Daily Market Analysis by ForexMart

[Luis ForexMart]

USD/CAD Technical Analysis: October 6, 2016

The CAD increased its trading value following the release of the US crude oil inventories data this week, which portrayed a drop of 3 million barrels. The drop in the weekly data for stocks was unexpected since forecasts showed a significant increase after consecutive drops in the data. The CAD has been previously on the lower rung during the first few hours of the trading session after the data released showed a decrease in trade deficits from August’s $1.47 billion.

Meanwhile, the Bank of Canada is not yet expected to cut back on its interest rates in spite of the ambiguities portrayed in the recent trade data. This is because the BoC is still awaiting the fiscal stimulus data from the Canadian government and will keep the CAD from further appreciation by using dovish stances. Non-resource exports were not able to increase and the direction of oil prices are still uncertain after the OPEC’s cuts in its production will still be subjected to another review in another meeting in Vienna.

The USD/CAD pair decreased by up to 0.267 points during the last trading session. The currency pair is presently trading at 1.3166 points following an increase in oil prices. The CAD initially traded over the 1.32 price levels prior to the release of the crude stocks data but eventually plummeted to 1.3166.

 

[Luis ForexMart]

AUD/USD Technical Analysis: October 6, 2016

The Australian dollar has to find a way to match the signaled reversal of US dollar after the chart showed a Bearish Evening Star candlestick pattern. The near-term support is at 0.7597 with a 23.6% fibonacci extension. A break for a re-test of 0.7496 with an uptrend line of 38.2% level. After a reversal above the triple line of resistance at 0.7699, it reach a high at 0.7760 on August 11.

The AUD/USD price is still uncertain with the Head and shoulders emerge forming a higher top setup. The trend is close to near-term support for traders looking for short term trade weighing the risk-reward ratio. To wait and go for the sidelines is a suggestive move until a more profitable opportunity comes.

 

[Luis ForexMart]

EUR/USD Fundamental Analysis: October 6, 2016

The day for EURUSD had been very slow as it return to its naughty rangy ways subsequent to a 2-day volatility. The past days are remarkable because set of good and bad news were aired but euro is seen to be very volatile and fastened in the middle of 1.1050 and 1.1250 regions. This range barely have series of attempts yet breaks are always unsuccessful. This event had brought advantages to traders because they are confident that the range is firm and cannot be damage quickly plus they can execute better strategies since the losses and profits are well-defined.

Euro and dollar were caught between the regions 1.1200 and 1.12300 under a tight range and due to a steady progression in the stock exchange the pair were not easily persuaded out from its safety level.

EUR/USD rested at 1.1200 and relatively produce 15 pips for a few hours. Furthermore, big announcements were not present in the Euro region since risk elements are turned down.

 

[Luis ForexMart]

USD/CAD Fundamental Analysis: October 6, 2016

Today, the loonies and greens are experiencing a very tight range but with lesser movements. The pair attempted to break the level of 1.3180 support upon the first 12 hours of trading, however buyers were dominant over the market so it plunged off and produced a low resistance found in the 1.3220 region. It was a day for small resistance and support because they are able to repress the development of USDCAD.

As of yesterday's forecast, there is some build up consolidation inasmuch as it continually analyze its previous earnings. It is expected that USD/CAD will be much active on Friday due to the labor survey from U.S and Canada to be issued simultaneously. It remain to demonstrate a bullish trend approaching the 1.3280 to 1.35 and sooner or later would arrive at 1.40.

The pair is speculated to execute similar actions like the other day, after all there are no any major reports regarding Canada, the market still looking forward for further releases.

Furthermore, there are speculations that the Canadian economy will soften for the upcoming weeks as the oil price reduction made an impact to the country's entire production network. In addition to it, cutback in the interest rate is also anticipated. Categorical reasons are considered that's why the pair persist to be bullish.

 

[Luis ForexMart]

USD/JPY Fundamental Analysis: October 7, 2016

The USD closed down today’s trading session with a higher value against the JPY for the eighth consecutive session after an increased interest rate differential which caused the surge in the US dollar. The USD/JPY pair was able to reach its highest trading level since September at 104.155 points. The pair then settled at 103.948 points, increasing by +0.42% or 0.439 points

The US dollar continued its increase against the Japanese yen after a highly positive US jobs data further increased the possibility of an interest rate hike by the Federal Reserve before the end of 2016. Another additional reinforcement was the release of the Unemployment Claims report which came in at 249,000, which is considerable lower than the expected 255,000 and last week’s release of 254,000. This lowered unemployment claims data might be a suggestion that the US economy might be nearing full employment, with employers wary of letting go of their present employees due to the lack of qualified people for the job.

On the other hand, Japan’s economy rates are on negative territory, with benchmark yields for its 10-year treasury note increasing at 1.7146%. Japan’s 20-year treasury bonds also went up higher to place at 1.4623%.

 

[Luis ForexMart]

USD/CAD Fundamental Analysis: October 7, 2016

The USD/CAD pair continued to consolidate for the duration of today’s trading session although it initially attempted to break through resistance levels at 1.3250 points following a late onset of the US dollar’s strength but was immediately countered by a sudden wave of sellers, causing the pair to drop below 1.3200.

Support levels for the pair came in at the 1.3180 trading range with resistance levels at 1.3250. These indicators are expected to maintain the USD/CAD’s price action for today’s session. The price action for the pair is largely dependent on economic data to be released today, such as the US non-farm payrolls data which is scheduled to be released today together with employment reports from Canada. The USD/CAD pair is then expected to have increased volatility compared with other currency pairs due to the release of these highly relevant data.

Traders are advised to keep out of today’s session since the economic data from Canada and US are expected to come out at opposite terms, which can make it hard for traders to predict the pair’s future price actions. Traders are also reminded to avoid the high volatility levels of the currency pair and wait for the increased activity to die down before going to trading on the USD/CAD.

 

[Luis ForexMart]

GBP/USD Fundamental Analysis: October 7, 2016

The sterling pound continued to plummet during Thursday’s trading session, after the GBP/USD pair dropped to 1.2601, its lowest ever in 31 years. The currency pair also decreased by 400 pips or roughly 5% during the Asian trading session in just a matter of minutes. Prior to the Tokyo session, the GBP/USD pair traded with a 10-pip spread and the currency’s charts portraying lows at 1.2000 and below. However, there is no clear reason yet as to what caused the currency pair to suddenly backslide. Analysts are expecting that the currency pair would further drop in the coming sessions due to massive political and economic uncertainties, as well as deterioration of the UK economy.

The GBP/USD was able to immediately revert back to the 1.2400 trading range. However, the technical indicators for the pair is presently erratic due to its recent activity. However, if the GBP/USD manages to maintain its risk levels below 1.2500 points then the currency pair would be able to recover even up to 1.2600. Market analysts are however warning traders that more sharp declines and sudden surges are to be expected in the upcoming trading sessions, particularly during this period that traders and investors are awaiting the release of the US Non-Farm Payrolls data in order to gauge the level by which they would resume their selling based on the stance of the pair.

 

[Luis ForexMart]

EUR/USD Fundamental Analysis: October 7, 2016

The pair showed slight volatility with defined ranges and did not move sparingly just a day ahead of the released of NFP. Euro is not that affected with Brexit but still weakened. For the whole day yesterday, it only reached the highest value at 1.3209 which is far from the strong resistance at 1.1250 level. Moreover, the announcement of the European Central bank that there will be no rate cuts did not help. Instead, the Euro further weakened that fell to 1.1150 support level during the US session. When the stop-loss for pound was operated it declined to 1.1132 level.

The upcoming release of NFP would say a lot on price activity and not much on technical and fundamental actions. Hence, it is predicted that Euro would fall between the usual range of 1.1150 and 1.1250 levels and the lowest support to be at 1.1045 levels. Until the NFP has been published, it is best for traders to hold off in the current market and look out for the NFP data considering both technical and fundamental forecasts and not just the news.

The NFP data would tell if there would be Fed price hikes soon. If it is high then there would be a price hike while it goes at low levels then it would await next year. This will be a good opportunity for stock markets and in the pair as USd would depreciate. Short term trade would still depend on the reports. Traders should not be impulsive with the volatility and be cautious of trading errors.

 

[Luis ForexMart]

USD/JPY Fundamental Analysis: October 10, 2016

The JPY went higher in relation to the USD after a long losing streak in nine trading sessions after the release of a somewhat negative US Non-Farm Payrolls report disappointed investors and traders. The USD/JPY pair traded at 102.906, decreasing by -1.00% or 1.042 points.

The US Non-Farm Payrolls report came out at 156,000, way below the expected 177,000 prediction for the NFP in September. Unemployment rates also increased by 5.0% from the previous data release of 4.9%. However, the data for the Average Hourly Earnings increased from 0.1% to 0.2%, with limited trader reactions since the data met its previous expectations.

Investors are now speculating that the disappointment in the US payrolls report makes it impossible for a Fed rate hike in November, but is still strong enough for an interest rate hike in December. Market buyers were also compelled to book their profits due to a slight drop in US Treasury Futures data.

The decrease in the USD/JPY came as a surprise to some investors since the economic data release, although on the negative side, is still strong enough to maintain speculations for an interest rate hike before 2016 ends. The pair is seen to further weaken since Monday is a bank holiday, and the absence of major market players could cause the pair to lose some of its current trading value.

 

[Luis ForexMart]

GBP/USD Fundamental Analysis: October 10, 2016

The outset of the pair fluctuated under the pressured area due to the remarks made by UK PM May that also laid out the itinerary of the EU exit process and made some indication regarding a tough negotiations and process.

The sterling and greenbacks sustained a weak position and drove to the lowest level of Brexit at 1.2790 wherein the market was very apprehensive during that time. Furthermore, a tension were formed as the GBPUSD dropped 800 pips within 5 minutes over the trading hours. Nobody knows the main reason that proceeded for a declivity accompanied with major losses accrued by bullish investors.

After the damage that occurred, the pound and dollar were able to compensate its deficit on Friday but the level of uncertainty or risk that the pair demonstrated indicated that it does not hold a stable conditions at present. It is recommended for the traders to wait more at least for two day so that it is much secured in dealing with this two currencies. The support is nearby the 1.2200 and resistance is spotted at 1.2500. Be more cautious in trading using pound and greens, it is much advisable to set aside this first.