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GDMFX - Weekly News
FOREX NEWS: EURO GAINS AGAINST THE US DOLLAR, POUND STILL HESITANT AHEAD OF MANUFACTURING DATA


EUR/USD


Forex News: Friday the US Dollar weakened against the Euro and the bulls made a clear break of resistance. This was mostly generated by a disappointing reading posted by the Advance version of the U.S. Gross Domestic Product: anticipated 2.6%, actual 1.2%.

[Image: W55QBBa.jpg]

Technical Outlook

The level at 1.1150, which acted as strong resistance in the past, is now clearly broken and may turn into support if price returns to test it. Already some rejection is seen around 1.1180 and the oscillators are overbought, so we may see a 30 pip drop into 1.1150 but the short term bias is bullish and price will probably continue towards 1.1240. This view will be strengthened if 1.1150 becomes support.

Fundamental Outlook

At 2:00 pm GMT the U.S. Manufacturing PMI is released, with an anticipated value of 53.1, almost identical to the previous 53.2. This is a survey of purchasing managers from the manufacturing sector that asks respondents to give their opinions on overall business conditions and health of the said sector; usually, higher numbers bring strength to the dollar but the impact is not always substantial.


GBP/USD

The pair remained above the 50 period Exponential Moving Average Friday and even tested 1.3280 resistance on the back of a worse than expected U.S. GDP but a break did not occur.

[Image: GgJQPJx.jpg]

Technical Outlook

Although the latest impulse is bullish and the pair is trading above the 50 period Exponential Moving Average, the picture is blurry until we will see a break of the horizontal channel created by 1.3280 resistance and 1.3070 support. For today, we expect another touch of the moving average and if price moves below it, a touch of 1.3070 zone is very possible.

Fundamental Outlook

The British Manufacturing PMI is released at 8:30 am GMT. Just like the U.S. indicator with the same name, this survey is derived from the opinions of purchasing managers and usually, higher numbers than the forecast 49.1 generate strength for the Pound.
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WEEKLY ANALYSIS: THE US DOLLAR RESUMES ITS ASSAULT, WITH BEARS THREATENING SUPPORT


EUR/USD


Weekly Analysis: The first part of last week was bullish but later on, the US Dollar made a spectacular comeback on the back of better than expected U.S. economic data so the week ended with the bears in control.

[Image: pV7zjCM.jpg]
Technical Outlook

Price bounced lower near the 1.1200 zone and has now returned below the 50 period Exponential Moving Average. Early during the week we may see small retracements (better observed on the lower time frames probably) but the momentum belongs to the bears and this is likely to generate a break of 1.1060 en route to 1.1000 psychological zone. The Relative Strength Index is pointing downwards and the Stochastic is about to cross, both agreeing with a move lower and strengthening our bearish bias.

Fundamental Outlook

After a busy week, now things calm down a bit as the week ahead offers a lackluster environment. The first notable event of the week comes Wednesday in the form of the U.S. JOLTS Job Openings; the indicator shows the number of job openings, excluding the farming industry and offers a look at future levels of employment but the impact is often mild.

Thursday the US Dollar will be affected by the Unemployment Claims, an indicator that tracks changes in the number of jobless people, but Friday will be the busiest day of the week: on the Euro side we have the German Preliminary Gross Domestic Product, the main gauge of economic performance and for the US Dollar the Retail Sales will be the main market mover. Later in the day the University of Michigan will release their Consumer Sentiment, a survey that tries to gauge the overall opinion of consumers regarding economic conditions and acts as a leading indicator of consumer spending.


GBP/USD

Last week the Bank of England made the bold decision to cut the interest rate from 0.50% to 0.25% and this stopped bullish momentum, pushing price almost 350 pips lower.

[Image: d7ni21J.jpg]

Technical Outlook

The control now belongs to the bears and the support around 1.3070 is threatened. This week we expect a break of this level and then a continuation of the move into lower territory, with the zone around 1.2800 as target. Keep in mind that the horizontal channel created by 1.3280 resistance and 1.3070 support is not clearly broken so we don’t exclude the possibility of bullish movement if 1.3070 cannot be broken.

Fundamental Outlook

Similar to the Euro and US Dollar, the Pound has a slow week ahead, with the only major indicator being the Manufacturing Production released Tuesday. It tracks changes in the total value of output generated by the manufacturing sector and usually has a medium impact on the Pound, with higher numbers strengthening it.
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WEEKLY ANALYSIS: US DOLLAR REMAINS STRONG AHEAD OF U.S. INFLATION DATA, FOMC MEETING MINUTES


EUR/USD


Weekly Analysis: The pair climbed last week and nullified the drop seen a week before. The fundamental scene was quiet until Friday, which was the busiest day of the week but was filled with disappointing U.S. data.

[Image: BNutSFN.jpg]

Technical Outlook

Price is currently ranging and deciding the next move but the short term bias is bullish as seen from last week’s action. After failing to break 1.1060, the pair bounced into 1.1210 resistance but rejection is clearly seen here (the last daily candle has a huge upper wick). The 50 period Exponential Moving Average is flat, meaning the balance doesn’t clearly belong to either side, and this combined with the shape of the candle we talked may generate bearish impulse. If this is the case, we expect a drop into 1.1000 zone. A break of 1.1200 zone will open the door for 1.1335 but unless the fundamental side agrees, we don’t expect that resistance to be touched this week.

Fundamental Outlook

Monday we don’t have any major announcements on the calendar but Tuesday action picks up with the release of the German ZEW Economic Sentiment (survey of about 275 German professional analysts and investors regarding overall economic conditions) and the more important U.S. Consumer Price Index (CORE version, which tends to have a higher impact). The CPI is the main gauge of inflation and the Fed closely watches it when deciding interest rate levels, thus the impact on the US Dollar is usually strong.

Wednesday the FOMC Meeting Minutes come out, offering insights into the reasons that determined the latest rate decision and possibly offering hints about future changes, followed Thursday by the Philly Fed Manufacturing Index, which is a leading indicator of economic health derived from the opinions of manufacturers in the Philadelphia district. Friday is an uneventful day, without major releases.


GBP/USD

Despite worse than expected U.S. economic data, the Pound continued to depreciate against the US Dollar throughout last week and is now a step closer to historical support.

[Image: UaRDfVt.jpg]

Technical Outlook

After the break of the horizontal channel created by 1.3280 resistance and 1.3070 support, the pair continued in the direction of the break, as it was anticipated and now it seems headed towards the historical low at 1.2796. Until it gets there, we will probably see some retracements to the upside but we don’t expect 1.3070 to be broken in the process.

Fundamental Outlook

The first event of the week for the British Pound is the release of the Consumer Price Index, scheduled Tuesday. As mentioned before, this is the main gauge of inflation and has a strong impact on the currency, with higher numbers strengthening it, given the fact that current inflation is considered too low.

Wednesday we take a look at the U.K.’s employment situation with the release of the Claimant Count Change, an indicator that tracks changes in the number of unemployed persons. The last important release of the week is scheduled Thursday in the form of the British Retail Sales; this type of sales represents a major part of the entire economic activity and higher numbers usually strengthen the Pound. As always the U.S. events will have a direct impact on the pair’s movement throughout the week.
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WEEKLY ANALYSIS: EURO APPROACHING PRE-BREXIT LEVELS, POUND BOOSTED BY POSITIVE ECONOMIC DATA


EUR/USD


Weekly Analysis: Last week the pair climbed for over 200 pips, approaching the place where the Brexit move started. A major role was played by the dovish stance of the Fed as revealed by the FOMC Minutes. 

[Image: y8xnVvQ.jpg]

Technical Outlook

The bullish move started at 1.0911 has nullified the major part of the Brexit fall but 1.1340 resistance may hinder further upside action. The Relative Strength Index and the Stochastic are overbought, increasing the chances of a bounce lower from here but the current bias is bullish so if 1.1340 can be broken early in the week, we expect a climb into 1.1415 and possibly 1.1450.

Fundamental Outlook

The week ahead is filled with medium-impact indicators and only a few that can really be considered market movers. Monday we don’t have anything on the economic calendar and Tuesday the German Manufacturing PMI will affect the Euro, while the New Home Sales will be the main catalyst for the US Dollar, followed Wednesday by the Existing Home Sales.

Thursday the main focus will be on the German IFO Business Climate, a survey with a huge sample of about 7,000 businesses that asks respondents to give their opinion regarding current business conditions as well as a 6-month outlook. The greenback will be influenced by the release of the Durable Goods Orders, an indicator that chows changes in the total value of orders for goods with a life expectancy of more than 3 years.

Friday the Preliminary version of the U.S. Gross Domestic Product is released, showing changes in the total value of services and goods produced by the United States economy and Fed Chair Janet Yellen will speak at the Jackson Hole Symposium. The exact time is not yet known and will be announced during the week. 


GBP/USD

Most of the British economic data that came out last week was better than anticipated (including inflation, jobs and retail sales) and this, coupled with the dovish FOMC Minutes, took the pair above resistance.

[Image: lWnqGUT.jpg]

Technical Outlook

The current move can be considered just a retracement for the bearish move that took place earlier but 1.3070 resistance was breached so if the bears cannot bring price back below this level, we will probably see a climb into the 50 period Exponential Moving Average. On the other hand, if the break of 1.3070 will be short-lived, we expect the pair to move closer to last week’s low at 1.2865.

Fundamental Outlook

Only one major indicator is scheduled this week for the Pound: the Second Estimate Gross Domestic Product. This is less important than the Preliminary version which was already released but it still has a high impact on the Pound because it is the main gauge of overall economic performance. The indicator will be released Friday.

U.K. representatives will participate at the Jackson Hole Symposium that starts Thursday so we may see Pound volatility, depending on the matters discussed.
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WEEKLY ANALYSIS: NFP TO ‘MAKE OR BREAK’ THE US DOLLAR RALLY


EUR/USD


Weekly Analysis: Last week belonged to the bears, who managed to bring the pair significantly lower after a bounce at resistance. Fed Chair Yellen’s speech at the Jackson Hole Symposium was interpreted as positive for the US Dollar and it became the biggest market mover of the week.

[Image: RkdX4gR.jpg]

Technical Outlook

The pair finished last week right on the 50 days Exponential Moving Average and below 1.1210, with both oscillators moving down and coming from overbought. The position and direction of the oscillators indicate that the pair will continue to move south but the 50 days EMA and its vicinity to price may be a reason to believe that a move up is next. Early in the week we will probably find out if we are dealing with a bounce or break; the former will likely take the pair back up into 1.1340 and if the latter comes true, we may see advances towards 1.1060. 

Fundamental Outlook

The week starts with a slow Monday, but continues Tuesday with the always important German Consumer Price Index, a key measure of inflation. The same day the Consumer Confidence survey will affect the US Dollar and Wednesday we take a first look at the American jobs market with the release of the ADP Non-Farm Employment Change. This version is released by Automatic Data Processing (ADP) and excludes from calculation government jobs and the farming industry.

Thursday is a slow day for the Euro and on the US Dollar side we have the Manufacturing PMI, a survey of purchasing managers that tries to gauge their opinions regarding the health of the manufacturing sector. Friday will be the busiest day of the week, with the main event being of course the Non-Farm Payrolls, a report that tracks changes in the total number of employed individuals, excluding the farming industry. Usually this release creates high volatility and possibly irregular movement, so caution is recommended.


GBP/USD

After a perfect bounce at resistance, the pair had 2 bearish days that erased most of the Pound gains obtained earlier in the week. The pair still finished higher than it started the week but the balance of power is not heavily tilted towards either side.

[Image: ZjRROxy.jpg]

Technical Outlook

The resistance at 1.3280 combined with the 50 days Exponential Moving Average created a strong confluence zone that rejected the bullish advance with pin-point accuracy. The move down is likely to extend into the support at 1.3070 and there the next medium term direction will be decided: a break will make 1.2865 the next target, while a bounce higher will open the door for another encounter with 1.3280.

Fundamental Outlook

The Pound has a light economic calendar ahead, with the only notable releases being the Manufacturing PMI and the Construction PMI that come out Thursday and Friday respectively. Both act as leading indicators of economic health, with higher numbers strengthening the Pound. As always, the U.S. events will have a direct and possibly strong impact on the pair.


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WEEKLY ANALYSIS: NFP CREATES MIXED MOVEMENT, FOCUS SHIFTS ON ECB RATE MEETING


EUR/USD


Weekly Analysis: The pair moved without conviction last week, bouncing above and below the 50 period Exponential Moving Average and between support and resistance. The NFP report showed a worse than expected number, weakening the US Dollar but hawkish comments form a Fed official nullified the move and turned the pair south.

[Image: mV9Xhs2.jpg]

Technical Outlook

After a failed attempt to break 1.1150 early during the week, the pair climbed and pierced the resistance at 1.1240 but then quickly reversed and finished the week on support. The latest impulse is bearish and the fact that despite a disappointing jobs report, the US Dollar is gaining against the Euro, makes us believe that we will see a break of 1.1150 and a move into 1.1060. If the pair doesn’t remain below the 50 period EMA and reverses direction again, the first target is 1.1240, followed by 1.1340.

Fundamental Outlook

U.S. banks will be closed Monday, celebrating Labor Day and no major indicators will be released as a result. On the Euro side we don’t have important releases either but the Group of 20 Meetings (G20) will continue (Sunday is the first day) and this may generate volatility.

Tuesday the United States will release the Non-Manufacturing PMI, which is less important than the Manufacturing PMI but can still create strong movement if the actual number shows a big difference from the forecast.

Wednesday we have another slow day for both currencies in the pair but Thursday action picks up with the important ECB interest rate announcement, followed by Mario Draghi’s press conference. The rate is expected to remain the same (0.00%) but the day of the release is almost always full of strong moves, especially during Draghi’s press conference. Friday the Eurogroup Meetings start but other than that, we don’t have any other major events.


GBP/USD

The Pound bulls scored a major victory last week and closed the week at the highest level since July. The Pound benefited from optimistic economic data while the greenback was hit with some disappointing numbers throughout the week.

[Image: X6pX0Vw.jpg]

Technical Outlook

The resistance at 1.3280, which acted as a strong level in the past, was broken last week. This could be a major victory for the bulls, if they manage to keep the pair above the mentioned level and above the 50 period Exponential Moving Average. During this week we expect the upside to prevail and the pair to move above the minor resistance at 1.3370, towards 1.3500 area but this doesn’t exclude the possibility of smaller moves south, in the form of retracements.

Fundamental Outlook

The first release of the week is the Services PMI, scheduled Monday, a survey that doesn’t always have a strong impact unless the difference between actual and forecast is substantial. The next release is scheduled Wednesday: the Manufacturing Production, an indicator that shows changes in the total value of goods produced by the manufacturing sector. The same day we have the Inflation Report Hearings; during these hearings, BOE Governor Mark Carney will testify on inflation before the Parliament's Treasury Committee but the impact differs from meeting to meeting.
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WEEKLY ANALYSIS: US DOLLAR MAKES TIMID ADVANCES. U.S. RETAIL SALES, INFLATION DATA ON THIS WEEK’S WATCHLIST


EUR/USD


Weekly Analysis: Early last week the US Dollar was hit with disappointing economic data and this allowed the pair to climb close to 1.1340 resistance. A big portion of the Euro’s gains were erased during Thursday’s ECB press conference but the week still ended higher than it started.

[Image: LS2iArf.jpg]

Technical Outlook

The pair is not showing a clear trend and the oscillators are giving mixed signals (Stochastic is moving up, coming out of oversold while the RSI is turning slowly lower) but it’s clear that rejection was present around 1.1340. The daily candle that came close to this resistance has a long upper wick and was followed by a bearish candle that confirmed the sell signal; this makes us anticipate a drop into the 50 period Exponential Moving Average and the bullish trend line seen on the chart above. If this area will be broken early during the week, we expect a move below 1.1150, otherwise we will probably see another attempt to break 1.1340 resistance.

Fundamental Outlook

The week starts slow as Monday lacks any major events; Tuesday action picks up with the release of the German ZEW Economic Sentiment and the same day ECB President Mario Draghi will speak at a ceremony in Trento. We don’t expect his speech to trigger huge moves but caution should be used nonetheless.

Wednesday we have another slow day, followed by a full calendar Thursday when the U.S. Retail Sales are released, as well as the U.S. Producer Price Index, which shows changes in the price charged by producers for their goods. This indicator has inflationary implications because a higher price charged by the producers will be eventually paid by the consumer, and that’s what makes it important.

Friday we take a look at United States inflation with the release of the Consumer Price Index, an indicator that shows changes in the price paid by consumers for the goods and services they purchase. The same day the University of Michigan will release their Consumer Sentiment, a survey that gauges the opinions of consumers regarding current economic conditions.


GBP/USD

The Pound was heavily affected by economic indicators last week and moved according to the readings posted. Better than expected data brought it up in the first part of the week but the second part was disappointing and the Pound weakened.

[Image: 9rtXClO.jpg]

Technical Outlook

The bounce at 1.3445 took the pair into the 50 period Exponential Moving Average and into the support at 1.3280 so we are now dealing with a ‘bounce or break’ scenario that will decide the next medium-to-short term direction. A bounce will make 1.3445 the target for the week, while a break will put the bears in control, making 1.3070 the target. The oscillators are curving downwards, close to overbought and this slightly favors the bears but control doesn’t clearly belong to either side.

Fundamental Outlook

The first important release of the week is the British Consumer Price Index, a key gauge of inflation that shows changes in prices paid by consumers for the products they purchase. The indicator is scheduled Tuesday and is followed Wednesday by the Claimant Count, a report that shows changes in the total number of unemployed people who asked for social aid.

Thursday will be the most important day of the week for the Pound, with the main event being the Bank of England interest rate decision. At the same time a Monetary Policy Summary comes out, detailing the reasons that stood behind the rate decision. Earlier during the day the British Retail Sales are released, so we are in for a busy day but Friday the Pound will have a lackluster economic calendar.
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WEEKLY ANALYSIS: BEARISH BREAKOUTS. THE US DOLLAR REIGNS AGAIN?


EUR/USD


Weekly Analysis: The US Dollar finally had a good week, strengthening against the Euro and breaking the bullish trend line seen on the Daily chart. The main catalyst was the better than expected U.S. Consumer Price Index, released Friday.

[Image: rl6vTv6.jpg]

Technical Outlook

After a relatively long period of indecision, the pair finally managed to pick a direction and we expect this impulse to continue. Now the 50 days Exponential Moving Average and the bullish trend line are broken and this makes the bias bearish but keep in mind that 1.1150 is not clearly broken so there’s still a chance of a bounce here. We favor the short side and a move into the 1.1000 area but if current support holds, we expect another encounter with 1.1240.

Fundamental Outlook

As usual, the first day of the week will be slow in terms of economic releases but action picks up Tuesday with the U.S. Building Permits. More permits means that activity in the construction sector will increase and this usually strengthens the greenback but the impact is not always very high.

Wednesday will be the busiest day of the week for the US Dollar as the Fed will announce the interest rate decision and will release a FOMC Statement outlining the reasons that stood behind the rate vote. Soon after the announcement, Fed Chair Janet Yellen will hold a press conference during which we expect increased volatility.

Thursday ECB President Mario Draghi will speak at the European Systemic Risk Board, in Frankfurt and the on the US Dollar side the Existing Home Sales will be the only notable event. The week ends Friday with the release of the German Manufacturing and Services PMIs, which are medium impact indicators but can have a positive effect on the Euro is they show higher numbers than forecast.


GBP/USD

The Pound closed last week at its weakest point since August 17, with Friday being the worst day of the week. The pair dropped more than 250 pips on the back of comments made by U.K. Chancellor of the Exchequer Philip Hammond regarding the willingness to give up Britain’s single-market membership in the European Union in order to achieve immigration restrictions, according to Bloomberg.

[Image: tQrFPPd.jpg]

Technical Outlook

The key support at 1.3070 was broken by a strong candle and the fundamental scene doesn’t favor the Pound, while the US Dollar benefits from a stronger than expected CPI (inflation data). In the current scenario the fundamentals and the technical aspect point towards the downside for the pair and this makes our bias bearish, anticipating a move into 1.2865 zone.

We don’t expect price to travel in a straight line to get there so it’s very possible to see some sort of bullish retracement, at least on the lower timeframes. The first potential resistance is now 1.3070, followed by the 50 period Exponential Moving Average.

Fundamental Outlook

The entire week lacks any major news releases for the Pound so the US Dollar events will hold the headlines. Worth mentioning is the release of the Public Sector Net Borrowing, scheduled Wednesday; the indicator shows the difference between spending and income for public corporations and the government. A number above zero shows deficit so the higher the number the bigger the deficit. This indicator is not known to be a major market mover but it may increase volatility because the week lacks other important indicators.
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WEEKLY ANALYSIS: EURO STILL IN RANGE-MODE, US DOLLAR FEEBLE AHEAD OF DRAGHI AND YELLEN’S TESTIMONIES


EUR/USD


Weekly Analysis: Last week we saw some bullish action that nullified the US Dollar gains from a week before but the pair was confined in a relatively small range and movement wasn’t strong.

[Image: 0iWZ6Ru.jpg]

Technical Outlook

The 50 days Exponential Moving Average is still flat and the pair reverses all directional moves so we can safely say that control doesn’t clearly belong to either side. The first barriers for the pair this week are 1.1240 as resistance and 1.1150 as support; a break of the former will open the door for a touch of 1.1340 while a break of the latter will likely take price into 1.1060. Until the pair breaks one of the two lines, our bias is neutral.

Fundamental Outlook

The week starts in full force Monday with the release of the German IFO Business Climate (a large survey of about 7,000 businesses) and Mario Draghi’s testimony before the Committee on Economic and Monetary Affairs of European Parliament. The latter event is prone to trigger high volatility and possibly irregular movement so caution is recommended.

Tuesday focus shifts on the US Dollar for the release of the U.S. Consumer Sentiment, a survey that asks about 5,000 households to give their opinions on current and future economic conditions. Wednesday Fed Chair Yellen will testify before the Committee on Financial Services and another notable release is the U.S. Durable Goods Orders, an indicator that tracks changes in orders for goods with a life expectancy of more than three years. The testimony is of course the more important event of the two and may generate strong US Dollar movement.

Thursday we take a look at the United States Gross Domestic Product (Final version), which is considered the main gauge of overall economic performance and the week finishes Friday with the German Retail Sales and the European Flash Estimate version of the Consumer Price Index.


GBP/USD

The pair showed mixed movement last week, initially dropping, then climbing just to fall again during the last day of the week. Movement has slowed down but the latest impulse is bearish

[Image: qX3hGSr.jpg]

Technical Outlook

The bulls attempted to take the pair above 1.3070 but after a small climb above the mentioned level, price dropped and now the door is open for a touch of 1.2865 support. The Stochastic is oversold and looks to cross upwards so we will most likely see some bullish movement this week but as long as the pair remains below 1.3070, our bias is bearish for a touch of the support mentioned earlier.

Fundamental Outlook

The week ahead is slow for the Pound as far as economic releases are concerned: the busiest day will be Friday when the Final Gross Domestic Product and the Current Account are released. The former is the main measure of the economy’s health and the latter shows the difference between the value of imported and exported goods and services. Even if there are not a lot of economic releases, this doesn’t mean that the pair will have a slow week in terms of movement and as always, the U.S. events will have a direct impact.
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WEEKLY ANALYSIS: NON-FARM PAYROLLS – THE KICK THE MARKET NEEDS


EUR/USD


Weekly Analysis: The pair ended another sideways week and so far nothing seems to take it out of its slumber. Friday was the most active day, with the Euro weakening due to a Deutsche Bank possible fine imposed by the U.S. Department of Justice for the sale of mortgage-backed bonds.

[Image: i99K90t.jpg]

Technical Outlook

The 50 days Exponential Moving Average continues to move flat and the pair is trapped between 1.1280 resistance and 1.1150 support. Until one of these barriers is broken, price is in range-mode and neither side is in control, so our bias is neutral but we must warn traders that often after a sideways period, the pair tends to breakout strongly in one direction or the other. This week important U.S. data comes out so we expect the mentioned breakout to happen.

Fundamental Outlook

German Unity Day is celebrated Monday, thus German banks will be closed; on the US Dollar side we have the Manufacturing PMI, a survey of purchasing managers that acts as a leading indicator of economic health, focused on the manufacturing sector.

Tuesday is a slow day for the Euro and US Dollar but Wednesday action picks up with a first look at U.S. employment data with the release of the ADP Non-Farm Employment Change, a report that shows changes in the number of employed people, excluding government jobs and the farming sector.

Thursday is another slow day and Friday the U.S. Non-Farm Payrolls come out, showing how many new jobs were created during the previous month. This is widely viewed as the most important jobs related indicator for the United States economy and usually it creates huge movement, with higher numbers strengthening the greenback.


GBP/USD

Similar to the euro-dollar, the pair traded mostly sideways and remained below resistance for the entire last week. The United Kingdom didn’t release important economic indicators and this contributed to the lack of action.

[Image: BgNXwNX.jpg]

Technical Outlook

The bulls made timid attempts to break 1.3070 resistance but trading volume remained low throughout the week and no major developments took place. The lack of determination from both sides makes our bias neutral but we must note that the 50 days Exponential Moving Average is still moving downwards and price is trading below it; also the resistance at 1.3070 is still holding and all this slightly tilts the balance towards the short side. First minor support is located at 1.2945 (better seen on a 4-hour chart), followed by the more important 1.2865.

Fundamental Outlook

The first three days of the week are reserved for the three PMIs that focus on the health of their respective sectors: Monday the Manufacturing PMI comes out, followed Tuesday by the Construction and Wednesday by the Services PMI. These are surveys derived from the opinions of purchasing managers from each of the three sectors and usually a higher value for any of them, brings Pound strength.

The last important release of the week is scheduled Friday in the form of the Manufacturing Production, an indicator that shows changes in the total value of output generated by the manufacturing sector. A higher reading is usually beneficial for the Pound but the impact is limited at times.
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