Saturday, 31 December 2016

The euro rose, the dollar was down in the last trading session of 2016

The euro jumped to a maximum of three weeks on weak trading on Friday, but is preparing to drop on expectations that the policy of the United States President-elect Donald Trump would fuel inflation and accelerate the increase in Fed rates.
By by the end of the last day of trading in 2016, the dollar index slowed by 0.3 percent to 102.380, below the peak of this year of 103.65, reached on December 20 - the maximum value since January 2003. However, at year-end it added 3.8 percent.
The euro rose by 0.4 percent to $1.0518 after a brief recovery to $1.0700 - the highest value since December 8. During the year the euro fell against the dollar by 3 percent.

Friday, 30 December 2016

Forex preparation (3)

Develop your discipline.

Fill a record of your transactions in a journal, it's the most useful habit, that you can build. The documentation of transactions will allow you to review your rules, to find mistakes and can even serve as a source of ideas. It will also help you avoid the same mistakes in future transactions.
Be detail-oriented! Pay attention to details. As John Wooden avoided injuries as directing his players how to shod socks in a special way, so dismissing small details can seriously affect your trades.

Thursday, 29 December 2016

Forex preparation (2)

"If you fail to prepare, then you are prepared to fail" - John Wooden said. For those who do not know who he is, here's a brief summary:
John Wooden is considered by many to be the greatest coach of all time. He has won 10 national championships in men's basketball. Wooden is not only famous for his victories, but rather for his approach to basketball and life in general. He was always prepared and paying attention to the smallest details, no matter how insignificant they looked.
An example is how he taught his players to be shod socks properly. That's right, even wanted them to put thrm in a specific way. The reason? He did not wanted any creases, which can cause blistering and potentially injure his players.
Wooden felt that a man should give all of himself into anything, and this part is always the first thing, that is under his control. Wooden so always came prepared.
Surely these principles can apply in forex trading. What habits must we develop to be prepared?

Forex preparation (1)

In forex trading there is only one thing over which we have control and that is ourselves. The markets move in different ways. Sometimes we win from trading, sometimes we lose, but when we draw the line, what remains is under our control.
Of course, when we are in chase for good ideas, we devote our time in analysis and research, but there will always be unexpected market events that happen out of nowhere. Here is where preparation and proper implementation of the deal becomes crucial to reduce potential losses from unexpected events.
The preparation includes optimal risk-profit ratio, placing of good stops, determining the size of the position based on the risk and stop and strong stick to our trading plan. These are aspects that are under our control, and if we want to be the best, we have to do everything, that depends on us to do this.

Look for part 2.

Wednesday, 28 December 2016

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Saturday, 24 December 2016

The British economy grew in the third quarter

In the third quarter the UK economy slowed its growth much more restrained than expected, despite the initial shock caused by the vote of the British people to leave the EU at the end of June. These are the final data of the official British statistics ONS.
Gross domestic product in the UK expanded during the period from July to September by 0.6% compared to the second quarter, when it was recorded growth by 0.7%, while the previous assessment of ONS was for growth by 0.5% in the third quarter.
On an annual basis UK GDP grew by 2.2%, but with previous estimate of an increase by 2.3 percent after growth by 2.1% recorded in the previous quarter.
British statistics noted that the economy has been supported largely by consumer spending which offset the weak performance of exports, analysts say. British exports fell by 2.6% after falling by 1.0% in the second quarter, while imports grew in the third quarter by 1.4% after rising by 1.3% in the three months by the end of June. Meanwhile, business investment growth slowed from 1.0% to 0.4%, agricultural production declined by 0.7% and industrial production - by 0.8%. The services sector grew by 1.0% q/q with previous estimate for an increase by 0.8%, while construction shrank by 0.8%, not by 1.1%, as were previous estimates of ONS.

The US economy grew in the third quarter with a stronger pace compared to the previous assessment

The US economy grew in the third quarter with a stronger pace compared to the previous assessment, thanks to a better increase in consumer spending and business investment during the period from July to September.
Gross Domestic Product of the US, which is the most common measure of the production of goods and services, increased in the third quarter by 3.5% yoy in the previous estimate of growth by 3.2 percent. This is the most solid expansion of the US economy for two years after its anemic performance in the first half, as the average forecasts of financial markets were for more modest upward revision for growth by 3.3%.
The solid economic growth in the third quarter is due to stronger growth in consumer spending and better business investment in construction and intellectual property.
The costs of US consumers who are the main driver of economic expansion, increased in the third quarter by 3.0% instead of 2.8%, according to previous evaluation, but after their strong growth by 4.3% in the second quarter. Let me recall that the domestic consumption forms more than two-thirds of the growth of the leading economy in the world.
Business investment in non-residential construction rose by 1.4%, which is far above the previous estimate for their anemic increase by 0.1%, while investments in infrastructure grew by 12% and intellectual property - by 3.2%. Investment in residential construction, however, narrowed in the third quarter by 4.1%.
One of the main generators of economic growth in the third quarter is the increased exports by 10.0% after an increase by only 1.4% in the previous quarter, this represents the most robust growth in exports in nearly three years. At the same time, imports rose by 2.2% after an anemic increase by 0.2 percent in the three months, ending in June.

Friday, 23 December 2016

ECB expects a sharp rise in inflation

Inflation in the euro area will exceed 1% at the end of the year, reaching levels not seen since the end of 2013, while growth in the global economy will increase speed. It was said the European Central Bank's latest economic bulletin, released today.
In the medium term prospects for global business activity remain in favor of strengthening of economic growth, though at a pace that is below its pre-crisis levels. Overall growth in developed economies will be a little better and it seems that the economies of emerging markets will start to get away from the bottom, says ECB.
However, the global outlook remains overshadowed by the unfavorable impact of lower commodity prices on countries exporting goods. The rebalancing of the Chinese economy and uncertainty about future US policy after the inauguration of the new US president Donald Trump also will have their influence. It was underlined by the central bank, as today's economic bulletin is largely in line with bank's statement after the last annual meeting on 8 December.
The ECB reiterated that they stand ready to use all available financial instruments within itheir mandate and that if necessary they can make new changes both in size and in duration of the program for "quantitative easing".

The Canadian economy shrank in October

Canada's economy shrank surprisingly at the beginning of the last quarter of the year due to strong weakness in the industrial sector and reduced yields of oil and natural gas, according to the official Canadian statistics.
Gross domestic product fell in October by 0.3% to 1.68 million canadian dollars in expectation of stagnation of the Canadian economy compared to September, when it rose by 0.4 percent.
This represents the first reduction of the Canadian economy after four consecutive months of growth and today's data will likely reinforce expectations for its delay at the end of the year after a good rebound in the third quarter, analysts say.
Surprisingly deterioration was due to the greatest degree of decline by 2% in industrial production - the most solidly decrease from December 2013. Extraction of oil and natural gas fell by 2.5%, retreating positions after four months of growth.
Weak construction also weighs on the economic performance of Canada in October it deteriorated by 0.5%, marking the fifth decline in the past six months, the analyst added.

Thursday, 22 December 2016

Bitcoin has risen above $850, the highest value since 2014

On Thursday, the digital currency Bitcoin has reached its highest level since January 2014, continuing its recent rally.
On the New York Stock Exchange itBit Bitcoin broke through $875, before returning to $870, rised more than 4% today and exceeded almost twice its level from the beginning of 2016.
This month the digital currency soared almost 18% on the back of growth in demand in India and China, as investors try to protect themselves against the devaluation of the local currency and the lack of funds.
US and Europe are also responsible for a significant part of the volume of trading, as traders seek refuge from the problems of the world economy.
Bitcoin is a decentralized electronic payment system, which is not regulated by any government or central bank. Bitcoins can be used to pay for goods and services from their host vendors.

Friday, 16 December 2016

US bulls with new rally

The US dollar continued its bullish run after the Fed raised interest rates. The greenback reached its strongest level in 14 years. For the last three months the dollar index rose by 3%, and for the last 4 months - by nearly 10%.
USD/JPY passed the barrier of 118 and now investors expect next target of 120, so as parity of EUR/USD. Janet Yellen gave a forecast for the new three raises of interest rates next year. This to some extent would lead to major problems for central banks around the world, including higher costs for debt service, higher inflation and falling of exchange rate. Emerging markets were hardest hit by capital outflows in search of higher yields and higher costs for servicing of dollar-denominated debt. In combination with the weak euro, yen and other major currencies this may have negative effects on the world and lead to slower growth, which will eventually overtake also the US economy.
Currently the strong dollar poses a major risk for the US economy, especially in terms of raising interest rates in the country. If the administration of Trump did not come quickly with a major fiscal stimulus package, the euphoria will fade and this will be the beginning of fluctuation for the US economy.

Thursday, 15 December 2016

Investors accepted the Fed optimism with caution, the US stock markets closed lower

Waiting for more significant increase of rates by the Federal Reserve System (FED) spooked investors, despite the optimistic forecasts for the US economy.
Immediately after the news about the increasing rates the major US stock indexes briefly switched to growth, but then resumed their decline and fell by 0.5-0.8%.
Dow Jones Industrial Average index on the session on December 15 fell by 118.68 points (0.60%) - up to 19,792.53 points. Standard & Poor's 500 was down by 18.44 points (0.81%) - up to 2,253.28 points. Nasdaq Composite lost 27.16 points (0.50%) and amounted to 5436.67 points.
Shares of financial companies fell by 0.6% on the news from the FED.
Oil and gas companies index fell by 2.1% following the decline in WTI oil prices by 3.7%, to $51.04 per barrel.
Stock price of Hertz Global Holdings Inc. dropped by 8.3%. CEO of the company John Teygen resigns from 2 January, he will be replaced by Kathryn Marinello.
Share price of analyst firm Neustar Inc. It jumped by 21% in trading in New York after the announcement of its purchase of a group of investors led by Golden Gate Capital for $2.9 billion.

Dollar at 14 years peak after the Fed's decision to raise the rate

The dollar reached 14 years peak to a basket of major currency rivals on Thursday after the US Federal Reserve has increased the number of expected rate increases in 2017, reviving lasted for a month rally and hitting the currencies of emerging markets.
The US Federal Reserve raised its key interest rate by a quarter point and indicated to accelerate the increase in the cost of borrowed funds in 2017 after promises of President-elect Donald Trump to spur economic growth with tax cuts, increased spending and deregulation.
The range of federal funds rate has been raised to 0,50-0,75 percent as expected by financial markets, however, the signals that the Fed could raise rates three times in 2017, instead of two, as expected in September, seems to have caught them by surprise.
By 5.53 GMT the dollar index to continued rally and rose by 0.57 percent to 102.32. It touched the mark of 102.620, the highest since January 2003. Euro fell by 0.3 percent to $ 1.0503 after falling to a minimum of 21 months to $ 1.0468.
Dollar on Thursday struck a 10-month high against the Japanese yen, reaching 117.860 yen, rising by 0.3 percent to 117.50.

Wednesday, 14 December 2016

Optimism on the stock markets in Europe and the US the day before Fed's decision

European markets led by Italian shares ended with raise and overseas indexes are on their way to new highs in anticipation of the Fed's decision on interest rates in the US.
European shares rose to 11-month high on Tuesday as a major factor for this was the Italian shares and more accurate - UniCredit, which present a plan for restructuring and reform. European Stoxx 600 index added 1.06 percent and reached 357.50, making it the best price from January this year. This occurs after the beginning of the week the index lost 0.5%.
Italian banking sector added 5.83%, while shares of UniCredit achieved a growth of 15.92 percent, after it became clear that the bank would cut 6500 employees by 2019 and that they will start selling stocks and bonds. This was welcomed by the markets in anticipation of stabilizing the bank. The market capitalization of the bank is worth 15 billion euros.
In the UK, FTSE 100 climbed by 1.13% to 6968, which is the highest level for six weeks. The main reason for growth also was the banking sector, which managed to prevail over the loss of the energy sector.
Overseas investors are about to find out whether Dow Jones will overcome the psychological level of 20 000. On Tuesday the index added new 114 points and climbed to 19,911 after reaching a peak for the day of 19 953. SP500 added 15 points to 2272, as 9 of the 11 sectors finished at plus. The tech Nasdaq added 59 points to 5471.

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Thursday, 8 December 2016

Euro close to the peak of 3 weeks in anticipation of results of the ECB meeting

The euro strengthened and traded at a three weeks peak against the dollar on Thursday in anticipation of the outcome of the ECB meeting, as the US currency slowed down against the background of a rollback of government bonds yields.
The focus of investors this week remains the euro after Italian Prime Minister Matteo Renzi announced his decision to retire after the failure of the referendum on constitutional reform.
Initially falling due to the news about the results of the referendum, the euro showed a strong rally on Monday and since then has been held near the maximum of three weeks against the dollar, as investors await the ECB decisions.
The European Central Bank will announce the extension of the quantitative easing program by six months on Thursday, while leaving the volume of buying up assets of EUR 80 billion, according to a majority of economists polled by Reuters.
In the morning the euro rose by 0.18 percent against the dollar to $1.0770, close to reached on Monday level of $1.0797, a peak from November 15.

Wednesday, 7 December 2016

At Commerzbank talk about conditions for euro back to 1.10 dollars

In light of yesterday's movement of the euro, EUR/USD can attempt to test 1.0816, warn from Commerzbank. According to analysts, the pair showed interesting price movements yesterday, as on the market there was a slight breakthrough of lowest since November 2015 level - 1.0523, which clearly showed an unwillingness of the pair to break the level of March 2015 - 1.0457, which break could open the way for parity.
The level at 1.0700/02 was broken and now it should act as support. Break up opens the way to 1.0816. Then there are resistances at 1.0821 and 1.0851, analysts say.
Their bearish forecast remains valid as long as the trading is below these levels. A breakout will lead to the initiation of recovery to 1.0910 and 1.1000.

UOB forecast range for USD/JPY

According to currency strategists at UOB Group the forecast for USD/JPY remains bullish and suggests a period of consolidation before further growth. They say that the fluctuations of the US dollar yesterday made a mixed outlook. Further, it is expected fluctuations to be in the range of 112.84/114.77.
The bank already have closed their long positions in the pair and have a neutral opinion about it today, they do not expect any change in the opinion of analysts. The pair is currently moving around in its early stage of the consolidation phase, as it will probably go to a very wide range of 111.50/115.00, analysts say.

Tuesday, 6 December 2016

The Australian dollar fell because of the GDP data

The Australian dollar fell on Wednesday during the Asian trading session, as Australian GDP shrank in the third quarter.
AUD/USD was trading at 0.7431, down by 0.40%, and the USD/JPY rose by 0.12% to 114.16.
The US Dollar Index, showing the strength of the dollar against the six major currencies, was up by 0.01% to 101.52.
In Australia the day is rich in fresh indicators. Thus, the index of activity in the construction sector from AIG rose from 45.9 in November to 46.6, and in the third quarter GDP fell qoq by 0.5% and grew year on year basis, while it was expected to grow by 0.3% and 2.5% respectively.
Reduction of GDP, the highest since 2008, is one of the biggest deviations from the forecasts of the Reserve Bank of Australia's history. RBA, according to the calculations of economists expect GDP growth somewhere at 0.5%. Although officials expect that GDP will retrace in the fourth quarter, the lowest rate will attract the attention of traders to the report on the state of the labor market and definitely will soften the current neutral position of the central bank.

Canadian dollar falls from highs due to lower oil prices

The Canadian dollar fell against its US counterpart on Tuesday, as oil rally ended as a result of profit taking by investors, as the market focused on the meeting of the Bank of Canada this week.
Pair USD/CAD rose by 0.30% to 1.3310. On Monday, the pair reached 1.3235, the lowest level since 21 October.
Oil prices fell on Tuesday to 16-month highs after data showed that the OPEC oil production reached in November another record high.
OPEC last week managed to sign an agreement on the limitation of production, which can reduce the excess of reserves of the world, which was followed by a sharp jump in oil prices, the main part of Canada's exports.
The increase in production before the coming into force in January an agreement to reduce production caused concern that the global excess of reserves can continue in 2017.

Friday, 2 December 2016

The attractiveness of the British currency may rise

The dollar took a break again, going to the correction mode after Wednesday's rally. European currencies are trying to recover due to the increased interest in risk appetite following Wednesday's decision of OPEC to reduce production volumes, which triggered a 10% rally of oil prices.
Especially actively adjusted pair GBP/USD, which had reached a 3-week highs near 1.2660. After the breakdown of the upward movement of 1.26 quotes accelerated, and now the pound is trying to strengthen its position on the psychological level. The key growth driver for the British currency were the optimistic statements of the Minister of Brexit, which tried to weaken the market fears of a "hard Brexit". Players were particularly pleased with the comment that Britain can maintain access to the European single market after leaving EU. This is directly beneficial for the sterling as the British currency will return the attractiveness, shattered after the June referendum.
If we compare the EUR and the GBP, the position of pound look at this stage is much more stable. Status of the British economy, in spite of the "divorce" with the EU, so far eliminates the need for additional stimulus, and the negotiations themselves on an output from the block may last for quite a long period. The ECB, from the other hand, may be forced to extend the program of buying assets, especially in light of the increased political risk in the region.
However, the potential for further strengthening of GBP/USD looks limited due to the fundamental strength of the dollar. Today the US will publish key employment report, which is expected to increase jobs in the area of ​​170-180 (in my opinion higher than 200) thousand. If expectations are met, players will resume buying USD in anticipation of Fed rate increase at the next meeting.

Thursday, 1 December 2016

New jobs in the private sector in the US rose in November

A research by the company Automatic Data Processing Inc. (ADP) reported an increase of 216 000 jobs created by private businesses in the US in November with average forecasts of financial markets for an increase of about 165 000. At the same time it was announced some downward revision of data for October, according to which private sector of the US economy were revealed 119,000 jobs during a previous assessment of the ADP of 147 000.
Yesterday's stronger than expected data suggest a pretty good rate of improvement in the labor market, even though the US economy is getting closer to achieving the so-called "Full employment", analysts say.
The ADP report is unlikely to lead to a substantial revision of forecasts of financial markets for upcoming on Friday an official report on employment in November, they added.
According to ADP small US companies with employees between 1 and 49 already for the fifth consecutive month are not a major generator of employment in November, as they had opened 37,000 jobs, medium-sized companies, employing between 50 and 499 people, were hired extra 89 000 workers, while large companies, employing more than 500 people have launched 90,000 new jobs.
The service sector added in the eleventh month of this year 228,000 jobs, in the manufacturing sector were cut 10 000 jobs, only within the industrial enterprises were laid off 10,000 workers, while in construction the number of jobs had increased by 2000, shows the latest survey of ADP.
Let me recall, that ADP surveys pretty much show what to expect from NFP on Friday. If their results are close to the real data, we can expect serious rise in dollar after this week's NFP.

European stock indexes rose on Wednesday after oil

European stocks finished the session in the growth on Wednesday. Driver of growth was the rise of shares of energy companies, caused by OPEC agreement for limitation of the production.
The composite index of the largest companies in the region Stoxx Europe 600 rose during trading by 0,3%, to 341.99 points.
The index of 50 largest enterprises of the euro zone Euro Stoxx 50 added 0.43%. The British FTSE 100 stock indicator rose by 0.17%, the French CAC 40 - by 0.59%, the German DAX - by 0.19%.
Prices of Brent crude for delivery in February soared on Wednesday by nearly 9%, to $51.55 for a barrel on news that OPEC agreed to reduce the collective production to 32.5 million barrels a day, starting from January next year.
Countries outside of OPEC will cut output at 600 000 b/d, and 300 000 b/d of them will fall to Russia.
Shares of Total SA (PA:TOTF) rose in price by 2,4%, BP Plc (LON:BP) - by 3,8%, Royal Dutch Shell - by 4%. The capitalization of the smaller European oil and gas company Tullow Oil (LON:TLW) and Saipem SpA increased by 13% and 10%, respectively.
However, the prospect of rising fuel prices led to a decline in prices for securities airline EasyJet Plc and Air France-KLM by more than 2%.
The contract value for most metals is reduced on Wednesday, due to which the capitalization of Anglo American Plc (LON:AAL) and Rio Tinto Group (LON:RIO) has decreased by 1.6% and 2.5%, respectively, at auction in London.
The market value of the German industrial gases producer Linde AG (DE:LING) increased by 1% on the news that its US rival Praxair Inc (NYSE:PX) resumed merger talks that could lead to the creation of a giant with $60 billion market capitalization.
Quotes of pharmaceutical companies Novo Nordink increased by 3.4% thanks to the good results of the clinical trials of its production of insulin.
Meanwhile, the price of securities of Royal Bank of Scotland fell by 1.4%. The bank failed the British Central Bank stress tests.

Wednesday, 30 November 2016

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Deutsche Bank: It's time to sell the most overvalued currency in the world

Currency strategists at Deutsche Bank, who already have in their portfolio short positions in Australian dollar against the Canadian, think it's time to consider selling AUD against the US Dollar.
Changes in the technical picture confirms the inability of the bulls to take advantage of this initiative, while improving the economic prospects of the United States after the victory of Trump and negative signals from data from Australia showed that the fundamental picture favors lowering. At Deutsche Bank paying attention to the weakening of wage growth in Australia and the general deterioration of the situation on the labor market in the country, which in the opinion of the analysts of the bank will cause the Reserve Bank of Australia to lower interest rates again in the first half of 2017.
In addition, DB doubt the recent rally in commodity assets as the bank's strategists do not believe that the movement reflects the real situation in the economy and therefore do not believe in its stability.
DB's analysts do not expect a noticeable improvement of the situation with the trade balance in Australia and also remind about the risks of China, which continue to maintain a policy of gradual devaluation of the yuan. From the bank also advise not to forget that with the arrival of Donald Trump at the White House it could be expecteda  deterioration in the trade disputes between the US and China.
At the bank believe that in given circumstances from the Australian currency can be expected a resumption of downward momentum, as the Australian dollar could be called the most overvalued currency in the world.

Friday, 25 November 2016

Three-week rally in the dollar against the yen is the biggest since 1995

Today is Friday - the last trading day of the week. If the dollar against the yen at the moment ended the day near current levels, this would be the most significant three-week rise since 1995 of the US dollar against Japanese rival, analysts say.
The opening of the markets after the celebration of Thanksgiving in the US was marked by continued growth in yields of US Treasury bonds. This pushed the USD/JPY up in Asian session, they added.
Markets calculated in the price the likelyhood of raising interest rates by the Federal Reserve in December long ago. But the flow of strong economic data continues to affect positive mood. Currently 64% of market participants expect another increase in US interest rates until June 2017, except for December, analysts reported. Earlier this week, the probability was 58 percent and half month ago - twice as low.
Technically USD/JPY now appears extremely overbought. 14-day indicator RSI (relative strength index) for 10 consecutive sessions held in the area more than 70%. Moreover, there are no signs of a possible reversal or correction, analysts conclude.

The dollar steadied after pre-holiday growth

The dollar stabilized in the course of trading on Thursday, breaking the majority of last year's highs against the euro.
Given the fact that US markets are closed because of Thanksgiving Day, trading activity was low yesterday after the dollar set a series of new highs early in the session in Europe, expanding its growth after strong economic data from the United States published on Wednesday.
The US currency hit an eight-month peak against the Japanese yen and the high of nearly 14 years to a basket of six major rivals.
In addition, the dollar renewed record highs in a number of emerging market currencies, including the Indian rupee, the Turkish lira and the offshore renminbi trading in which are held outside of mainland China.
The dollar's rise is largely due to expectations that the policy of Donald Trump will stimulate inflation, which will lead to an increase in Fed interest rates and potentially increase the inflow of capital into the country.
In developed markets, most strongly affected by the election of Trump is the yen. It fell by 0.6 percent to 113.15.
The euro is trading around the level of $1.0572 after falling to a low of $ 1.0518, while the dollar index held near 101.58, retreating from the morning peak 102.05.

Thursday, 24 November 2016

Nikkei is up for the 6th consecutive session due to the strengthening of the dollar against the yen

Japan's Nikkei index rose for the sixth consecutive session on Thursday because of hopes for growth of earnings of Japanese exporters against the background of rise of the dollar against the yen.
The dollar rose after upbeat economic data in the US, which further strengthened the likelihood of the Fed raising rates.
Nikkei closed the trading session rising by 0.9 percent to 18.333.41 points.
The broader Topix index also gained 0.9 percent, ending trading session at 1.459,96 points and showing an increase for 10th consecutive session.
Index JPX-Nikkei 400 gained 0.9 percent to 13.105,50 points.
USD/JPY is currently trading at 113.32 yens per dollar.

Wednesday, 23 November 2016

Dollar once again attacking highs

On world markets the dollar once again attacking highs: against the euro the US currency reached a mark of 1.054, while the dollar index rose to new multi-year highs.
Published data on reserves and production of oil in the United States did not changed the situation significantly: oil quotes reaction was mixed, but in general the price of oil in the first minutes remained in a narrow range of $49,20-49,40 per barrel after statistics. It did not lead to significant fluctuations in the domestic market.
Keeping in mind the outcome of the upcoming meeting of representatives of OPEC in late November, investors continue very painfully to react to any hints in favor of tightening of US interest policy.
USD/JPY easily overcomed 111.00 level and is now heading to new highs.

Dow Jones Industrial Average for the first time rose above 19,000 points

Indexes in Europe recorded gains supported by growth in the oil price and positivism overseas. The price of oil reached a month high today amid expectations that OPEC will agree to limit yields. The market continues to be sensitive to comments from OPEC members, but expectations for an agreement are growing, despite opposition from Iraq and Iran.
German DAX 30 ended with an increase of +0.27% at the level of 10713 points. Here the gains came from stocks of Thyssenkrupp who have added +2.85%, followed by Deutsche Telekom with a daily increase of +1.67%.
Britain's FTSE 100 rose by +0.62%, closing the session at 6819 points.
France's CAC 40 also ended at green area adding +0.41% to close at 4548.35 points.
Dow Jones, S&P500 and Nasdaq ended the session on Tuesday at record high levels. For the first time since March 1998 indices ended for second consecutive trading session, both reaching a record at once.
The data showed that existing home sales rose in October by 2% annual growth to 5.6 million units, the highest level in nine years and a half.
S&P500 also reached a record, rising above 2200 points, leading sectors are real estate and energy, recording daily growth of +0.22%. It closed at 2202.94 points.
Technological Nasdaq Composite added +0.33%, closing the day trading at a level of 5386.35 points.

Saturday, 19 November 2016

Nomura expects growth of the pound

The reduction of short positions and the idea of ​​strengthening of the inflation caused rally of the pound. GBP regained the status of a reserve currency, but it does not reflect the hope that the UK can receive preferences in negotiations with the EU, analysts say. The pound should overtake other currencies in the short term as market attention is not drawn to negotiations for Brexit next year, they added.
Bank analysts expect the GBP/USD to reach 1.30 while EUR/GBP to fall to 0.84, while sales do not reach the threshold and did not give any other signal. The Supreme Court may decide that the reference to Article 50 of the Lisbon Treaty to initiate the procedure for leaving the country from the EU, requires the approval of parliament. But it is not excluded the Parliament to vote earlier and that they do not need a court decision, according to analysts.

Friday, 18 November 2016

Danske Bank: EUR/USD will fall to 1.04 dollars, and then will rise to 1.12 dollars

In the next 1-3 months the decisive mood of Federal Reserve and the growing political risk in Europe will send EUR/USD to 1,04-1,05 dollars, analysts say.
In the longer term, analysts remain bullish in the pair and believe that the huge difference between the positive current account of the euro area and negative US will send EUR/USD to 1.12 dollars.
Historically, the biggest fiscal deficit in the US, which does not accompany rising interest rates in the country, is a bearish factor for the US currency, analysts say.
They say the Fed will likely to disturb from the strength of the dollar, which may interfere with the planned increase in interest rates. Bank analysts lowered their forecasts for EUR/USD and now they look like this:
- 1 month - 1.05 dollars;
- 3 months - 1.04 dollars;
- 6 months - 1.08 dollars
- 12 months - 1.12 dollars.

Wednesday, 16 November 2016

The ActivTrades Financial Trading Summit 2016

I am thrilled to inform that my favorite forex broker ActivTrades will hold their ActivTrades Financial Trading Summit 2016!
It will be held on Saturday, November 19, in The May Fair Hotel, London.
On this amazing event we will meet the best ActivTraders speakers:
- Mr. Paul Wallace will speak on how to build a trading position;
- Mr. Martin Walker will guide us thru the forex traders’ essentials;
- Ms Catherine Stott will present us the main prospects in forex traders psychology;
- Dr. Andrew Lumsden-Groom, Kenneth Stanion and Pratik Thakar will clarify for us the institutional methods for the retail environment.
The program of this outstanding event also includes tea and coffee, lunch, panel discussion with lecturers and networking with industry professionals and other traders.
All attendees will have opportunity to continue their development on a free 2-week online trading course worth £495.
No Black tie, just forex!
For more information and registration, visit here.

Tuesday, 15 November 2016

The dollar plays all in

The rapid rise of the inspired by victory of Donald Trump US dollar revived the idea of ​​its parity with the euro. Traders have increased the probability of such an outcome to 45%, even though a week earlier it was estimated at two times lower. Deutsche Bank recalls that when the EUR/USD pair for the last time came out of a long consolidation range, it quotes changed by 10% over the next few weeks and expects them to decline to 1.05 by the end of 2016 and to 0,95 by the end of 2017. The main driver appears divergence in the monetary policy of the ECB and the Fed.
Indeed, comments from the Federal Reserve are "hawkish" in nature, allowing the derivatives market to increase the likelihood of tighter monetary policy in 2016 to 86%. Thus, according to the head of the Federal Reserve Bank of Richmond Jeffrey Lacker, the stimulating policy of the new president of the United States is able to force the Fed aggressively raise the federal funds rate. Trump plans to spend on infrastructure around $0.5-1 trillion and according to research by BofA Merrill Lynch, fiscal stimulus of 1% of GDP would lead to an increase in the yield on 10-year treasury bonds by 48 bp. In terms of the interest rate differential of US and German debt markets, EUR/USD should have been already traded in the parity area.

USD/CAD has won back losses on strong US statistics

The US dollar has won back losses against the Canadian Dollar on Tuesday and is trading at nine-month highs, supported by upbeat US economic data, while the decline in oil prices is putting pressure on the Canadian currency.
In early US trade, the pair USD/CAD rebounded from 1.3489, the session low, to 1.3527, still down by 0.26%.
The pair was likely to receive support at 1.3420, Friday's low, and resistance at 1.3589, Monday's high and a nine-month high level.
Demand for the dollar as a whole is stored on hopes that the presidency of Trump would increase budget spending, will come to tax cuts and a weakening of the financial regulation, which, in turn, will contribute to improving the economic growth and inflation.
The Canadian dollar remained under pressure as oil prices continue to decline amid concerns of oversupply of world reserves.
Canadian dollar is higher against the euro, with EUR/CAD rose by 0.29% to 1.4516.

Sunday, 13 November 2016

The markets have calmed down and the dollar stopped growing

The dollar has stopped the rise and traded steadily against other currencies in quiet trading on Friday as investors have recovered from the shocking results of the voting in the United States, and became even optimistic considering the choice of Americans to the country's economy.
The EUR/USD fell by 0.30% to 1.0852. On Wednesday, the pair jumped to 1.1298, the highest level since September 8, before returning to 1.0902.
The dollar was supported as investors revised their initial expectations for Trump presidency. Market participants expect an increase in costs and increase in inflation during the administration of Trump.
The dollar showed an increase after on Thursday the US Department of Labor said the number of initial applications for unemployment benefits for the week ended November 5 fell by 11000 to 254000. Analysts had expected a decline in the number of initial applications by 5000 to 260,000 last week.
The Mexican peso continues to fall, MXN/USD pair fell by 1.44% to a fresh record low at 0.0479.
At a press conference on Wednesday the governor of the Mexican central bank said that the institution is watching the market volatility, but refrain from any national currency stabilization measures.
GBP/USD pair rose by 0.85% to 1.2595, the highest level since 6 October.
The pound was supported, as some British politicians have declared that they intend to vote against the negotiations on Brexit, after a court stated that the UK government must obtain parliamentary approval to initiate the process of exit from the EU.
Pair USD/JPY fell by 0.49% to 106.66, holding near a three-month high on Thursday at 106.94.
Australian and New Zealand dollars fell, AUD/USD pair fell by 0.33% to 0.7541 and the pair NZD/USD fell by 0.29% to 0.7106.
Pair USD/CAD rose by 0.27% to 1.3536, holding near a seven-month high at 1.3525.
USD index, which shows the relationship of the US dollar to a basket of major currencies, was steady at 98.84, remaining at the 2.5-week high on Thursday at 99.08.

Friday, 11 November 2016

Dollar demonstrates rally against the Trump's victory

The dollar held close to the peak of three and a half months against the yen on Friday after rising last night, caused by the growth of the markets bets for the US economy and the rise in interest rates during the presidency of Donald Trump.
By 5.30 GMT the dollar fell slightly to 106.63 yen after rising to 106.950 yen at night - a maximum of 21 July.
The dollar is preparing to finish the week woth 3.3 percent growth against the Japanese yen, although earlier it was believed that the safe yen would gain against dollar in case of Trump's victory on presidential election in the United States.
The dollar on Wednesday briefly fell to around 101 yen after the Republican defeated Democratic candidate Hillary Clinton.
Now, however, the dollar demonstrates rally amid risk aversion and US bonds yields rise due to expectations that the Trump policy will support costs and accelerate inflation.
Trump promised large-scale of tax cuts and developing of infrastructure that can increase the US budget deficit.
Mexican peso stood at the level of 20.55 to the dollar, close to the record low reached on Wednesday.
The euro traded near $1.0906 after losing 1 percent last night and preparing to show a drop by 2.3 percent for the week.
The dollar has not changed to a safe Swiss franc, holding at a level of 0.9860 after falling to near three-month low of 0.9550 on Wednesday.
Sterling held position against the dollar, trading just below the monthly peak of $1.2585, reached on Thursday.

Thursday, 10 November 2016

Key comments of Saxo Bank on the results of the US elections and the reactions of markets

Here are the key comments of Strategic Team of Saxo Bank shortly after announcing the results of the US elections and the reactions of the markets:

John Hardy, head of "Forex Strategies" at Saxo Bank

- The markets have already made conclusions
- The reaction in the US dollar is in line with the expectations
- USD/JPY is rated correctly, nothing changes basically
- It will be interesting to see what will be the next move against the status quo in Europe
- The clock is ticking for Janet Yellen

Steen Jakobsen, chief economist and CIO at Saxo Bank

- I'm currently in Russia, where they are not surprised by the victory of Trump
- It's not that Trump wins, but that Clinton lost again
- It's about the antiglobalizm and the coming of age of a generation "Berlin Wall"
- People can not live another eight years without change
- The likelihood of higher interest rates in the US dropped

Peter Garnri, head of "Strategies in securities" at Saxo Bank

- Today (on Wednesday) we will see a repeat of the reaction of the markets after Brexit
- Financial markets in Asia Pacific behave better than expected
- We can expect serious dynamics in Mexican stocks

Ole Hansen, head of "Strategies in raw materials" at Saxo Bank

- Oil and copper are down, bets on gold increase
- The Trump's policy on fuels can help restore oil production in the US
- Gold is necessary to close above 1.330 dollars to signal movement towards the peaks of 1.375 dollars that were in July
- We're already seeing great excitement in gold volumes

ING: The yen will rise to 95, the euro - to 1.15, and the Canadian dollar could drop to 1.38

A verbal intervention by the Ministry of Finance and the Bank of Japan after the rise of the yen is quite possible, but unilateral intervention beyond the level of 100 seems unlikely, say analysts at ING.
According to them there is a risk of collapse of the USD/JPY to 95 amid growing demand for protective assets, which may cause Japanese authorities to strengthen verbal and actual intervention in the currency market.
ING Analysts' forecasts after winning the US presidential election by Trump suggest growth of EUR/USD to 1.15, but any growth will be limited, taking into account that the re-evaluation of the prospects for an increase in interest rates by the Federal Reserve was partially compensated by a concern for the affairs of European exporters.
We can see a sharp movement on the USD/CAD to 1.38, as the global market will avoid the risk, analysts said. There are concerns about the expectations of easing of the monetary policy by the Bank of Canada, taking into account the current uncertainty in the US. All the factors are negative for the Canadian dollar. On the other hand the bank of Switzerland would remain on the market and will closely monitor francs and will resort to actual intervention, analysts said. USD/CHF will follow the dynamics of EUR/USD, they added.

Wednesday, 9 November 2016

The dollar steadied against the euro after a shock reaction to the victory of Donald Trump

The US dollar steadied against the euro and the majority of the world's currencies after falling sharply against the background of the panic caused by the victory of Donald Trump's presidential election in the United States.
Despite the fact that before voting probability of presidency for Hillary Clinton was estimated at 80%, D. Trump managed to win in the key "fluctuating" states. His victory was called by the US media the biggest surprise in the history of the US electoral system.
The euro exchange rate against the US dollar by 20:38 GMT was $1.0922 compared with $ 1.1026 at the close of the previous session. Earlier in the trade, the dollar fell to $1.1300 per euro.
Meanwhile, the Mexican peso fell in value by 7.5%, earlier that day its fall against the dollar exceeded 11%, which was a record for 20 years. According to economists, the election of President Trump could worsen relations between the two countries and to reduce the volume of trade. The newly-elected president spoke about the possible cancellation of a free trade zone with Mexico and Canada. Canadian dollar against the US dollar decreased by 1%.

Sunday, 6 November 2016

Commerzbank believes that the euro will be stopped at 1.12

According to analysts at Commerzbank, upward momentum of the pair above 1.1200 could disappear. They say that the rally in EUR/USD looks more like targeted and it reached resistance at 1.1123, a minimum of August and September.
Above 1.1203, which is a 6-month resistance line, next level of resistance is at 1.1217. This level should keep the bulls and provoke failure, analysts say.
Falling below this level indicates that the 20-day moving average is at 1.1000 and initial support is at 1.0950 levels and 1.0821, the minimum from March, they added.
Currently lows should stay above 1.1060. If the market fails to close above 1.1203/17, it can eliminate the downward pressure, which  would lead to further rise to 1.1366, the maximum form August 2016, the experts wrote.

HSBC: Gold could rise to $1,500 an ounce if Trump wins the elections

The price of gold could rise to 1,500 dollars an ounce by the end of 2016 if Donald Trump wins the presidential election in the United States, analysts from HSBC said. On Tuesday there was published a poll, which shows that Trump for the first time since May, was pulled over Hillary Clinton. According to the study the candidate for US president Donald Trump is ahead of Hillary Clinton by 1%.
US presidential election will be held on 8 November. Gold is growing rapidly, adding 0.88 percent to 1288 dollars per ounce, analysts reported. Trump victory will undoubtedly contribute to the growth of quotations of gold since the policy of trade protectionism to which he adheres, will put pressure on the growth rate of the US economy, they added.

Wednesday, 2 November 2016

Free webinar: "US Election Fever: Which way will it go?"

On November 3 there will be a very useful free "US Election Fever: Which way will it go?".
The Pro trader Paul Wallace will discuss how the US elections affect the trading on US markets.
Time: 7pm-8pm Cost: Free Place: Online
Don't the other interesting and useful webinar, which will be held in November:
November 10: "Working with Stop Losses and Take Profits";
November 17: "Breakouts or Pull-backs? What kind of trader are you?";
November 24: "ActivTrades Event Follow Up: Tools & Trading Setups".
For more information and registration, visit here.

Tuesday, 1 November 2016

Dollar rises in price against the euro, while remaining at a maximum of 7 months

During today's Asian trade, the US dollar rises in price in tandem with the euro, while remaining at a peak since March on expectations of rate hikes by the Federal Reserve System in December.
In October, the dollar showed growth in pairs with all the currencies of developed countries, for Bloomberg the dollar index this month was the best since 2008 - an indicator added 2.2%.
Euro to 6:25 GMT was worth $1.0969 compared with $1.0981 at the close of the North American market.
The chances of increase in the Fed rate to the end of 2016 increased to 71.4% with less than 60% at the end of September. The market confidence in recent days was reinforced by published positive data, including the dynamics of US GDP in the 3rd quarter, and income and expenses of Americans in September.
The dollar against the yen is stable - 104,80 yen against 104.82 the previous day.

Societe Generale sees strong support for euro at 1.08

Currency strategists at Societe Generale believe that the fall of the EUR/USD may be limited at 1.0800 zone for a while. They say they still prefer to buy the dollar against the yen and the euro.
According to them EUR/USD seems likely to move down to 1.0800, but they are still concerned that the weakness of the euro depends on the ECB and active private investors in the European bond market.
They believe that reducing the volume of purchases of bonds can cause rebound of the euro, but in a broader sense, the weaker currency is one of the main channels through which worked ECB policy.
But if the euro is now located in a range of trade and the ECB almost has no response instruments, we can see difficulties in trying to find a new catalyst for another significant decrease of the euro, experts say.

Thursday, 27 October 2016

How to use the Stochastic

Stochastic is based on indicators that help us state where the trend may be over.
By definition, a stochastic is an oscillator that measures conditions of overbought and oversold market. Both lines are similar to the MACD lines.
Stochastic has a scale from 0 to 100.
When the indicator is at a level above 80 on the scale, it means that the market is overbought and when the indicator is below 20, it means that the market is oversold.
As a rule, we buy when the indicator is below 20 and sell when it's over 80.

Tuesday, 25 October 2016

Are you concerned (Part 2)?

Why is it a problem? If you can not overcome them, concerns may become a major obstacle to success and can lead to many other problems. For example: have you ever changed impulsively your stop levels or take profits, only to check if your initial levels were correct? So you lose contact with your plan because you leave the worries of losing and the worries that you're not right are taking control over you.
Fear and anxiety redirect our concentration on the situation and could lead to impulsive or irrational decisions. Even worse, to stay and to worry about something without taking any actions is counterproductive and a waste of time.

BBH forecast that EUR/USD will go to 0.83 dollars, while GBP/USD - to 1.00 dollar or even lower

EUR/USD fell below the important support of 1.1040 dollars, this level has now become resistance.
The bank remains bearish long-term to the couple as according to them a further reduction could send the GBP/USD to parity or even below. This month, the single currency fell by 2.4 percent against the US dollar and increased by 2.8% against the British pound, and October can be the fifth consecutive month of growth of EUR/GBP (+ 12% since the beginning of Brexit). The length of this uptrend is comparable only to the period August 2012 - February 2013, when the couple grew seven consecutive months.
The recovery of EUR/USD from the declines in January was interrupted in the middle of last week with a break below 1.1040 dollars and now the pair descended to levels of late July, trading not far from achieved immediately after the British referendum drop around 1.0915 dollars, say analysts.
A break below this level could send the pair to test the support at 1.0800-20 dollars, and if EUR/GBP rise to 0.90 pounds, analysts expect GBP/USD to return to 1.20 dollars.
In the long term, analysts of the bank are in anticipation of reducing the EUR/USD to historic lows around 0.83 dollars, and the GBP/USD to fall below 1.00 dollar.