Thread: Daily Market Analysis from ForexMart

The anticipation for the US’ nonfarm payrolls blocked the AUD’s slight uptrend on Thursday session, sending it down to slump at 0.73. The current spot exchange is 0.7372. A decline in crude oil prices and the RBA’s statement of monetary policy (SOMP) released today tightened the bears’ grip on the AUD/USD.

After the RBA slashed interest rates to 1.75 percent on Tuesday, its SOMP revealed further cuts on inflation forecasts. From the previous estimate of 2 to 3 percent growth, the RBA lowered its projection for the 2016 to just 1 to 2 percent. The central bank is aiming for a 2 to 3 percent inflation rate by the end of the year.

Forecasts for the next two years’ inflation were also revised down to 1.5 to 2.5 percent from the initial 2 to 3 percent. RBA’s statements indicated another possible rate cut.

The MACD indicator is in a negative location. The first support is at 0.7459 and 0.7422 subsequently. The first resistance is at 0.7522 and 0.7560 subsequently. The price is falling.


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The sterling hardly reached the 1.45 level when dismal figures on the UK’s services sector was released. GBP/USD retreated to 1.44 levels and bottomed at 1.4456. The current exchange rate is 1.4496.

The service industry’s purchasing managers index (PMI) slimmed to 52.3 in April from the previous month’s 53.7, recording the softest PMI in three years. Economists expected a 53.5 growth. Traders are closely watching for the NFP data from the US which will help decide the Fed’s next move on its interest rates.

The first support is at 1.4442 and 1.4403 subsequently while the first resistance is at 1.4494 and 1.4496 subsequently. The MACD indicator is in neutral location. The price is increasing.


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The AUD/USD has now settled at the 0.73 handle as data from China, Australia’s largest trade partner, did little to boost the Australian dollar’s value against the greenback. The AUD bottomed at 0.7299 today and peaked at 0.7351.

The impact of China’s bearish consumer prices, which grew by 2.3 percent in April from the same period last year, was lukewarm. Markets were expecting a 2.4 percent rise. Its PPI fell by 3.4 percent, not as much as the forecasted 3.8 percent decline. Exports and imports, which stood at -1.8 percent and -10.9 percent y/y respectively, were also on the red.

Buying interest on the USD firmed slightly due to an increase in wages, which was up 0.3 percent m/m in April and 2.5 percent y/y. Only 160,000 jobs were added to the nonfarm payrolls opposed to a projected 202,000 additional positions.

The spot exchange is now at 0.7339 and the price is rising. However, we are yet to see the AUD breach 0.74 today.

The immediate support is at 0.7272 and 0.7236 subsequently while the first resistance is at 0.7364 and 0.7397 subsequently. The MACD indicator is in a negative location.


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The NZD/USD is showing a shaky flight as the USD rallies despite muted nonfarm payrolls released last week. China’s modest CPI and PPI lifted the bird slightly, although not enough to push the kiwi above 0.6780, its intraday high.

Traders are going short on the NZD with little impetus coming this week. The Reserve Bank of New Zealand will publish its biannual Financial Stability Report later today followed by Governor Graeme Wheeler’s remarks.

We will scout for foreshadowing in Wheeler’s speech that may indicate the next route of the central bank’s interest rate. Retail sales will follow on Thursday.

The pair is now at 0.6741 and is continuing to decline. The MACD indicator is in a negative location.

The first support occurs at 0.6723 and 0.6689 subsequently while the first resistance occurs at 0.6809 and 0.6843 subsequently.


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Tuesday, the dynamics of the market was enliven with the help of the calendar of economic events. Job Openings was issued by the US wherein the data came in at 5.757 million contrary to the report of 5.431 million.

The euro currency heightened a little in opposition with the dollar. The euro zone has made a report about Industrial Production in Germany for March which the data dropped low more than what was expected wherein it came at -1,3% contrary with the expectations of -0,2%. Meanwhile, exports displayed a fast growth showing 1,9% against expectations -0,1%.

The Trade Balance which has sustained the pound was showed by the United Kingdom. The Bank of England Governor Mark Carney apprised the commercial banks and other financial institutions regarding a probable rate cut if ever the UK departs from the European Union.

The fall of the yen currency is an aftermath of the statement of the Minister of Finance on Monday. If it happens that the yen continues to grow, the regulator is ready to intercede, as stated by the ASO. The Japan Minister of Economy Nobuteru Ishihara stated that after the rally of the yen in the past week, he is nearly observing the financial markets.

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Yesterday, in opposition with the US dollar, the major pairs has been rectified. We haven't heard EU stating significant data and the market's volatility was weak. The market was not affected by the British data through the main cross-pair EUR/GBP and most of the trades were unperturbed and smooth.

The scarcity of drivers helped the UK market to stay still. But the forthcoming referendum can probably become one of the drivers in the future. As stated by Michael Sanders, Bank of England Monetary Committee representative, if Britain favors the exit from EU, the Central Bank will be obliged to heighten the rates to 3.5% by the end of 2017, because the exit out of the EU union will facilitate the slump of the pound and will probably strengthen the inflation.

Due to the profits taken by the investors, the dollar slumped in opposition with the yen on Wednesday. It was an aftermath of the recent rally gaining a two-week highs and the Japanese speech regarding its preparation for an intercession. Yet, Japan were expected by many investors to refrain from doing any activity to enfeeble the yen before the G7 meeting.

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The increase of risk appetite caused a positive effect on investor's sentiment. As a funding currency, the yen were pressured by the optimism showed by the leading stock exchanges. However, the US and Japanese government bonds yield differential had been decreasing for many consecutive trading days. The dollar/yen pair decreased by the end of the trades.

The first support occurs at 108.20 and at 107.40 subsequently. The first resistance stands at 109.00 and at 109.80 subsequently.

The price is in the Ichimoku Cloud and it is over the Chikou Span. The Tenkan-sen displays a descending movement and the Kijun-sen forms a horizontal movement. The MACD indicator is in a positive location. The price is consolidating.

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The sturdiness of the world economy was left vague even though the dollar was sustained by the restored risk appetite. The Initial Jobless Claims volume was issued by the US wherein the data came in at 294,000 contrary with the expected 270,000. The political event of the day were the statements which came from Rosengren E. and Mester L, the Fed representatives. Mester stated that the risks which relative with the Fed reports should not affect the monetary policy management. While Rosengren proposed that the risks of leaving the rates unmodified seem too inferior for a long term of time.

The Germany issued the Wholesale Price Index wherein the data came in at 0,3% m/m in opposition with the expected 0,2% m/m while the Eurozone issued Industrial Production wherein the data came in at -0.8% m/m contrary with the expected 0.1% m/m.

The significant event of the day was the Bank of England meeting. The rate was remained unmodified by the regulator at 0.5%. At the same time, the inflation report of the Central Bank became the center of attraction. We hope that the growth in assessment of the inflation in the present year could help the pound to rise and counterbalance concerns about the cost of lending decrease. The Central Banks anticipates the inflation to restore at 0.2%.

In the midst of short positions closing, the dollar still managed to increased in opposition to yen. However, the US currency was still under pressure caused by the vagueness of probable increase in the global market.

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The significant event on Thursday was the inflation report of the Bank of England. As we have expected, the Central Bank statements about the economy and the inflation increase were quite negative. The rate remained unmodified by the UK regulator at the level of 0,5%.

The first support occurs at 1.4400 and at 1.4320 subsequently. The first resistance stands at 1.4480 and at 1.4560 subsequently.

A confirmed and a sturdy sell signal has been found. The price is below the Ichimoku Cloud and it is below the Chikou Span. The Tenkan-sen displays a horizontal motion and the Kijun-sen forms a descending movement creating a "Golden Cross". The descending movement will remain until the price is below the Cloud.

The MACD indicator is in a negative location. The price is declining.

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The Service Sector activity in Japan has reduced more than expected last month. Tertiary Industry Index seasonally corrected displayed -0,7% contrary with -0,1% in the recent month. The experts anticipated a decrease to -0,2%.

The first support occurs at 108.20 and at 107.40 subsequently. The first resistance stands at 109.00 and at 109.80 subsequently.

The price is in the Ichimoku Cloud and it is over the Chikou Span. The Tenkan-sen forms a horizontal movement and the Kijun-sen displays an ascending movement.

The MACD indicator is in a positive location. The price is consolidating.

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