Inflation – MaiMarFX

Bullish Breakouts

November 16, 2023/in General News & Updates /by MaimarFX

We didn’t trade the EUR/USD and GBP/USD yesterday after we were able to pocket a good gain on Tuesday amid strong bullish breakouts. U.S. inflation came in below expectations, a fact that has crushed a hawkish repricing that would have benefit the greenback. The euro surged to a high of 1.0887 from where it consolidated yesterday. Higher targets are now seen at 1.0940 and 1.10 while we expect a fresh support to come in at around 1.0730.

The GBP/USD is currently hovering around 1.24 after it was unable to break significantly above 1.25. For the bullish bias to continue, the cable will need to stabilize above 1.24 while traders will focus on a break above 1.2510 in order to go for 1.26.

The DAX broke above 15600 and headed towards 15800. The next crucial target for traders will be the crucial 16000-barrier. Our former breakout-area at 15600 could now turn into a support zone.

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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.

Overbought Territory Amid Low Volatility

July 17, 2023/in General News & Updates /by MaimarFX

Last week was characterized by significant bullish moves across the greenback’s counterparts. The U.S. dollar sold-off sharply after the June inflation report surprised to the downside. Given the strength of the latest upward moves and with both EUR/USD and GBP/USD overcoming key technical hurdles, we expect some further upside potential.

On Wednesday, the UK inflation report will be released and if there are signs that inflation is falling, the pound could correct from its heavily overbought territory.

GBP/USD: A higher resistance is seen between 1.3150 and 1.32. The pair remains, however, in deeply overbought territory, increasing the chances for a consolidation phase. A support is now seen at 1.2850.

EUR/USD: Remaining above 1.12, the focus shifts to higher resistances at 1.14 and 1.15. A current support could lie at 1.11.

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.

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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.

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Bullish Bias

July 13, 2023/in General News & Updates /by MaimarFX

We saw some bullish breakouts yesterday with the pound sterling rising towards 1.30 and the euro breaking above 1.11. Also, the DAX headed, as expected, towards 16000 and finds itself currently at around 16050.

The reason for the bullish bias was a slower-than-expected U.S. inflation print in June. This reinforced the market’s assumption of a nearing end of the Federal Reserve’s tightening cycle. The greenback thus weakened against other peers.

Traders should brace for upcoming corrections in short-term time frames, even though the latest bullish moves appeared to be strong – paving the way for a continuation of the uptrend.

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.

Our trading ideas for today 13/7/23:

EUR/USD

Long @ 1.1160

Short @ 1.1125

GBP/USD

Long @ 1.3020

Short @ 1.2980

DAX® (GER40)

Long @ 16060

Short @ 15970

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!

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Bullish Movement After Corrections?

June 26, 2023/in General News & Updates /by MaimarFX

We saw a renewed round of hawkishness of global central banks on the back of still elevated inflation. The bank of England surprisingly raised interest rates by 50bp last week, instead of an expected 25bp-move and the European Central Bank indicated more hikes to come. The only exception was the Federal Reserve, which left rates unchanged this month but reiterated a hawkish stance.

This week starts with three days of ECB forum on Central Banking with speeches from ECB President Christine Lagarde. In terms of inflation, it might be worth to take a look at the Euro area inflation data for June and the U.S. PCE price index, both are due for release on Friday.

From a technical perspective, we saw sharp corrections in our three trading instruments.

The euro corrected towards 1.0840 against the U.S. dollar after euro bulls proved unable to push the pair significantly above the 1.10-hurdle. As long as the euro remains below 1.1050, we favor a bearish bias with lower targets seen at 1.0650 and 1.05.

GBP/USD – The perfect correction?

The pair has stopped its correction exactly at the lower ascending trendline of its latest upward trend channel. If the bullish trend remains intact, we would now see a further leg up towards 1.30 but if 1.27 breaks to the downside, the focus shifts to a break of the lower support at 1.26.

DAX

The index sharply tumbled and gave up all of its previous gains after hitting its new high at 16432. There is a crucial support area around 15600 and bulls might want to defend it. However, we now brace for a short-term trading range between 16100 and 15700.

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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!

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Have Markets Over-Reacted To Last Week’s Inflation Data?

November 14, 2022/in General News & Updates /by MaimarFX

Welcome to a new trading week. Risk appetite improved around the world after signs of cooling in U.S. inflation and the prospects of a dovish tilt by the Federal Reserve. The U.S. dollar weakened against other counterparts. However, markets may have over exaggerated last week’s inflation print since a few declines in inflation does not mean that inflation pressure is finally over and that the Fed is shifting from hawkish to dovish. The market’s risk appetite could thus be premature with limited upside in both EUR/USD and GBP/USD.

For the British pound, the U.K. will release inflation data on Wednesday.

GBP/USD

The shift in global risk sentiment and the large dollar sell-off benefitted the pound and sent sterling soaring, lifting it above 1.16 and further to the 1.17-1.19 resistance zone. Sterling bulls should however be careful. U.K. employment and inflation data are on tab this week, leaving the pound vulnerable.

From a technical perspective, the pair is overbought with the current resistance zone ranging from 1.17 to 1.19. We expect any further gains to be limited to a maximum of $ 1.1940. The most likely scenario in our opinion is a correction towards 1.15/1.1450.

EUR/USD

Speculation for a smaller Fed rate hike in December could keep the pair afloat over the coming weeks. However, the pair is overbought, making it vulnerable for a correction toward the parity level. A bullish breakout above 1.0370 on the other side could see a bullish extension towards 1.06.

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.

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Profitable Week

November 11, 2022/in General News & Updates /by MaimarFX

Slower-than-expected U.S. inflation gave a boost to risk appetite, pushing both euro and British pound above bullish breakout levels. Both of our yesterday’s long entries in EUR/USD and GBP/USD have hit their profit targets easily. Overall, we were able to secure a very good weekly profit which is why we do not trade today.

Our trading ideas for the DAX today 11/11/22:

DAX® (GER40)

Long @ 14280

Short @ 14230 Hit TP in a few minutes

Settings for all trades today: 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.

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We wish you good trades!

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Major Risk Events Loom Before Easter Holiday

April 11, 2022/in General News & Updates /by MaimarFX

This holiday-shortened week is loaded with economic event risk. Before the Easter holiday and the French presidential election on Sunday, market participants are eyeing inflation risk with the U.S. CPI scheduled for release on Tuesday. On Thursday, the European Central Bank will deliver its interest rate decision while no monetary policy changes are expected. Nonetheless, traders should expect some hawkish commentary for the euro.

While other major central banks are already tightening monetary policy, the ECB seems to be behind the curve. Market participants brought forward their calls for interest rate hikes, now seeing moves in September and December. The format of Thursday’s ECB press conference is yet to be decided after ECB President Christine Lagarde tested positive for Covid-19.

EUR/USD – Opening gap

The euro opened higher versus the U.S. dollar this week amid some relief over the French election. However, the upside gap was closed in the early morning hours of trading.

Technically, the pair finds itself in oversold territory which is making corrections towards 1.11 more likely ahead of Thursday’s policy decision. However, there is also potential for disappointment, so potential gains might be limited. A crucial support is seen around 1.08.

GBP/USD – Will the 1.30-support hold?

The cable slid below 1.30 but found some halt at around 1.2980. If sterling bulls are unable to push the pair back above 1.31, we expect further losses and a test of 1.29 in the near-term.

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.

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Inflation ist das größte Risiko

March 14, 2022/in General News & Updates /by MaimarFX

Der Krieg in der Ukraine geht in die dritte Woche und die Aussichten für die Finanzmärkte sind ernsthaft ungewiss. Globale geopolitische Risiken, eine Verlangsamung des Wachstums, hohe Inflation und Zentralbanken, die gezwungen sein werden, ihre Geldpolitik zu straffen, verstärken die Besorgnis über die Erholung der Weltwirtschaft.

Das größte Risiko ist die Inflation. Es wird erwartet, dass die U.S. Notenbank die Zinsen am Mittwoch um 25 Basispunkte anheben wird. Der Fokus wird jedoch auf der offiziellen Prognose der Fed und dem Ausblick, jenseits der sechs bereits eingepreisten Zinserhöhungen in diesem Jahr, liegen. Die Fragen werden daher lauten: Wie hoch könnten die Zinsen letztendlich steigen und wie schnell werden die Währungshüter handeln, um dorthin zu gelangen. Die sogenannte Dot-Plot Zinsprojektion der Fed wird daher beim Mittwoch Statement eine Schlüsselrolle spielen.

Abgesehen von der Fed wird auch von der Bank von England am Donnerstag die dritte Zinserhöhung in Folge erwartet.

Was erwarten wir technisch in beiden EUR/USD und GBP/USD Paaren?

Im Vorfeld der FOMC-Entscheidung am Mittwoch gehen wir von weiterer USD-Stärke aus mit tieferen Zielen bei 1.0730-1.07 im EUR/USD und 1.2970-1.2950 im GBP/USD.

GBP/USD: Sofern 1.2950 halten sollte, könnte der Cable bei einer hawkischen BoE eventuell einige seiner Verluste in Richtung 1.32 gutmachen.

EUR/USD: Sollte es dem Euro nicht gelingen über 1.1050 auszubrechen, bleiben die Chancen zugunsten der Bären mit nächsten niedrigeren Zielen bei 1.07 und 1.0640.

Wir wünschen gute Trades!

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EUR/USD: On Its Way Toward 1.17?

October 25, 2021/in General News & Updates /by MaimarFX

The U.S. dollar was virtually unchanged last Friday after Federal Reserve Chair Jerome Powell sounded a note of heightened concern over high inflation, while making clear that the Fed will begin tapering bond purchases shortly. While Powell said during Friday’s virtual panel discussion “the risks are clearly now to longer and more persistent bottlenecks, and thus to higher inflation,” he played down interest rate hikes. “I do think it’s time to taper and I don’t think it’s time to raise rates.” However, there is concern that faster tapering or more rate hikes will create the risk of a slowdown.

The Fed is expected to announce its taper at their policy meeting next week on Nov 3.

This week we will have the European Central Bank decision on Thursday, as well as the U.S. GDP (Thursday) and core PCE data (Friday). From a fundamental perspective, the U.S. dollar might be vulnerable to a larger correction going into the end of the month as Thursday’s U.S. GDP report is anticipated to show a slowing recovery.

As for the ECB meeting, no policy shifts are expected this month. The ECB is preparing for a major policy overhaul at the final ECB meeting in December. Policy makers are expected to start phasing out the emergency plan in December while it could be followed by a new program. This Thursday, the focus will be on the press conference and any hints from ECB President Christine Lagarde on faster interest rate increases amid a global surge in inflation. Current expectations see no ECB rate hike through at least 2023.

To sum up, Thursday’s decision could end with no movement in the EUR/USD.

EUR/USD: In short-term time frames, we will pay attention to a break above 1.1670 which could see a test of 1.17/1.1710. Bears on the other side, will wait for a significant break below 1.16 in order to shift the focus toward 1.15.

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Inflation is Here to Stay

October 18, 2021/in General News & Updates /by MaimarFX

Welcome to a new trading week.

Wall Street analysts say inflation is not transitory, it’s permanent. The sentiment that inflation is not transitory is also echoed by Mohammed El-Erian, the chief economic advisor at Allianz SE, who said elevated inflation and supply-chain bottlenecks are only partly rooted in transitory reasons. He predicted “another year at least of high and persistent inflation.”

With this in mind, the Federal Reserve may have no choice but to pull back on stimulus measures.

The U.S. dollar was firm against the euro but weaker against the British pound.

GBP/USD

The cable extended its advance to a fresh monthly high at 1.3773 on speculation the U.K. Consumer Price Index (due for release on Wednesday) is showing a slowdown in the core rate of inflation. However, a marked slowdown in the U.K. CPI would derail the pound’s recent rally as it provides the Bank of England greater scope to retain its current monetary policy and dampens speculation for an imminent BoE rate hike.

From a technical perspective, chances are in favor of a test of 1.38 and possibly even 1.3850, provided that the pair holds above 1.36. A renewed break below 1.3570 would shift chances in favor of the bears with a lower target seen at 1.3370.

EUR/USD: The euro refrained from a break below 1.1580, at least until this morning. Below 1.1580 we expect the pair to dip towards 1.1550-40. Bulls on the other side will have to wait for a break above 1.1610 to shift the focus to a higher target at 1.1650-60.

DAX

The DAX knew only one direction in recent days: Upwards. The recent break above 15550 could now have paved the way for a test of the 15800-resistance. A break above 15820 could see a renewed test of the crucial 16000-mark. A current support is however seen at around 15300.