Category: Daily Look

Fed worries about Dollar’s strength



We are entering the European session with the dollar under pressure, but that comes after what has been a relentless rise so far this month and especially so against the single currency. We’ve marked a 1.0495 low on EURUSD in overnight trading and as we highlighted yesterday, the risks of some sort of rebound were growing given the price action seen over recent days. The dynamics underlying the single currency have been done to death, but the question for markets is how far they can still run. Furthermore, the relentless rise of the dollar also poses a dilemma for the Fed in terms of its desire to raise rates around mid-year as it bears down on inflation and impinges on the ability of exporters to remain competitive. This could be a factor worth keeping a keen eye on over the coming few months.

For today, the pace of the dollar reversal suggests that more corrective activity could be in store. We’re seeing cable close back to the 1.50, from the low just below the 1.49 level. We’re also seeing the same on AUDUSD, with USDJPY close to 121.00, from a recent high of 122.03. Overnight, we’ve seen tine New Zealand central bank keep rates on hold at 3.50%, as broadly expected. Together with the weaker dollar tone, this has supported the recovery back to the 0.74 level.

Further reading:

EUR/USD bounces up nearly 150 pips – just a necessary correction?

AUD/USD recovers to resistance: 3 reasons

EURUSD, GBPUSD, USDJPY Pivot Points, TA – Mar. 11 2015

EURUSD, GBPUSD, USDJPY Pivot Points, TA – Mar. 11 2015

EURUSD Daily Pivots R3 1.0986 R2 1.0920 R1 1.0799 Pivot 1.0733 S1 1.0612 S2 1.0546 S3 1.0425   EURUSD continues to weaken with every passing day showing no respite with little to none pullbacks in this downtrend. If this bearish momentum continues, EURUSD could likely target 1.05 levels quite easily. Any bounces are most likely

Markets await Draghi ‘s speech

Markets await Draghi ‘s speech

The path of least resistance for the single currency has been lower through most of the month and that was especially the case yesterday. The euro was down 1.4% over the day, with a push below the 1.07 level seen towards the end of the session. Equities were also weaker across the board, with bond

EURUSD, USDJPY, GBPUSD Technical analysis, pivot points – Mar. 10 2015

EURUSD, USDJPY, GBPUSD Technical analysis, pivot points – Mar. 10 2015

EURUSD Daily Pivots R3 1.0981 R2 1.0943 R1 1.0897 Pivot 1.0859 S1 1.0813 S2 1.0776 S3 1.073   EURUSD fell below the short term support at 1.08333. If we see a bounce back to this level to establish resistance, EURUSD could see continued declines, as long as the the short term tip at 1.08907 holds

Eurozone QE starts

Eurozone QE starts

After the drama of Friday, we saw a relatively subdued start to the week in FX markets. The two main events of the day, namely the start of QE in the eurozone and also further tension surrounding Greece look to be more “slow burn” affairs, rather than having an instant impact. Indeed, both have many

EURUSD, GBPUSD, USDJPY Pivot Points, TA – Mar. 9 2015

EURUSD, GBPUSD, USDJPY Pivot Points, TA – Mar. 9 2015

EURUSD Daily Pivots R3 1.116 R2 1.1096 R1 1.097 Pivot 1.0904 S1 1.0778 S2 1.0712 S3 1.0586   EURUSD declined to new multi year lows trading at 1.084 levels. The next major support comes in at 1.051 levels but we suspect a bounce could be in store, back to the broken support at 1.117 levels.

Euro continues to struggle

Euro continues to struggle

The single currency starts the week scraping itself from the floor after last week’s concerted push lower. The break below 1.10 on EURUSD happened before the US jobs data, but the firmer than expected release led to further dollar strength and the euro suffered the most in the wake of the ECB’s detailing of bond

This week in the markets: The euro hits an eleven and a half year low

This week in the markets: The euro hits an eleven and a half year low

The two main events this week were the ECB monetary policy announcement and the US non-farm payrolls report. As expected, the ECB left rates on hold. The bank upgraded growth forecasts but, as President Draghi delivered details about the quantitative easing programme, EUR/USD broke down through $1.10 to an eleven and a half year low.

In Like A Lion

In Like A Lion

The American job market is roaring ahead. According to non-farm payroll numbers released this morning, the US economy created more than 295,000 jobs in February, driving the unemployment rate down to 5.5%. This result exceeded expectations across the board – before the announcement, many analysts expected a small seasonal dip to drive the number closer

Markets await the NFP event

Markets await the NFP event

A bit of volatility in EURUSD during yesterday’s ECB press conference saw the rate recover to back above 1.1100 as Mario Draghi announced upgrades to growth forecasts for the Eurozone, but the gains were swiftly reversed as we now sit just above 1.1000. Although there was the odd brief visit below 1.1000 the fact that