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Daily Market Analysis from ForexMart -V
« on: November 08, 2018, 12:01:31 PM »
EUR/USD Fundamental Analysis: November 8, 2018



The euro major pair faced a bearish drop after the result of split congress which is already anticipated by the market and momentum of the pair starting to become insufficient after the final outcome was announced.       The Republicans kept the Senate and Democrats took the House.       Although, House will probably pressure Trump concerning taxes whom he pledged to fight back with investigations being out.       Meanwhile, the eurozone resulted in a positive macro data which had no impact on price action as momentum yesterday were dominated by the US elections results and the pair has had important gains.       Yet, the US dollars recovered in the broad market during the Asian session, as well as late American hours following a major loss against euro yesterday.       

There is a probability for the dollar to become dovish if the policy statement shows a sensitive reaction to the recent declines in the stock market.       Looking at the technical perspective, the euro against the US dollar 25 delta risk reversals grew to -0.      575, which was the peak since August 1.       The means that the demand or the implied volatility premium for the cheaper money of euro is presently at the lowest in more than three months.       The falling demand for the bearish bets of the euro would mean that investors are anticipating for a stronger recovery rally for the euro major pair.       Meanwhile, the greenback starts to kick-off on the 4-hour and daily chart implying the bullish momentum to remain intact, demonstrated that price continues to move higher than the level of 1.      14.       

Post Merge: November 09, 2018, 11:14:46 AM
EUR/USD Fundamental Analysis: November 9, 2018

The euro major pair has been moving steadily after the release of the FOMC report since there is a bearish pressure on both currencies.      Aside from rising tensions in Europe, the hawkish sentiment remains with market expectations that adds pressure on the common currency.      Various political tensions such as Brexit, tensions between Brussels and Rome are anticipated to heighten tension in the next few weeks, yet Brexit is likely to move in a sluggish pace.      The issue between EU and Italy influence the spread between Italy and Germany to 300 bps.      Other than that, the two major coalition partners in Italy proceeds to take action in limiting immigration that also affects the euro across markets.       

These economic events limit the progress of the euro while in the US, uncertainty has pushed investors to side on the US-dominated assents and the greenback.      The EUR/USD pair grew modestly after the release of the FOMC statement and rise to 1.     1409.      It declines immediately and broke the previous slows.      The price declined below 1.     1350 during the Asian trading session as the US central bank kept the funds' rate at 2.     25% to 2.     00.      At the same time, the recent statement remained the same from the September meeting, providing a solid bullish support.      Meanwhile, the Italian bond yields yesterday night after the EU commission’s forecast saying that Italy has undergone inadequate and partial analysis.     

Post Merge: November 12, 2018, 11:45:21 AM
GBP/USD Fundamental Analysis: November 12, 2018

Brexit remains to be the center for today’s Asian session since UK Prime Minister Theresa May canceled the emergency meeting to approve the Brexit deal this week.     The meeting was postponed but the resistance from the cabinet remains strong, added to Brussels concerns, which delays the Brexit talks and lessen the possibility of the expected meeting in November.     In this case, the Sterling bulls are on the less favorable situation.     Market hopes for a miracle to relieves the pressure amid the heavy headlines with the Brexit as the main concern over the weekend causing more tension in the market.     It seems that the market declined by 0.    46% from this morning price level of 1.    2911.     

There is no major economic event for the UK, hence, traders can expect for thin trading volumes given that there is less US money market for the long Thanksgiving weekend but Tuesday seems to offer UK Average Earnings and GBP/USD traders are looking for something an early event to the headlines prior to major economic data.     The dollar was strengthened by last week’s gains and grew to a 16-month high on Monday as traders anticipate for the US Federal Reserve to tighten monetary policies and the bullish tone of the greenback with the ongoing Brexit talks to further escalate the bullish situation.     As for the technical perspective, the implied volatility premium grew sharply while an increasing demand for the British pound puts a bearish pressure while traders are anticipating for a much bigger decline of the currency.     The risk appetite has also lessened during the Asian trading session as the EU’s situation worsened.     

Post Merge: November 13, 2018, 11:38:18 AM
EUR/USD Fundamental Analysis: November 13, 2018

The euro influenced the appreciation of greenback during Monday trading session with political uncertainty affecting the European market.    The euro major pair dropped to 1.   1239 soon after the opening of the London session in the background of tension with the Italian budget as rejected by the EU commission in the previous week.    The Italian government submitted again a fiscal plan in correspondence with the EU rules and risk an economic sanction.    Yet, it seems that there is no intent to change the budget.    The pair is declining across the European and North American hours reaching a fresh 16-month low due to the bearish pressure from both sides of Atlantic.   

Lack of progress in the Brexit negotiation adds pressure on the bearish tone to the common currency added to the Italian budget concerns.    The White House also intends to reconsider auto tariffs against Europe which gives a dovish sentiment for the investors, further adding a bearish pressure to the common currency in the future.    Reconsideration of tariffs on the European market despite ending it a few months after meeting between the US and Europe, which can be because of various reasons such as the global trade war and renewed Iran sanctions and criticism of “America first” in the Trump administration.   

There are bids for the EUR/USD pair in Asia and an optimistic view of the renews US-China trade.    Yet, the change in budget still questions the Italy that could affect the spread between the high-spend budget to the European Union today will likely increase the spread between the Italian 10-year government bond yield and its German counterpart to the recent high of 325 basis points.    Om case that market expectations.    If Italy submitted an unchanged budget for euro, traders can anticipate the resumption of a bearish pressure.    As for the fundamental data, investors are eyeing on the German CPI data scheduled today which is expected to remain the same.    However, in case it turns out positive, this could drive momentum for a relief rally on the euro major pair.   

Post Merge: November 16, 2018, 11:55:16 AM
EUR/USD Fundamental Analysis: November 16, 2018

The euro major pair did not have an optimistic trading overnight with UK ministers exiting their roles attesting as a protest in the negotiation deal of Prime Minister Theresa May with the EU not meeting UK’s electorate vote.   Being against the authority of Theresa May raising uncertainty in the European politics that further raises the chance for the Brexit to be no deal that affects both economies.   Nevertheless, the euro major pair rise despite higher forecast of 0.  8% by the  U.  S.   Census Bureau US retail sales data in October, higher than the 0.  5% market expectation.   Meanwhile, the action moves with the reversal on Wall Street that resulted in a rally of the euro and retreating of long yen as the EUR/JPY pair recovered.   

Moreover, the greenback also received more bearish pressure after the profit taking on the trade talk news between the US and China, giving America the lead and raising risk appetite.   Investors now wait for the speech from ECB president Draghi and a drive on strong bid can take place if Draghi is able to act on the Italy budget crisis and confirm plans on ending the QE program.   If Draghi becomes heedful, the price may drop below 1.  30 and bet on a delay of the rate hike in 2019.    The Eurozone CPI data is anticipated to be released, as well as the data on Industrial production.   


Post Merge: Today at 11:01:07 AM
EUR/USD Fundamental Analysis: November 19, 2018


The euro major pair retreated back higher than 1. 14 level after the headlines on US President said to make a trade deal.  Although no agreement has been set yet, which in turn, raised risk appetite with investors and kickstart momentum across the market on Friday last week.  Thus, the pair gained 200 pips from the low level of 1. 1215 on Monday and closed in favor of the euro and grew by 0. 81% on the day. 

It has been trading close to the Friday high at 1. 14 at the beginning of the Asian session as investors became heedful following the dovish comments from ed’s newly appointed vice chair, Richard Clarida, saying a global economic slowdown is important for the US economic outlook and a similar to the interview from the Fed Dallas President Robert Kaplan who sees a slowdown in China and Europe.  Nevertheless, analysts see this as an acceptable risk factor given that the Fed is reliant on rate hikes while the investors reacted to the dovish rhetorics resulted in US dollar weakened. 

Yet, it is unlikely for the euro to hold on the gains for long-term as headlines directed differently after a poor output from the European macro data.  Despite the weakened outlook from the PPI data from Germany and PMI of Eurozone give a steady trend in medium- to long-term while analysts anticipate Fed rate hike and suggest a hawkish outlook in the future. 

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« Last Edit: Today at 11:01:07 AM by Obasi FXMart »

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Daily Market Analysis from ForexMart -V
« on: November 08, 2018, 12:01:31 PM »

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