in the 19 countries sharing the euro recorded 0.2% year-on-year growth in the sixth month of the year, following the 0.3% growth recorded in May.
Back then the gauge ended a five-month streak of no growth. Services inflation, which tends to be more domestically driven, rose to 1.3% from 1% in May.
Meanwhile, core inflation - a measure of price development excluding food and energy - rose 0.8% in June, compared to the 0.9% hike seen a month before.
source
EUR recorded a slight rise against the USD on Thursday after two consecutive negative sessions before. The pair opened at a rate of 1.1052, and the price went down slightly, reaching a daily bottom at 1.1031. Later direction started to climb and at the end of the day the euro closed at a rate of 1.1083. If the price went up, the pair will move to the first resistance at 1.1270.