29 / 04 / 2016 | Technical Analysis

AUD/USD: Today’s Major Levels 0.7622 and 0.7668

North American Session
The AUD/USD pair has been trending upwards since Wednesday, the 27th of April 2016, with the bulls leading the price from as low as 0.7548 to as high as 0.7667.   

During the trading session today, the pair price fell from 0.7668 down to 0.7622. At the time of writing the pair price is trading at 0.7646.  
In the event that the buyers attempt to move higher and break above 0.7667, the pair could reach 0.7691 and 0.7725 in extension.

Conversely, in the scenario where they sellers manage force the price successfully below 0.7608, the pair could decelerate down to 0.7593 and 0.7576 respectively. 



Please note: The content in this daily technical analysis article should not be taken as investment advice. It comprises our personal view.
 
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29 / 04 / 2016 | Market News

Dollar remains under pressure as markets digest central bank moves

The dollar was hovering at eight-month lows against the other major currencies on Friday, as investors continued to digest Thursday's unexpected decision by the Bank of Japan to keep its monetary policy unchanged at ¥80 trillion annually, avoiding taking any further moves on negative interest rates and as they eyed a string of U.S. data due to be released later in the day.
 
Furthermore, investors expected further easing, after Bloomberg reported that the Bank of Japan could step up the negative interest rate policy employed since January, at the conclusion of its rate review. The yen remained broadly supported after the BoJ report with USD/JPY plummeted 0.79% at one-and-a-half year low of 107.26.
 
The BoJ kept the deposit rate at minus 0.1% and its asset purchases at ¥80 trillion per year, but also pushed back the expected data for reaching its 2% inflation target. The decision came a day after the Federal Reserve left interest rates unchanged close to zero on Wednesday and offered little guidance on future rate hikes.
 
Market participants were looking ahead to U.S. data on employment costs, personal spending and consumer sentiment due later Friday, for further indications on the strength of the economy following a mixed bag of reports on Thursday.
 
The Bureau of Economic Analaysis said on Thursday that U.S. economic growth slowed to an annual rate of 0.5%, from the 1.4% expansion registered in the fourth quarter of 2015. That has been the slowest pace of growth since the first quarter of 2014.
 
At the same time, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending April 23 decreased by 9,000 to 257,000. Analysts had expected jobless claims to rise by 12,000 to 260,000 last week.
 
Elsewhere, the single currency rose 0.27% against the dollar, with  EUR/USD to trade at 1.1383, the highest since April 21.
 
In the meantime, the dollar was lower against the sterling, with GBP/USD rising 0.04% at 1.4615.
 
Elsewhere, the Australian advanced against the US dollar, but New Zealand and Canadian dollars trade lower against their U.S. counterpart, with AUD/USD steady up 0.10% at 0.7634, NZD/USD down 0.03% to 0.6961 and with USD/CAD dropping 0.25% to 1.2525.
 
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.33% at 93.42, the lowest since August 2015.
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29 / 04 / 2016 | Technical Analysis

EUR/CHF: Major Levels 1.0964 and 1.0980

European Session 
The EUR/CHF pair has been trading downwards since Friday, the 22nd of April 2016, with the bears leading the price from as high as 1.1016 to as low as 1.0965.   

During the course of the day on Thursday, the pair fell from as high as 1.1000 to as low as 1.0964, but as of writing the price is trading at 1.0969.
 
In the event that the bears manage to force the price even lower and breaks below the level of 1.0954, the pair could find support at 1.0939 and 1.0921 respectively.

On the flip side, in the scenario where the price breaks above the level of 1.0977, the pair could escalate up to 1.0984 and 1.0991 in extension.


Please note: The content in this daily technical analysis article should not be taken as investment advice. It comprises our personal view.
 
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28 / 04 / 2016 | Technical Analysis

GBP/USD: Failing to surpass 1.4619

North American Session
The GBP/USD pair has been under upward pressures since the 21st of April 2016, with the bulls sending the major from as low as 1.4300 to as high as 1.4619.

During the course of the day on Wednesday, the pair moved on the sidelines, with the price ranging between the levels of 0.46187 and 1.4474. Today, the pair initially rose, but encountered resistance at the 1.4618 level, forcing it to correct lower. The price is trading at 1.4581 at the start of the North American session in anticipation of the U.S. advance GDP reading for the first quarter of 2016.

In the event that the price breaks below 1.4500, the pair could find support at 1.4461 and 1.4422 respectively.

Alternatively, in the scenario where the price manages to break above the barrier of 1.4619, the price could go up to 1.4655 and 1.4700 in extension.



Please note: The content in this daily technical analysis article should not be taken as investment advice. It comprises our personal view.
 
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28 / 04 / 2016 | Market News

Yen Soars following BoJ’s decision to leave rates unchanged

The Japanese yen surged after the Bank of Japan left its monetary policy unchanged at ¥80 trillion annually on Thursday, avoiding taking any further moves on negative interest rates.

Investors expected further easing, after Bloomberg reported that the Bank of Japan could step up the negative interest rate policy employed since January, at the conclusion of its rate review. USD/JPY plummeted 1.89% to 109.34 in the aftermath of BoJ’s decision.

Earlier in Japan, official data showed that household spending declined 5.3% in March on a year-over-year basis, exceeding expectations for a 4.2% fall. Likewise, national core CPI declined 0.3% last month year-over-year, above expectations for a 0.2% decline, even as the unemployment rate fell 3.2% from a 3.3% forecast.

Another report showed that provisional industrial production increased 3.6% month-over-month, higher than expectations for a 2.9% increase, while retail sales fell 1.1% year-over-year, less than a projected decline of 1.5%.

Meanwhile, the central bank of New Zealand also announced its decision to leave the official cash rate unchanged at 2.25%, while signaling the need to ease upward pressures on the Loonie. The Reserve Bank of New Zealand also stated that further easing might be needed in order to ensure that future average inflation will be set at the middle of the target range. Following the announcement, NZD/USD gained 0.52% at 0.6919.

In a note to clients, Capital Economics said that the positive tone set by the RBNZ after its decision to leave rates on hold at 2.25%, will not prevent the bank from trimming rates to 2.0% at its June meeting. They also added that RBNZ might even cut rates to 1.75% later in the year.
 
The U.S. dollar index was down 0.032% at 94.09 during the European morning.

On Wednesday, the Federal Open Market Committee left short-term interest rates on hold in a widely expected moved, but tweaked its policy statement, with the intention to prepare the markets for another modest rate raise in the months to come.

FOMC left the funds rate in a 25 to 50 basis point target range, following a 9-1 vote, as Kansas City Fed President was in favour of a rate hike for the second consecutive meeting. In its remarks, the Federal Reserve said that labour market conditions have improved, even as economic activity appeared to have declined. Growth in household spending was modest, although households’ real income has increased and consumer sentiment remains high.

Another report released by the National Association of Realtors indicated that pending home sales index ticked up to 1.45% in March, exceeding expectations for a 0.5% rise. In February, pending home sales rose by 3.4%. Despite the optimistic data, the dollar moved was weaker against its counterparts, amid ongoing uncertainty over the timing of a future rate hike by the Fed.

The euro posted moderate gains against the yen, rising 0.24% at 1.1326, closing above 1.13 for the first time in six straight sessions. The greenback was also lower against the franc, with USD/CHF sliding 0.17% at 0.9718.
 
In the meantime, the dollar was higher against the sterling, with GBP/USD falling 0.14% at 1.4563, as a report earlier revealed that the U.K. economy rose 0.4% in the first quarter, in line with expectations. The economy, however, slowed from 0.6% in the previous quarter. The economy grew at an annual rate of 2.1% from January to March, moderately higher than anticipations for a 2.0% rise.
 
Elsewhere, the Australian, New Zealand and Canadian dollars were down against their U.S. counterpart, with AUD/USD falling 2.07% at 0.7587, NZD/USD gaining 0.62% to 0.6856 and with USD/CAD rising 0.19% to 1.2627.

The Australian dollar was under pressure following the release of data showing that consumer prices fell from January to March, as lower oil prices weighed. The U.S. dollar index ticked down 0.032% at 94.09. 
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28 / 04 / 2016 | Technical Analysis

EUR/USD: Reaching the High of 1.1363

European Session
The EUR/USD pair has been trending upwards since the 22nd of April 2016, with the bulls lifting the price from as low as 1.1219 to as high as 1.1363.

The major rose on Wednesday, ending a highly volatile day at 1.1321. The pair fell during the opening of the Asian session today to subsequently bounce, in the wake of the Bank of Japan’s decision, reaching the high of 1.1363. The pair benefited by the dollar’s weakness against the yen, after the BoJ surprised the markets by staying on the sidelines at its April policy meeting.

In the event that the price breaks above that level, the pair could higher to 1.1388 and 1.1400 respectively.

On the flip side, a reversal from the current resistance below 1.1310 could expose 1.1276 and 1.1258 in extension.



Please note: The content in this daily technical analysis article should not be taken as investment advice. It comprises our personal view.
 
 
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27 / 04 / 2016 | Technical Analysis

USD/CAD: Falls below 1.2600

North American Session
The USD/CAD has been trading lower since the 22nd of April 2016, with the bearish pressures pressing the price from as high as 1.2758 to as low as 1.2573.

The pair fell during the course of the day on Tuesday, reaching the daily low of 1.2593. Today, the major rose up to 1.2639 at the start of the European session to subsequently fall down to 1.2573 during the early North American session. Recovery in crude oil prices and a mix of upbeat economic reports, coupled with strong inflation in Canada dragged the USD/CAD pair lower.

In the event that the pair finds significant support below the 1.2600 area, the price could bounce back above 1.2645 and reach 1.2677 and 1.2718 in extension.

Alternatively, in the scenario where the price keeps falling, next targets could be set at 1.2522 and 1.2490 respectively.



Please note: The content in this daily technical analysis article should not be taken as investment advice. It comprises our personal view.
 
 
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27 / 04 / 2016 | Market News

Dollar weakens ahead of the FOMC’s policy review

Overnight, the greenback remained broadly lower against its major peers, as demand was affected by poor U.S economic reports and as investors remained jittery ahead of the Fed’s policy meeting due later in the day.  

Data from the U.S. Conference Board released on Tuesday reported that the consumer confidence index dropped to 94.2 in April, from a previous downwardly revised reading of 96.1. Economists anticipated the index to fall to 96.0. 

The report came after the U.S. Commerce Department stated that the total durable goods orders advanced 0.8% in March, as opposed to expectations for a 1.8% increase. In February, orders were revised to a 3.1% drop from a previously reported 3.0% fall.
 
Core durable goods orders, excluding volatile transportation items, slipped 0.2% last month, compared to forecasts for a 0.5% increase. February's core durable goods orders had shown a 1.3% decline.

The euro inched up 0.28% against the dollar, settling at 1.1298 as investors awaited the Federal Reserve’s policy decision due today. The greenback also fell against the sterling and the Swiss franc, with GBP/USD climbing 0.70% near a three-month high of 1.4586 and with USD/CHF falling 0.32% to 0.9719. 

On Wednesday, the yen eased 0.13% against the dollar to 111.16, moving further back from the three-week peak of 118.86 seen on Monday, as investors looked ahead to policy decisions from the Federal Reserve and the Bank of Japan.  Meanwhile, the Australian and New Zealand dollars weakened against their U.S. counterpart, following the release of soft economic reports from both Australia and New Zealand.

AUD/USD plummeted 1.64% to 0.7620, the lowest since the 18th of April, after the Australian Bureau of Statistics reported that the consumer price index dropped 0.2% in the first quarter. Analysts expected a 0.3% increase, following a rise of 0.4% from October to December. Consumer price rose by 1.3% YoY from January to March, as opposed to expectations for a 1.8% gain. 

Australia’s CPI figures, excluding the most volatile 30% of items, edged up 0.2% in the first quarter, surprising expectations for a 0.5% rise and following a 0.6% increase in the quarter before.

NZD/USD fell 0.45% to trade at 0.6867, as an official report from New Zealand reported that the country’s trade surplus narrowed to NZ$117million in the previous month. Economists anticipated the trade plus to widen to NZ$476 million. The U.S. dollar index was last up 0.08% at 94.54. 

The greenback’s gains, however, remained limited, ahead of the Federal Open Market Committee’s interest rate decision due later today. This is the third monetary policy statement release, since the historic rate hike in December. Last month, the FOMC voted 9-1 to leave the funds rate unchanged, with Kansas City Fed President voting against. 

Investors will also be monitoring U.S. goods trade balance, which is seen widening to 62.50 billion from the previous reading of 62.86 billion. The pending home sales report is also due to be released, with analysts expecting a 0.5% decline from a 3.5% rise in the month before.
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27 / 04 / 2016 | Technical Analysis

AUD/USD: Hitting fresh weekly lows at 0.7604

European Session
The AUD/USD pair has been trading sideways since the 21st of April 2016, with the price mostly ranging between the levels of 0.7775 and 0.7693.

The pair tried to push higher during the course of the day on Tuesday, with the price reaching the intraday high of 0.7765. Today, the major fell dramatically during the Asian session, with the price hitting new weekly lows at 0.7604. The price is trading at 0.7613 at the early European session.

The Australian dollar remains broadly weakened as European traders react negatively to the disappointing Australian CPI figures released earlier today. In addition, remarks from Goldman Sachs stating their anticipation of an RBA rate cut in the coming way weighed down on AUD/USD.

In the event that the price breaks below 0.7604, the pair could find support at 0.7586 and 0.7539 respectively.

Alternatively, in the scenario where the buyers manage to gain momentum and break above 0.7693, the pair could rise up to 0.7747 and 0.7786 in extension.



Please note: The content in this daily technical analysis article should not be taken as investment advice. It comprises our personal view.
 
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26 / 04 / 2016 | Market News

Dollar trading broadly lower amid weak U.S. housing sector data

Overnight, the greenback edged lower against its major peers, following the release of downbeat U.S. housing sector data and as sentiment on the dollar remained vulnerable ahead of the Fed’s upcoming policy meeting.

Official statistics from the U.S. Commerce Department reported on Monday that new home sales declined by 1.5% to 511,000 units in March. New home sales in the month before were downwardly revised to show a 0.4% decrease to 519,000 units, from the previous reading of a 2.0% rise. Economists expected a 1.0% gain to a total of 520,000 units.

The euro advanced modestly on Monday, ending a four-day losing streak, as investors await the beginning of the Federal Open Market Committee’s two-day meeting. EUR/USD went up 0.31% at 1.1267 on the session. Market participants were looking ahead to the Federal Reserve’s policy meeting - the third since the rate hike in December - scheduled to conclude on Wednesday for further signals on the pace of a future rate hike.

In the meantime, Germany’s Ifo Institute reported on Monday that its business climate index declined in April by 0.1% to 106.6, below economists’ forecasts for a reading of 107.0. The report came after Bundesbank reported last week a decline in economic growth over the second quarter.

The dollar was also lower against the sterling and the Swiss franc, with GBP/USD gaining 0.59% at 1.4489 and with USD/CHF falling 0.42% to 0.9747.  The British pound found support after U.S. President Barack Obama commented over the weekend that Britain would be in a disadvantaged position in terms of a negotiation of a trade deal with the U.S. in the event of Brexit.

The yen advanced slightly in Asia in a subdue trade on Tuesday, as market participants await the Federal Reserve's and Bank of Japan’s monetary policy reviews. USD/JPY fell 0.4% to trade at 110.80.
 
The Australian dollar was unchanged against the greenback at 0.7719, while the New Zealand dollar gained 0.45% to 0.6886, as higher oil prices continued to underpin commodity-linked currencies. The U.S. dollar index was steady at 94.67.
 
Oil prices recovered on Tuesday, due to a weaker dollar, but gains were expected to remain limited as Iran, Saudi Arabia and Kuwait reported output increases, fueling concerns over a global supply glut.
 
Focus today will be on the U.S. durable goods order, expected to increase 1.8% from a previous decline of 3.0%, and on core durable goods order, which is seen rising 0.5% from a 1.3% fall in the month before. U.S. is also going to release the services PMI data expected to advance to 52.3% from 51.3% before, and on the S&P/CS HPI Composite, forecasted to fall to 5.5%, as opposed to 5.7% a month earlier.
 
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