The euro is broadly stronger after EUR/GBP ran through stops above 0.8153, reaching as high as 0.8165.
Some modest EUR/USD buying at 1.3080 added to the move. Watch 104.50 in EUR/JPY to trigger the next move.
Showing posts with label Forex Analysis. Show all posts
Showing posts with label Forex Analysis. Show all posts
Monday, October 22, 2012
Eight in a row for USD/JPY
Eight in a row for USD/JPY
Written by Adam Button
October 22, 2012 at 12:27 GMT
October 22, 2012 at 12:27 GMT
USD/JPY is consolidating around 78.80 after a high of 78.87.
The pair is on an eight-session winning streak (160 pips). A quick look at the chart shows it’s the longest run of gains since Feb 2011.
After such a strong move, bulls may want to bide their time. If 80.00 breaks, more offers lurk at 80.20.
Euro-yen demand has been strong so far today but offers up to 104.50 are capping the rally in a similar way to 80.00 in USD/JPY.
Sunday, October 21, 2012
USD/JPY Weekly Fundamental Analysis October 22-26, 2012 Forecast
Introduction: In the USD/JPY trade, trying to pick tops or bottoms during that time would have been difficult. However, with the bull trend so dominant, the far easier and smarter trade was to look for technical opportunities to go with the fundamental theme and trade with the market trend rather than to trying tofadeit.
Against the Japanese yen, whose central bank held rates steady at zero, the dollar appreciated 19% from its lowest to highest levels. USD/JPY was in a very strong uptrend throughout the year, but even so, there were plenty of retraces along the way. These pullbacks were perfect opportunities for traders to combine technicals with fundamentals to enter the trade at an opportune moment.
- The interest rate differential between the Bank of Japan(BoJ) and the Federal Reserve
- Japanese government intervention to maintain their currency sends USD/JPY lower
Weekly Analysis and Recommendation:
The USD/JPY ended the week climbing towards the 80 big number. After two months of being stuck in a range close to the 78.50 range the USD was able to gather some momentum to move towards the 80 level. The pair closed the week at 79.33. Two weeks of positive eco data in the US showed definite signs of recovery, while Japan still sees negative reports. With the better eco data, the possibilities of additional Fed QE in the US are reduced helping drive the price. On the other side the Bank of Japan is under instructions to find ways to stimulate the economy by its November meeting.
Date
|
Last
|
Open
|
High
|
Low
|
Change %
|
Oct 19, 2012
|
79.33
|
79.32
|
79.43
|
79.14
|
0.00%
|
Oct 18, 2012
|
79.32
|
79.07
|
79.45
|
78.99
|
0.33%
|
Oct 17, 2012
|
79.06
|
78.86
|
79.14
|
78.62
|
0.26%
|
Oct 16, 2012
|
78.86
|
78.79
|
78.97
|
78.72
|
0.08%
|
Oct 15, 2012
|
78.79
|
78.48
|
78.86
|
78.33
|
0.40%
|
This week is a two-day meeting of the Federal Open Market Committee, which concludes Wednesday. Nomura analysts said considering that QE3 was announced in the September meeting, they now expect the FOMC to enter a holding pattern while watching for signs of a substantial improvement in the labor market. With the FOMC in wait-and-see mode, the ongoing discussion among participants around crafting a consensus forecast is likely to intensify, while other discussion may focus on what to do when Operation Twist ends in December.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide dailyupdates and outlooks.
Major Economic Events for the week of October 15-19, 2012 actual v. forecast for Yen, the Aussie, the Kiwi and USD
Date
|
Currency
|
Event
|
Actual
|
Forecast
|
Previous
|
Oct. 15
|
AUD
|
Home Loans (MoM)
|
1.8%
|
1.4%
|
-0.7%
|
CNY
|
Chinese CPI (YoY)
|
1.9%
|
1.9%
|
2.0%
| |
CNY
|
Chinese PPI (YoY)
|
-3.6%
|
-3.6%
|
-3.5%
| |
CNY
|
Chinese CPI (MoM)
|
0.3%
|
0.4%
|
0.6%
| |
JPY
|
Industrial Production (MoM)
|
-1.6%
|
-1.3%
|
-1.3%
| |
USD
|
Core Retail Sales (MoM)
|
1.1%
|
0.6%
|
1.0%
| |
USD
|
Retail Sales (MoM)
|
1.1%
|
0.8%
|
1.2%
| |
USD
|
NY Empire State Manufacturing Index
|
-6.2
|
-4.5
|
-10.4
| |
NZD
|
CPI (QoQ)
|
0.3%
|
0.6%
|
0.3%
| |
Oct. 16
|
USD
|
Core CPI (MoM)
|
0.1%
|
0.2%
|
0.1%
|
USD
|
CPI (MoM)
|
0.6%
|
0.5%
|
0.6%
| |
USD
|
CPI (YoY)
|
2.0%
|
1.9%
|
1.7%
| |
USD
|
Core CPI (YoY)
|
2.0%
|
2.0%
|
1.9%
| |
USD
|
TIC Net Long-Term Transactions
|
90.0B
|
45.3B
|
67.2B
| |
USD
|
Industrial Production (MoM)
|
0.4%
|
0.2%
|
-1.4%
| |
Oct. 17
|
USD
|
Building Permits
|
0.894M
|
0.810M
|
0.801M
|
USD
|
Housing Starts
|
0.872M
|
0.770M
|
0.758M
| |
Oct. 18
|
AUD
|
NAB Quarterly Business Confidence
|
-2.00
|
-2.00
| |
CNY
|
Chinese Fixed Asset Investment (YoY)
|
20.5%
|
20.2%
|
20.2%
| |
CNY
|
Chinese GDP (YoY)
|
7.4%
|
7.4%
|
7.6%
| |
CNY
|
Chinese Industrial Production (YoY)
|
9.2%
|
9.0%
|
8.9%
| |
CNY
|
Chinese Retail Sales (YoY)
|
14.2%
|
13.2%
|
13.2%
| |
USD
|
Initial Jobless Claims
|
388K
|
365K
|
342K
| |
USD
|
Continuing Jobless Claims
|
3252K
|
3275K
|
3281K
| |
USD
|
Philadelphia Fed Manufacturing Index
|
5.7
|
1.0
|
-1.9
| |
Oct. 19
|
USD
|
Existing Home Sales
|
4.75M
|
4.75M
|
4.82M
|
Historical: From 2010 to present
Highest:94.99 on May 05, 2010
Average:82.77 over this period
Lowest:75.58 on Oct 31, 2011
Economic Highlights of the coming week that affect the AUD, JPY, NZD and USD
Date
|
Time
|
Currency
|
Event
|
Forecast
|
Previous
|
Oct. 24
|
01:30
|
AUD
|
1.1%
|
0.5%
| |
01:30
|
AUD
|
0.6%
|
0.5%
| ||
02:45
|
CNY
|
47.90
| |||
15:00
|
USD
|
385K
|
373K
| ||
21:00
|
NZD
|
2.50%
|
2.50%
| ||
Oct. 25
|
22:45
|
NZD
|
-825M
|
-789M
| |
Oct. 26
|
00:30
|
JPY
|
-0.5%
|
-0.4%
|
Government Bond Auction
Date Time Country
Oct 22 09:10 Norway
Oct 23 08:30 Spain
Oct 23 14:30 UK
Oct 23 17:00 US
Oct 24 09:10 Sweden
Oct 24 09:30 Germany
Oct 24 14:30 Sweden
Oct 24 15:30 Italy
Oct 24 16:30 US
Oct 25 00:30 Japan
Oct 25 09:10 Sweden
Oct 25 15:30 Italy
Oct 25 17:00 US
Oct 26 09:10 Italy
Click here to read USD/JPY Technical Analysis.
EUR/USD Weekly Fundamental Analysis October 22-26, 2012 Forecast
Introduction: Out of the major currency pairs the most popular and easy to trade currency pair is the EUR/USD. It has become so popular with traders these days that even when there is no visible trade to be had it is yet traded as a matter of habit. This is of course something that should be avoided and any investor who trades this currency pair wisely can do so successfully with sizable profits at the end of the day.
The first thing with trading currencies is to realize that the EUR/USD is made up of two separate currencies although considered to be one unit when taken as a pair. The weaknesses and strengths of each currency have to be taken into consideration when trading the unit as it influences the final outcome. Another factor that is often overlooked by traders or investors is that the weakening of one currency along with the strengthening of the other currency in the pair results in the generation of pips. It is according to this that entry and exit from the Forex market has to be done in order to maintain profitability.
- The interest rate differential between the European Bank(ECB) and the Federal Reserve(FED)
- Dollar strength drives EUR/USD lower
- FED intervention to weaken the dollar the sends EUR/USD higher
Weekly Analysis and Recommendation:
The EUR/USD fell from its weekly high of 1.3139 to end the week at 1.3023 and is drifting lower as sentiment towards the euro has turned negative. Although traders did not expect any results from the EU Summit they did hope. Spain dodged the bullet again, and did not request a bailout, which markets were anticipating. And Greece was not resolved. So after much anticipation markets deflated after the final announcements on Friday. The only positive note from last week was the Chinese data dump which met or exceeded expectations, relieving worries of investors.
Date
|
Last
|
Open
|
High
|
Low
|
Change %
|
Oct 19, 2012
|
1.3023
|
1.3069
|
1.3077
|
1.3014
|
-0.35%
|
Oct 18, 2012
|
1.3069
|
1.3112
|
1.3129
|
1.3056
|
-0.34%
|
Oct 17, 2012
|
1.3113
|
1.3106
|
1.3139
|
1.3086
|
0.06%
|
Oct 16, 2012
|
1.3105
|
1.2966
|
1.3123
|
1.2952
|
1.07%
|
Oct 15, 2012
|
1.2966
|
1.2933
|
1.2978
|
1.2890
|
0.26%
|
This week the Chinese data will give a better understanding of the current Chinese economy as the PMI number will have to be above 49 to generate risk-on trading activity. The bigger risk is if it comes in lower as it will (call) into question the veracity of the data previously released.
Draghis speech will review the ECBs recent outright monetary transaction plan and what it means for European sovereigns. Given his audience, the risk is that he will sound more hawkish to assuage the German politicians. Tough talk from Draghi coupled with weaker than expected PMI data will hurt the euro.
Across the pond, the two-day meeting of the Federal Open Market Committee, which concludes Wednesday. Analysts said considering that QE3 was announced in the September meeting, they now expect the FOMC to enter a holding pattern while watching for signs of a substantial improvement in the labor market. With the FOMC in wait-and-see mode, the ongoing discussion among participants around crafting a consensus forecast is likely to intensify, while other discussion may focus on what to do when Operation Twist ends in December.
FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports and we provide dailyupdates and outlooks.
Major Economic Events for the week of October 15-19, 2012 actual v. forecast for Euro, GPB, the Franc, and USD
Date
|
Currency
|
Event
|
Actual
|
Forecast
|
Previous
|
Oct. 15
|
GBP
|
Rightmove House Price Index (MoM)
|
3.5%
|
-0.6%
| |
CHF
|
PPI (MoM)
|
0.3%
|
0.2%
|
0.5%
| |
USD
|
Core Retail Sales (MoM)
|
1.1%
|
0.6%
|
1.0%
| |
USD
|
Retail Sales (MoM)
|
1.1%
|
0.8%
|
1.2%
| |
USD
|
NY Empire State Manufacturing Index
|
-6.2
|
-4.5
|
-10.4
| |
Oct. 16
|
GBP
|
Core CPI (YoY)
|
2.1%
|
2.1%
|
2.1%
|
GBP
|
CPI (YoY)
|
2.2%
|
2.2%
|
2.5%
| |
GBP
|
PPI Input (MoM)
|
-0.2%
|
-0.1%
|
1.9%
| |
GBP
|
CPI (MoM)
|
0.4%
|
0.4%
|
0.5%
| |
GBP
|
PPI Input (YoY)
|
-1.2%
|
-0.8%
|
1.1%
| |
EUR
|
CPI (YoY)
|
2.6%
|
2.7%
|
2.7%
| |
EUR
|
German ZEW Economic Sentiment
|
-11.5
|
-15.0
|
-18.2
| |
EUR
|
ZEW Economic Sentiment
|
-1.4
|
-1.1
|
-3.8
| |
EUR
|
Core CPI (YoY)
|
1.5%
|
1.6%
|
1.5%
| |
USD
|
Core CPI (MoM)
|
0.1%
|
0.2%
|
0.1%
| |
USD
|
CPI (MoM)
|
0.6%
|
0.5%
|
0.6%
| |
USD
|
CPI (YoY)
|
2.0%
|
1.9%
|
1.7%
| |
USD
|
Core CPI (YoY)
|
2.0%
|
2.0%
|
1.9%
| |
USD
|
TIC Net Long-Term Transactions
|
90.0B
|
45.3B
|
67.2B
| |
USD
|
Industrial Production (MoM)
|
0.4%
|
0.2%
|
-1.4%
| |
Oct. 17
|
GBP
|
Average Earnings Index +Bonus
|
1.7%
|
1.6%
|
1.6%
|
GBP
|
Claimant Count Change
|
-4.0K
|
-1.0K
|
-14.2K
| |
USD
|
Building Permits
|
0.894M
|
0.810M
|
0.801M
| |
USD
|
Housing Starts
|
0.872M
|
0.770M
|
0.758M
| |
Oct. 18
|
GBP
|
Retail Sales (MoM)
|
0.6%
|
0.4%
|
-0.1%
|
GBP
|
Retail Sales (YoY)
|
2.5%
|
2.1%
|
2.5%
| |
EUR
|
Spanish 10-Year Obligation Auction
|
5.458%
|
5.666%
| ||
USD
|
Initial Jobless Claims
|
388K
|
365K
|
342K
| |
USD
|
Continuing Jobless Claims
|
3252K
|
3275K
|
3281K
| |
USD
|
Philadelphia Fed Manufacturing Index
|
5.7
|
1.0
|
-1.9
| |
Oct. 19
|
USD
|
Existing Home Sales
|
4.75M
|
4.75M
|
4.83M
|
Historical: From 2010 to Present
Highest:1.4940 USD on May 04, 2011.
Average:1.3434 USD over this period.
Lowest:1.1877 USD on Jun 07, 2010.
Economic Highlights of the coming week that affect the Euro, GBP, CHF and the USD
Date
|
Time
|
Currency
|
Event
|
Forecast
|
Previous
|
Oct. 24
|
07:58
|
EUR
|
44.0
|
42.7
| |
08:28
|
EUR
|
48.0
|
47.4
| ||
09:00
|
EUR
|
101.6
|
101.4
| ||
09:00
|
EUR
|
109.7
|
110.3
| ||
09:00
|
EUR
|
94.3
|
93.2
| ||
11:00
|
GBP
|
-8
| |||
15:00
|
USD
|
385K
|
373K
| ||
Oct.26
|
07:00
|
EUR
|
5.9
|
5.9
| |
08:00
|
CHF
|
1.67
|
1.67
|
Government Bond Auction
Date Time Country
Oct 22 09:10 Norway
Oct 23 08:30 Spain
Oct 23 14:30 UK
Oct 23 17:00 US
Oct 24 09:10 Sweden
Oct 24 09:30 Germany
Oct 24 14:30 Sweden
Oct 24 15:30 Italy
Oct 24 16:30 US
Oct 25 00:30 Japan
Oct 25 09:10 Sweden
Oct 25 15:30 Italy
Oct 25 17:00 US
Oct 26 09:10 Italy
Click here for updated EUR/USD News.
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