Tuesday, 31 January 2017

Oil in the red on a background of the US production growth

Oil prices fell during morning trading on Tuesday amid rising of drilling activity in the US.
By 6.27 GMT, futures for Brent oil fell by 0.11 percent to $55.17 per barrel.
Futures for WTI US crude at the same time traded at a mark of $52.49, 0.27 percent lower than the previous close.
North Sea oil fell from January's peak by more than 5.6 per cent, WTI - around 3 per cent.
The number of drilling rigs in the United States rose for the week ended 27 January, by 15 units to 566 showed Friday data of oilfield services company Baker Hughes. This is the highest value since November 2015.
Analysts believe that the increase in drilling activity and, as a consequence, production in the US can neutralize the effect of OPEC agreements and non-OPEC countries to cut production.
Brent futures for March delivery today traded at a premium above $2.7 per barrel for WTI, reflecting the balance of alignment between supply and demand on the world market due to OPEC's pact and the excess of the market in US crude because of the continuing growth in the number of drilling rigs.

The dollar fell after Trump fired Attorney General

The dollar has fallen in price on Tuesday during the Asian trading session, after yesterday the US president Donald Trump fired the Acting Attorney General Sally Yates, who ordered the Ministry of Justice lawyers not to embed Trump's ban on immigration, and the Bank of Japan left policy unchanged, as expected, but raised its forecast about growth.
Trump has appointed Dana Boente, Attorney for the Eastern District of Virginia, to the position of Yates, the White House press secretary Sean Spicer wrote on Twitter.
USD/JPY was trading at 113.56, down by 0.18%, while AUD/USD rose by 0.13% to 0.7565. The US Dollar Index, which shows the strength of the dollar against the trade-weighted basket of six major currencies, fell by 0.08% to 100.34.

Thursday, 26 January 2017

Dow Jones ran over the barrier of 20 000

On Wednesday, Dow Jones Industrial Average crossed and closed above the psychological level at 20,000 for the first time, while the S&P 500 and Nasdaq Composite also went to record levels after the disclosure of upbeat corporate earnings of giants such as Boeing Co.
Dow Jones Industrial Average surged 0.8% to a price of 20,068.51 as Boeing Co. and Caterpillar Inc. contributed to solid gains.
S&P 500 recorded a growth of 0.8 percent to a record price of 2 298.37, eight of 11 major sectors finished with increases. Financial and industrial shares led the winners, while telecommunications and real estate were among the laggards.
Nasdaq Composite ended with a rise of 1% to a price of 5 656.34 points. Since the beginning of the year until now, Nasdaq surpasses other indexes, gaining 5.1 percent.

Wednesday, 25 January 2017

UOB sees range for the yen

USD/JPY consolidates and this will continue over the next 1-3 weeks, according to currency strategists at UOB Group.
While the couple is moving to the top of last Friday at 115.45, it is not expected to rise above that level, analysts say. The dollar reached a peak of 115.61, but quickly fell from the top, reaching a minimum, they added.
At the same time, positive expectations weakened slightly, but it is too early to expect a sustained rebound. The bank switched to a neutral stance and expressed the view that the recovery of the US dollar may move to 115.45/50, but it quickly came back.
Inability to break up is not surprising, so that the bank continued to maintain a neutral position and expect the dollar to trade in a wide range.

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Tuesday, 24 January 2017

Scotiabank doesn't believe in the further rise in EUR/USD

Yesterday the EUR/USD managed to break firmly above 1.07 dollars, which held back the growth of the pair last week. However, analysts of the bank in no hurry to move into the camp of the bulls since, in their opinion, the dynamics of the couple reflects only the adjustment of the positioning of market participants, rather than a fundamental change in the outlook for the US currency.
Mario Draghi's speech last week clearly wore a soft character, while the Federal Reserve expressed growing confidence in the stability of economic growth.
The differential in yields on short-term US and European bonds narrowed somewhat, but remained in the range of the last few weeks, so the prospects for further growth of the single currency seems questionable, say analysts. They remain bearish in terms of the couple and believe that current levels do not correspond to fundamentals.

The Nikkei fell due Trump policy

Japanese stocks fell on Tuesday, as the protectionist stance of US President Donald Trump on trade has excited investors, while the bonds of the banks showed the worst dynamics due to falling profitability of US and global government bonds.
Nikkei fell by 0.6 percent to 18.787,99 points, the broader Topix index slowed by 0.6 percent, ending trading at 1.506,33 points.
Banking shares have lost 2.3 percent, showing the worst dynamics among the sub-indices on the Tokyo Stock Exchange. Shares of exporters also declined due to the strengthening of the yen, which is close to a two-month peaks.

Thursday, 19 January 2017

Goldman advised to use strengthening of the pound for sales

The pound has clearly demonstrated this week that is among the major currencies, analysts say. First, published on Saturday and Sunday article in the Sunday Times, which refer to confidential sources, said that British Prime Minister Theresa May in a statement categorically said that the country is out of the EU single market.
As a result of an increased risk of difficult Brexit, the pound fell. In reality, however, in her statement on Tuesday Theresa May said she wanted a soft option, stating that the procedure for the final vote for Brexit will be voted by parliament, and lack of access to the EU single market for goods and services will be replaced by new contract, the analyst added.

Wednesday, 18 January 2017

BTMU don't believe in sustainable growth of the yen

BTMU currency analysts expect that the yen will lose up momentum for next month. The yen has stabilized after receiving support from the press conference of the newly elected US president Donald Trump which focuses on strengthening the protectionist trade policy.
The correction of the yen so far this year has been relatively small compared to its sharp decline, seen at the end of last year, analysts say. At this stage the bank analysts believe that the weakening of the yen is likely to be temporary and will be seen only in the short term. This will require a reversal in terms of initial optimism, the analyst added.
After Trump took office there was a rally. For comparison, the wave of optimism of investors who welcomed the introduction of Abenomics at the end of 2012, continued until 2014, experts write.

Lloyds Bank: In December EUR/GBP could fall to 0.83

In recent months, EUR / GBP is consolidating widely. Following the recent ECB decision to extend the quantitative easing program, while reducing the monthly volume and to expand the list of instruments suitable for the bank, the pair fell significantly. Then the pair resumed growth amid worsening of fears about tough Brekzit, analysts say. Currently EUR/GBP is trading significantly higher, they added.
According to the bank's analysts forecast for this year, the ECB and the Bank of England will not change interest rates, so the differential factor will have a serious impact on the pair. The main driving forces for its movement will become political events in Europe, elections in the Netherlands in March, in France in April-May, in Germany - probably in September and possibly Italy, analysts say. According to their forecasts, in December this year EUR/GBP will fall to 0.83.

Tuesday, 17 January 2017

Commerzbank don't exclude growth of the euro to 1.1039

Technical analysts at Commerzbank believe that the EUR/USD can still test the zone around 1.0820. They say that EUR / USD pair has risen and now trades around 1.07, which is the maximum of the recent upwards movement, then the market fell into a phase of correction, analysts say.
Currently, they do not exclude the test of 1.0820, which is 50% correction. Elliott waves are contraversial. There is a risk of growth to 1.0875, which is a peak of December. At this stage analysts can not exclude even rise to the 200-day moving average at 1.1039.
The market would maintain its support in the near future over 1.0450. In a case of breakthrough the attention will be directed back to 1.0372/40 which are recent minima. Analysts expect that closing below 1.0372/40, which is minimum from mid-December 2016 will lead to a new wave of significant reduction.

National Australia Bank: We should not expect extraordinary results from the Australian Dollar

In recent days, the Australian dollar moved up strongly, and today finally bulls managed to break the field of defense in the seventy-fifth digit. The mood remains positive and now after a pause investors are interested in buying at dips.
Analysts at National Australia Bank remind that the long-term trend remains downward. However, in recent weeks it is seen a number of positive changes, suggesting the possibility of more severe corrective phase. Thus for the stabilization of the price a good sign was the passage above 0.7150/00, and the formation of three ascending candles on the weekly chart is a bullish signal.

Sunday, 15 January 2017

Recommendations of UOB for the pound

The pound remains bearish with the potential for a possible test of 1.20, according to currency strategists at UOB. They say that the pound has been pushed down to the support at 1.2100 and reached 1.2038, having previously turned to growth, to test the strong resistance at 1.2250 (maximum 1.2273), analysts say.
The upward movement seems to be underway and while testing again 1.2270/75 will not cause surprise, the next major resistance at 1.2300 is likely to hold the attack of bulls, analysts say.
Earlier, the pound has broken through the strong support at 1.2085/90 (minimum 1.2038) but the downward movement was quickly replaced by recovery. While the level of 1.2290 remains intact, another wave down to 1.2000 can not be excluded, they added. Those who have short positions should consider partial profit taking near 1.2005/10, write experts.

Comments from Fed officials reduced the depreciation of the dollar

The dollar managed to recover some of its lost positions, supported by the comments of some members of the Fed. On Friday morning the dollar fell more than one percent.
Kaplan and Harker, two presidents of the Fed expect the central bank to raise interest rate three times this year. Meanwhile, Evans believes that the US central bank will raise interest rates twice this year. A positive signal came from the data on applications for unemployment. For the week ending on January 7 their number is 247 000. The expectations of analysts were for 258,000.
Despite the positive news the dollar failed to get out of negative territory and finished the day with a decline. The dollar index slid by 0.4 percent to 101.19 points.

Saturday, 14 January 2017

Decrease of indexes in Europe

At the end of the week, the German DAX 30 continued to show high levels of volatility, as on Friday scored the biggest price change, but this time in a negative direction - it lost lost 1.07% of its value, closing at the level of 11,521.04 points. Sectors that lost the most during the day were: Pharmaceuticals and media and the companies that registered the largest decreases in the value of their shares were Deutsche Bank AG (-3.46%), Bayerische Motoren Werke AG (-2.96%) and Daimler AG (-2.80%).
France's CAC 40 also fell, closing at a level of 4863.97 points, but it was significantly lower than in the stock exchange in Frankfurt - only 0.51%. Companies that have achieved the greatest decrease were: ArcelorMittal SA (-3.40%), Sodexo (-3.24%) and Renault SA (-2.60%).
Britain's FTSE 100 followed the continental trend, but managed to keep most of its value - losing only 0.03%, closing at 7292.37. Losses were realized by manufacturing sectors of food, pharmaceuticals and biotechnology.

Thursday, 12 January 2017

The euro/dollar has reached resistance

On Thursday trading in Europe, the US dollar continued to fall in price to its competitors. The euro/dollar initially extended consolidation area to the level of 1.0665, the price corrected from there to 1.0620. Then, supported by EUR/GBP cross pair buyers went on the offensive position and pushed the session high at 1.0685. Opposite fluctuations in the euro/dollar was caused by anticipation of the publication of minutes of meetings of the ECB.
Pound/dollar during the European session, rebounded to 1.2316, which was followed by a 38% correction of the upward movement from 1.2168.
After the press conference of Donald Trump, which was held January 11, demand for US bonds has risen. In this regard, they reduced yields and the US dollar depreciates. Now the focus is on the speach of the US Federal Reserve Chairman Janet Yellen, which will be held on Friday at the start of the Asian session, at 06:00 GMT.
EUR/USD reached a resistance. Toward the close of the European session, the Euro is expected corrective phase in the region of 1.0630. If this level can stand up to the European session on Friday, we could expect the next updated week high.

Wednesday, 11 January 2017

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Sunday, 8 January 2017

Societe Generale: Speculative actions may contribute to the weakness of the pound and the euro in the first quarter

Looking at data on speculative positioning, analysts of the bank are wondering how quickly long positions in the yen have become short positions, the amount of these short positions is now greater than that of long positions during their peak last year. Not surprisingly, last week USD/JPY can not continue to grow, analysts say.
This event contributes to the growth of speculative long positions in dollars, but their current size is not worrisome, analysts say. At the same time, a liquidation of speculative short positions in pounds and euros is observed, which can contribute to the weakness of these currencies in the first quarter of the year.

Friday, 6 January 2017

SEB: What to do with EUR/USD in two hours?

Currency strategist at the SEB carefully studied the history of the behavior of EUR/USD in the first day after the publication of the minutes from the FOMC meeting and recommend to do the following:
- Keep track of the dynamics of the couple in the first three hours after the event. If at that time EUR/USD is trading higher than the day before publication, buy and hold position one day;
- If EUR/USD is trading lower than the day before publication, sell and also hold the position just one day.
In the bank noted that the in period since 2010, this system has generated 84 signals, 52 of which (62%) worked in plus and brought an average gain of 0.5%. The average loss for the rest of the signals is 0.4%. Maximum profit is 1.6% and the maximum loss - 1.4%, analysts say.

Scotiabank: EUR/USD should stay above 1.0167 dollars

Despite the two-day rise in EUR/USD short-term technical indicators of the bank remain the sword territory. From there the pair have underestimated the possibility to develop upward correction, but doubted its continuation.
A return below 1.0485 dollars will return bears full control over the situation.
Calculations of the bank shows that EUR/USD should be worth in excess of 1.0167 dollars.
On Friday the euro lost some positions against the dollar after US NFP data showed, that the average hourly wages has grown unexpectedly.

Thursday, 5 January 2017

Growth in US stock markets after the minutes of the Federal Reserve

From the Fed protocol it became clear that the first increase in interest rates in a year was approved mostly because of market reaction after the presidential election and the expectations for an aggressive fiscal policy.
On Wednesday, the major indexes closed session overseas on green territory after minutes of the Fed was released. Although the name of the president-elect is not mentioned in the transcript, the impact of the vote on the markets and the economy seems to have been discussed.
Dow Jones Industrial Average rose by +0.30% closing at 19942.16. Broad S&P 500 rose by +0.57%, closing the session at 2270.75 points.
The technological Nasdaq added +0.88% and closed at 5477.07 points.

The rise of the euro

Good data from the eurozone helped the euro and the single currency took back territory against other major currencies.
Published data on unemployment in Spain (reduced by over 86 000 in expectation of 44000), PMI index of services for four major EU economies - Germany, France, Italy (only here a negative divergence forecasts: 52.3 against 52.7) and Spain as well as the overall index for the EU (53.7 in forecasts for 53.1), gave major impetus to the growth of the euro during the day.
Preliminary information about the consumer price index for the EU was also positive (1.1% against expectation of 1%), but it was unable to give further acceleration to move up. This happened in early US session - during the first hour EUR/USD added 25 pips to its value.
By 20:00 GMT EUR/USD is trying to break 1.0600 level.