Forex Crunch » EUR/USD

ECB Press Conference Live Blog

Yohay — Thu, 09 Feb 2012 13:18:05 +0000

ECB president Mario Draghi left the interest rate unchanged for a second month in a row. In the press conference, Draghi will explain the decision, discuss the LTRO and will likely be “grilled” on the ECB’s contribution to the Greek bailout.

Follow all the updates in the live blog, as Greek news continue to flow and a report about a “done deal” by the FT rocks the markets.

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ECB Leaves Rates Unchanged – All Eyes on Draghi as Euro Pressured

Yohay — Thu, 09 Feb 2012 12:45:32 +0000

The European Central Bank left the benchmark interest rate unchanged at 1.00%. This was widely expected.

Update: Follow the live blog of the ECB Press Conference

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Chinese New Year fuels inflation

Yohay — Thu, 09 Feb 2012 09:21:07 +0000

In a major blow to hopes that Chinese policy officials would sanction a further easing of financial conditions, inflation in January rose to 4.5% YoY, up from 4.1% in the final month of 2011 and well above expectations. In the month of January alone, prices were up by 1.5%, which represents the largest monthly increase since 2008.

Part of the explanation for the higher rate of prices growth is the distortion from the Chinese New Year, which often triggers a surge in spending. Even so, what will most concern policy-makers is that consumer spending is still so strong, despite a determined regime of tightening over the past eighteen months.

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5 Reasons Not To Cut Rates – ECB Preview

Yohay — Thu, 09 Feb 2012 09:11:55 +0000

Those expecting a third rate cut from Draghi might be disappointed. The ECB will likely repeat the “business as usual” stance that worked so well last month.

There are 5 reasons for the ECB to wait and see for another month.

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Commodities Supportive For Majors – Video Analysis

Yohay — Wed, 08 Feb 2012 09:44:03 +0000

Hello traders! Stocks are higher and the USD reached new lows against the majors during Asian session.

It seems that this type of a price action will continue this week, especially after a sharp impulsive break on EUR/USD yesterday out of its 6-day consolidation range.

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A change of stance at the ECB

Yohay — Wed, 08 Feb 2012 09:06:12 +0000

So, the farce in Greece continues, but there is good news in reports emerging (e.g. Wall Street Journal) that the ECB is going to give up some ground in relation to its bond holdings, although no official comment on this as yet.

The issue has proven to be a key sticking point (see blog last week ‘The ECB will have to yield on Greece’), but it now appears that the central bank will undertake an exchange with the EFSF (for EFSF bonds), so that the ECB will not make any profit on its holdings. Greece will then repay the EFSF at the ECB’s original purchase price. Video:

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EUR/USD Breaks Resistance On Greek Hope, Bernanke’s Gloom

Yohay — Tue, 07 Feb 2012 16:46:49 +0000

Serious progress has been made among Greek politicians in accepting the troika’s demands. In the US, Ben Bernanke refused to cheer the drop in the unemployment rate and found negative aspects to cling to.

Both events sent EUR/USD above the 1.3212 line and is now at the highest levels in 2012. It still has room until the next resistance level.

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European Cliff Hanger – France

Yohay — Wed, 01 Feb 2012 07:00:29 +0000

Europe’s second largest economy has multiple fronts. The economy is stuck, as seen in consumer spending. It’s perfect AAA status is all but gone. This immediately risks the AAA status of the EFSF bailout fund.

In addition, France holds presidential elections in April. Expectations are for an ousting of incumbent Nicolas Sarkozy by socialist Francois Hollande.
This analysis originally appeared in the Forex Outlook for Q1 2012. You can download the full report for free by joining the mailing list in the form below.

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EUR/USD Loses Channel Support – 4 Reasons

Yohay — Tue, 31 Jan 2012 18:27:29 +0000

EUR/USD failed to break a line of resistance within the uptrend channel, and the downfall was sharp. It eventually lost uptrend support and is now struggling on lower ground.

The never ending Greek troubles are the main reason among 4:

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European Cliff Hanger – Portugal and Ireland

Yohay — Tue, 31 Jan 2012 07:30:50 +0000

Portugal: Spain’s neighbor in the Iberian Peninsula already received a bailout program and is struggling to keep up. The hidden debt in the island of Madeira as well as the ongoing recession could make Portugal the second domino to fall after Greece does.

Here are three scenarios for Portugal:

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