Thread: Daily Market Analysis from ForexMart

Brent. April 27, 2021 | Oil rises in anticipation of OPEC meeting

On Tuesday, Brent quotes are growing moderately, recovering to the level of $65.70 per barrel. Oil prices were supported by the decision of OPEC+ to raise the short-term forecast of world oil demand growth to 6 million barrels per day from the March estimate of 5.6 million.

Today, a day ahead of schedule, a meeting of the OPEC ministerial monitoring committee will take place. OPEC Secretary General Mohammed Barkindo in his recent speech noted that the oil market is experiencing a significant improvement in prospects, and the excess oil reserves formed in the world market during the pandemic will completely disappear by the end of this quarter.

At the same time, many risks remain relevant, primarily associated with the deterioration of the epidemiological situation in India, Japan and a number of other regions. India is one of the largest oil importers, so the introduction of additional quarantine restrictions will inevitably impede the recovery in demand for raw materials.

EUR/USD. April 27, 2021 | Euro corrected after reaching local highs

The US dollar is showing signs of strengthening against the euro, reaching 1.2050. The American currency is supported by expectations of the results of the two-day meeting of the US Federal Reserve System.

Market participants assume that the regulator will confirm its readiness to continue buying back assets in the same volumes in order to achieve maximum employment and price stability. However, many also admit that even before the end of this year, the Fed is announcing plans to gradually reduce monthly asset repurchases (currently the amount is $120 billion), as the US economy shows signs of a rapid recovery from the Covid pandemic.

Also, the regulator is not expected to change the base rate and monetary policy parameters. The main attention of traders on Wednesday will be attracted by the press conference of the head of the Federal Reserve System Jerome Powell, from whom they expect signals about when the Fed may begin to cut stimulus.

Today the macroeconomic calendar is almost empty. It is worth paying attention only to the CB consumer confidence index in the USA. Analysts expect a slight increase in the indicator.

EUR/USD. April 29, 2021 | Dollar weakened after the US Federal Reserve meeting

On Thursday, the EUR/USD pair started to rise sharply and reached the level of 1.2150. The US dollar was pressured by the results of the US Federal Reserve meeting and the subsequent speech by the head of the regulator Jerome Powell.

The US Federal Reserve System has left the interest rate unchanged in the target range of 0-0.25% per annum. In addition, the Fed kept the volume of purchases of Treasury bonds in the amount of $80 billion monthly, as well as the purchase of $40 billion in mortgage-backed securities unchanged. The regulator noted that it will continue to buy back bonds until progress is made on GDP and inflation.

The general tone of the Central Bank's comments turned out to be restrained and soft, which put pressure on the dollar's position. Jerome Powell said the economic recovery is still fragile and the coronavirus situation remains worrisome.

The macroeconomic calendar today is presented by data on US GDP for the first quarter of the year and the number of applications for unemployment benefits. The Eurozone will share statistics on inflation in Germany in April.

Brent. April 28, 2021 | Oil rises amid improved forecasts for global demand

Oil prices shifted to growth on the back of optimistic forecasts for global demand. The current Brent quotation is $66.30 per barrel. At the same time, the risks, in the form of the rapid spread of the coronavirus in India and the exceeding expectations of the growth of oil reserves in the United States, limit the rise in prices.

Today, the joint technical committee of OPEC+ has kept the forecast for the growth of global oil demand in 2021 at the level of 6 million barrels per day. Moreover, the organization intends to adhere to plans for a phased release of production restrictions from May to July, which also strengthens producers' confidence in a recovery in global demand.

Analysts at Goldman Sachs bank expect the sharpest jump in oil demand ever – an increase of 5.2 million barrels per day over the next half year. And the easing of restrictions on movement between the countries in May will lead to a recovery in global demand for jet fuel by 1.5 million barrels per day.

Yesterday was published a report from the American Petroleum Institute (API), according to which US oil reserves unexpectedly rose by 4.3 million barrels. Today you should pay attention to a similar report from the US Department of Energy. Analysts predict an increase in reserves by 650 thousand barrels.

EUR/USD. April 28, 2021 | The pair consolidates under 1.21 in anticipation of the Fed meeting results

Today the EUR/USD pair continues to consolidate below the 1.2100 level ahead of the Fed meeting. The current price of the instrument is 1.2070. It is unlikely that the quotes will be active until the results of the meeting are announced.

Yesterday in the US was published statistics on the house price index for February: the indicator showed an increase of 0.9 m/m against the forecast of growth of 1.0% m/m. A report from the Conference Board was also presented, according to which the consumer confidence index unexpectedly rose sharply in April and amounted to 121.7 points against the forecast of growth to 113.1. The March indicator was marked at the level of 109.0 points. The current value of the indicator has become the highest in 14 months.

Today the macroeconomic calendar is empty, all the attention of market participants is focused on the results of the meeting of the Federal Reserve System and its decision on the rate and further monetary policy.

EUR/USD. April 30, 2021 | The pair is consolidating below the 1.21 level

On Friday, the EUR/USD pair started to decline, reaching the level of 1.2075. The dollar received support from data on US GDP, whose growth exceeded analysts' forecasts: from January to March, the economy grew by 6.4% versus 4.3% a quarter earlier.

The results of the meeting of the Federal Reserve System showed that the American regulator is not yet ready to curtail incentives, despite the optimism about the US economy. The Fed still expects when the country's macroeconomic indicators begin to show a stable increase.

Today you should pay attention to the data on GDP in Germany for the first quarter. The financials disappointed investors as the index fell 1.7% qoq, while analysts had forecast a decline of only 1.5%. On an annualized basis, the German economy contracted 3.3%, better than forecast for a decline of 3.6%. The GDP of the entire eurozone exceeded forecasts: the region's economy contracted by 0.6% qoq (forecast -0.8%). In annual terms, the economy contracted by 1.8% (forecast 2.0%).

Thus, the EUR / USD pair is consolidating under the influence of ambiguous statistics. The RSI indicator is corrected to the neutral zone, which indicates the formation of a flat below the 1.2100 level.

EUR/USD. May 3, 2021 | The US dollar started the week on a minor note

The US dollar ended April on a positive note, but on the first Monday in May, the american currency weakened to 1.2050. The main influence on the dynamics of the EUR/USD pair is provided by macroeconomic publications from the USA and the Eurozone.

At the end of last week, the US released data on personal income and spending of Americans in March. Revenues rose 21.1% m/m against the forecast of a rise of 20.1% and the previous decline of 7%. Expenses, in turn, increased by 4.2% on the expectation of an increase of 4.3% m/m and the previous decline of 1.0%. It should be noted that such a rapid growth in income is the result of cash payments to the population.

Additional support to the dollar was provided by the final value of the consumer confidence index in the US from the University of Michigan: in April the indicator rose to 88.3 points against the forecast of an increase to 87.3 and the previous value of 86.5 points.

The European currency was supported this morning by the statistics on the volume of retail sales in Germany in March: in monthly terms the indicator increased by 7.7% against the forecast of growth of only 3%. The annual rate rose 11% after falling 6.6% in February. At the same time, the indexes of business activity in the manufacturing sectors of the eurozone and Germany for April disappointed the markets, falling short of forecasts.

The United States will also publish PMI in the evening. In addition, there will be data on construction costs and the price paid index. And also the head of the US Federal Reserve System Jerome Powell will make a speech.

EUR/USD. May 4, 2021 | The dollar strengthened and returned to the level of 1.20

On Tuesday, the dollar began to recover and reached the level of 1.20. The US currency is supported by a positive fundamental background: high rates of vaccinations in the US, direct payments to the population and easing of restrictions.

The main problem today is that the dollar retains its status as a safe haven currency. Since the beginning of the year, the United States has been ahead of other countries in terms of economic recovery, but now Europe is showing significant progress in vaccinations and plans to ease restrictions. And global growth tends to be more favorable for high beta currencies than safe haven currencies. Therefore, together with the lifting of restrictions, the demand for the euro will return.

Yesterday was published data on business activity in the US manufacturing sector, which turned out to be much worse than forecasted. Economists had expected the index to rise from 64.7 to 65, but in April it fell to 60.7 points. And even these statistics did not allow the dollar to fall. Analysts say the dollar is rising mainly on expectations of a potentially strong Payroll employment report. Today during the day, the EUR/USD pair will moderately rise from the level of 1.20.

GBP/USD. 06.05 | The pair cannot decide on the direction of movement

The GBP/USD pair on Thursday started to rise to 1.3940 after a two-day flat at 1.3900. Today is rich in various events in the UK: attention should be paid to the elections in Scotland, the results of the meeting of the Bank of England and the publication of important economic reports.

The results of the parliamentary elections in Scotland will determine the holding of a repeated referendum on independence from Great Britain. The victory of the ruling national party will speed up the exit of Scotland from the United Kingdom, but this is unlikely to have a strong impact on the pound rate, since the issue of independence will be resolved for several years.

The meeting of the Bank of England is of no small importance today. The regulator decided to keep the base interest rate at 0.1%, and the volume of asset repurchases from the market – at 895 billion pounds. The redemption of government bonds is 875 billion pounds, and the volume of redemption of corporate bonds remained at 20 billion pounds.

Short-term support for the sterling today was provided by data on business activity in the service sector in April in the UK: the indicator rose to 61.0 against the forecast of growth to 60.1 points. In the US today, it is worth paying attention to the publication of the number of applications for unemployment benefits: the report showed that the number of applications fell better than forecast, to 498 thousand. This gave the US dollar some support, which allowed the GBP/USD pair to return to the 1.39 level.

May 07 | USD / CHF technical analysis: H4 chart, Pivot levels

The US dollar against the Swiss franc at today's trading has rewritten the minimum since February 26 at around 0.9057.

Bouncing off the lows, the USD / CHF price is correcting towards the daily pivot level.

The medium-term trend is directed downwards, therefore, upon completion of the correction, it is more likely that a further decline can be predicted, but, most likely, this will happen already next week.

Daily Pivot - 0.9094;
Daily Resistance 1 - 0.9119, DR2 - 0.9169, DR3 - 0.9194;
Daily Support 1 - 0.9044, DS2 - 0.9019, DS3 - 0.8968.

Weekly Pivot - 0.9129;
Weekly Resistance 1 - 0.9180, WR2 - 0.9231, WR3 - 0.9281;
Weekly Support 1 - 0.9078, WS2 - 0.9028, WS3 - 0.8977.

Monthly Pivot - 0.9226.

EUR/USD. May 11, 2021 | Dollar continues to decline after Friday's Payrolls report

The US dollar accelerated its decline after the release of Friday's Non-farm Payrolls report, according to which the number of new jobs created was almost 25% lower than forecasted – 266 thousand against 1 million. The unemployment rate rose from 6% to 6.1%. The latest statistics turned out to be an unexpected shock for market participants, and the quotes of the EUR/USD pair rose to the level of 1.2180.

In total, during the pandemic, the American economy lost 22 million jobs, and about 8 million are still not restored.

Today the pair continues to fluctuate slightly below the 1.22 level. The economic calendar is of little interest. All market participants' attention is directed to the upcoming statistics: on Wednesday the US will publish statistics on consumer prices, on Friday – on retail sales.

The oil market on May 11, 2021

Brent quotes on Tuesday decline from the area of ​​local highs above $69 per barrel. The current price of the asset is $67.50 per barrel.

Black gold is declining amid the gradual reopening of the Colonial Pipeline Co. pipeline system, which suspended operations last Friday due to a hacker attack. This pipeline system is the main source of gasoline, diesel and jet fuel supplies to the US East Coast.

The rapid spread of the coronavirus in India continues to put additional pressure on investor sentiment. The government of the country came face to face with the need to introduce a harsh isolation regime.

In the near future, oil prices can only be supported by data on crude oil reserves in the United States. Analysts expect that statistics from the Ministry of Energy (May 12) will show a decrease in reserves by 2.3 million barrels per week. Gasoline stocks are expected to fall by about 400,000 barrels. Today you should pay attention to the monthly OPEC report, which will include data on production in April.

EUR/USD. May 12, 2021 | Euro is correcting after strong growth

The EUR/USD pair declines slightly on Wednesday after a sharp rise to the level of 1.2180. The current quotation of the asset is 1.2125.

The statistics from the eurozone published the day before, as a whole, pleased investors: the index of sentiment in German business circles in May rose to 84.4 points from the previous 70.7. The forecast assumed a rise to 72.0 points. The same indicator for the entire euro area soared to the level of 84.0 points from the previous 66.3. Such data speaks about the attenuation of the third wave of coronavirus in Europe and has a positive effect on business prospects.

Today you should pay attention to the report on the volume of industrial production in the eurozone for March. The indicator came out worse than expected, rising only 0.1% against expectations of 0.7% growth.

In the US, the most anticipated indicator of the week will be published – the consumer price index for April. Median forecasts assume only 0.2% MoM gain is possible after the 0.6% rise in March. If the data is in line with expectations, the dollar will have a chance to strengthen and return to the area below 1.21.

GBP/USD. May 12, 2021 | The pound sterling breaks all records

The pound sterling remains the leader of the foreign exchange market, demonstrating a sharp rise to 1.4170, which was the highest since the end of February. In general, the pair is approaching the level of 1.42 – the last time such values ​​of the British currency rate were recorded in April 2018.

The pound received strong support on the results of the regional elections. Scottish National Party SNP won 64 seats in the Scottish Parliament, one less for the majority. Analysts note that calls for a referendum on independence will continue, but this is unlikely to lead to increased political risks for the pound sterling.

Additional positive was brought by the report from the BRC chain: the volume of retail sales in April on an annualized basis increased by 39.6% after increasing by 20.3% a month earlier.

A busy news day awaits the UK today. The country's GDP contracted by 1.5% on a quarterly basis (which turned out to be better than the forecast of -1.6%). Industrial production statistics in March showed an increase in the indicator by 1.8% (against the forecast of growth by 1%). The data on the trade balance reflected a decrease of 6.55 billion.

It can be said that the strong statistics were the result of successful mass vaccinations and the relaxation of quarantines.

EUR/USD. May 13, 2021 | Dollar remains strong after inflation data

The EUR/USD pair has weakened noticeably after the release of yesterday's statistics on inflation in the US. The current quote for the pair is 1.2050. According to the US Department of Labor, in April, consumer prices rose at their most in almost 12 years due to increased demand amid the opening of the economy. Excluding food and energy prices, consumer prices rose 0.9%, the highest since April 1982. Annualized inflation rose to 4.2%, the highest since 2008.

There is a logical reason for this rise in prices: as the American economy recovers, the consumer is faced with a noticeably reduced supply, which pushes prices up.

Additional pressure on the euro was exerted by macroeconomic reports from the eurozone. According to Eurostat, industrial production in the region rose 0.1% in March, after falling 1.2% a month earlier. Experts forecast an increase of 0.7%. On an annualized basis, the indicator grew by 10.9% against the forecast of 11.6%.

Today we should pay attention to the report on the number of initial claims for unemployment benefits and the producer price index in the United States.