Technical and Market Analysis by Vistabrokers

[Vistabrokers]

EUR / USD. Apocalypse Was Cancelled!?..

We should definitely mention a kind of immunity that markets had to develop over the endless Greek tragedy. Thus, earlier market experts were expounding various apocalyptic scenarios about the collapse of the synthetic formation called "the euro zone" in a case of Greek default, but now forecasts have become much more modest, given that the market has remained fairly stable after Sunday's referendum and earlier (when Greece has missed the payment to IMF). One of the key technical analysis postulates states that "prices take everything into account", which means that all projections and assumptions are already accounted in current prices. Earlier we have mentioned the formation of the graphic figure like "symmetrical triangle", where were converging graphic borders. So, if the price leaves its borders, it will give us the reason to open a position in the direction of the breakthrough, and it is meaningless to talk about "to be or not to be". Any trade action will not be justified until the market itself shows the direction.

It is recommended to focus on "triangle" borders and use their breakthrough as a signal to enter the market in the direction of the breakthrough.

Volatility: 47%
Trend: sideways
Fundamental background: moderate

GBP / USD Sees how the Land Lies

The British currency could catch hold of the important support line, thereby interrupting a decline in borders of a short-term downward correction. Here, according to the first rebound, bulls are going to resume the interrupted trend, using current technical opportunities, and not just them, because today is also expected a fundamental reason to buy. Thus, at 08.30 GMT in theUK will be published May industrial production data, which in case of predicted values exceeding may act as a catalyst of growth.

It is recommended to go long ion a breakthrough of 1.5631 to reach the resistance line of the current downtrend. A break of this line will open GBP / USD the way to June highs above 1.59.

Volatility: 67%
Trend: bearish
Fundamental background: moderate

 

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Vista Brokers: Oil Is Recovering after Falling

On Tuesday, crude oil futures are rising in price. Vista Brokers analysts note that the "black gold" restores the position after yesterday's strongest decline in the last three months. Oil was pressured with talks on Iran and Greece, as well as concerns over a slowdown in China's economy.

During the European trading session on the ICE Futures Exchange Brent futures for August have risen in price by 0.38% to $ 57.38 per barrel. A day earlier, these futures have fallen by 6.27%, to close at 3-month low of $ 56.54 per barrel.

Meanwhile, on the New York Mercantile Exchange crude oil futures for August delivery have risen by 0.27% to $ 53.14 per barrel. On Monday, futures have lost 7.73% to close at the low of April 10, at $ 52.53 per barrel.

 

[Vistabrokers]

Market Outlook According to the Method of Bill Williams: GOLD

We have fixed the result on the short position (from 1165.87) on one of the bar's closure above the red Alligator's line. Currently we are in a «standby mode», and our pending orders are placed at the nearest fractal levels. Thus, we will start to buy at 1174.44 and to sale at 1162.57.

Volatility: 6%
Trend: sideways
Fundamental background: weak

Market Outlook According to the Method of Bill Williams: USD/JPY

The short position from 122.59 is still relevant, because no any bar was closed above Alligator's teeth, despite the high market volatility. Among additional signals we have a «saucer» on АO and a «red zone» signal. Recall that the last is formed when histograms on AO and AC are red.

Volatility: 71%
Trend: sideways
Fundamental background: moderate

Market Outlook According to the Method of Bill Williams: EUR/USD

The market is waiting for results of the unscheduled summit of the euro zone leaders, which was a respond on results of the Sunday's referendum in Greece. Amid this the euro is declining versus its counterparts par to the course and this means the increased unfixed profit on the short position from 1.1031. Among additional signals we should note a «saucer» on АО, as well as «red zone» signals.

Volatility: 46%
Trend: bearish
Fundamental background: moderate

Market Outlook According to the Method of Bill Williams: GBP/USD

The data on the manufacturing activity, published in the UK during today's European sessin, was rather contrary. Bulls, who have just started to test the waters of counterattack from the middle-term trend line, gave way. So, the short position from 1.5671 is in the market, and we have moved the stop-trade (the red Alligator line level) to 1.5593 with the current price at 1.5450.

Volatility: 35%
Trend: bearish
Fundamental background: strong

 

[Vistabrokers]

Vista Brokers: Euro Is Grasping at Straws

On Tuesday morning the single currency fell against the dollar to 1-month low, but later regained position. Vista Brokers analysts note that the growth driver during the American session for the euro was the fact that Greece has submitted a new request to creditors to continue the program of financial assistance, despite the fact that the Sunday's referendum had showed the negative attitude of the Greeks to conditions of lending program from the ECB, the EU and the IMF. This is probably the last hope of Greece to remain in the euro zone.

At the emergency meeting in Brussels, the Greek Prime Minister Alexis Tsipras has suggested European leaders a new plan to help the country to avoid bankruptcy. The plan includes two phases. The short-term phase implies that lenders will provide a new tranche in the next 3-4 months that Greece could pay debts to the ECB and the IMF, as well as to support banks. The long-term one is a two-year lending program, which also involves the releif of a significant part of the Greek debt. Judging objectively, the "troika" is unlikely to agree to such conditions, although it is impossible to make any predictions in such a difficult and tense situation.

Nevertheless, the market took the news about the latest proposal by Greece positive, and the euro rose sharply to $ 1.1002, ending the session with only a slight decline - 0.48%. Earlier, the pair has dropped to a four-week low at 1.0917.

 

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Vista Brokers: Crude Oil Futures Are Falling again

On Wednesday, oil price are falling in price again. Vista Brokers analysts name several reasons for the decline: concerns over Greece, the panic in the Chinese stock market and the expectation of data on crude oil inventories from the US Energy Department.

Today during the Asian trading session, August futures for Brent have lost 38 cents, dropping to $ 56.47 per barrel. Since the beginning of the week, futures prices have dropped by more than 6% to April lows. US crude oil futures have tumbled today by 35 cents to $ 51.98, and since the beginning of the week they have lost about 8%.

Let us briefly describe all above-mentioned pressures. The development of the debt crisis in Greece continues to affect all financial markets. Lenders have given Athens timeuntil the end of the week to present a list of reforms in exchange for a new program of financial aid. Otherwise, Greece is likely to leave the euro zone.

As for China, the country's stock market continues to fall rapidly. The Shanghai Composite index has dropped at the opening by 6,97%, the Shenzhen Component has lost 4.44%. Compared to the peak in mid-June, the Shanghai Composite has sinked down by more than than 33% and the Shenzhen Component – by 40%. This weekend, the People's Bank of China said that it would take measures to ensure financial support and stabilize the stock market by providing sufficient liquidity to China Securities Finance Corporation (the only company in China that provides financing secured by margin to brokers). CSF, in turn, will actively buy shares of small and medium-sized companies, supporting the stability of blue chips and providing liquidity to the market.

The data on crude oil inventories from the US Energy Department will be published today - analysts suggest that the volume of stocks last week has plunged again (by about 700,000 barrels). Earlier was released the data from the American Petroleum Institute (API), which showed a decrease of inventories by nearly 960,000 barrels in the same period.

 

[Vistabrokers]

Vista Brokers: US Soybeans Are near 1-Week Low

On Wednesday, soybean futures declined for the fifth consecutive session, dropping to the 1-week minimum. Vista Brokers analysts note that the reason for the decline is the information on the good harvest in the US Midwest, as well as concerns about global economic slowdown.

Today at the Chicago Mercantile Exchange, soybean futures for August delivery have fallen to the daily low of $ 9.8763 per bushel (the lowest level since 30 June) from the previously achieved level of $ 9.8850 (-0.31%). On Tuesday, the same futures has lost 2.96% during the day.

According to the US Department of Agriculture, as of July 5, about 63% of the crop of soybeans in the Midwest of the country is in good or excellent condition.

 

[Vistabrokers]

Market Pulse 07/09

During early trading on Thursday in Australia and China was published a lot of important statistics. In Australia - the data on the labor market, and in China - the consumer price index and the producer price index. The Bank of England today will announce a decision on the interest rate, and the USA - data on unemployment claims.

6:00 ** Trade Balance - May (Germany)

Moderate impact on the market (EUR). The trade balance is the difference between exports and imports for the period. Positive values ​​are favorable for the currency, as they reflect the flow of money into the country.

11:00 *** Bank of England Interest Rate Decision - July (UK)
11:00 *** Asset Purchase Facility - July (UK)
11:00 *** MPC Rate Statement - July (UK)

Strong impact on the market (GPB). From the Bank of England, investors do not expect any surprises. According to forecasts, the interest rate will remain at 0.50%, while the volume of asset purchases - 375 billion. Comments in the accompanying statement can be interesting.

12:30 ** New Housing Price Index - May (Canada)

Moderate impact on the market (CAD). This indicator is strongly correlated with the overall health of the economy and reflects the level of consumer confidence. The increase reflects positive trends.

12:30 *** Unemployment Claims - July (USA)
12:30 ** Continuing Claims - July (USA)

Strong impact on the market (USD). The number of initial applications for unemployment benefits is a weekly indicator, having a great importance due to the expectation of the Fed's raising interest rate in September. It is expected reduction in the number of applications.

14:15 ** FOMC Member Lyell Braynard Speaks - July (USA)

Moderate impact on the market (USD). Braynard is a member of the FOMC, so his opinion influences decisions on monetary policy. Therefore, market participants are paying attention to his comments.

 

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Vista Brokers: Greece and Fed Rate Hike Are in Central Focus

On Wednesday, EUR / USD was traded in a wide range. Vista Brokers analysts note that main subjects that move the market are still the Greek crisis and the Federal Reserve interest rate hike.

Yesterday, the European authorities have given Greece a period until Thursday to provide a new proposal to creditors. Athens hope to agree on a program of financial assistance from the European Stability Mechanism, the bailout fund of the euro zone. If no agreement is reached, the EU leaders will gather on Sunday at an unscheduled summit in Brussels to discuss the procedure and consequences of a Greek exit from the currency union. The new Greek finance minister Euclid Tsakalatos said that a new proposal for the creditors is ready - it includes tax and pension reform, as well as debt relief.

During the US trading session on Wednesday the minutes of the last FOMC meeting were published. They showed that members of the Committee have expressed concerns that the situation in Greece will affect the financial markets, as well as were talking about the fact that the growth of the US economy should be more stable, and inflation - closer to the target of 2% before the rate hike. Thus, there are doubts that the Fed will raise the rate in September - investors will closely monitor the statistics published in the United States.

 

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Vista Brokers: Oil Is Rising on Positive News from China

On Thursday, during the Asian session, oil was rising in price. Vista Brokers analysts note that positive news from China was the driver for the growth. Firstly, the consumer price index in June has increased more than expected. Secondly, it became clear that the Chinese authorities are taking all necessary measures to calm the unrest in the country's markets.

Amid this on the New York Mercantile Exchange crude futures for WTI crude oil for August delivery have risen by 0.90% to $ 52.12 per barrel. On the Intercontinental Exchange (ICE), August futures for Brent were traded between $ 55.88 and $ 57.75 per barrel.

Events in China and the economy of this country greatly affects the oil market, as China is the world's largest consumer of "black gold." In June, the consumer price index in China has increased by 1.4% against the forecast of 1.3% and growth of 1.2% a month earlier. The producer price index has dropped by 4.8% vs. 4.6%, which means that the pressure on prices continues. However, optimism exceeded disappointment at the reduction of PPI.

Recall that in the past few days, investors' anxiety commodity market caused panic in the Chinese stock market and a significant drop in major stock indexes. However, today during the morning trading the Shanghai Composite Index has risen by 2.35%. It became known that the People's Bank of China has provided liquidity to China Securities Finance Corp, which in turn, will provide it to other stock market participants.

We should also note other factors affecting the oil market. Last night, the US Energy Department has reported about crude oil inventories. So, for the week ended July 3, inventories have increased by nearly 400,000 barrels, although it was expected a decline by 750,000 barrels.

A certain influence also have talks on Iran, a positive result of which will allow the country to return to the oil market as a full participant. In recent days, the negotiations were actively conducted in Austria and it is the information that the parties have almost reached an agreement.

 

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Vista Brokers: BOE Decisions Met with Expectations

On Thursday, the British pound was strengthening against the US dollar prior to the release of the Bank of England decisions on the monetary policy. Vista Brokers analysts note that the British central bank has left its key interest rate unchanged - 0.50%, as well as the amount of asset purchases - 375 billion. These decisions are fully in line with expectations. Recall that the Bank of England's interest rate remains at 0.50% since March 2009.

Although market participants do not expect from the "old lady" any decisive steps in the near future, they are still looking for some hints that the central bank will gradually tighten its monetary policy. Perhaps some signals can be seen in the minutes of today's meeting, which will be published on July 22. The first reaction of GPB / USD on decisions of the Bank of England was a decline from 1.5385 to 1.5377.

European stock markets are rising today. The British FTSE 100 has increased by 1.1%, the EURO STOXX 50 - by 1.8%, the French CAC 40 – by 1.75%, the German DAX – by 1.65%.