Technical and Market Analysis by Vistabrokers - page 9
You are missing trading opportunities:
- Free trading apps
- Over 8,000 signals for copying
- Economic news for exploring financial markets
Registration
Log in
You agree to website policy and terms of use
If you do not have an account, please register
Vista Brokers: EUR/USDRemainsinNarrowRange
At the end of the last week, the EUR/USD has stabilized, and on Monday the pair has remained in the same range of about 80 points. Monday trades passed with a slight increase of the pair.
Vista Brokers analysts note that mostly all statistics published the first trading day was positive for the euro. Eurozone PMI index for the manufacturing coincided with the forecast of 51.0 against 50.6 a month earlier. Thus, the indicator showed the strongest monthly growth in the last six months due to the increase in new orders. In Italy and Spain PMI index for the manufacturing surpassed market expectations, while in Germany and France the index came out worse than forecast.
American statistics did not please investors. At first it was reported that US consumer spending fell in December, which means Americans are cautious and in no hurry to spend money, despite the decline in gasoline prices and a steady growth in the labor market. Personal spending fell by 0.3% compared to the previous month and the forecast of 0.1%. Recall that consumer spending accounts for about 70% of economic activity in the United States and is a key factor in the growth.
Later came the index of business activity in the US industry from the ISM, which disappointed investors who had expected 54.9 in January. Index fell more than expected - to 53.5, although the value above 50 indicates that economic growth continues.
www.vistabrokers.com
Market Pulse 03.02
Early Tuesday morning in Australia came out a large portion of important data, including buildingapprovals, tradebalance, the RBAinterestratedecision, together with the accompanying statement. Between publications that are only scheduled to be released, the most important may be called PMI index for the UK construction sector.
9:30 *** Construction PMI - January (UK)
Strong impact on the market (GPB). The situation in the construction industry in Britain is closely monitored, so the publication can affect markets. Analysts predict a slight decline of the index in January.
13:30 ** Raw Materials Price Index - December (Canada)
Moderate impact on the market (CAD). A leading indicator of price pressure in the country. Important for Canada, as it exports a lot of raw materials. Disappointing data may put pressure on the Canadian dollar.
15:00 ** Factory Orders - December (US)
Moderate impact on the market (USD). The change in volume of production orders is often a leading indicator of the industrial production dynamics for several months.
www.vistabrokers.com
Vista Brokers: RBA Decision was Unexpected
On Tuesday, February 3, the Reserve Bank of Australia has announced the next interest rate cut - to the value of 2.25%. The decision was a real surprise for the market, because most analysts had expected that the regulator woukd keep interest rates at 2.50% for quite a long time.
Vista Brokers analysts identified factors that RBA Governor Glenn Stevens has called causes of rates reducing. They are contained in the accompanying statement. Thus, the rate of economic growth in Australia is low, demand is weakening, inflation is low, the Australian dollar is still overvalued, the real estate market raises fears, peak in unemployment may be higher than had been expected previously. Among other reasons Stevens has called the fact that monetary policy in the major economies of the world is becoming more stimulative, obviously referring to the ECB.
Leaders of the central Australian bank hopes that the rate cut will support the demand, will help to achieve inflation targets in 1-2 years, will reduce the rate of the Australian dollar, which is necessary for balanced economic growth.
Market reaction to the RBA rate cut followed immediately. The Australian dollar fell sharply against the dollar to 0.7750, where the pair stabilized. The New Zealand dollar followed the aussie. Analysts say that a further decline in AUD/USD is likely, because 130 points is a slight decrease for such news. In comparison, when the Reserve Bank of New Zealand only hinted at mitigation, kiwi fell by 240 points. After the ECB's decision to launch QE, the euro/dollar fell by more than 500 points.
www.vistabrokers.com
USD / JPY. VectorMovesDown
The pair quotes remain in hibernation, but if you look closer, it is still very slowly leaving the familiar range, tending more and more to the south direction. The reason is firstly the latest data from the US, the majority of which (such as GDP data - 2.6%, forecast 3.0%) was below expected levels. So, the next resistance level moves to the today extremum 118, while support is now at 116.85. In the long term the dollar is expected to be supported with the ongoing quantitative easing program of the Bank of Japan to achieve inflation at 2% per year after 15 years of deflation. On this occasion, today the BoJ deputy governor Kiku Iwata spoke. He assured that everything is under control, but the situation is somewhat spoiled by the current decline in oil prices, as well as increased sales tax.
It is recommended to work within the formed channel using its boundaries to work on the rebound. Trend indicators are useless now, so we should look for the rebound confirmation from oscillators using the exit of the curve from overbought and oversold zones. At the moment, we hold a short position with a view to 116.50-116.85.
EUR/USDGets off the Ground
It seems that the balance of buyers has finally heavy enough to be able to talk seriously about a correctional scenario for EUR/USD. The European Commission President Jean-Claude Juncker yesterday has showed the possibility to negotiate with the new Greek government, agreeing to some concessions. This gave the bulls confidence, which led to an increase in the pair at the moment almost by 180 points. However, after that the movement has been corrected, but we see clearly a change of moods. Today we expect a number of macroeconomic publications, both from the euro zone (retail sales, business activity in the services sector), and the United States, where preliminary data will be released (prior to the official on Friday) for the growth of the number of jobs from ADP, as well as activity in the service sector according to the Institute for Supply Management. All these data are able to provide additional impetus to the pair, as well as to freeze the status quo prior to the publication of the said employment figures from the US Department of Labor. In general, many economists think, that current prices already consist everything, including any impact of a full-scale quantitative easing program, which was announced at the last ECB meeting.
In the case of growth scenario, the first target is 1.1620. Here is the Fibonacci extension level 161.8% from the January pair rebound, and here goes the channel line of the already confirmed short-term uptrend. The nearest support is 1.1261, and its breakthrough will renew pressure on the euro.
www.vistabrokers.com
Vista Brokers:Greek Debt Plan Brought EUR/USD out ofHibernation
On Tuesday, world's stock markets rose amid news about debt restructuring plan proposed by Greece. Constructive proposal of the new Greek authorities caused positive sentiments towards the euro zone. The US dollar was trading under pressure.
In last two weeks the world's media were actively discussing further development of the situation in Greece, where as a result of recent parliamentary elections the radical party "Syriza" has come to power. Representatives of international financial institutions and European countries vie stated that the debt remission is impossible for the EU, the ECB and the IMF. Everyone was waiting that Athens submits such requirements and use its possible exit from the euro zone as a blackmail.
But it seems that the Greek government has taken a different tack, offering international lenders to conduct a partial exchange of existing bonds for so-called "growth-linked" bonds. Greek finance minister Janis Varufakis explained that part of the debt, which currently stands at more than 300 billion euros, Athens offers to swap into bonds linked to the level of the economic growth. Another part was proposed to swap into "eternal" bonds. When the proposal was announced, Greek stocks rose on average by 4.6%. European stocks also began to rise. At the same time, the dollar index fell against a basket of currencies by 0.6%.
As Vista Brokers analysts sat, news that Greece will negotiate with international lenders, rather than give up the debt, brought EUR/USD out of hibernation, where it was in the last days, and caused a rally of the single currency.
www.vistabrokers.com
Market Pulse 04.02
On Wednesday, some European countries and the euro zone will publish data on the PMI index for the services sector. In the US and Canada some important indexes will be released, which may cause the growth of the market volatility.
8:00 ** Halifax House Price Index - January (UK)
Moderate impact on the market (GPB). One of the oldest indicators of the UK property market, which is always in the focus of investors.
8:55 ** Final Services PMI - January (Germany)
8:55 ** PMI Composite - January (Germany)
Moderate impact on the market (EUR). The index of purchasing managers in the service sector growth or exceeded forecast will be favorable for the currency. Analysts expect that in Germany the above mentioned indices remain at the level of December.
9:00 ** Final Services PMI - January (euro zone)
9:00 ** PMI Composite - January (euro zone)
Moderate impact on the market (EUR). The index of purchasing managers in the service sector growth or exceeded forecast will be favorable for the currency. Analysts expect that in euro zone the above mentioned indices remain at the level of December.
9:30 *** Final Services PMI - January (UK)
9:30 ** PMI Composite - January (UK)
Strong impact on the market (GPB). The index of purchasing managers in the service sector growth or exceeded forecast will be favorable for the currency. Analysts expect the growth of the index, which can support the pound.
10:00 ** Retail Sales - December (euro zone)
Moderate impact on the market (EUR). According to forecasts, the volume of retail trade in the euro area decreased, which means a reduction in consumer activity and may put pressure on the euro.
13:15 *** ADP Non-Farm Employment Change - January (USA)
Strong impact on the market (USD). This index is the main reference to official statistics, sometimes causing strong market fluctuations. The excess of the forecast is favorable for the dollar.
15:00 *** Ivey PMI - January (Canada)
Strong impact on the market (CAD). The index of purchasing managers in the service sector growth or exceeded forecast will be favorable for the currency. Analysts expect that in Canada the index will show a slight increase.
15:00 *** ISM Non-Manufacturing PMI - January (USA)
15:00 ** ISM Non-Manufacturing Employment Index - January (USA)
Strong impact on the market (USD). The value of the ISM Non-Manufacturing PMI in the USA is at a high level, and in January, analysts also expect a small increase - up to 56.6.
www.vistabrokers.com
Vista Brokers: OilCompleted itsRally
During the last few days, oil has increased in price by 19% and is now correcting from highs in anticipation of data on crudeoilinventories in the United States and amid general concerns about demand.
Vista Brokers analysts say that Wednesday morning March futures for Brent were traded at $ 57.65 per barrel compared to $ 57.91 per barrel at the close of market on Tuesday. WTI futures are at $ 52.42 per barrel compared to $ 53.05 per barrel on Tuesday.
After the end of the last week, when oil prices had started to actively grow, investors began to talk about the fact that the oil market bottomed after seven straight months dropping and losing in price about 60%. During few days oil has grown by more than 20% from the minimum recorded on January 13 that technically means the beginning of "bull" market. But it seems that the bottom has not been reached.
On Wednesday fundamental factors pressured on oil. Firstly, according to the American Petroleum Institute, the US stocks last week rose by more than 6 million barrels. Secondly, a top Chinese energy company CNOOC Ltd announced that this year will significantly reduce the investment to adapt to the reduction in oil prices. The third is that index of business activity in the services sector in China in January rose at the slowest pace in six months. These data were known early Wednesday.
It is obvious that such a strong decline in oil prices that we have seen during the last few months, has a strong impact on the world economy. Some analysts still insist that the fall of the market in the long term will be benign. Decline in oil prices will stimulate economic growth, which in turn will support demand for commodities, including oil.
www.vistabrokers.com
Vista Brokers: Market FixedProfit on AUD/USD
On Wednesday morning, the Australian dollar has come up – investors took profits after yesterday's AUD/USD fall to five-year low. Vista Brokers analysts note that on Tuesday the Australian dollar fell sharply after the Reserve Bank of Australia has unexpectedly cut interest rates.
After lowering the rate by 0.25% to a record 2.25% the RBA stood on a par with the world's central banks, which began 2015 with the next steps of monetary policy easing. Note that 2014 the Reserve Bank of Australia finished with the message about plans to keep interest rates at 2.50% throughout 2015, to support the mining sector. Therefore, yesterday's decision of the central bank was an absolute surprise for the markets.
Long-term forecasts for the Australian immediately began to be revised down. So Goldman Sachs chief economist Tim Toohey has lowered the forecast from $ 0.7500 to $ 0.7200 for the end of 2015.
www.vistabrokers.com
GBP / USD. Whatthe OldLadySays?
During last weeks the GBP/USD did not show any interesting trade opportunities, however, as is often happens, right now, a few hours before publication of the Bank of England's monetary policy decision the picture is very pretty. Here we have all the signs of graphic reversal pattern "head and shoulders" formation, here it is the proximity of the trendline (and not just any, but the very same), here is also a recent attempt to break the next resistance level (1.5222). Well, now it's Old lady business, because BOE today can reduce the rateexpectedly and unexpectedly at the same time. Expectedly because a number of other central banks has also all surprisingly reduced rates or softened monetary policy during their last meetings. Of course, the Bank of England did not even think about this before, but on the contrary, according to the distribution of votes in the last few sessions at the end of last year, even was considering rates raising. However, times change, and it will be possible to take a moment at very low rates of inflation.
Thus, it is recommended to wait for the publication of the BOE decision (12.00 GMT) and to work depending on the solution and the market's reaction to it. If the BOE reduce rates, a reducing aim for the pair will be a minimum of 23 January, and of the last year and a half - 1.4950. If rates remain at the same level (0.5%), we will expect the final break of the neckline, which will cause the achievement of the 61.8% correction of the reduction wave in December 2014 - January 2015, where the minimum growth target points out in such cases (the distance from the highest point of the head to the neckline, deferred from the breakout point).
GOLD.Everybody SitsonFence...
Apparently, market players are not ready to take decisive action in relation to gold. Correction of the January growth continues and it is likely that there will be nothing interesting here up to tomorrow's publication of the US labor market statistics. Support still is at the correctional Fibonacci level 38.2% of the mentioned wave of growth (tested twice), while growth is limited by the resistance line drawn through several successive downward highs (visible when approaching). Another possible option when gold will get off the ground, is the support line of the current uptrend achievement. Note that the growth began after testing of correctional Fibo level 61.8% of the growth in the period 2008-2011 when gold was very popular amid raging global financial crisis.
In this situation, it is important not to take active steps ahead of time. So we should wait for a break of 1308 level, which is corresponding to the ended ascending wave extremum, or be ready to buy at the approach to the uptrend line. In the case of one of these scenarios realizationour targets will be based on the actual technical picture.
www.vistabrokers.com
Vista Brokers: PositiveNewsdid not SupportEuro
On Tuesday, European stock markets rose up amid positive earnings reports for Q4, strong statistics for the euro zone and progress in negotiations on Greek debt restructuring.
Representatives of the new Greek government held several meetings with the "top officials" of the European Union. Prime Minister Alexis Tsipras met with European Commission President Juncker, President of the European Council and the European Parliament Tusk Schultz. A Greek Finance Minister visited the ECB president Draghi. Athens also reported about upcoming negotiations with the IMF on a partial exchange of Greek debt to "growth-linked" bonds.
Among positive statistics for the eurozone, Vista Brokers analysts paid attention to data on the composite PMI index, which in January rose to a six-month high - 52.6, as well as PMI index for the services sector - 52.7. Note that in Italy and Germany these indices have also showed good results, beating forecasts. And only in France data came slightly lower than expected. Retail sales in the euro area continued to rise in December, the growth continues for the third month in a row.
Despite this positive news background, EUR/USD only managed to push off from session lows and recover from 1.1437 to 1.1470. The pair failed to rise up to the level of 1.15.
www.vistabrokers.com