All Eyes On U.S. CPI Data

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Dear Traders,

The FX market on Thursday can be described as rather muted. As expected, GBP/USD traded higher but the bullish momentum was limited to a high of 1.2955. The cable now needs to overcome the 1.30-barrier in order to encourage sterling bulls for a test of 1.3020/45 . EUR/USD traders however, sold euros below 1.1420 but yesterday’s downward movement was limited to a low of 1.1370. A break below 1.1380 has thus failed to ignite bearish momentum toward 1.13.

Today might be more interesting for traders as U.S. Consumer Inflation due at 12:30 UTC will be closely scrutinized. Yellen believes that the current downtrend in inflation will be temporary and if she is right and we see upbeat inflation figures, the greenback will rise. However, there is a risk that inflation could slow again in June and this would increase the pressure on the U.S. dollar. If the forecast is correct and inflation slowed to 1.7 percent, it is the fourth consecutive month of deceleration and the weakest reading since November 2016.

Let’s be surprised while we prepare for higher volatility around the release of CPI data.

We wish you good trades and a beautiful weekend.

If you want to know how to exactly trade EUR/USD and GBP/USD including an appropriate money management per trade and day, sign up for our daily signal service here.

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Further U.S. Dollar Weakness Expected

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Dear Traders,

We hope you successfully weathered the first day of Yellen’s testimony and the currencies’ whipsaw performance.

The Federal Reserve Chair sounded slightly more cautious on the inflation outlook while saying the U.S. economy should continue to expand over the next few years, allowing the central bank to stick to its path of higher interest rates. In the Q&A session, Yellen indicated the Fed is still considering risks around the inflation outlook while inflation is running below the Fed’s 2 percent target. Concerning the Fed’s balance sheet, Yellen mentioned that the central bank anticipates it will start reducing its balance sheet “this year” while the size of the balance sheet is uncertain.

The Fed chair will continue testifying today at 14:00 UTC before the Senate Banking Committee.

In short, Yellen’s comments suggest that the Fed is in no rush to tighten monetary policy because of too-low inflation, even though the U.S. economy is in good shape. This slightly less hawkish tone bodes well for U.S. stocks but weakens the U.S. dollar.

Traders of the EUR/USD now might argue that the U.S. dollar strengthened instead in the aftermath of the testimony. One reason for the euro’s short-term decline might be speculation the ECB could follow the Fed’s low inflation expectations and may put the awaited taper in question, at least in the near future.

For our part, we expect the EUR/USD to strengthen, heading for a test of 1.15. Euro bears should however wait for a break below 1.1380 or, on the other hand, sell euros at higher levels following a test of 1.15.

As expected, the GBP/USD received a boost from stronger-than-expected U.K. labor market data and started its relief rally towards 1.29. If the pound breaks above 1.2930 we expect further gains towards 1.2970 and possibly even 1.3020. A significant break below 1.2850 however, could spark bearish momentum towards 1.28.

If you want to know how to exactly trade EUR/USD and GBP/USD including an appropriate money management per trade and day, sign up for our daily signal service here.

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EUR/USD Forecast Met; Focus Now On Further Upside Momentum

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Dear Traders,

We got what we were looking for in yesterday’s analysis: A breakout in the EUR/USD. The euro broke out of its narrow trading range and surpassed the 1.1445-barrier. Our long entry has thus proved a success. We are now looking for additional upside in this pair and look at higher targets at 1.15, 1.1530 and 1.1580. With the EUR/USD gradually approaching overbought territory we also anticipate pullbacks which may drive the euro back toward 1.1415. With the euro remaining above 1.1460 however, there is no cause for concern for euro bulls, at least for a while.

Federal Reserve Chair Janet Yellen gives testimony today and tomorrow with market participants looking for guidance on when the Fed could start shrinking its balance sheet. Ms. Yellen is due to start her prepared remarks at 12:30 UTC followed by Q&A at 14:00 UTC. Yellen’s testimony is the prime monetary policy event for dollar traders and so we expect higher volatility in all USD crosses.

The British pound depreciated against the U.S. dollar Tuesday and fell toward a low of 1.2830. The catalyst for the decline was a speech by Bank of England Deputy Governor Broadbent who refrained from commenting on interest rates. Broadbent instead warned of Brexit risks and hence the pound weakened as the market has hoped that there would be anything hawkish in his speech.

From a technical perspective, we now expect the GBP/USD to trade with a tailwind since the pair refrained from a break of its recent downtrend channel. Based on that channel, it could be time for a pullback and hence upcoming bullish momentum toward 1.2920. Let us be surprised.

The U.K. Labor Market report is scheduled for release at 8:30 UTC and could have an impact on the pound. Signs of stronger job growth may encourage the BoE to start normalizing monetary policy. Stronger job/wage growth figures would thus have a positive impact on the pound sterling.

We wish you profitable trades for today!

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We wish you good trades and many pips!

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Will Payrolls Hurt Or Help The U.S. Dollar?

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Dear Traders,

It’s payrolls day and the euro already started to show some bullish price action ahead of the highly anticipated U.S. jobs report. In our analysis of Thursday we highlighted the chance of a bullish continuation in the EUR/USD and this is precisely what has happened yesterday. The euro was Thursday’s best performer and rose toward 1.1425 on speculation the European Central bank is slowly starting to prepare the market for stimulus tapering.

All eyes now turn to the NFP report which is scheduled for release at 12:30 UTC. While the ADP report fell short of expectations, there is a risk that also NFP data miss and this would be poison for the U.S. dollar. The jobs report is expected to show 178K workers in June while wage growth is expected to have strengthened. If the headlines figures exceed expectations we could see the greenback strengthening but we bear in mind that any disappointment will have a greater impact on the market.

As usual, we will prepare for both bullish and bearish scenario but recommend not investing too much – at least ahead of the payrolls report. If you want to know how to trade the payrolls report and how to adjust your money management, sign up for our signal service here.

We wish you profitable trades and a relaxing weekend.

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Market Is Running Out Of Steam; Focus Now On ISM And NFP Data

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Dear Traders,

The FOMC minutes have turned out to be a non-event for traders and failed to lift the U.S. dollar. While the Federal Reserve referenced the hawkish shift in its QE plans, the FOMC was split on the timing for their balance sheet reduction. Moreover, there were some inflation concerns in the statement while Fed officials continued to view gradual interest rate increases as appropriate. With the mixed tone from the minutes, the market’s reaction was muted.

The U.S. dollar neither declined significantly nor did it recover following the minutes. We hope for better trading opportunities today with the ISM service sector and private ADP report scheduled for release. While most attention will be paid to tomorrow’s NFP data, the ISM Non-Manufacturing Index, due at 14:00 UTC could spark some volatile movements ahead of the U.S. Labor report. Before, the ADP employment change report is due for release at 12:15 UTC.

EUR/USD

Recent downward trend channel is still intact within an overall uptrend. The euro was recently confined to a narrow trading range between 1.1370 and 1.1310. With the pair remaining below 1.1350 we expect it to follow the downward channel towards 1.1285. If the euro breaks however above 1.1360 we could see another leg upwards, pointing towards 1.15.

The performance of the GBP/USD was muted with the pair trading more or less sideways between 1.2950 and 1.2890. We will keep an eye on prices either above 1.2960 or below 1.2890.

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We wish you good trades and many pips!

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Yen Serves As Safe Haven On Korea Worry; Euro And Pound Unmoved

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Dear Traders,

Nothing much has changed in the EUR/USD and GBP/USD while a holiday trade was clearly in effect on Tuesday. Other currencies, such as the yen were sought as a safer haven after North Korea said Tuesday it successfully test-fired an intercontinental ballistic missile, escalating tensions between North Korea and the U.S.

The political turmoil comes ahead of the G-20 summit in Hamburg this weekend. U.S. President Trump will attend the G-20 summit and is expected to hold his first meeting with Putin.

Today, market participants will focus on the Federal Reserve and its minutes from the latest FOMC meeting. Investors are looking for clues on the path for interest rates ahead of the U.S. jobs report due on Friday. With a number of market participants doubting the Fed rate hike plans, the FOMC meeting minutes could be an interesting event for traders.

The FOMC minutes are scheduled for release at 18:00 UTC.

The EUR/USD found some near-term support at 1.1335 but we expect a stronger support to be at 1.13. If the euro falls below 1.1280 we could see a slide towards 1.1220. Euro bulls should however focus on a renewed break above 1.14 in order to buy euros towards 1.15.

The GBP/USD refrained from dipping significantly below 1.29, at least for the time being. In order to sell pounds we will keep an eye on prices below 1.2880. Lower supports are seen at 1.2850 and 1.28. Buyers of the GBP/USD should either take advantage of corrections towards 1.2885 and 1.28 or wait for a breakout above 1.3030.

The U.K. PMI report is scheduled for release at 8:30 UTC and could have a short-term impact on the pound.

We wish you good trades for today!

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We wish you good trades and many pips!

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Dollar Strengthened Amidst Quiet Trading Environment

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Dear Traders,

The U.S. dollar regained some strength and rose against the euro and British pound Monday. However, yesterday’s rebound in the dollar is still not significant enough to alter the technical outlook, thus far.

The euro fell toward 1.1350 and with U.S. markets being closed for the Independence Holiday today, we expect the EUR/USD to remain trading between 1.1440 and 1.13. If the euro dips below 1.1325 we anticipate increased bearish momentum towards 1.1290. For euro bulls to regain control, the euro will need to take the hurdle at 1.14 significantly.

The pound sterling came off its highs but found some halt near 1.2930. If the cable slides below 1.29 we expect a next support to be at around 1.2860. On the topside, the pound will need to break above 1.3030 in order to encourage sterling bulls for a test of 1.3060 and 1.31.

The U.K. Construction PMI is scheduled for release at 8:30 UTC and this is already the only piece of data today.

It is the U.S.  Independence Holiday today and trading is expected to be quiet.

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Profitable Trading Month June

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Dear Traders,

The euro and British pound extended their rallies and further strengthened against the struggling U.S. dollar. With the European Central Bank and the Bank of England gradually shifting the tone toward a more hawkish stance, the euro and pound benefited against the greenback.

The EUR/USD approaches 1.15 and if U.S. key inflation data due at 12:30 UTC misses, we could see at least a test of the crucial 1.15-level. The PCE deflator is considered the Federal Reserve’s favorite inflation gauge and analysts expect the annual rate slowed to 1.4 percent.

The EUR/USD trades currently at 1.1445 and if the pair passes 1.1470, we could see the euro heading for a test of 1.15 and possibly even 1.1550. Sellers of the EUR/USD should either enter at higher resistance levels, taking advantage of potential pullbacks or wait for a decline below 1.1370.

Euro traders should keep an eye on the Eurozone Consumer Prices scheduled for release at 9:00 UTC.

The GBP/USD was able to hold above 1.30, at least for the time being. If the price breaks above 1.3060 we expect the cable to head for 1.3120. A crucial resistance is however seen at 1.3240/50. As long as the pair remains above 1.29, there is no cause for concern for sterling bulls.

The U.K. GDP is scheduled for release at 8:30 UTC.

Having gained a very good profit this month by our daily signals we will sit back today and secure our monthly profits. Have a good weekend.

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We wish you good trades and many pips!

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Euro And British Pound Flying High

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Dear Traders,

After the euro’s strong performance from Tuesday, the cable followed with a rise towards 1.30. A reason for the pound’s flight were hawkish rate comments made by Bank of England Governor Carney who said the BoE may need to begin raising interest rates and will debate a move in the next few months. “Some removal of monetary stimulus is likely to become necessary” Carney said on Wednesday in Sintra, Portugal. The pound sharply strengthened in response to his remarks.

Technically, the GBP/USD broke out of its recent downtrend channel and is currently headed towards 1.30. Buyers should pay attention to higher prices above 1.3060 in order to buy pounds towards 1.32. A current support is however seen at 1.28.

Traders who traded the EUR/USD Wednesday had a tumultuous session with the currency pair fluctuating choppily between 1.1390 and 1.1290. Everything from profitable breakouts till loss-making fake-outs was included in yesterday’s trading but at the end of the day, we were able to post a small profit.

Meanwhile, the euro was torn between the market’s (mis)interpretation of Draghi’s recent upbeat remarks, suggesting the beginning of the ECB’s withdrawal from its accommodative policy, and the central bank’s back paddling afterwards. The conflicting ECB signals sent the euro on a roller coaster ride but the follow through of the euro’s latest rally had a greater impact than quelling speculation. Consequently, the euro broke above 1.1390 and tested the 1.1420-level. Given the strong uptrend in the EUR/USD we expect the euro to continue its rally towards 1.15/1.1550. If the pair touches 1.15, sellers may take the opportunity and jump back in. A pullback towards1.13 however, may attract the attention of buyers.

From the Eurozone we have the German Consumer Price scheduled for release at 12:00 UTC, a report which could have an impact on the euro.

The U.S. GDP report due for release at 12:30 UTC will be of interest for dollar traders.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

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EUR/USD & GBP/USD: Range-Bound Price Action

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Dear Traders,

There was nothing to gain for traders of the EUR/USD and GBP/USD Monday with both major currency pairs trading flat within tight trading ranges. The euro took a brief glimpse above 1.1210 but was unable to hold above that level. The cable however, traded choppily sideways between 1.2760 and 1.2705 while none of our daily signal entries provided a sustained profit.

Market participants will now focus on an address by Fed chair Yellen at 17:00 UTC. If she does not touch on monetary policy, her speech could have very little impact on the U.S. dollar. During the European trading session, monetary policy and financial stability will remain in focus with Bank of England Governor Carney due to speak at 10:00 UTC.

Furthermore, U.S. Consumer Confidence is scheduled for release at 14:00 UTC.

Daily Forex signals:

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2017 Maimar-FX.

www.maimar.co