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Is The Cable Poised For A Breakout?

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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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Market Listens To Draghi: Tapering Or Expanding Stimulus Plan?

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Dear Traders,

Top event risk for the upcoming session is the European Central Bank meeting and ECB President Draghi‘s comments on tapering. While recent ECB meetings have rendered little market reaction, there has been speculation recently that the central bank will begin tapering its bond purchase program at one of its next meetings. While Draghi was optimistic about the outlook for the Eurozone economy, most economists predict the ECB won’t start tapering before the second half of 2017. Quantitative easing is currently scheduled to end in March and with consumer prices still hovering close to zero, policymakers should at least be comfortable with the current level of stimulus or even extend the program before gradually phasing it out once inflation approaches the ECB’s goal of 2 percent.

The ECB will announce its policy decision at 11:45 UTC but no changes are expected. The main focus will be on the press conference 45 minutes later and Draghi’s comments. If he pushes back aggressively against recent talk of tapering, the euro could be vulnerable to further losses. Any signal that the ECB plans to reduce bond purchases will provide a strong boost to the euro. If the central bank however refrains from providing any signals and defers any changes until December, today’s announcement could turn out to be a non-event for euro traders.

To cut it short, let us have a look at the technical chart and prepare for both possible scenarios.

EUR/USD

The euro recently weakened against the U.S. dollar but found some halt around the 1.0950-level, the descending trend line of the euro’s recent downward channel. If the pair breaks below 1.0940 we see a higher likelihood of further losses towards 1.09 and 1.0830. On the upside, the euro would need to break above 1.1060 in order to spark some bullish momentum towards 1.1170.

chart_eur_usd_daily_snapshot20-10-16

Apart from the ECB meeting we have U.K. Retail Sales at 8:30 UTC, the Philly Fed index at 12:30 UTC as well as U.S. Existing Home Sales at 14:00 UTC scheduled for release but all these reports could take a backseat to the ECB.

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U.S. Dollar Weakened Ahead Of CPI Data

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Dear Traders,

The U.S. dollar weakened against the euro and British pound ahead of today’s consumer price reports. While Monday’s trading in the EUR/USD was quiet and none of our entries was triggered, sterling traders had to struggle with false breakouts within a tight trading range. Thus we had to record some losses before our last buy attempt proved to be successful. The pound strengthened before the U.K. releases inflation figures today at 8:30 UTC and sterling traders should pay close attention to the CPI report as it could have a major impact on the price action in the GBP/USD.

Technically, the pound broke above a descending trend line, pointing to further upside momentum in the short-term. If the pair is unable to break above 1.2275, the recent upward movement could be on shaky ground.

Bullish scenario: Above 1.2275 we expect further gains towards the next resistance at 1.2320/50. Above 1.2375 the pound may even head towards 1.2430.

Bearish scenario: Below 1.2130 we expect further pound weakness.

chart_gbp_usd_4hours_snapshot18-10-16

Apart from the U.K. CPI report we have U.S. Consumer Prices scheduled for release at 12:30 UTC. Economists predict the report to show inflation is accelerating and if they are right the dollar will strengthen in the wake of Federal Reserve rate hike speculations before year-end.

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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

 

 

 

Market Remained Unimpressed By FOMC Statement

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Dear Traders,

The market reaction to the FOMC statement was muted with the U.S. dollar ending the trading day virtually unchanged against the euro and British pound. While the Fed minutes confirmed that the central bank is moving toward tightening it also shows continuing disagreement among policy makers. Last month’s decision to hold interest rates at their current level was a close call with three FOMC members dissenting for a rate rise, the minutes showed. Market participants expect the Fed to move in December and while the market is pricing in the probability of year-end hike, the Fed may consider that move to be inevitable to preserve the central bank’s credibility.

Overall, the dollar remains bid on corrections and investors will be looking for dollar dips to buy the currency and participate on the dollar rally. Consequently, we expect further dollar gains in the medium-term but we will pay attention to potential pullbacks in the short-term.

There are no major economic reports scheduled for release today so trading could be quiet.

Here is where we see current resistance and support levels for both currency pairs:

  Resistances Supports
EUR/USD 1.1050/60

1.11

 

 1.10

1.0970

 

 

  Resistances Supports
GBP/USD 1.2230

1.2320

 1.2150

1.21

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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

 

 

 

U.S. Dollar Gains Momentum But Watch Out For Potential Corrections

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Dear Traders,

Despite the lack of market moving economic data on Monday the U.S. dollar continued to strengthen against the euro and British pound. Short traders, therefore, continue to profit but we should remain vigilant as to potential corrections in both major currency pairs.

EUR/USD

The euro trades under pressure and is currently hovering around the 1.11-mark. Short-traders are already preparing for a break of that crucial support level. Below 1.1090 we see next support levels at 1.1050 and 1.10 while on the upside, potential pullbacks could be limited until 1.12. Only a break above 1.1250 would change the bias in favor of the bulls.

chart_eur_usd_daily_snapshot11-10-16

The Eurozone ZEW Survey is scheduled for release at 9:00 UTC today but whether this report will have a significant impact on the euro remains to be seen.

The pound sterling tested its new support at 1.23. A renewed break below that level may send the pound tumbling towards 1.22 whereas any pullbacks might be currently limited until 1.2350/70. Above 1.24 however, we anticipate that the market will gain some bullish momentum towards 1.25.

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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

 

 

 

U.S. Dollar Consolidates Within Quiet Trading Environment

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Dear Traders,

While Friday’s payrolls data came in below the market’s expectations it had only little impact on the performance of the U.S. dollar. Non-farm payrolls rose by 156K last month while the jobless rate ticked up to 5.0 but the small slowdown was not expected to prevent the Federal Reserve from raising rates in December. The dollar slightly weakened against its counterparts after Friday’s data but the short-term correction does not change the overall picture.

The economic calendar this week is very light in terms of market moving data. From the U.S. we only get the FOMC minutes (Wednesday) and the Retail Sales report (Friday). Moreover, the focus will be on Fed speak, here in particular on Fed chair Yellen who is scheduled to speak on Friday.

EUR/USD

The euro remained firmly above 1.11 but gains were capped at 1.12. With no market moving data we expect the currency pair to remain confined to a trading range between 1.1250 and 1.11. Below 1.1090, however, we expect the euro to fall towards lower targets at 1.1050 and 1.0950.

GBP/USD

The cable formatted a current trading range between 1.2450 and 1.2350. Above 1.2480 we see chances of a move towards 1.26 while a renewed break below 1.23 may invigorate further bearish momentum.

Trading could be quiet on Monday so we recommend taking profits even at smaller levels if possible.

We wish you a good start to the new week and good trades!

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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 On A Rollercoaster While Pound Continues To Weaken

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Dear Traders,

The broad-based strength of the U.S. dollar drove the activities in the currency market and allowed for adequate profits for sterling and euro bears. The British pound was hit hard by Brexit concerns on the one hand and dollar strength on the other. As a result, the cable fell to a 31-year low against the greenback and traders prepare for further losses in the GBP/USD. While the pound is expected to depreciate further ahead of Britain’s planned exit from the EU, investors believe that a weaker currency will help to boost British exports, making larger U.K. companies more competitive.

Technically, we expect the 1.27-level to lend a short-term support to the pound before we may see further losses. In case that the 1.27-mark withstands the downward pressure, we anticipate a correction toward the 1.28-level.

The euro was accompanied by higher volatility on Tuesday and losses in the EUR/USD were soon erased after a report said that the European Central Bank will probably taper bond purchases before the conclusion of quantitative easing. The euro overreacted on that hawkish statement and jumped towards 1.1250. Nevertheless, the technical picture has not changed materially as the euro is still confined to its tight trading range between 1.1240 and 1.1140. Above 1.1240 we may see a renewed test of 1.1270 while a current support is still seen around the 1.1130-level.

Today, we have some interesting economic data scheduled for release, influencing the price development of both major currency pairs:

8:30 UK Services PMI

9:00 EUR Euro-zone Retail Sales

12:15 USA ADP Employment Change

14:00 USA ISM Non-Manufacturing Composite

(Time Zone UTC)

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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

 

 

 

Pound Near Post-Brexit Low as U.K. Sets EU-Exit Date

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Dear Traders,

The British pound came under huge pressure after U.K. Prime Minister Theresa May set a March 2017 date to trigger Article 50 and begin exiting from the European Union. The pound subsequently went into a tailspin as market participants now prepare for a “hard Brexit“.

GBP/USD

The cable may face a next support around its post-Brexit low at 1.2798. Technically, we see an oversold situation in the 4- hour chart, which could increase the probability of some corrections toward the 1.29-level in the near-term. In case of a break below 1.2790 however, sterling could fall towards 1.2720.

chart_gbp_usd_4hours_snapshot4-10-16

From the U.K. we have the Construction PMI scheduled for release at 8:30 UTC, which could have a minor impact on the pound.

The euro traded slightly lower against the U.S. dollar Monday. With no major market moving data we expect the 1.1160/50- area to lend a short-term support to the EUR/USD while a current resistance is still intact at 1.1250.

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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

 

 

 

U.S. Dollar Back In Focus: Will U.S. Data Help Or Hurt?

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Dear Traders,

While both of our major currency pairs fluctuated more or less sideways yesterday, the U.S. dollar was gaining momentum as upbeat economic data boosted optimism on the world’s largest economy. A gauge of consumer confidence rose to its highest level in nine years, coming in as a positive surprise for the market.

The euro tested the 1.12-support but, for the time being, the currency was able to remain above that important price level. Once the 1.1190-level is significantly breached, we may see accelerated bearish momentum towards 1.1130. However, given the recent sideways trend in the EUR/USD we anticipate the price action to be confined to a range between 1.1285 and 1.1120.

GBP/USD

The pound sterling rebounded against the greenback Tuesday and rose to a high of 1.3026. While we expect any further gains in this pair to be limited until 1.3070, downward movements may also be limited towards the lower bound of the pounds recent trading range at 1.2920. Once the 1.29-mark is breached to the downside, we could see further losses towards 1.2820.

chart_gbp_usd_4hours_snapshot28-9-16

Today, we will watch U.S. Durable Goods Orders, scheduled for release at 12:30 UTC, which could have a major impact on the U.S. dollar. Furthermore, Fed chair Janet Yellen testifies before the House Financial Services Committee at 14:00 UTC. Market participants scrutinize her remarks, looking for clues regarding future monetary policy but Yellen is not expected to reveal anything new after last week’s news conference.

ECB President Mario Draghi is scheduled to speak at 14:30 UTC at a meeting of the German Parliament’s EU Committee, but his speech is not expected to have a significant impact on the euro.

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 2016 Maimar-FX.

www.maimar.co

 

 

 

U.S. Presidential Debate In Full Swing But Investors Remain Risk-Averse

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Dear Traders,

This week started with some volatile swings in the Forex market with GBP/USD being the most volatile currency pair on Monday. The British pound dropped again towards its current support at 1.2910 before it started a relief rally. The cable has been torn between the rising fears of a “hard Brexit” and the weakening dollar.  The euro, however, rebounded against the U.S. dollar and the pair tested its resistance zone around 1.1275/85. As stated in yesterday’s analysis euro bulls should better wait for prices above 1.13 and even better above 1.1350. As long as the euro remains below 1.13, our focus shifts to a break of the 1.12-support.

The pound sterling traded volatile during the Asian session as the first U.S. presidential debate is in full swing. A Clinton win is seen as dollar-positive while a Trump victory would lead to chaos in the markets and has not yet been priced in. Investors remain risk-averse in the run-up to the presidential election in November and seek safe havens. Recent polls show a close head-to-head contest between the two candidates.

Apart from the U.S. debate and safe haven flows, U.S. Consumer Confidence, due at 14:00 UTC could have an impact on the greenback.

Daily Forex signals:

Additional daily and long-term entries are available for subscribers.

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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