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Euro Drops On Fears The EU Could Collapse

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Dear Traders,

The euro weakened against the U.S. dollar after investors have been reminded that the French election is one of the biggest risks this year with the prospect of a victory of Marine Le Pen fueling concern that the European Union will collapse. France’s far-right leader Le Pen unveiled a manifesto pledge on Monday in which she said that she would take the country out of the EU should she win. Within this climate of increasing anti-globalism there is not much that is positive and currencies become victims of these policies. The euro fell towards 1.07 and we will now wait for a sustained break below that support-level. If the euro falls below 1.0680 we expect further losses towards 1.0620. On the upside we see a current resistance around 1.0780.

The British pound’s downward movement came to a short-term halt near 1.2425. We are anticipating further losses in the cable and thus focus on a significant break below 1.24. A short-term resistance is however seen around 1.2550.

With no major economic data on the docket, the price action will be determined by political developments and global risk appetite.

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Traders Prepare For Volatile Swings This Week

/in /by

Dear Traders,

We welcome you to a new trading week. Financial markets are dominated by uncertainty surrounding Donald Trump’s administration, prompting large investors to adopt a wait-and-see stance. The U.S. dollar came under further pressure after Trump’s order halting some immigration, causing geopolitical tensions. Risk aversion has therefore led to a recent sideways trend with both major currency pairs trading in relatively narrow trading ranges. This phase of trendless and uncertain markets makes it difficult for day traders to benefit from limited fluctuations and the lack of price breakouts.

This week’s major event risks might bring some new momentum to the markets and trigger profitable breakouts. The economic calendar is very busy in terms of market moving data and traders await high volatility throughout the entire week. The week starts off with the German Consumer Price report, scheduled for release today at 13:00 UTC which could lend a support to the euro. On Tuesday, the Eurozone Consumer Price report will be important to watch while an upbeat report could lead to speculation that the European Central Bank might start to reduce its asset purchases in the near future. With regard to top-tier U.S. economic data, the FOMC rate decision and the Non-Farm Payrolls report (Friday) will take center stage this week. The FOMC committee will deliver an update on its policy stance on Wednesday and while the FOMC statement is expected to be relatively upbeat, the fiscal policy uncertainty may frustrate the greenback’s recovery.

For sterling traders, the most interesting event will be the Bank of England‘s ‘Super Thursday‘ which may shape expectations for the near-term outlook for sterling. The BoE releases its Quarterly Inflation Report alongside its monthly monetary policy decision. If BoE policymakers show greater willingness to drop their dovish tone and gradually move away from their easing cycle, the pound could be vulnerable to further gains, heading for a test of 1.2780/90.

Important data for today:

13:00 EUR German CPI data

13:30 USA PCE Report

15:00 USA Pending Home Sales

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Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2017 Maimar-FX.

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Markets Were Slightly Rattled By Europe Turmoil

/in /by

Dear Traders,

Shortly before Christmas the mood changed from pleasure to shock and grief following Monday’s multiple terrorist attacks such as the Christmas market tragedy in Berlin, which was probably a terror attack, a shooting near the Islamic center in Zurich and the assassination of Russia’s ambassador to Turkey. The killing of Russia’s ambassador Andrey Karlov and the deadly truck attack at a Berlin Christmas market, killing 12 people added to geopolitical uncertainty and caused financial market turmoil on Monday.

Meanwhile, the U.S. dollar received a boost from Federal Reserve Chair Janet Yellen as she expressed in her speech at the University of Baltimore her optimism about the developments in the current U.S. labor market. She said that the job market is the strongest in nearly a decade and that it contributes to higher wages. All in all, dollar bulls had every reason to buy the dollar on dips, which is why a potential pullback still appears to be some way off.

EUR/USD

Double bottom or short-term support?

The euro tagged a fresh low at 1.0366 and once this level is breached to the downside, we could see the euro tumbling towards 1.03 and 1.0250. On the other hand, if the euro is able to hold above the 1.0365-level we will shift our focus to the 1.0480-mark which is seen as a current resistance in this pair. Above 1.0480 the double-bottom pattern will be played out, suggesting that the euro is headed for higher prices at 1.0530 and 1.0560.

GBP/USD

The descending triangle points to further losses. As mentioned in previous analysis we see a current support area between 1.2350 and 1.23. Furthermore, a descending trend line at 1.2340 marks the lower bound of the current trend channel so if the pound falls below 1.2340 and further 1.23, we expect accelerated bearish momentum sending the pound lower towards 1.2130.

There are no major economic reports scheduled for release today so the price development could be subdued.

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Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2016 Maimar-FX.

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Dollar Rally: Next Price Levels To Watch Out For

/in /by

Dear Traders,

It seems that everyone is jumping into buying U.S. dollars before year-end as this trade appears to be relatively risk-free at the moment. Amidst a strong market environment the dollar rallied to its strongest level since 2003 against the euro while the British pound dropped below 1.24 after the Bank of England’s monetary policy statement flagged global risks. As expected, BoE policymakers kept monetary policy unchanged, indicating that the outlook for the global economy has darkened amid renewed strains from rising interest rates and a strong dollar.

The U.S. dollar is on the rise, so which are the next important price levels to pay attention to?

EUR/USD

The euro broke below its crucial support at 1.0470. Given the strong downtrend we should generally expect further losses towards 1.01 and possibly also a drop towards parity but this move may not happen this year. In view of the fact the price developments are never straight-lined, we must also prepare for potential pullbacks. With this in mind, we see a next resistance at around 1.05 – the former support area in the euro. Above 1.0570 however, prices may consolidate towards 1.0670.

GBP/USD

The pound sterling faces a next support zone ranging from 1.2350 to 1.23. In case of a break below 1.2270 the pound may tumble towards lower targets at 1.2150 and 1.21. If the cable, however, is able to hold above that support area we may see a renewed test of 1.2520 and 1.2660.

 

There are no major economic reports scheduled for release today. Eurozone Consumer Prices due at 10:00 UTC should be of secondary importance as no changes are expected. From the U.S. we only have Housing Starts scheduled for release at 13:30 UTC but this report is unlikely to affect the USD.

We hope that you were able to take some profits this week and wish you a relaxing pre-Christmas weekend.

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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 2016 Maimar-FX.

www.maimar.co

 

 

 

Euro Paradoxically Rallied Despite Political Risks

/in /by

Dear Traders,

It was a paradox: The euro shrugged off political risks from Italy and rallied towards 1.08 amidst political uncertainties in Europe. The short squeeze in the EUR/USD can be explained by profit taking after the euro rejected to extend its losses beyond 1.05. However, given the anti-establishment mood sweeping around the world we doubt that the euro can hold onto its recent gains. Thus, dollar bulls may jump in again and take this opportunity to sell EUR/USD at higher levels. Nevertheless, we will also discuss a potential bullish scenario.

If the euro rises above 1.08, traders will be asking “How high the euro might go?”. So let’s try to figure it out.

EUR/USD

Given the impressive bull candle in the daily chart, we might see further upward movement before the euro reverses. In short-term time frames a next resistance could be at 1.0830/50, followed by a stronger resistance zone at 1.0950. If the euro takes the next hurdle at 1.0830, chances increase that it heads for a test of 1.0960. Above 1.0970 however, the euro may rises towards 1.1030 and perhaps even towards 1.11. Current supports are however seen at 1.0650 and 1.06.

chart_eur_usd_daily_snapshot6-12-16

GBP/USD

The cable is still on the rise but we expect gains to be limited until 1.2760 and 1.28. A significant break above 1.28 may drive the pair towards 1.2860 but then we may see some pullbacks. Crucial supports are seen at 1.26 and 1.25, which is why sterling bears should rather wait for a break below 1.2480.

chart_gbp_usd_daily_snapshot6-12-16

 

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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 2016 Maimar-FX.

www.maimar.co

 

 

 

Is The Cable Poised For A Breakout?

/in /by

Dear Traders,

Both of our major currency pairs ended the trading day virtually unchanged as there was not much consistency in the dollar’s performance Monday. The euro tested the 1.09-level on better than-expected Eurozone data. Manufacturing and Services PMI reports showed the fastest pace of economic momentum this year but this uptick was not sufficient to alter the sentiment in the EUR/USD. The euro trades on the increasing divergence in monetary policy between the U.S. and Europe and that is precisely the driver for the euro’s weakness. ECB President Mario Draghi is scheduled to speak in Berlin today at 15:30 UTC and any comments on extending the QE program beyond March could put further pressure on the euro. Before his speech the German IFO index is due for release at 8:00 UTC but this report is not expected to have a significant impact on the currency pair. Technically, we wait for a significant break above 1.0910 in order to buy euros towards 1.0950. On the downside the 1.0860-level remains in focus whereas a break below that level may drive the euro as low as 1.0830.

The pound sterling remained within a tight trading range between 1.2250 and 1.2190. We see chances of an upcoming breakout of that narrow range provided that sterling breaks above 1.2235 on the upside or respectively below 1.2190 on the downside.

chart_gbp_usd_4hours_snapshot25-10-16

Bank of England Governor Carney appears at the House of Lords economic committee today at 14:35 UTC and any comments on future monetary policy changes could have an impact on the pound.

From the U.S. we Consumer Confidence scheduled for release at 14:00 UTC, a report which could influence the dollar’s performance.

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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 2016 Maimar-FX.

www.maimar.co

 

 

 

Sterling Traders Benefit From High Volatility Environment

/in /by

Dear Traders,

The pound sterling is currently the most volatile currency and traders’ efforts were rewarded once again: As expected in yesterday’s analysis, some of the GBP’s recent losses have been corrected due to an oversold situation. Consequently, our long-entry has proved to be successful, providing traders a nice profit on Monday. The pound rejected the 1.4330-level and dropped back below 1.42. Given the fact that the ‘Leave’ Campaign gains ground against the ‘Remain’ before next week’s referendum, traders should generally expect further losses in the GBP. A next lower target could be at 1.40, whereas corrections might be limited until 1.4260. U.K. Consumer Prices are scheduled for release at 8:30 UTC and even if the report comes in with an uptick in CPI, the pound is likely to remain under pressure.

The euro tested the 1.13-barrier and held steady around that level amidst uncertainties surrounding the Brexit vote and the Federal Reserve’s rate decision. With no major important economic reports scheduled for release from the Eurozone, the euro is expected to fluctuate within smaller trading ranges. The focus will rather be on the U.S. dollar and important U.S. data such as Retail Sales due at 12:30 UTC. Retail Sales are expected to show a slower growth in May and this expectation could weigh on the dollar before the report is due for release.

We currently see a higher likelihood for upcoming bullish momentum, driving the EUR/USD towards 1.1390. A crucial resistance level is seen at 1.1330/40 which must be significantly breached to the upside in order to reinvigorate fresh bullish potential. If the euro is unable to break above 1.1305 we will shift our focus to the 1.1270-level. Below that level we expect the euro to fall towards 1.1240 and 1.1215.

Chart_EUR_USD_Hourly_snapshot14.6.16

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Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2016 Maimar-FX.

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Bearish Momentum Faded – Time For Corrections?

/in /by

Dear Traders,

While the British pound continued its slide against the U.S. dollar Wednesday, the euro quickly recovered its losses after the U.S. services PMI showed contraction, raising concerns about the resilience of the U.S. economy. The euro initially fell to a low of 1.0957 but was later able to stabilize above the 1.10-mark. We consider the 1.1050-area as a current resistance for the EUR/USD, whereas downside movements could be extended toward 1.0930.

EUR/USD

The euro is still trading within a short-term downward channel. With a sustained break above 1.1070/80 we might see the pair rallying toward 1.1140. However, bearish movements could be limited until the descending trend line, which is currently at around 1.0930.

Chart_EUR_USD_4Hours_snapshot25.2.16

From the eurozone we have Consumer Prices scheduled for release at 10:00 GMT but no changes are expected.

The pound has gained some ground against the greenback and was able to remain above 1.39. Upside movements could be capped at 1.40 and 1.4050 whereas a break below 1.39 could drive the cable towards lower levels at 1.3850.

U.K. Gross Domestic Product figures are scheduled for release at 9:30 GMT, but as long as numbers are consistent with the expectations the impact on the GBP should be limited.

The most important piece from the U.S. will be Durable Goods Orders, due for release at 13:30 GMT. Data is expected to show an improvement, which could add strength to the dollar in the short-term.

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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 2016 Maimar-FX.

www.maimar.co