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EUR/USD Technical Overview – 28, Nov

EUR/USD is displaying a lackluster performance in the Tokyo session after resurfacing from the critical support of 1.0382. The Euro pair is oscillating above the round-level support of 1.0400. The major is awaiting a potential trigger for a fresh impetus as the market mood is extremely quiet amid the holiday in the United States on account of Thanksgiving Day.

EUR/USD is playing with the 200-period Exponential Moving Average (EMA) at 1.0389 on a daily scale. The corrective move in the asset after printing a high of 1.0482 on November 15 to near 1.0226 has been supported by the upward-sloping trendline placed from November low at 0.9730. Going forward, potential resistances are plotted from June 27 high at 1.0615, and May 30 high at 1.0787.

The Relative Strength Index (RSI) (14) is oscillating in a bullish range of 60.00-80.00, which indicates that the upside momentum is active.

GBP/USD Technical Outlook – 15, Nov

GBPUSD is likely to face stiff resistance at 1.1850 (static level). In case it manages to rise above that level and starts using it as support, it could target 1.1900 (former support, psychological level) and 1.2000 (psychological level).

On the downside, 1.1800 (psychological level, static level) aligns as initial support before 1.1750 (20-period Simple Moving Average (SMA)) and 1.1700 (psychological level, static level).

Meanwhile, the Relative Strength Index (RSI) indicator on the four-hour chart stays below 70, suggesting that GBPUSD has more room on the upside before turning technically overbought

EUR/USD Technical Outlook – 3, Nov

The EUR/USD pair closed a third consecutive day below the 0.9900 level and near a fresh weekly low of 0.9821, which lifts the risk of a bearish extension in the upcoming sessions. Technically speaking, the pair is breaking below the 50% retracement of its latest daily advance between 0.9630 and 1.0093 at 0.9856, another bearish hint. The daily chart shows that the pair is currently battling a flat 20 SMA while a bearish 100 SMA heads firmly lower at around 1.0065. Finally, technical indicators resumed their declines, with the Momentum just above its 100 level and the RSI already below its midline.

The 4-hour chart favors a bearish extension, particularly if the pair breaks below the 0.9800 price zone. Technical indicators have gained bearish strength within negative levels, supporting further declines, while a firmly bearish 20 SMA continues to reject buyers.

Support levels: 0.9800 0.9760 0.9615

Resistance levels: 0.9865 0.9910 0.9970

Forex Market Weekly Recap – 24 Oct – 28 Oct

News and Economic Events Update:

  • China’s exports grew by 5.7% y/y to $322.8B in September; it’s the slowest rate of growth since April. Imports inched up by 0.3% y/y vs. 1.0% y/y forecast
  • China GDP for Q3 was 3.9% y/y vs. 3.3% y/y forecast; the unemployment rate increased to 5.5% vs. 5.3% previous
  • CFTC Chair Rostin Behnam said on Monday that  he sees ether as a commodity — not a security.
  • Oil prices jumped on Wednesday on record high U.S. crude exports and strong refining demand; WTI crude broke back above $88/bbl while Brent crude jumped above $96/bbl
  • The Bank of Canada surprised markets with a smaller-than-expected rate hike of 50 bps vs. a 75 bps forecast
  • Russian President Putin said on Thursday that his nation has never discussed a nuclear strike, and that there was no necessity for Russia to attack Ukraine with nukes.
  • As expected, the European Central Bank raised the deposit rate to 2.00% vs. 1.25% previous
  • The International Monetary Fund lowered its economic projections for Asia to 4.0% for 2022 (vs. a 4.9% forecast back in April) on Friday.
  • North Korea fired two short-range ballistic missiles on Friday from the North’s eastern coastal Tongchon area
  • The U.S. Core PCE Price Index annualized read of 5.1% y/y came in slightly below expectations, taming inflation fears a bit during the Friday session.
  • U.S. Flash Manufacturing PMI for October: 49.9 vs. 52.0 in September; Services Index at 46.6 vs. 49.3; input cost pressures have increased; employment conditions mostly unchanged
  • U.S. Home Prices growth in August: +13.1% y/y vs. 16.0% y/y in July according to the S&P CoreLogic Case-Shiller Home Price Index
  • U.S. New home sales fell -10.9% y/y to 603K in September
  • U.S. GDP rebounded slightly in Q3 2022 with the advance read at +2.6% q/q vs. 2.3% q/q forecast
  • U.S. durable goods for September: +0.4% m/m vs. upwardly revised +0.2% m/m in August
  • U.S. weekly jobless claims: 217K vs. 214K previous
  • U.S. Core PCE Price Index came as expected at 0.5% in September, inline with the August read; the annualized read of 5.1% y/y was slightly below expectations
  • U.S. Personal income in September: +0.4% m/m vs. an upwardly revised August read of +0.4% m/m
  • U.S. UOM consumer sentiment for October: 59.9 vs. the preliminary read of 59.8, and above the September read of 58.6
  • On Monday, Rishi Sunak was elected as the new leader of the Conservative Party, making him the next prime minister of Britain.
  • U.K. Flash Manufacturing PMI for October: 45.8 vs. 48.4 previous; Services PMI at 47.5 vs. 50.0 previous; output and demand continue to weaken; political uncertainty added to inflationary pressures contributed to downbeat sentiment
  • U.K. bond prices rallied on Monday as traders bet that new Prime Minister Rishi Sunak will put an end to weeks of upheaval plaguing the nation’s markets and restore credibility to economic policy making
  • U.K. CBI manufacturing output for October -4%, the same as September, but sees output to increase over the next three months; firms seeing a shortage of skilled labor is at its highest level since 1973 at 49%; New orders fell -8% q/q vs. +11% q/q in July
  • The unveiling of a highly anticipated strategy for stabilizing the nation’s public finances was pushed back by Britain’s new Prime Minister Rishi Sunak on Wednesday to Nov. 17, two and a half weeks later than originally anticipated.
  • Germany Flash Manufacturing PMI for October: 45.7 vs. 47.8 previous; Services PMI at 44.9 vs. 45.0 previous
  • Eurozone Flash Manufacturing PMI for October: 46.6 vs. 48.4 in September; Services PMI at 48.2 vs. 48.8 previous; inflationary pressure remain due to high energy prices and rising wages
  • Germany Ifo business climate index in October ticked lower to 84.3 vs. a revised 84.4 read in September
  • Euro area M3 money supply growth for September: +6.3% y/y vs. 6.1% y/y in August; private loans increased by 5.5% y/y vs. 5.6% y/y in August
  • German GfK consumer climate index improved from -42.8 to -41.9 in Oct
  • Spanish jobless rate ticked higher from 12.5% to 12.7% in Q3 vs. 12.4% forecast
  • The European Central Bank raised the deposit rate from 0.75% to 1.50% as expected; future policy path will be decided during the upcoming meetings
  • Germany posted unexpected Q3 growth — up by 0.3% q/q vs. -0.2% q/q expected
  • France CPI for October; 7.1% y/y vs. 6.4% y/y forecast
  • Swiss KOF Economic Barometer fell from 92.27 in September to 90.93 in October
  • The Bank of Canada hike interest rates by 50 bps to 3.75% vs. an expectation of a 75 bps hike; the BOC sees growth slowing through the first half of 2023
  • Canada GDP for August: +0.1% m/m vs. 0.0% m/m forecast
  • RBNZ chief economist Paul Conway said on Tuesday that despite the fact that inflation in New Zealand was higher than anticipated in the third quarter, the central bank remains “hopeful” that it has peaked.
  • ANZ’s survey shows a 6 point drop in business confidence in October to -43; inflation pressures remain high with expectations at 6.13%
  • RBNZ Governor Adrian Orr warned on Thursday that the central banks efforts to slow inflation will likely slow down employment conditions in the near-term
  • New Zealand consumer confidence for October: unchanged at 85.4 vs. previous
  • Australia manufacturing PMI slows from 53.5 to 52.8 in October; Services PMI contracts from 50.6 to 49.0 in October
  • RBA Assitant Governor Christopher said on Monday that further rates are likely, but the timing and size wil depend on data
  • Australia’s annual inflation races from 6.1% y/y to a 32-year high of 7.3% y/y in September; CPI jumped 1.8% m/m vs. 1.6% m/m forecast
  • RBA’s trimmed mean CPI jumped from 4.9% y/y to 6.1% y/y, much higher than RBA’s 2% – 3% target
  • Australian import prices up by 3.0% q/q in Q3 vs. a projected 0.8% q/q uptick
  • Australia producer price index read for September quarter rose 1.9% q/q (1.4% q/q previous) and 6.4% y/y
  • Japan flash manufacturing PMI for October: 50.7 from 50.8 in September; Services PMI was higher at 53.0 vs. 52.2 in September, likely due to increasing travel volumes
  • Bank of Japan was suspected to have intervened again on Monday after the yen jumped against the dollar to 145.50 during the Asian session. Japan officials continued to refuse to make comments on any possible intervention actions.
  • BOJ core CPI read was up from 1.9% y/y in August to 2.0% y/y in September

EURUSD – Technical Overview 18, Oct

The EUR/USD pair has room to extend its gains according to the daily chart, as it managed to advance beyond a mildly bearish 20 SMA, now facing resistance around 0.9980, where a daily descendant trend line coming from the year high at 1.1494 stands. The same chart shows that technical indicators aim firmly higher, the Momentum well above its 100 level, but the RSI at around its 50 level.  

The 4-hour chart shows that the pair rallied above its 20 and 100 SMAs, with the shorter one about to cross above the longer one, both around 0.9750. The 200 SMA provides resistance at 0.9865, while technical indicators hold near overbought levels, supporting another leg higher in the near term.

Support levels: 0.979,0 0.9750, 0.9710

Resistance levels: 0.9865, 0.9900, 0.9940

Forex Market Weekly Recap : 10, Oct – 14, Oct

News and Economic Update:

  • China Caixin services PMI fell to 49.3 in September from 55.0 in August.
  • Russia unleashed its most broad air assaults since the start of the Ukraine war on Monday, showering cruise missiles on cities during rush hour to avenge a blown-up bridge.
  • The IMF estimated that global GDP will drop to 2.7% next year, 0.2% lower than its July forecast, and that 2023 will feel like a recession for millions.
  • On Tuesday, G7 leaders began an emergency meeting to examine the latest round of missile attacks that Russian forces conducted against Ukraine.
  • Bank of England expanded its emergency purchase to include inflation-linked debt in an effort to stop a rapid sell-off in the 2.3 trillion pound market for British government bonds.
  • The Bank Of Korea has raised its key base interest rate 50 bps to 3.00% as expected
  • API reports surprise 7.05M build in oil stockpiles
  • EIA: U.S. crude supply up by 9.9 million barrels for the week ended Oct 7, the most since March 2021
  • The Central Bank of Chile hike its interest rate by 50 bps to 11.25% on Friday, but suggested that they may hold off on rate moves at their next meeting.
  • The Monetary Authority of Singapore tightened policy once again by re-centering its policy band
  • According to Chicago Federal Reserve President Charles Evans, as supply chain pressures ease, there are some indications that inflation is slowing down.
  • According to Fed Vice Chair Lael Brainard on Monday, the U.S. Federal Reserve is clear that restrictive monetary policy is necessary to reduce inflation, but the direction and rate of rate increases will remain “data-dependent.”
  • The National Federation of Independent Business (NFIB) reported that its Small Business Optimism Index improved to 92.1 this month, marking the second consecutive month of gains.
  • Fed’s Mester says there’s been no progress on inflation, so interest rates need to move higher
  • U.S. Producer Price Index for September: +0.4% m/m vs. -0.1% m/m previous; core PPI was +0.4% m/m vs. +0.2% m/m previous
  • U.S. mortgage interest rates rise to an average of 6.81%, the highest level since 2006; mortgage loan appliction volume fell -2.0% w/w and down -69% y/y
  • U.S. monthly headline CPI up by 0.4% in Sept vs. 0.2 expected, core CPI also higher at 0.6% vs. 0.5% estimates; Annualized U.S. inflation slows to 8.2% –the lowest in seven months – but still higher than 8.1% estimates
  • The Federal Reserve Open Market Committee (FOMC) meeting minutes from the most recent meeting showed that the FOMC members are surprised that inflation has been persistent and pulling back at a slower-than-expected pace.
  • The Bank of England announced an expansion of its emergency bond-buying operation on Tuesday. widening its buying of index-linked gilts from Oct. 11-14.
  • U.K. claimant counts increased in September at 25.5k vs. 4.2k forecast and 6.3k in August; the jobless rate ticked down from 3.6% to 3.5%; average earnings index popped higher from 5.5% to 6.0% vs. 5.9% forecast
  • U.K. GDP in August: -0.3% m/m vs. +0.2% m/m previous; manufacturing production fell -1.6% m/m
  • UK trade deficit widened to 7.1B GBP in August from a downwardly revised 5.4B GBP in July
  • Eurozone industrial production increased by 1.5% m/m in August vs. -2.3% m/m drop in July
  • erman final CPI unchanged at 1.9% m/m or 10% on year-over-year basis
  • August saw the euro zone’s goods trade deficit with the rest of the world rise to about 51 billion euros ($49.7 billion), the largest deficit the group has experienced since Lithuania joined in January 2015 as its 19th member.
  • Germany Wholesale prices jumped in September by 19.9% y/y and 1.6% m/m (vs. 0.1% m/m previous)
  • Swiss Producer and Import Price Index rose by 0.2% m/m in September and +5.4% y/y; The rise was mostly a result of higher prices for steel, raw milk and dairy products, as well as vegetables and potatoes. Products made of aluminum and petroleum, on the other hand, became less expensive.
  • Canada manufacturing sales for August fell -2.0% m/m to $70.4B vs. -0.6% m/m previous
  • Canada Wholesale sales for August: +1.4% m/m to $81.3B vs. -0.6% m/m previous
  • BusinessNZ: New Zealand’s manufacturing sector loses steam, drops from 54.8 to 52.0 in September
  • New Zealand Food Price Index for September: +0.4% m/m vs. 1.1% m/m
  • Australia AiG September services index 48.0 vs 53.3 in Aug.
  • Australia’s Westpac consumer sentiment retreated by 0.9% after earlier 3.9% gain
  • Australian NAB business confidence index slipped from 10 to 5 in Sept.
  • Australia Household Spending Index fell 0.5% m/m in September, Commonwealth Bank of Australia announced Tuesday.
  • The Household Spending Intentions Index fell 0.5% in September from a month earlier, Commonwealth Bank of Australia announced Tuesday.
  • Australia’s MI inflation expectations unchanged at 5.4%
  • Japan’s core machinery orders post -5.8% m/m decline, the biggest fall in 6 months. Core orders came in at +9.7% y/y vs. an expectation of +12.6% y/y
  • Japan Reuters Tankan index hits 5-month low of 5 in Oct
  • Japanese producer prices jumped from 9.4% to 9.7% y/y in Sept.

Week Ahead in FX: 19, Sep – 23, Sep

Major News & Economics Events:

FOMC interest rate hike (Sept 21, 11:30 pm IST) – Surprisingly higher and stickier inflation in August led some market players to price in a 100 basis point interest rate hike from the Fed last week.

BOJ’s policy announcement (Sept 22, Asian session) – Markets don’t expect the Bank of Japan (BOJ) to make monetary policy changes this week.

SNB’s monetary policy decision (Sept 22, 01:00 pm IST) – A report printed earlier this month showed Switzerland’s annualized inflation at 3.5% in August, still higher than Swiss National Bank’s (SNB) “less than 2% per year” target.

BOE’s interest rate hike (Sept 22, 04:30 pm IST) – Recall that the Bank of England’s (BOE) Monetary Policy Committee (MPC) postponed its decision by a week to observe the death of Queen Elizabeth II.

Other notable central bank events – Other non-decision central bank events that may cause ripples in the central bankers’ local currencies include RBNZ Gov. Orr’s climate change-themed speech today at 08:30 am IST, RBA’s meeting minutes on Sept 20, 07:00 am ISTECB President Lagarde’s speech on Sept 20, 10:30 pm IST, and FOMC Gov. Powell’s opening remarks on Friday at 10:30 pm IST

Source: forexfactory.com

Forex Market Recap : 12 Sep – 16 Sep

News and Economic Update:

  • President Zelensky says Ukraine retook 6K sqm from Russian control this month
  • U.S. Consumer prices rose in August and the annual growth rate slowed less than expected
  • U.K. headline consumer inflation slowed in August to 9.9% y/y but still remains way hot; core CPI ticked higher to 6.3% y/y
  • ZEW economic sentiment in Europe weakened to -60.7 vs. -54.9 previous
  • Australia’s unemployment rate ticked higher to 3.5% and net jobs gain came in below expectations as 33.5K
  • EIA crude oil inventories rose by 2.4M barrels
  • The German government took temporary control of two subsidiaries of the Russian energy giant Rosneft on Friday
  • FedEx Corp. sees business conditions deteriorating, and possibly will get worse, fueling global recession bets further ahead of the weekend.
  • Russian President Vladimir Putin pledged to up attacks on Ukraine’s civilian infrastructure, and pledging to continue military operation despite recent setbacks.
  • In August, the U.S. consumer price index rose by 0.1% m/m . The inflation gauge increased 0.6% when food and energy were excluded, which is higher than anticipated.
  • U.S. budget deficit widens to $220B in August, up by 29% from the same month last year
  • Homebuyers’ demand for U.S. mortgages declined 29% since last year as interest rates rise above 6%.
  • U.S. industrial production contracts by 0.2% (vs. 0.2% uptick expected) on lower utilities output
  • UK July GDP up by 0.2% vs. 0.3% expected, -0.6% in June
  • UK’s industrial production dips by 0.3% vs. 0.4% expected, -0.9% in June
  • UK manufacturing production improves by 0.1% vs. 0.3% expected, -1.6% previous
  • GDP grew in July by +0.2% q/q but the outlook remains one of recession – NIESR
  • The seasonally adjusted Italian industrial production index rose 0.4% m/m in July 2022. The recent three months’ average dropped 1.6% from the prior three.
  • According to Bundesbank President Joachim Nagel, the European Central Bank would have to keep raising interest rates if the current trend in consumer prices continues.
  • ZEW’s economic sentiment index for Germany declined to -61.9 from -55.3 in August. Reuters economists predicted -60.0 for September.
  • Swiss producer prices dip by another 0.1% vs. estimated 0.1% uptick
  • Canadian manufacturing sales declined 0.9% to $71.6B in July, mainly driven by the primary metal, petroleum and coal, and furniture and associated products industries.
  • Canada Housing Starts for August: -3% m/m to 267,443 units
  • NZ current account deficit narrows from 6.5B NZD to 5.22B NZD in Q2 2022
  • Australian Westpac consumer sentiment index rebounded by 3.9% m/m vs. -3% m/m previous
  • AU new home sales down by another 1.6% in August after 13.1% slide in July
  • Australia’s MI inflation expectations slowed from 5.9% to 5.4%
  • Australia added 33.5K jobs in August vs. estimated 35.5K gain
  • Japan’s core machinery orders surprisingly gain by 5.3% vs. 0.6% decline expected in July

Source: forexfactory.com

Market Headlines Update – 15, Sep

  • GBP/USD testing key level as UK and US inflation remain hot
  • To Halt Yen’s Plunge, Japan Gets Ready to Sell Foreign Exchange Reserves Instead of Hiking Interest Rates. Won’t Work for Long
  • Japanese Yen Gained After BoJ Hinted Intervention
  • Australian Bureau of Statistics data shows about 900,000 people had more than one job in June quarter - the highest on record
  • Yen Steadies as Traders Weigh Impact of Japan Intervention Threat
  • New Zealand Dollar Aims Higher on GDP Surprise as China Eases Lockdowns
  • Japan’s opposition leader calls for more fiscal stimulus, not rate hike to cope with weak yen
  • Steel prices extend recovery as supply squeezes in Europe, China announces more stimulus
  • Asian Stock Market: Mixed concerns over China, Fed tests bulls
  • USD/IDR Price News: Rupiah remains firmer below $15,000 on upbeat Indonesia trade data
  • Fed to keep rolling with another 75 bps hike next week – Wells Fargo

Source: forexfactory.com

Market Headlines Update – 12 Sep

  • Asia FX Treads Lightly Before U.S. Inflation Data, Euro Surges
  • Asian Stocks Turn Risk-On Ahead of U.S. CPI Reading
  • Dow Futures Move Higher After Winning Week
  • Gold Creeps Higher as Dollar Eases Ahead of CPI Data
  • Swiss Re expects rise in demand amid global uncertainty
  • Asia stocks bounce, dollar cautious before inflation test
  • Thailand to consider more measures to support energy prices-deputy PM
  • Yen Traders Eye Further Official Warnings, Border Opening Moves
  • S&P 500 powers ahead, Bitcoin and tech stocks rally, ASX set to jump
  • Steel price remains firmer even as China’s holiday, covid policy probe bulls
  • Asian Stock Market: Extensively bullish on subdued DXY, oil slips to near $85.00
  • BOJ set to end COVID-relief scheme but leave its loose policy unchanged – Reuters
  • US inflation: A big downside miss to core CPI to knock the Fed off course – Scotiabank
  • UK Manufacturing Production rises 0.1% MoM in July vs. 0.6% expected
  • UK GDP expands 0.2% MoM in July vs. 0.5% expected
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