Further fundamental deterioration of EUR vs. USD evident in lower PMI in Europe and stronger PMI in US (high in the Markit series since 2010). Dovish talk from the ECB continues. There will be several Fed speakers this week, they may be less dovish. GBP event risk starts tonight with BoE parliamentary testimony. The risks are for a pull-back in the GBP, but its yield support, trend and solid global risk appetite suggest…Continue
Added by Daologic on June 24, 2014 at 7:06am — No Comments
EUR is continuing consolidation below 1.3600, and yesterday's attempt to break that resistance has failed because of the worse than expected PMI data. Today the IFO data will be released and if it is also worse like yesterday's then the EUR may drop again to 1.3550 or 1.3510. Currently the price is above the H4 negative cloud and going deep below it is not likely. Recovery to the upside will continue once the price is above 1.3600, until that one or several downside tests may appear. Daily…Continue
Added by Vladimir Mihaylov on June 24, 2014 at 4:59am — No Comments
A 3rd up week in succession was posted in CABLE last week although the scope of the upside was significantly less than the preceding week.
That was due to profit taking attempts above the psychological level of 1.7000, at the highest levels traded since Oct 2008 and with signals for sentiment at overbought extremes.
But although the…Continue
Added by Alan Collins on June 23, 2014 at 7:51am — No Comments
We would buy USD vs. EUR and JPY even though it feels like a patience trade. As discussed last week, we think the market is underpricing the risk of hikes in the US, whereas policy is likely to generate low rates in the Eurozone and Japan for much longer. The GBP has had a run on higher rate expectations; the risk is that this cools somewhat after the lower-than-expected inflation reported last week and focus on…Continue
Added by Daologic on June 23, 2014 at 7:04am — No Comments
"Speculative positioning registered a few notable changes during the week ended on June 17th, according to the latest Commitments of Traders Report from the CFTC:
Added by Daologic on June 23, 2014 at 4:11am — No Comments
EUR finished the week at 1.3600 support after a quick test of 1.3550-60. The price bounced back to the upside and the pair is now bullish on all time frames. This means the recovery will continue and with the help of good PMI and IFO on Monday and Tuesday for EU and Germany the pair may reach easily 1.3750-1.3820. Breaking of 1.3650 will be the signal for this. Downside may be restored only below 1.3540, but for now we are far from that and expected fundamental data is in favor of the EUR.…Continue
Société Générale's Top 10 forex trade recommendations for the second half of 2014
Here are SocGen's top 10 for the second half of this year. Verbatim.
1- Long USD, NOK and GBP vs CHF, SEK and EUR.
Easy money continues to support risk taking, but the FX carry trade needs to be selective, i.e. avoid trades where valuation is stretched (e.g. risk/reward in NZD/JPY isn't great). This portfolio exploits central bank policy differentiation. An alternative is to be long USD, NOK…
Added by Daologic on June 20, 2014 at 4:05pm — No Comments
"Go With the stronger GBP story: currency markets have not yet had sufficient time to re-price the reality that Bank of England is now very likely to run ahead of the Fed vis-à-vis first monetary tightening. The slightly weaker UK Retail Sales data does not change our view on this. Long Cable and long GBP/SEK."
Added by Daologic on June 19, 2014 at 10:03am — No Comments
EUR has made a shy move to the upside following the FED's decision to keep the interest rate unchanged and to continue with reducing stimulus program. This decision was expected and the market was not surprised, so the dollar lost positions against almost everything. However we lack enough power to break through the important 1.3600 resistance. Once above the price will easily go to 1.3660, but for that we need at least one H4 candle closed well above 1.3600. For now the pair seems uncapable…Continue
Added by Vladimir Mihaylov on June 19, 2014 at 5:04am — No Comments
EUR has made a test of 1.3510 yesterday before reversing to the upside and breaking of the 1.3550 took the price to 1.3580-85 as expected. However we are still below the important for further recovery 1.3600 resistance. Breaking of the 1.3600 may take the price to 1.3650-60 quickly, but there a storng resistance is placed and moving futher to the upside will be very hard. But first we need to break above 1.3600, until that we are bearish.
GOLD didn't reached my thirs target from last…Continue
Added by Vladimir Mihaylov on June 17, 2014 at 4:59am — No Comments
"There may be better opportunities to short the CAD—versus the JPY amid declining expectations of the need for further BoJ stimulus and safe-haven demand, CADJPY remains blocked below 94.00/10, where the market has been capped for the past month. GBPCAD remains a candidate to improve in the medium-term amid positive BoE rate comments and a still…Continue
Added by Daologic on June 16, 2014 at 11:35am — No Comments
"Stay short EUR/GBP as the EUR under-performs broadly on rate spread moves and GBP finds support from Carney's aggressive intervention in the UK monetary policy debate. Commodity and EM currencies supported by gradual global recovery and pro-cyclical easing by the ECB and to a lesser extent the PBoC. A more hawkish Fed is a risk, so EUR/USD may have more downside. Long NOK/SEK positions vulnerable on the chances of a softer Norges Bank rate profile, but significant NOK falls should be seen…Continue
Added by Daologic on June 16, 2014 at 6:54am — No Comments
EUR failed to reach 1.3600 and to close above so bears took the price back to 1.3520-30 area on last week's close. We are slowly approaching the positive Weekly cloud which is expected to bounce the price to the upside. There are signs of a support formed at 1.3500, but we need to break above 1.3600 resistance to confirm the recovery. There are also some signs of nearby recovey to the upside on Daily and smaller frames, but this is too unreliable as the price is now even below 1.3550.…Continue
Added by Vladimir Mihaylov on June 16, 2014 at 4:31am — No Comments
EUR went back above 1.3550 after US data yesterday, but the outlook will remain negative as long as the price is below 1.3600. Possible recovery may extend to 1.3620 or 1.3655, but no more than the last for now. Daily indicators are turning bullish, H4 are already bullish. We are short term bullish while the price is above 1.3550 for a recovery to 1.3600.
GOLD has reached my first target 1268 and almost reached the second 1276 both forecasted yesterday. Now we have support at 1267 and…Continue
Added by Vladimir Mihaylov on June 13, 2014 at 5:21am — No Comments
EUR is still above the 1.3530 support and every attempt to break above 1.3550 is not successful. So now we are watching the 1.3530-40 area, break below will increase the downside pressure and first support to come is 1.3500, then 1.3470 and finally 1.3430.Today we have plenty of economic data from EU and USA. EUR is now beraish on all time frames, so it is more likely the downside to continue today.
GOLD is above the support 1254 and the first resistance to battle with is 1268,…Continue
Added by Vladimir Mihaylov on June 12, 2014 at 8:02am — No Comments
EUR has reversed losses after testing 1.3500 support and now it is back to the SMA200 resistance at 1.3650. We have also a diagonal resistance line somewhere around 1.3670 and we need to break above the 1.3670 to progress to 1.3740-50. Continuation to 1.3805 is less possible but not impossible. Downside will be restored once the pair breaks below 1.3590. Between 1.3620 and 1.3650 the pair is locked and sideways movements can be expected.
GOLD is blocked by the 1254-1258 resistance…Continue
Added by Vladimir Mihaylov on June 9, 2014 at 5:02am — No Comments
The players yesterday quicklyas expected dropped for the ECB rate decision but reversed quickly to go above that of the initial high in EURO and GBP.They normally do this sort of quick reversal move for NFP.For a change they have done the day before for ECB rate decision.
Today they are expected to swing and slowly slide all the day as intentional move.Small swing and slide moves they may do for NFP and continue the slide during US session.
They donot make…Continue
EUR has tested 1.3500 after ECB rate cut yesterday, but then reversed quickly to the upside reaching 1.3670. Such reversals are always hard to explain and there are several reasons for that. But first of all i think that this is because the market is expecting FED to make additional stimulus to the economic growth like ECB has done, this has put the dollar under downside pressure against all currency pairs and commodities. This is the main reason for the risk aversion yesterday, and the…Continue
Added by Vladimir Mihaylov on June 6, 2014 at 4:53am — No Comments
Although the upside extended, in a sharp spike, higher than assessed initially yesterday, gains were not maintained. Instead the market continued to fluctuate above the daily Ichimoku Cloud but without sustaining prices beyond last Wed’s Marabuzo line - the 3rd day in a row that that point has curtailed demand. It is that failure, coupled with selling interest attracted in Asia that means that intraday signals for sentiment are left negative with potential to 1.6693 and 1.6660.…Continue
Added by Alan Collins on June 4, 2014 at 5:57am — No Comments
EUR is locked within the range between the support 1.3585 and resistance 1.3650. We are bearish as long as the pair is below 1.3630,above 1.3650 further recovery is possible to 1.3750-60, but i think that will be used for opening Short positions at a better price. The market is waiting for the ECB to act, if we have another rate cut the downside move may reach 1.3350-1.3310. Add to SHORT below 1.3550.
GOLD is above 1240, but on Daily is bearish, H4 is also bearish and H1 or smaller…Continue