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Monday 10 March 2014

12:38       No comments

GBP/USD Outlook March 10-14


GBP/USD showed downward movement but closed the week almost unchanged. The pair ended the week just above the 1.67 line. This week’s highlights are Manufacturing Production and the Inflation Report Hearings. Here is an outlook for the main events moving the pound, and an updated technical analysis for GBP/USD.
British PMIs releases met expectations, and the BOE maintained interest rates, as was expected. In the US, the markets were pleased with strong employment data from Unemployment Claims and Nonfarm Payrolls.
Updates:
GBP/USD graph with support and resistance lines on it. Click to enlarge: GBPUSD Forecast Mar. 10-14
  1. BOE Deputy Governor Charles Bean Speaks: Monday, 14:15. Bean will speak at an event in Darlington. Remarks that are more bullish than expected are bullish for the British pound.
  2. BRC Retail Sales Monitor:Tuesday, 00:01. This indicator measures retail sales in stores belonging to the BRC chain. Retail Sales is the primary gauge of consumer spending and this indicator will be closely monitored by the markets. The January reading was excellent, with a surge of 3.9%.
  3. Manufacturing Production: Tuesday, 9:30. Manufacturing Production is a key event which can move GDP/USD. The indicator posted a modest gain of 0.3% last month, and no change is expected in the upcoming release.
  4. Inflation Report Hearings: Tuesday, 10:00. This event is one of the highlights of the week. Parliament’s Treasury Committee conducts the hearings, and BOE Governor Mark Carney and other policymakers will testify. With inflation running close to the BOE’s target of 2.0%, the markets will be following closely.
  5. NIESR GDP Estimate: Tuesday, 15:00. This monthly indicator helps analysts track GDP, which is released on a quarterly basis. The indicator has looked very steady, with the previous release coming in at 0.8%. No major movement is expected in the upcoming release.
  6. Trade Balance: Wednesday, 9:30. Trade Balance surprised last month with a smaller deficit than expected. The deficit narrowed to -7.7 billion pounds, bettering the estimate of -9.3 billion. The estimate for the February release stands at -8.7 billion.
  7. BOE Quarterly Bulletin: Thursday, 00:01. This report contains market commentary and analysis. It is a minor release.
  8. CB Leading Index: Friday, 10:00. The index is based on 7 economic indicators, but most of the data has been previously released, so it is unlikely to impact on GDP/USD.
* All times are GMT
GBP/USD Technical Analysis
GBP/USD opened the week at 1.6734. The pair touched a low of 1.6640 before reversing directions and climbing to a high of 1.6786.  GBP/USD closed the week at 1.6710, just above support at 1.6705 (discussed last week).
Live chart of GBP/USD:


Technical lines from top to bottom
We begin with resistance at 1.7383. This line marked the start of a rally by the pound back in April 2006, which climbed as high as the 2.11 level.
1.7180 has served in a resistance role since October 2008.
1.6990 is next. This line has been protecting the key 1.70 level and has held firm since October 2008.
1.6823 held firm as the pound moved higher late in the week before retracting. This line has some breathing room as the pound trades just above the 1.67 line.
1.6705 continues to see action and was breached again this week. The pair ended the week just above this line, which could see more activity early in the week.
The round number of 1.6600 has some breathing room as the pound trades above the 1.67 line.
1.6475 remains a strong support line. 1.6343 is the next support level.
1.6247 is the final support line for now. It was a key resistance line in October and November 2012.
I am neutral on GBP/USD.
The pound continues to trade at high levels, buoyed by the British economy, which continues to produce solid numbers. US employment numbers looked strong on Friday, and market sentiment remains positive about the US economy.

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12:36       No comments

EUR/USD Forecast March 10-14


EUR/USD had a superb week, riding on the inaction of the ECB to reach levels last seen in 2011. Is it the beginning of a long rally? Industrial production data, Eurogroup and ECOFIN Meetings and inflation data are the highlights of this week. Here is an outlook on the major events and an updated technical analysis for EUR/USD.
After the ECB made no changes in rates, Draghi gave the euro a big boost. as he refrained from taking actionto ease pressure on short-term borrowing rates caused by European banks paying back LTRO loans. Some analysts expected Draghi would end sterilization of its SMP program. The lack of news was excellent news for the euro. In the US, Non-Farm Payrolls surprised to the upside, and this stopped the rally, but EUR/USD remains on high ground. Let’s start,
Updates:
EUR/USD daily graph with support and resistance lines on it. Click to enlarge:
EURUSD March 10 14 technical analysis forex trading euro dollar for currency trading
  1. French Industrial Production: Monday, 7:45. France’s industrial production declined 0.3% in December, following a sharp rise of 1.2% in the previous month. Economists expected a smaller drop of 0.1%. Output declined in transport equipment as well as energy products, however motor vehicles went up. French manufacturing showed signs of improvement, but remained in contraction as well as in the service sector. Francoise Hollande’s reform agenda may give the necessary boost to start recovery in the French economy. Industrial production is expected to increase by 0.6%.
  2. Italian Industrial Production: Monday, 9:00. Italian industrial production plunged 0.9% in December, following a 0.3% rise in November. Likewise, Italian Service and Retail sectors remained in contraction, despite some improvement in the manufacturing sector. Italian industrial production is predicted to gain 0.4%.
  3. Sentix Investor Confidence: Monday, 9:30. Investor sentiment in the euro zone increased to 13.3 in February, reaching the highest level since April 2011, following 11.9 in January. Analysts expected a decline to 10.7 in February. Investors were more confident regarding the Eurozone’s economic outlook. Investor confidence is expected to rise to 14.3.
  4. Eurogroup meetings: Monday. The Eurogroup, an informal body includes Member States using the euro currency. It meets normally the day before the Ecofin meeting in Brussels and deals with issues relating to the Economic and Monetary Union (EMU). 
  5. German Trade Balance: Tuesday, 7:00. Germany’s seasonal adjusted trade surplus, narrowed less than expected in December to €18.5 billion from a revised €18.9 billion in November. The release was above the €17.3 billion projected by analysts. Both the trade and the current account surplus were above expectations. Meanwhile, German exports in December declined 0.9% from November, but increased 4.6% on a yearly base. German exported mainly to other EU countries, followed by exports to countries outside the single market. Surplus is expected to rise to €19.3 billion.
  6. ECOFIN Meetings: Tuesday. The Economic and Financial Affairs Council, is one of the oldest Council configurations. It is composed of the Economics and Finance Ministers of the Member States, as well as Budget Ministers when budgetary issues are discussed, and meets on a monthly basis. It covers EU policy in a number of areas including: economic policy coordination, economic surveillance, monitoring of Member States’ budgetary policy and public finances, the euro (legal, practical and international aspects), financial markets and capital movements and economic relations with third countries.
  7.  French Final Non-Farm Payrolls: Wednesday, 6:30.  French non-farm job market contracted further in the third quarter, falling 0.1% after a 0.2% decline in the preceding quarter. The reading was in line with market forecast. Employment, excluding the farming industry, decreased by 15,600 in the three-month period ending September measured on a quarterly basis, after falling 37,700 in the second quarter. Excluding temporary work, employment plunged by 20,600 jobs in the third quarter 2013. The European Commission projects consumption will improve gradually as well as investments. The commission projects a GDP growth rate of 0.2% in 2013, with a pick up to 0.9% growth in 2014.  A rise of
  8. Industrial Production: Wednesday, 10:00. Euro zone industrial production plunged 0.7% in December, far more than the 0.2% decline projected by analysts, following a 1.6% gain in November. The sudden fall stopped GDP growth in the final quarter of 2013. However economists stated that industrial production actually was 0.3% higher in the last three months of 2013 compared to the third quarter. The main declines in production were mainly related to energy and capital goods.
  9. French CPI: Thursday, 7:45. French Consumer prices fell 0.6% in January, declining 0.3% in December. On a yearly base, CPI increased 0.7% in January as in December. The largest declines occurred mainly from winter sales which explained the fall of manufactured product prices.
  10. ECB Monthly Bulletin: Thursday, 9:00. The European Central Bank, stated its monthly bulletin on February that forward guidance will continue, keeping interest rates at low levels for an extended period. Regarding inflation, the ECB said subdued global inflation will continue in the coming months as spare capacity worldwide remains large. However a gradual improvement in global economic activity will support a gradual increase in global inflation.
  11. Employment Change: Friday, 10:00. The Eurozone’s job market has remained unchanged in the third quarter, the same as in the second quarter, indicating economic recovery has not yet reached the labor market. Nevertheless, the workforce was shrinking more slowly than a year ago. The unemployment rate remained above 12% expecting to improve gradually this year while economic growth slowly picks up. Germany registered a 0.2% quarterly growth in employment while France and Italy remained unchanged. However the Eurozone economy showed signs of recovery in the first months of 2014 which nay boost the labor market condition.
* All times are GMT
EUR/USD Technical Analysis
Euro/dollar began the week with perfect range trading between the 1.37 and the 1.3773 lines (mentioned last week). After dipping to 1.3650, the pair recaptured 1.37 and then jumped all the way to 1.3823 before ticking lower. The ECB announcement sent it all the way to the highest since October 2011 at 1.3915, but the pair eventually returned below the 2013 high of 1.3894.
Technical lines from top to bottom:
The all important round number of 1.40 is of high political importance. Below, 1.3940 served as resistance back in 2011.
The 2013 high of 1.3895 is the top line looming above and it is becoming more important. 1.3830 was a serious peak that was seen with better volume and was challenged afterwards in 2013.
1.3773 was a cap in February and beforehand in December 2013 and now switches to strong support. The round number of 1.37, is another support line after capping the pair in December.
1.3650 provided support in December and worked as resistance in September 2013, and is also a significant line. Also the February rally fell short of this line. Below, 1.3560 worked as good support twice during February 2014.
The January 2014 low of 1.3515 provides minor support on the way down. 1.3450 worked as resistance in August 2013 and as support in September and October. It is now a key line on the downside.
Long term uptrend resistance breakout?
A downtrend resistance line that dates from mid 2008 has been crossed on the monthly chart. This still awaits a clear confirmation.
I am bullish on EUR/USD
The 2016 forecasts of the ECB leave little room for doubt: the ECB is not really concerned with the low level of inflation. A negative deposit rate will be kept deep in the shed. And while the exchange rate was mentioned several times, the optimism coming out from the powerful institution about the recovery means that there is room for more euro appreciation before deflation worries return.
In the US, the better than expected NFP confirmed the taper, but this will not be huge surprise. Also the technical look seems quite bullish.

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12:35       No comments

USD/JPY Forecast March 10-14


The Japanese yen was significantly sensitive to the events in Ukraine, strengthening at first before weakening afterwards. Eventually we have seen a big upside breakout. Will the pair run to new highs? The rate decision in Japan is the main event in a very busy calendar. Here is an outlook on the major events moving the yen and an updated technical analysis for USD/JPY.
USD/JPY dropped to low ground on the rising tensions in the Ukraine, but didn’t really break out of the triangle. This all changed as the mood improved, especially as US Non-Farm Payrolls beat expectations. The previous range is gone and the pair hit resistance.
Updates:
USD/JPY graph with support and resistance lines on it. Click to enlarge:
USDJPY Technical Analysis March 10 14 2014 forex trading currencies dollar yen outlook
  1. Final GDP: Sunday, 23:50. The initial publication of Q4 GDP disappointed, as the economy grew less than expected on both the monthly and yearly indicators. A confirmation of 0.3% growth is expected now, raising the chances for more monetary stimulus.
  2. Current Account: Sunday, 23:50. Japan’s trade balance and the wider current account suffer from the energy imports that have increased following the Fukishima disaster. A fifth consecutive current account deficit is expected for the month of January 2014, after around  the country posted around 200 billion yen deficit in December.
  3. Bank Lending: Sunday, 23:50. Bank lending is growing nicely in recent months, with an accelerated pace of 2.3% in the last two months. February will likely see a similar rise.
  4. Economy Watchers Sentiment: Monday, 5:00. This survey of 2000 consumers provides a good insight about the economy. It is a PMI-like scale. Since February 2013, it has been positive, with the score rising above 50. After a small disappointment with 54.7 points in January, another small drop can be expected now.
  5. Machine Tool Orders: Monday, 6:00. This indicator at the industrial level has show a strong year over gain in January: 39.6%. Another strong yearly rise is likely to be reported by JMTBA.
  6. M2 Money Stock: Monday, 23:50. The growth of money in circulation is watched by the Bank of Japan as a signal of expansion and also for inflation. After a better expected growth rate of 4.4% in February, an even stronger rise is expected now.
  7. Rate decision: Tuesday. The Bank of Japan already took some small steps in the direction of loosening monetary policy in its previous meeting. No action is likely in this meeting, but Kuroda and his colleagues might use the opportunity to hint about bigger moves in April, when the sales tax is hiked. The BOJ could counter the fiscal squeeze by ramping up the volume of QE.
  8. BSI Manufacturing Index: Tuesday, 23:50. This official Business Survey Index surprisingly dropped to 9.7 points back in Q4 2013, causing worries after big quarterly rises. For Q1, another drop is likely due to the sales tax rise.
  9. Tertiary Industry Activity: Tuesday, 23:50. While the indicator refers to the month of January, it still has a lot of impact as it is quite wide. METI reported a bigger than expected fall of 0.4% in December, and could now show a rise. Note that there are usually significant revisions to the data published here.
  10. BOJ Monthly Report: Wednesday, 5:00. Just one day after the rate decision, we get to see what the members saw when making their decision. The report contains forward looking forecasts and could consist of hints towards the April BOJ meeting, thus making it important.
  11. Consumer Confidence: Wednesday, 5:00. This measure of consumer confidence has been on the fall in the past two months, ticking to 40.5 points. The ~5,000 households surveyed here are likely to show figure now.
  12. Core Machinery Orders: Wednesday, 23:50. The figure relates to machines ordered by factories: an early stage in the manufacturing process. This shows the expectations for the future, and has a significant impact despite the big month over month changes. After a plunge of 15.7% in December, a leap is likely to printed now.
  13. Monetary Policy Meeting Minutes: Thursday, 23:50. The meeting minutes from the BOJ do not refer to the latest meeting but actually to a previous one. Nevertheless, hints about future policy could still be relevant.
  14. Industrial Production: Friday, 4:30. The initial estimation for industrial production growth for January surprised to the upside with a rise of 4%. This figure is set to be confirmed in the revised industrial output release.
* All times are GMT.
USD/JPY Technical Analysis
Dollar/yen started the week gaping lower on a Sunday, but it eventually settled above the 101.35 level (mentioned last week) and then continued back to the previous range. It then surged higher and fell short of the 103.77 line by just 2 pips.
Technical lines from top to bottom
The top line is the peak seen in the turn of the year: 105.44. This was challenged several times. Below, 104.80 capped the pair during January.
Below, 103.77 provided support for the pair in January and served as a clear separator of ranges. 102.74 was a stubborn peak during February and is the top line of the current trading range.
102 is a round number that provided support to the pair in late January and is now a pivotal line in the range.
101.35 replaces the previous peak of 101.44 after working as support in February. 100.75 was a cushion for the pair during several days earlier in the year and is the last defense before the very round number.
100 is the ultimate support line and the last line for now.
I turn bullish on USD/JPY
With an ease of tensions related to the Ukraine crisis, the safe haven yen demand could peter out. In addition, the solid US data, as well as the growing chances of BOJ action all point to a lower yen and another bullish run of USD/JPY.

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12:33       No comments

Forex Weekly Outlook Mar. 10-14


The US dollar and the Japanese yen were sold off as the market mood improved. Will we see more falls? Rate decisions in Japan and New Zealand, US employment and retail figures as well as PPI and Consumer confidence are the major events on our calendar. Here is an outlook on the highlights of this week.
The US Non-Farm Payrolls surprised to the upside with 175K, far better than the 150,000 rise projected by economists. This most probably cemented another round of tapering in March. However, it wasn’t the dollar’s week:Draghi’s lack of action sent the euro to new highs and the Aussie enjoyed a nice recovery thanks to good data. The crisis in Ukraine, which helped the safe haven dollar and yen, fell back from center stage and played against these currencies, but it is not over. Let’s start:
Updates:
  1. Japanese rate decision: Tuesday. Bank of Japan maintained its monetary policy in February, stating that the economy was moving in line with the central bank’s projections, indicating monetary stimulus will not get bigger. However in case of downside risks, the BOJ will act and adjust its policy. The GDP release showed external demand has weakened in emerging market economies affecting growth, but domestic demand has remained strong. The bank also forecasts that the current account balance will also improve once exports strengthen alongside global recovery.
  2. US Federal Budget Balance: Wednesday, 18:00. The U.S. government’s deficit continued to decline in January reaching $10.4 billion. The ongoing reduction totaled 36.6% in the first four months from a year ago, signaling further improvement in the nation’s economic condition. The Congressional Budget Office expect deficit to reach $514 billion in the current budget year while last year deficit reached $680.2 billion. The US Senate passed legislation to suspend the debt ceiling until March 16, 2015 eliminating more risk for budget wars. U.S. government’s deficit  is expected to reach $223.2 billion.
  3. NZ rate decision: Wednesday, 20:00. New Zealand’s central bank kept rates unchanged in February but gave a strong hint for a rate hike this month. While inflation has been moderate, inflationary pressures are predicted to rise over the next two years. The RBNZ’s decision followed strong data indicating the economy is growing faster than the central bank had projected, while inflation got closer to the RBNZ’s 2% target. A rate hike to 2.75% is expected this time.
  4. Australian employment data: Thursday, 0:30. Australia’s unemployment rate worsened in January increasing to 6.0% its highest level in a decade. The Australian economy shed 3,700 jobs due to a turbulent transition away from mining and the jobless rate increased from 5.8% in December, mainly full time positions. Australia is facing an economic transition following the termination of the mining boom, reflected by a big drop in mining related investment. Other sectors in the economy will have to fill in the gap and start contributing to growth. Australia’s unemployment rate is expected to remain unchanged at 6% while the Australian economy is predicted to add 15,300 new jobs.
  5. US retail sales: Thursday, 12:30. US retail sales edged down in January, amid cold weather Americans spent less on automobiles and clothes following the rise in the end of 2013. Retail sales fell a seasonally adjusted 0.4% after a 0.1 percent drop in December. However, economic slowdowns caused by winter weather are usually transformed to stronger growth once temperatures rise again.  Nevertheless economic growth in the first quarter is expected to be well below 2% annual rate compared to the 3.2% rate in the final quarter of 2013. Meanwhile Core retail sales excluding volatile spending on autos, gas and building supplies, remained flat compared with December with a drop in purchases of clothing and furniture because of rising prices. Retail sales are expected to gain 0.3%,  while core sales are forecasted to rise 0.2%.
  6. US Unemployment Claims: Thursday, 12:30. The number of Americans queuing for unemployment benefits fell to a three-month low last week, indicating the US labor market has recuperated from the severe weather. Initial claims for state unemployment benefits declined 26,000 to a seasonally adjusted 323,000, better than the 326,000 projected by analysts. The continuing claims have stayed at higher levels in recent weeks, due to the cold weather preventing some recipients from going out to search for work and causing companies to delay hiring. A rise to 334,000 is expected this time.
  7. US PPI: Friday, 12:30.  U.S. producer prices increased in January, but did not reflect broader price pressures in the economy. The producer price index for finished goods edged up 0.2% on a seasonally adjusted basis, following a 0.4% increase in December. PPI was revised and now includes the wholesale cost of goods and adds services, construction, government purchases and exports for the first time. It now includes a new index that tracks prices of goods and services meant to be sold to consumers. The index, known as personal consumption, rose 0.3%. It’s expected to give a heads up if consumer inflation is about to begin a sharp move up or down. The rise in prices does not indicate any major shift in inflation. Meantime, PPI, excluding the volatile categories of food and energy, edged up 0.2%. Producer prices are expected to gain 0.2%.
  8. US UoM Consumer Sentiment: Friday, 13:55. Consumer confidence in the US remained unchanged at 81.2 points in February, indicating shoppers remained dormant last month. However economists expected the index to decline to 80.6. However, the figure indicated a worsening mood after December’ release showed a three-year high on a monthly basis. Consumer confidence  is expected to rise to 81.9.

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12:26       No comments

Forex Trading Signal for 10th March 2014


                                                                                


Japan (Tokyo)                               United Kingdon (London)                        USA (New York)

For more easy access,,,,,,Download our mobile application on your mobile :   Click Fxsignals 













EUR/USD
 Down Trend :

 (1) SELL
Entry Point: 1.38810
Take Profit: 1.38510
Stop Loss:   1.39100
 

GBP/USD
Down Trend:

(1) SELL
Entry Point: 1.67340
Take Profit: 1.67000

Stop Loss:   1.67000

NOTE: The above posted Signals are delayed 2 - 4 hours after it has been  generated.
Daily forex signals are sent ontime to only our subcribers.

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