Daily Market Analysis | HotForex

HotForex_Broker · October 14, 2015, 9:29am

TODAY’S CURRENCY MOVERS

EURUSD, Daily

EURUSD daily price has been in a momentum driven mode since clearing to the upside the previous resistance now turned support (1.1280) level. This upward momentum on price has been done on the back of mostly disappointing Eurozone data; however, the market has interpreted last week’s release of the U.S. Feds FOMC meeting minutes as a reason to sell off the USD, therefore, proving short term support for the EUR. Moving forward, stochastic oscillator analysis is starting to look overextended, indicating that momentum may start to slow. Price is also nearing the 260 period (1 year) SMA leaving me with the technical view that the EURUSD remains at risk for a fall towards the 1.1280′s, unless we see a clean break above the 1.1460′s that could open up the way for the 1.1530′s.

On Tuesday, we saw that the German ZEW investor expectations drop was much more pronounced than anticipated, with optimists only marginally outnumbering pessimists now. The index has been falling steadily since March and the decline in investor sentiment clearly reflects growing concerns about the health of the global economy and the impact of slowing growth in emerging market economies on advanced countries. The expectations index for the U.S. dropped sharply in October, and the reading for the Eurozone also declined. The German ZEW decline was not a total surprise in the wake of the VW emission scandal, the refugee crisis and, of course, uncertainty about the global growth outlook.

Global stock markets were weaker on Tuesday, as disappointing trade news from China continues to influence investor sentiment, and signs of disinflation from Europe. Also, profit taking on U.S. markets added to the selling pressure after the Dow Jones posted a 7-week high last week.

HotForex_Broker · October 15, 2015, 5:22am

EURJPY FAILED TO CHALLENGE THE CHANNEL TOP

EURJPY, Weekly

After swinging strongly at the end of 2014 and in the first part of this year EURJPY is moving sideways with a slight downside slope. Price has struggled this week to move higher due to a weekly pivotal candle low at 137.06. The level also coincided with an almost flat 50 week SMA, which highlights the sideways nature of this market. Stochastics is reflecting this by moving sideways near the 50 point mark. The major weekly support and resistance levels are at 132.19, 133.17, 137.06 and 139.04.

EURJPY, Daily

After rallying higher last week, the pair has been trading sideways for the last three days. The loss of upside momentum was due to several technical factors. The upside was limited by the upper Bollinger Bands but also by 100 period SMA. Furthermore, these coincide with declining channel top and a pivotal high from September 17th. Stochastics rolling over near the overbought territory was another signal to focus on the short side. Support and resistance levels in the daily chart are 135.35 and 137.08 while lower Bollinger Bands coincide with a pivotal support area between 133.43 to 134.25.

HotForex_Broker · October 15, 2015, 9:03am

TODAY’S CURRENCY MOVERS

EURUSD, Daily

EURUSD daily price is currently testing the upper end of my predicted price path range (1.1090 – 1.1460). Ideally, a solid close above the 260 period SMA (1 year moving average) could indicate a possible trend reversal on the EURUSD. The next major daily resistance is now at 1.1560, however there still remains the possibility of a failed upward break that could shift the control back to the short sellers for a retest of the 1.1340′s , 1.1280′s and the 1.1090′s in extension. From a technical standpoint the EURUSD continues to look overextended, the technical trader should be reminded that just because the stochastic oscillator is in overextended territory that does not indicate an immediate fall in price, on the contrary, it is not uncommon that in a strong uptrend that an oscillator could remain overextended while price continues to advanced. My conclusion for short term traders is to add long positions on dips for targets between the 1.1460’s and 1.1560’s.

In the event that the ECB can not meet its inflation objective, the European Central Bank may make a move to extend QE, according to the Bank of Spain deputy governor Restoy.

Crude overnight hit near $45.90, down from yesterday’s $46.91 peak , crude moved lower after the close on Wednesday, as the API reported a huge 9.3 mln bbl weekly stock build, the largest in six-months. Some of the inventory rise was attributed to falling refinery operating rates, as API reported a 5 mln bbl fall in gasoline supplies for the latest week.

Stock markets have been moving higher as weak economic data continues to hit the news wires, with U.S. negative data on ex-auto retail sales and PPI, a deterioration of Japanese manufactures, and the unexpected dip in Australian employment all giving some relief for stock investors since it adds to the possibility of a delay in a U.S. interest rate raise, while increasing the risk that the ECB will proceed with additional QE in order to boast the Eurozone.

HotForex_Broker · October 16, 2015, 4:37am

EURUSD UPDATE

EURUSD, Daily

EURUSD sold off in the wake of mixed U.S. data that highlighted a 40 year low in U.S. jobless claims, slightly better core CPI reading, and a small improvement in the Empire State index. The EURUSD market sell off yesterday was a standard knee jerk reaction to the headline positive jobless claims, which saw renewed interest in buying the USD. Technically, the sell off was expected, as momentum indicators have been signaling that buying interest in the EURUSD has been slowing with the stochastic oscillator reading as overextended. Price now sits around the 1.1370′s, and I expect this area to hold, unless today’s U.S. release of the UoM Consumer Sentiment comes in above expectations. The 1.1370′s also happens to be the 38.2% Fibo from the July low (1.0808) – August High (1.1713), so I would expect price support around current levels. My conclusion for the short term trader is to add long positions above 1.1370 for targets between the 1.1460′s and 1.1560′s.

HotForex_Broker · October 16, 2015, 7:15am

MACRO EVENTS & NEWS

FX News Today

Bund futures are outperforming and yields heading south, while Eurozone spreads narrow, as weak inflation numbers bolster hopes of further ECB easing. Pressure on Draghi to at least set the stage for a widening or extension of the QE program next week are mounting amid the uncertainty about the global growth outlook. Nowotny’s comments yesterday that even core inflation is clearly below target further fuelled speculation of additional measures, although the Austrian central bank head called for structural reforms rather than hinting at ECB action.

The Eurozone posted trade surplus of EUR 19.8 bln in August, down from EUR 22.4 bln in the previous month. Exports were up 6.0% y/y in August, versus nominal import growth of 3.0% y/y, although considering that lower oil prices are suppressing the nominal import bill, real import growth will have been higher.

Eurozone final CPI was confirmed at -0.1% y/y, in line with the preliminary number and down from 0.2% y/y in the previous month. The breakdown confirmed that the drop back into negative territory was driven by a sharp decline in energy prices, which were down -1.7% m/m and -8.9% y/y, versus -7.2% y/y in August. Core inflation remains much higher at 0.9% y/y, but as Nowotny highlighted yesterday, this is also considerably below the ECB’s 2% limit for price stability. So more arguments for the doves at the ECB although the amount of stimulus in the system is already substantial and while central bankers want to keep markets happy they also seem wary of additional action, especially as monetary policy alone can’t fix the Eurozone’s problems.

Main Macro Events Today

Canada Manufacturing: We expect shipments, due today, to tumble 1.5% m/m in August after the 1.7% gain in July. A 3.6% plunge in exports values provides a compelling reason to forecast a pull-back in manufacturing shipments during August.

US Industrial Production: September industrial production data is out Friday and we expect a 0.2% (median -0.2%) headline decline for the month which follows a 0.4% decline in August. This would bring capacity utilization down to 77.3% from 77.6% in August. The September employment report was weak and we saw declines in hours worked as well as employment in both manufacturing and mining which will likely weigh on the release.

US Michigan Consumer Sentiment: The first release on Michigan Sentiment is out on Friday and should reveal a headline increase to 89.0 (median 88.4) from 87.2 in September. The already released IBD/TIPP poll for October improved to 47.3 from 42.0 in September and the Bloomberg Consumer Comfort survey is poised to average 45.0 for the month.

HotForex_Broker · October 16, 2015, 8:40am

TODAY’S CURRENCY MOVERS

AUDUSD, Daily

As expected the pair rallied from the 0.6938 support. AUD has now been trading at resistance and just recently failed to stay above the daily Bollinger Bands. The 100 period SMA has been limiting the upside in the occasions while the September pivotal high at 0.7280 has been supporting price yesterday and today. Price is now trading at 0.7263. A close below 0.7266 would make yesterday’s candle a pivot and a lower high. This looks likely. A break below 0.7200 would open a way to the 0.7020 support. If 0.7200 fails to support price look for reversals in 0.6938 – 0.7020 range for long trades and 0.7344 - 0.7382 for short trades.

HotForex_Broker · October 19, 2015, 5:32am

TODAY’S CURRENCY MOVERS

AUDUSD, Daily

AUDUSD 5-day change is lower against other major currencies in what seems to be a pause in the recent price rally from the September 29th low (0.6936) to the Oct 12th high (.7380). Daily technical observations spots a bullish 10,50 SMA cross, consecutive higher tops and bottoms on price from September 4th – October 12th (0.69 L / .7380 H ) and the fact that current price is trading above the 10,50 SMA brings me to the conclusion that price remains in a short term uptrend. If today’s low on price holds above the 0.7230 area this could create a lower top above last week’s low (0.72) that may open up the way towards 0.7380; my ultimate short term price objective near 0.7440. However, traders should be on alert for any break below the 0.72 support that may support a deeper price retracement from the September Low to October’s current high with relevant support in this case spotted around the 0.71-0.7110′s.

HotForex_Broker · October 20, 2015, 5:36am

TODAY’S CURRENCY MOVERS

AUDUSD, Daily

The pair is trading in a triangular formation near a descending regression channel (drawn from July 30th high). There was a close below 0.7265 low but no downside momentum or follow through. This suggests that price that the September pivot high is likely to support prices over the coming days and market is likely to eventually push higher from its support. The sideways movement might therefore continue. Last week’s high and low are key levels to look at. The nearest resistance levels are at 0.7364 and 0.7382, two pivotal highs that coincide with the upper Bollinger Bands and a 100 period SMA. Price should move to these highs and could turn lower from there in which case the 0.7260 support should work as an initial target for shorts. If price breaks out of the sideways formation the Fibonacci extension levels at 0.7471 and 0.7640 could come into play. The latter one coincides with a historical resistance level and is therefore more significant as a resistance level. In case the last week’s low gets violated the weekly high at 0.7085 should work as a target level.

HotForex_Broker · October 21, 2015, 4:12am

TODAY’S CURRENCY MOVERS

EURAUD, Daily

EURAUD Daily, the AUD has given back some recent gains against the majors over the last few trading sessions, leaving the outlook for the AUD to continue a narrow trade range as concerns about inflation subside, while commodities seek out a bottom. Technically, the Daily EURAUD observations include: bearish 10,50 SMA crossover spotted, price trades within a downward slopping trend channel, and stochastic oscillator indicates positive upward momentum. My conclusion for the Daily supports long positions with a price target near the 1.5840 inside swing area.

HotForex_Broker · October 23, 2015, 4:30am

MACRO EVENTS & NEWS

FX News Today

The EURUSD pair dropped nearly 240 pips yesterday while EU stock markets jumped on the comments from the ECB president Mario Draghi that the European Central Bank is “committed to further easing”. Traders took this comment as a clue that the ECB is not happy with having a strong currency in the current Eurozone economic environment. The EURUSD Asia session reached a low at 1.1072. EURJPY dropped into a multi-week low, and the EURGBP has broken its 100-day moving average at 0.7213, trading on the downside side of this average for the first time since late summer. Since it is now clear that the ECB is fearful of a stronger EUR, the EUR is likely to stay under general pressure. However, the EURUSD price may bounce a bit before any test of 1.1000 round number.

The ECB’S comments yesterday sparked a rally on stock markets that continued in both Asia and U.S. stock markets. Further gains in Europe stock markets looks likely as the ECB prepares for additional easing measures.

Main Macro Events Today

• EUR Market PMI: French, German Composite PMIs surprise on the upside. France reported a slight improvement in the manufacturing PMI to 50.7 from 50.6 and a rise in the services reading to 52.3 from 51.9. Germany meanwhile saw a slight decline in the manufacturing number to 51.6 from 52.3, but a jump in the services reading to 55.2 from 54.2. The latter left the composite at 54.5 up from 54.1 in September. In France the composite improved to 52.3 from 51.9, indicating acceleration in overall economic activity against expectations for declines in both countries.

• CAD Consumer Price Index: It’s expected CPI to expand at a 1.2% y/y pace in September, a slowdown from the 1.3% y/y clip in July and August. CPI is seen as flat on a month comparable basis in September after the identical flat reading in August. Gas prices plunged 7.5% in September compared to August, which is expected to weigh on month comparable CPI. The BoC’s core CPI index is seen rising 0.3% in September, a bit stronger than the usual 0.2% gain seen during the month as currency weakness provides and extra boost. Annual core CPI growth is expected to expand at a 2.2% y/y rate in September following the 2.1% clip in August. The expected core CPI figure would, of course, leave the measure at the BoC’s 2.0% midpoint. However, Governor Poloz has maintained that run-up is transitory and not reflective of a tightening in supply conditions.

• USD Market Manufacturing PMI: Consensus calls for a 52.8 number vs the previous 53.1. The macro data continues to face headwinds from an inventory overhang and a petro-sector recession, even though housing, the labor market, and real consumer spending continue to improve.

HotForex_Broker · October 23, 2015, 6:56am

TODAY’S CURRENCY MOVERS

ECB Prepares Ground For December Easing. The ECB did what markets wanted and laid the groundwork for further easing measures in December. The question seems to be not if, but which measures the central bank can take to bring inflation back towards 2%, with the possibility of a deposit rate back on the table. Yields came down and the curve flattened from the short end, on the indication that the cut off point for negative yields under the QE program will be lowered further. The reliance of markets on ECB measures is increasing and what were initially exceptional measures becomes quickly the new normal.

EUR pairs are trending lower. Over the last five days euro has lost some ground across the board but the single currency has also been losing ground over the last month especially against the commodity currencies (AUD, CAD, NZD). In this report we will take a look at euro performance against them to reveal the concerted sell off in the currency. We will also identify the major support and resistance levels in these markets.

HotForex_Broker · October 26, 2015, 4:59am

ECONOMIC WEEK AHEAD

Main Macro Events This Week

• United States: FOMC meeting is scheduled for Wednesday. No changes are expected at this week’s FOMC meeting, especially after China’s rate cut and further QE comments from the ECB last week. The markets are not pricing in much chance for hike until perhaps after March. If Fed policymakers were worried about growth and prices at last month’s meeting, they can not be encouraged by the recent downbeat developments about global growth. The firming in the dollar will only make it more difficult for the FED Committee to be confident in meeting its price mandate anytime soon too, which likely rules out action at the December meeting. Economic data this week will show an economy that continues to expand, but at a slower pace in Q3 as the Advance Q3 GDP release is seen slowing to a 1.7% pace from the 3.9% growth rate in Q2. Another weak durable orders report is projected: September orders are seen falling 1.0% after the 2.3% drop in August. The ECI will accelerate to a 0.6% growth rate in Q3, according to the survey median, from the 0.2% gain in Q2.

• Europe: A heavy data week in the Eurozone that will focus on October confidence readings and preliminary inflation numbers. PMI readings came in better than expected, which means there is some room for upside surprises. French and Italian PPI, German import prices, German retail sales, French consumer spending and Italian business confidence. The German Ifo Business Climate (Monday) is seen falling to 108.1 (median 107.8) from 108.5, led by a drop in the current conditions indicator following the slump in orders. Eurozone ESI Economic Confidence (Thursday) meanwhile is expected to ease slightly to 105.3 (median 105.1) from 105.6 following the mixed leads from better than expected PMI reading and the marked drop in the preliminary consumer confidence figure. The latter is likely to be followed by another decline in German GfK Consumer Confidence to 9.4 (median same) from 9.6.

• United Kingdom: This weeks U.K. data brings the October CBI industrial trends survey (Monday), the first estimate of Q3 GDP (Tuesday), the monthly batch of BoE lending data (Thursday), the CBI distributive sales survey (also Thursday), and, finally, the October Gfk consumer confidence survey (Friday). The main market focus will be clearer picture of moderate growth in Q3, strong mortgage lending and rising lending to businesses, along with an uptick in consumer confidence. It is also anticipate that the CBI surveys will show some moderation, correcting in the case of the sales sector poll following a very strong number in September.

• Japan: Japan month end data could set up the for the BoJ to consider its next QQE stimulus on Friday, following the ECB and PBoC rate cuts. Bank of Japan data this week includes, retail sales, personal income and consumption, and employment data. September services PPI (Tuesday) is expected to ease to 0.6% y/y from 0.7%. September retail sales (Wednesday) are forecast to fall to 1.0% y/y from the prior 1.8% for large retailers, and dip to 0.5% y/y from 0.8% for total retail sales. The balance of the calendar comes on Friday, and includes September national CPI, expected to fall to -0.1% y/y from 0.2% on a headline basis, and to -0.3% y/y from -0.1% on a core basis. October Tokyo CPI is seen unchanged at -0.1% y/y for headline, and unchanged at -0.2% for the core reading. September unemployment is seen steady at 3.4%, as is the job offers/seekers ratio at 1.23. September personal income is forecast at 1.0% y/y from 2.2% previously, with PCE expected to fall to 1.0% y/y from 2.9% in August. September housing starts are penciled in at a 4.0% y/y rise, from 8.8% in August. September construction orders are also due. The BoJ meets Friday, and following China’s lead last week, it’s expected that the Bank to increase its prior JPY 80 tln QE efforts to JPY 100 tln, taking the monetary base target to JPY 345 tln from JPY 325 tln.

HotForex_Broker · October 27, 2015, 3:58am

MACRO EVENTS & NEWS

FX News Today

Greek bailout payment delayed, Greece is once again behind in the implementation of the agreed reforms and so far only 14 of the 48 “milestones” have been implemented. A delay of the reform plan and the payout likely also means a delay in the reform of the banking and finance system, including the recapitalization of banks.

Commodities were on the defensive, but the CAD was range bound near 1.3160 since the open. The lack of price action came as oil prices were steady near $43.5 – $44.00 and as the risk backdrop remains quiet.

Gold been relatively steady, following last week’s dollar rally inspired sell-off. Gold traded near the two-week low under of $1,160/ounce on Friday, and currently trades at $1165. Copper meanwhile, topped out at $2.381/lb earlier, and have since fallen back to $2.351, with softer U.S. home sales data weighing. Copper remains up on the session.

USDJPY given back some gains, the pair has gained considerable ground since last week, as the dovish ECB and the aggressive PBoC combined to rally the dollar broadly. With the China rate cut having many market players up the BoJ’s ante to add to QE this week, USD-JPY gains may well hold.

Main Macro Events Today

• GBP U.K. Gross Domestic Product: U.K. GDP numbers for Q3, with the quarterly growth rate expected to slow to 0.6% (med same) from 0.7%.

• USD Durable Goods Orders: September durable goods data is out today and should reveal a 0.8% (median -1.0%) decline for orders on the month with shipments unchanged and inventories growing by 0.1%. This compares to respective August figures of -2.3% for orders, -0.2% for shipments and unchanged for inventories. Data in line with analyst forecast would leave the I/S ratio for the month at 1.66 from 1.65 in both August and July.

• USD Consumer Confidence: October Consumer Confidence is out today and should reveal a 104.0 (median 102.8) headline, up from 103.0 in September and 101.3 in August. Other confidence measures have improved in October with Michigan Sentiment rising to 92.1 from 87.2 and the IBD/TIPP Poll rising to 47.3 from 42.0.

HotForex_Broker · October 27, 2015, 6:29am

EURUSD UPDATE

EURUSD, Daily

EURUSD failed to hold above its weekly uptrend line on a clean break below the 1.11 resistance. Now that the 6 month uptrend-line has been lost, we need to see if the 1.0990 low, as seen last week, will be retested before price makes an attempt towards 1.11 and possible 1.1170 in a return move. Momentum analysis remains towards the downside, although, I would expect to see some short term buying interest if the Stochastic can create a bull cross near the Stch.Os. 20 line. My multi-day conclusion on EURUSD price action is for a retest of Friday’s low (1.0996) before a return move towards 1.11 –1.1170.

HotForex_Broker · October 28, 2015, 7:04am

TODAY’S CURRENCY MOVERS

The AUD is broadly weaker against the majors in the wake of disappointing CPI data.
The CAD is higher even though the BoC’s Lane did not offer anything new on policy or the economy, as expected.
The USD, EUR and GBP are mostly unchanged ahead of today’s start of the FOMC meeting.

AUDUSD, Daily

Price looks to retest .7160 before continuation of its downtrend for a 0.7162 target in the immediate short term. Price has broken down through recent lows at .7200. Targets further out could be near 0.7100 and 0.7020. However attempts to form a higher low near 0.7260 could signal a potential recovery towards the .7400′s.

USDCAD, Daily

Stochastic Oscillator analysis is starting to turn bearish. The medium term risk of a deeper retracement of the May to September 1.1922-1.3454 advance to a minimum of 1.2658-88 and possibly 1.2507-61 is possible; provided we get a solid break below the recent upward trend line. The longer-term trend does remain up. However, for the short term daily trader, I would expect any downward movement to stop near the 1.3180 – 1.3045 levels.

John Knobel
Senior Currency Strategist

HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HotForex_Broker · October 28, 2015, 9:03am

Silver is showing short term bullish clues

Silver (XAGUSD), Daily

Silver is showing short term bullish clues as it retraces the May High (17.760) August low (13.96) down trend. Silver price now looks to be consolidating in a bullish pennant pattern. Moving average analysis spots a bull cross of the 10, 50 SMA with current price testing the yearly moving average. Stochastic Oscillator analysis confirms bullish momentum. Technically, long positions can be supported for a price objection near resistance level R1 (16.80). Alternatively, any price break below the bullish pennant may call for a test of support level 14.70. Traders should now be on alert for a breakout trade set-up in either direction; however, the bias does remain to the upside.

HotForex_Broker · October 29, 2015, 4:55am

MACRO EVENTS & NEWS

FX News Today

FOMC hints of a hike as early as the next meeting, while maintaining the policy holding pattern, the Fed tone was a little less dovish than anticipated as it downgraded concerns over “global economic and financial developments. Yesterday’s FOMC repeated the economy continued expanding at a moderate pace, while leaving policy unchanged at 0%. The tone of the statement, however, is a little less dovish than expected as the Fed removed worries over global developments from its comments. Also the FOMC said “In determining whether it will be appropriate to raise the target range at its NEXT meeting, which suggests some risk for a December rate hike. On the other hand, the Fed downgraded its outlook on jobs, saying the pace of gains has slowed and the unemployment rate has been steady. The FOMC also remains boxed in via its data dependency, because if growth and inflation continue to slow it will be difficult to argue for a December rate hike keeping the markets guessing for at least another month.

The USD is stronger, in the wake of yesterday’s FOMC Fed statement, which has been generally accepted as leaving the possibility of a rate hike in December on the table the EUR has generally weaken off the news. The EURUSD is now bouncing of 3 month lows (1.0890′s).

Japan industrial production rose, 1.0% m/m in the preliminary September report after falling 1.2% m/m in the final August reading. On an annual basis production fell 0.9% y/y after the 0.4% drop in August. Both results were better than expected, with the month comparable gain contrasting with projections for a decline. The improvement tempers the case for further BoJ easing this week.

Crude Oil is up, moving from near $43.50 at the open to highs near $45 ahead of the EIA inventory data, and later to $45.96 highs following a smaller than expected inventory build. A large systematic buy order was reportedly responsible for the early rally, which was fueled by stop-loss buying over the $44 level. The October 22 peak of $46.10 marks the next resistance level.

U.S. advance trade report showed a narrowing, in the deficit to $58.63 bln , for September, unwinding the surge to -$66.60 bln in August from -$59.8 bln in July. Imports declined 2.6% last month following a 1.8% increase in August, while exports rebounded 2.4% after falling 3.1% previously. Data will help fine tune estimates for the upcoming September trade report, due November 4, and suggest narrowing from the $48.3 bln shortfall registered in August.

ECB’s Coeure hints at further easing measures, deposit rate cut discussed. The executive board member said in a speech last night that if the ECB sees “a risk that inflation would go back to 2% much less quickly or in a much more sluggish way than previously expected, that would imply that the de facto real interest rate at this level would be higher”. He added that adjusting the deposit rate is “an open discussion, but its a discussion that has started”. Further confirmation then that the ECB may add further easing measures at the December meeting, when the adjusted set of economic forecasts is also due.

Main Macro Events Today

• EUR Eurozone Prelim CPI: Eurozone preliminary HICP inflation for October, Germany and Spain will release national numbers today. It’s expected German HICP to rise to 0.1% y/y (median same) from -0.2% y/y and the Spanish harmonized rate to lift to -0.9% y/y from -1.1% y/y. Still very low numbers that will keep the doves at the ECB calling for further action in December.

• USD GDP: Analyst expect Q3 GDP growth of 2.0% in the advance report, following 3.9% growth in Q2.Forecast risk: downward, given the potential for a bigger estimated inventory drawdown. Market risk: downward, as a weaker report could delay the Fed rate hike. Final sales growth is pegged at 3.5% in Q3, from 3.9% in Q2. Consumption growth is estimated at 3.6%, versus the same 3.6% in Q2. Fixed investment growth should rise to a 5.5% rate in Q3 from 5.2% in Q2. Equipment spending should expand at a 4.0% pace in Q3 from 0.3% in Q2.Residential construction growth is projected at 12.0% in Q3 from 9.3% in Q2. The intellectual property component should grow at a 5.5% rate in Q3, versus a 8.3% in Q2. Government spending should grow at a 0.8% rate in Q3, after a 2.6% rate in Q2. The chain price index should grow 0.8% in Q3, following a 2.1% Q2 pace. It’s expected that Q4 real GDP growth of 2.5%, with a 0.4% chain price gain.

• USD Initial Jobless Claims: U.S. initial jobless claims are expected to be 268k (median 263k) in the week-ended October 24. Continuing claims are expected to fall to 2,160k for the week-ended October 17. Forecast risk: downward, as volatility concerns could give businesses pause. Market risk: downward, as weaker than expected data could delay rate hike expectations. The 262k mark in the 4/25 release marked the lowest reading of the decade. Claims had been following a volatile downward trajectory since early October of last year. Claims are poised to average 262k in October from 269k in September, 275k in August and 272k in July. Claims revealed monthly averages of 310k-356k in 2013.

John Knobel
Senior Currency Strategist
HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HotForex_Broker · October 29, 2015, 10:06am

TODAY’S CURRENCY MOVERS

• USDCAD rallied over 1.3220 from 1.3095 following the FOMC announcement, the commodity backdrop didn’t help the CAD either, as oil prices pulled back from $46 to $45.34 lows, and gold dropped from $1,178 to $1,162 on fears of a December Fed rate hike.

• The USD gets a boast of strength, in the wake of yesterday’s FOMC Fed statement, 1.1000 now marks a minor resistance zone.

• The AUD is broadly weaker, as the RBA is expected to refrain from cutting rates at its November policy meeting next week, according to the latest Reuters survey of economists. 17 of the 21 respondents expect a no change announcement, while the remaining four anticipate a 25 bp rate cut.

EURUSD, Daily

EUDUSD, remains below its weekly uptrend line, and is now bouncing off the July 20th low (1.0807). Intra-day, a small price rebound hit a high of 1.0976, and then turned back under 1.0960. The intra-day move higher coincided with an unexpected rise in the Eurozone economic confidence index. The EURUSD declined approximately 550 pips since mid October, after ECB’s president Mario Draghi announced expansion for QE program and Fed’s decision for no change regarding interest rates.

EURAUD, Daily

EURAUD key support at 1.56 broke to complete a short term top. The latest bounce may seek to leave a lower top near 1.56 ahead of a deeper drop towards 1.5190. Bearish moving average cross of the 10,50 SMA is spotted, price is below the tentative downward slopping trend line. Downward price momentum has turned bullish. EURAUD is expected to retest the key resistance level at 1.5600 and to continue its downtrend.

John Knobel
Senior Currency Strategist

HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

HotForex_Broker · November 2, 2015, 4:47am

ECONOMIC WEEK AHEAD

Main Macro Events This Week

• United States: There are several crucial economic reports this week, including nonfarm payrolls, vehicle sales, ISMs, and trade. The October employment report due out on Friday will be the week’s main event. The unemployment rate is forecast dipping to 5.0% from 5.1% previously, another multi-decade low. Also of importance is October ISM manufacturing figures on Monday and the services data on Wednesday. The manufacturing index is estimated edging up to 50.5 from 50.2 in September, though that’s just barely in expansionary territory. The non-manufacturing index is expected to rise to 57.0 from 56.9 as solid growth is seen accelerating a bit. Vehicle sales on Tuesday are expected to inch lower, however, after strong sales through the summer. Trade figures for September on Wednesday should show sharp narrowing in the deficit to a -$41.5 bln gap, from -$48.3 bln in August, given the drop in the goods deficit posted last week. Q3 productivity on Thursday is seen at unchanged for the preliminary report, from the 3.3% Q2 pace. Unit labor costs should rebound to a 2.5% rate in Q3, versus Q2′s -1.4%. Other data include October ADP private payrolls on Wednesday, construction spending for September also on Monday, September factory orders on Tuesday, and September consumer credit to be released on Friday.

• Canada: Key reports this week from Canada, with September trade and October employment on the schedule. The September trade balance on Wednesday is expected to narrow to -C$1.9 bln in from the -C$2.5 bln shortfall in August. Employment on Friday is expected to improve 10.0k in October after the 12.1k gain in September. The unemployment rate is seen at 7.1% in October, matching the 7.1% rate seen in September. The Ivey PMI on Thursday is projected to improve to 55.0 in October from the seasonally adjusted 53.7 in September. Building permits on Friday are anticipated to grow 1.0% in September after the 3.7% drop in August. The RBC manufacturing PMI for October is due Monday. Results in line with analyst estimates, especially on trade and employment, would be supportive of the Bank of Canada’s constructive view on the growth and inflation outlook as detailed in the October Monetary Policy Report.

• Japan: The October Markit/JMMA PMI on Monday is expected to slip to 51.0 from 51.2. Auto sales are also on tap. The markets are closed Tuesday for the Culture Day holiday. The calendar does not pick up again until late in the week with the BoJ minutes to the October 6, 7 meeting on Thursday. Preliminary September leading and coincident indices on Friday should show the former down 1.3% m/m from the prior -1.5% reading, while the latter is expected to come in at -0.7% m/m from -0.9% in August. In addition, eyes will be peeled for news on a rumored Japanese government special stimulus budget, which made the rounds last Friday following the BoJ’s inaction on the QE front.

• China: The Caixin/Markit series released today improved slightly to 48.3 from 47.2. October services PMI out on Wednesday is likely to improve to 50.7 from 50.5.

• Australia: The calendar for Australia features the RBA on Tuesday, which is expected to maintain the current 2.00% policy setting, although the slowing in core CPI during Q3 revealed last week opened the door to a possible rate cut. As for economic data, the trade deficit on Wednesday is expected to narrow to -A$3.0 bln in September from -A$3.1 bln in August. Retail sales on Wednesday are seen rising 0.3% in September after the 0.4% gain in August. Building approvals on Monday expanded 2.2% in September after the 6.9% drop in August. The RBA’s quarterly Statement on Monetary Policy due out on Friday will update the bank’s growth and inflation projections.

• New Zealand: The calendar features the Q3 employment report on Wednesday. It’s expected for HLFS employment to rise 0.5% in Q3 (q/q, sa) after the 0.3% gain in Q2. The unemployment rate is seen rising to 6.0% in Q3 from 5.9% in Q2.

• Europe: This week’s reports are unlikely to change the macro outlook fundamentally for the Eurozone . The services index is out on Wednesday. Economic activity continues to expand, and on the whole, confidence readings have surprised on the upside in October, which shows the recovery remains on track. German manufacturing orders on Thursday are also expected to have rebounded in September, after falling sharply in August. German industrial production on tab for Friday is seen up 0.4% m/m , after falling 1.2% m/m in August — the September drop in orders likely will prevent a more pronounced rebound. Eurozone retail sales are also due out on Thursday.

• UK: October editions of PMI survey data, along with September production numbers are on tap. There also is the November BoE Monetary Policy Committee meeting (announcing Thursday). An expected uptick in the services index should help stabilize the composite reading. Its expected that the services PMI released on Wednesday to rebound from September’s 29-month low at 53.3, anticipating a 54.4 outcome. The manufacturing PMI today is expected at 51.3 after 51.5 in the previous month. Production data is expected to show a -0.1% m/m dip in the industrial output figure, while the narrower manufacturing number is expected at +0.6% m/m.

HotForex_Broker · November 2, 2015, 7:13am

MACRO EVENTS & NEWS

FX News Today

The GBP is slightly higher, against the EUR and USD after a much stronger than expected U.K. Manufacturing PMI reading. The unexpected jump in the manufacturing PMI, which has lowered the chances that the BoE will remove its implicit tightening bias. Gains against EUR, JPY and USD are modest however.

Eurozone manufacturing PMI, All Eurozone PMI readings apart from Greece are above the 50 point no change mark and even in Greece, confidence is improving further. Still, while the numbers signal a slight uptick in manufacturing output at the start of the last quarter, growth in the manufacturing sector is hardly buoyant and the sector is feeling the strain from the slowdown in emerging market economies, most notably China.

Eurozone stock markets are higher, the FTSE 100 is underperforming and posting slight losses, despite much better than expected PMI readings.

Worries over China’s growth, the official manufacturing PMI held steady at 49.8 in October, disappointing expectations for a bounce back to the 50.0 expansion-contraction line. It’s a third straight sub-50 reading. The non-manufacturing index slipped to to 53.1 from 53.4, still reflecting expansion but is the slowest pace since December 2008.

Greek banks need EUR 14.4 bln recapitalization, the ECB said in its Asset Quality Review, published Saturday, that Greek banks need at least EUR 4.4 bln from shareholders and bondholders to meet the shortfall identified under the current baseline macroeconomic assumptions.

Turkish lira soars, with stocks on Erdogan election success. The currency jumped the most since 2008 according to Bloomberg calculations after Erdogan’s AK Party won the second election this year. This ends months of political deadlock and gave a boost to stocks, as well as bonds, with 10-year yields dropping to the lowest level in three months.

Main Macro Events Today

• GBP U.K. manufacturing PMI: Jumped to 55.5 in October from 51.8 in September. A much stronger than expected reading and in fact the highest since June last year. The new orders number jumped to 56.9 from 52.9 in the previous month and is at the highest level since July 2014. GBP is slightly higher against EUR and USD and the Gilt contract has extended losses on the strong number that will back the arguments to maintain the BoE’s tightening bias.

• EUR Markit Manufacturing PMI: EMU Oct manufacturing PMI revised up to 52.3 from 52.0 reported initially and versus 52.0 in the previous month. National readings had been mixed, but with Spanish and French numbers slightly lower than expected, while the Italian reading surged higher and the German PMI was revised up markedly with the final release.

• USD ISM Manufacturing PMI: The manufacturing index is estimated edging up to 50.5 from 50.2 in September, though that’s just barely in expansionary territory.

• CAD RBC Manufacturing PMI: If the results are in line with consensuses, especially on trade and employment, this would be supportive of the Bank of Canada’s constructive view on the growth and inflation outlook as detailed in the October Monetary Policy Report.