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ECB Decision: Euro’s Outlook Remains Neutral

Federal Reserve Chair Jerome Powell’s testimony has caused some volatility through the market and the U.S. dollar weakened on the back of falling U.S. Treasury rates. The reason for the downward tilt in the greenback was merely that there was nothing new to report, even though Powell’s remarks leaned towards the hawkish side.

Tomorrow’s NFP report could however surprise and if U.S. labor market data come in stronger-than-expected, it could trigger a shift in market pricing and thus, an upward move in the U.S. dollar.

Today, the European Central Bank is expected to leave interest rates unchanged for the fourth consecutive meeting. Investors will however closely monitor ECB President Christine Lagarde’s press conferences following the decision. Lagarde is expected to embrace a neutral stance, even though disappointing growth data in the EU may argue for a more dovish stance. Any signals about potential earlier rate cuts would weigh on the euro, whereas a delay of any potential easing measures could spark a hawkish repricing and thus, strengthen the euro.

The ECB’s decision is due at 13:15 UTC, followed by the press conference 30 minutes later.

EUR/USD – Still Sideways

Despite its recent upward tick, the currency pair still finds itself below 1.10 (blue EMA) and therefore still sideways. In order to speak of an upside breakout of the recent sideways range we would need to see a rise above 1.1050. As long as the pair remains between 1.07 and 1.10, the outlook is neutral.

GBP/USD – Struggling With Resistances

The cable is struggling to overcome a resistance at around 1.2750. We recommend traders to wait for a sustained upside break above 1.28 (red ellipse) to engage in an upside swing. On the downside, the 1.2550-area (orange EMA) could act as a support.

Daily Forex and DAX Signals:

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Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

We wish you good trades!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2024 MaiMarFX.

www.maimar.co

ECB Decision Takes Center Stage

All eyes will turn to the European Central Bank decision today at 13:15 GMT where the central bank is expected to stand pat on rates with inflation still above target. While inflation in the euro area has maintained a downward trajectory during the last year, ECB policymakers are wary of upside risks to inflation. The biggest threat might be the latest crisis in the Middle East with a temporary supply shock posing a risk to European businesses.

Traders will focus on ECB President Christine Lagarde’s press briefing at 13:45 GMT for an updated view on the economy and inflation outlook.

The risk for the euro is to the downside. For the common currency to recover, Lagarde would need to sound surprisingly hawkish, dashing hopes for an ECB rate cut anywhere near as much as what markets have priced in. Markets expect the ECB to cut rates in June. If the communication among policymakers is, however, not clear, the euro could end up drifting sideways.

We will focus on a break below 1.0820 and further 1.08 in order to sell the euro towards 1.0750 and 1.07. Above 1.0935, the focus shifts back towards the 1.10-threshold.

Daily Forex and DAX Signals:

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Our trading ideas for today 25/1/24:

EUR/USD

Long @ 1.0910

Short @ 1.0870

 

Entries from 8:00 am UTC, SL 25, TP 40

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

We wish you good trades!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2024 MaiMarFX.

www.maimar.co

ECB Meeting And U.S. PCE Data Will Take Center Stage

Welcome to a new trading week.

From a fundamental perspective, trading might be in quiet waters at the beginning of this week but towards the end of the week we have two high-importance data releases and events.

The European Central Bank decision will take center stage on Thursday. Most action will come from the commentary by President Christine Lagarde. Markets currently expect the ECB to cut interest rates in April, but Lagarde warned that’s too early, pointing to a summer rate cut instead. While traders hope for a timetable of when to expect the first cut, this ECB meeting will likely be too soon to hope for a strong guidance. If Lagarde is however successful in dampening rate cut expectations, the euro could briefly spark higher.

On Friday, the core U.S. PCE index will be important in shaping expectations for Federal Reserve rate cuts.

Looking at the technical picture, both EUR/USD and GBP/USD remain stuck in broad ranges. As long as currencies are struggling for momentum, traders are advised to focus on range trading and breakout levels.

EUR/USD – Watch out for breakouts above 1.10 or below 1.08.

GBP/USD – Sideways range is intact. Sustained breakouts above 1.28 or below 1.25 will be of interest.

DAX – We will focus on a bullish break above 16820 in order to try another push for 17000. Remaining above 16300 will favor bullish action.

 

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If you are keen to know where we put Take-Profit and Stop-Loss, if we trade on a specific day or not and how we manage open positions, subscribe to our signals.

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

We wish you good trades!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2024 MaiMarFX.

www.maimar.co

ECB Decision: No Rate Hike, No Surprises

The recent rally in both euro and British pound has proved to be short-lived while the euro has tested the area around 1.07 before retreating whereas the pound did not even manage to climb above 1.23 before falling back below 1.21. Given geopolitical tensions and thus an increased demand for safe haven currencies, the U.S. dollar remains strong so far and many traders use dips as USD buying opportunities.

In the GBP/USD the psychological 1.20-level comes back into focus now and in case this support level is broken, we may see a free-fall towards 1.18.

Today, all eyes turn to European Central Bank policy statement due at 12:15 UTC and the first look at the U.S. Q3 GDP, scheduled for release at 12:30 UTC.

The ECB will keep rates on hold, so no big surprises are expected here but if U.S. GDP reveals a further economic expansion, the euro is vulnerable to further losses.

Daily Forex and DAX Signals:

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Our trading ideas for today 26/10/23:

EUR/USD

Long @ 1.0570

Short @ 1.0525

 

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

We wish you good trades!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2023 MaiMarFX.

www.maimar.co

ECB Decision: 50/50 Chance Of A Rate Hike

Yesterday’s mixed U.S. inflation figures did not serve us well in terms of profitable trades as the dollar choppily whipsawed without a clear direction. This has led to a false breakout in both EUR/USD and GBP/USD. While the core inflation gauge was in line with estimates, the 12-month reading came in slightly higher than forecast. Traders are mostly anticipating no monetary action from the Federal Reserve next week with a view to a possible hike in November.

Today, the European Central Bank will decide whether to hike rates again amid worsening economic conditions in the Euro Area. Sources have suggested the ECB policymakers are about to upgrade their inflation outlook for 2024 to above 3 percent. This would mean a hawkish repricing of rate hike expectations. In short, it is now a 50/50 chance on whether the ECB raises rates today or not.

From a purely technical view, we now see short-term momentum in favor of the dollar, but if the ECB hikes today, the euro will rally.

Let’s see.

The ECB decision is due at 12:15 UTC followed by the press conference 30 minutes later.

In case the euro rallies, the next target is at 1.0835, while slipping below 1.0685, the next lower target is seen at 1.0630.

Daily Forex and DAX Signals:

If you are keen to know where we put Take-Profit and Stop-Loss, if we trade on a specific day or not and how we manage open positions, subscribe to our signals.

 

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

After Fed Focus Turns To ECB

The Federal Reserve hiked interest rates as expected but did not strike a hawkish tone. The U.S. dollar weakened amid the lack of commitment to further tightening.

The euro flirted with the 1.11 handle but trading was limited to a tight price range without major breakouts. The focus now turns to the European Central Bank’s decision today at 13:15 UTC.

The ECB is expected to raise rates by 25bp but traders speculate on a shift in a dovish direction in the face of the deteriorating health of the EU-economy. If traders begin to price out the probability of more tightening in September, the euro could experience a sharp sell-off.

However, from a technical view we see chances for further leg-up towards 1.12. On the downside, if the euro falls back below 1.1020, the next support lies at 1.0970.

Summer doldrums: We advise traders not invest too much or doing a trading break since volatility typically remains at very muted levels during the summer months of July and August. When volatility is low, there is more to lose than to gain.

Daily Forex and DAX Signals:

If you are keen to know where we put Take-Profit and Stop-Loss, if we trade on a specific day or not and how we manage open positions, subscribe to our signals.

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2023 MaiMarFX.

www.maimar.co

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Trading Profits And A Hawkish Takeaway

It came as expected, but with a hawkish takeaway. The Federal Reserve paused rate hikes in June after 15 months of interest rate increases but there is less conviction for markets now that yesterday’s decision will mark the end of its tightening cycle. The Federal Open Market Committee stated that this month’s pause aims to allow the officials to assess more incoming data and Powell added that nearly all FOMC officials expect ‘some’ further rate hikes. Additionally, the dot plot peak rate for 2023 revised to 5.6 percent form previous 5.1 percent, which suggests another 50bp tightening by the end of this year.

The U.S. dollar gained following the more hawkish dot plot projections and thus, corrected recent gains in the EUR/USD and GBP/USD.

Our yesterday’s signal entries have proved highly profitable with two long entries in both pairs, providing only yesterday +64 pips in the EUR/USD and +80 pips in the GBP/USD.

Today, we will have the European Central Bank decision due at 12:15 UTC followed by the ECB press conference. It is expected that officials will raise rates by 25bp but may signal on a dovish guidance.

 

Daily Forex and DAX Signals:

If you are keen to know where we put Take-Profit and Stop-Loss, if we trade on a specific day or not and how we manage open positions, subscribe to our signals.

 

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

We wish you good trades!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2023 MaiMarFX.

www.maimar.co

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Central Bank Decisions In Focus

Welcome to a new trading week which could have some larger market moves in store as the U.S. Federal Reserve and ECB are set to announce policies this week.

As for the Fed which meets on June 13-14, officials are expected to take a breather and skip a rate hike this month after more than a year of increases. However, Fed Chair Jerome Powell could signal that policy makers are prepared to keep hiking if needed. Some market participants expect the Fed decision this month to be a close call, especially if Tuesday’s U.S. inflation print should come in higher than expected.

On Thursday the European Central Bank is widely expected to raise rates by 25bps again.

Taking a look at the technical picture, the British pound showed decent gains against the U.S. dollar, closing the past week on a positive footing.

GBP/USD

We will keep tabs on a breakout price range between 1.2650 and 1.24. Breaking above 1.2670 will increase chances in favor of a bullish breakout towards 1.30. However, we bear in mind that the pair entered overbought territory, making corrections towards 1.2450 likely.

EUR/USD

The pair consolidated within its recent price range between 1.08 and 1.06. Until there is no breakout of this range, there is nothing new to report.

DAX

Breakout in the making?

The index’s price movement narrowed, increasing the chances for a profitable breakout. Above 16020, we favor a bullish bias with a higher target at 16200. Below 15900, however, we will pencil in a lower target at around 15700.

 

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

We wish you good trades!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2023 MaiMarFX.

www.maimar.co

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Markets Keep Betting Against The Fed

And finally, bulls were able to profit yesterday. The best performer was the euro which soared to a high of 1.10 following Federal Reserve Chair Jerome Powell’s comments. The cable, however, proved to be difficult to trade with two false breakouts before a final third buy order compensated some losses.

The Fed raised rates as expected with a 25bp hike and warned of further rate hikes which, however, didn’t interrupt the market’s dovish speculations. Powell stressed that the central bank ‘will need to stay restrictive for some time’ and that inflation remains elevated. Policymakers see no rate cuts this year which deviates from the market’s view which prices in 2 rate cuts towards the end of this year. The market’s disbelief could quickly result in disappointment if there is something hard and fast to change its view.

Today, both European Central Bank and Bank of England are anticipated to raise their rates by 50bp. The ECB decision poses, however, a risk to the lofty euro.

EUR/USD

The euro tested the upper ascending trendline of its recent uptrend channel. If euro bulls are unable to push the euro above 1.1060 and thus towards the next resistance at 1.12, we could see a sharp correction. The current support area is seen between 1.08 and 1.07.

Daily Forex and DAX Signals:

If you are keen to know where we put Take-Profit and Stop-Loss, if we trade on a specific day or not and how we manage open positions, subscribe to our signals.

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

Eventful Week Gives Hope For New Momentum

After several weeks of lackluster momentum, market participants are now bracing for a heavy loaded week of event risk with not only three crucial Central Bank meetings on tap but also the U.S. nonfarm payrolls at the end of this week.

The first risk event will be Wednesday’s FOMC rate decision. The Federal Reserve is expected to slow the pace of tightening to 25 basis points. The problem is that the markets are ahead of themselves, appearing more dovish than the Fed. Rate cuts are already priced in looking two years out while inflation is still far above target. In other words, while the Fed may keep the focus on near-term tightening, the market is already speculating on an end of the tightening cycle instead of the possibility of keeping rates restrictive for some time. This sets the stage for disappointment rather than for confirmation of the speculation.

On Thursday, the Bank of England and European Central Bank rate decisions are due.

The BoE has hinted at yet another 50bp rate hike which is largely priced into GBP crosses. What could be bearish for the pound would be an additional vote split between 50bp and 25bp among BoE policy makers.

GBP/USD: The current bias is still bullish, provided the pair remains above 1.2250. A break below 1.2240 would possibly result in a quick sell-off towards 1.2170/1.21 and possibly even 1.20. On the top side, sterling bulls were still unable to push through the resistance zone at 1.2450 but this week’s fundamental drivers could provide a catalyst for a leg higher – or lower.

EUR/USD: The euro’s uptrend is still intact even though overbought conditions and the solid resistance around 1.09 raise the odds for a correction. If the ECB hints at a more aggressive approach in hiking rates to fight inflation while the Fed remains comfortable with slowing the pace of hikes, we could see a test of 1.10 and possibly even 1.11. On the downside, we keep tabs on the 1.0650-area as a potential support zone.

Daily Forex and DAX Signals:

If you are keen to know where we put Take-Profit and Stop-Loss, if we trade on a specific day or not and how we manage open positions, subscribe to our signals.

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

We wish you good trades!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2023 MaiMarFX.

www.maimar.co

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