Thread: Daily Market Analysis from ForexMart

The EURUSD traded sideways during Friday’s trading and experienced a session with high volatility since US job figures took a longer time than the anticipated. Nevertheless, as the session ends it appeared that the pair begins to demonstrate stronger stance once again while the weekly candle generates a hammer formation.

The market would likely make an attempt to reach the 1.15 region where a significant resistance was seen in the past 3 years. Ability to break above it and a daily or weekly close would indicate a bullish sign showing that the market is apt to resume to go near the 1.18 handle.

Having said that, the market is currently in the “buy on the dips” condition in the near-term.
In case that the 1.15 handle was able to be broken down, it will suggest a major signal that the downward trend has ended. On one side, buyers will consider the single European currency in the longer-term or maybe tries to push it up towards the higher levels.

This is a situation where the Fed is thinking about the increase in interest rates, however, the European Central Bank recently mentioned the tightening of monetary policy which is quite surprising. With this, the pair requires some rebalancing which we have been witnessed.

Otherwise, a break down under the 1.1350 area will test the 1.13 level and a breakdown below that point will consider the 1.11 mark eventually.

The overall market seems equal and buyers are currently in the driver’s seat.


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The British pound against the U.S. dollar weakened on Friday last week because of below expectations manufacturing production data from the U.K. Although, the U.S. dollar has a higher value due to improved NFP data. This resulted in a faster correction of the pair which is necessary for the pair following several increases in the past few weeks. This has still reach highs of the range that lead to a correction.

The negative in the manufacturing data has put the pound bulls in dismay which was anticipated to continue the positive flow and attempt to lift the price range much higher to reflect that it soared to the upside. This has reversed the strong data from the U.K. over the past few months. There is also a tendency for the resignation of the U.K. prime minister May that indicates the political conflict has not been completely settled. This is not necessarily needed by U.K. as it proceeds with the negotiation with the Euro representatives over Brexit but they don’t have any other reasons to blame.

Better than anticipated outcome for the NFP data has alleviated concerns on negative data from the U.S. which was the trend in the past few months. However, traders are anxious on whether the Fed Reserve would raise its hikes amid the current situation. Nevertheless, the FOMC minutes indicated clearly that the next rate hike would be relative to the incoming data that makes that employment report to essential. The strong data pushed the price of the GBP/USD pair towards the 1.29 level which the former close of the week.

For today, the traders are expected to respond to the U.S. labor data on Friday on the first day of the week. It is anticipated to give off a bearish tone.


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The market had a long day yesterday since there are few market drivers present in the market which resulted in a low volatility and low liquidity as well. This naturally occurs during the first day of the week, except when there is a special progress happened over the weekend, but there were none. There are expectations for further actions for this day since traders already recovered from its weekend blues and started to continue trading.

The EURUSD does not move a lot in the past 24 hours by which the pair moved on a certain side of the 1.14 region without any development in a particular direction. The US dollar remained steady and it’s quite surprising that American traders failed to lead the run during a follow-up action on Friday. Moreover, the NFP report showed a moderately strong position that relieved the fears and uncertainties towards the US economy and this also help the greenbacks to stabilize.
On the first part of the day, it is anticipated that US traders will support the USD to gain further, however, unable to accomplish it. The concerns regarding the ability of the Trump administration to implement their policies remain to continue, but there are barriers in every step. The possibility that the United States will face difficulty for the next couple of years increases in consideration with the changes in policy. This also explains the hesitation of investors and traders about not engaging with the greens, even if the employment report was stable.

Some reports say that the ECB may not deal with tapering in the next months but it did not bring such impact against the EUR.

Ultimately, there are no major economic releases except for the speech from a Fed member later this day. It is projected for more actions this day on the back of market’s inactivity but the favor remains for the euro-dollar pair.


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The GBP/USD remained in the pressured area yesterday prior the late recovery that the helped the pair to moved higher and closer the 1.29 level. It further ended the day in an acceptable manner. As mentioned previously, the pound is one of the weakest currencies in the market due to events that continue to impact the GBP. however, there are some signs of recovery and remain to search for ways to have a complete recovery.

The dovish remarks of BOE member, Ben Broadbent pushed the Cable under pressure during the earlier session along with some strong selling in the pair of pound-yen that helped the GBPUSD to reach the 1.28 mark, whereas, the pair started another rally during the afternoon trading.
The Bank of England was able to provide support for the British currency but the market was surprised when Broadbent did not stated hawkish comments as expected. It will be disregarded when the data of average earnings index is released and predicted to helped the GBP to increase, then recovery will continue.

The testimony of Yellen was the major event for this day but there’s nothing hawkish came out based on what she was mentioned previously, hence, this led to further selling of the USD throughout the markets.

It further assisted the pound-dollar to recover and touched the 1.29 mark. It also indicates clear hints about pair recovery and traders should take note of this.

Ultimately, there are no major events or releases from the United Kingdom, aside from the PPI data and Yellen’s speech later this day. Both events mentioned would likely carry some volatility, however, the 1.28 area shows a strong buying support. It can be an interesting trading day today.


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As mentioned in the previous forecast, the 1.28 region is suitable for the pair to rebound and the GBP/USD was able to begin its recovery prior it moved higher than the said level. The recovery resumes since the Cable was under the consolidation period showing a bullish sentiment.

The area within 1.29 contains lots of volatility, even the pair trades around a narrow range and unable to reach either side of the range. However, it was obvious that bulls remain in control at this moment and the level 1.28 would be the indicator, in case that bears urge to take the driver’s seat. There is no fundamental news released the previous day from the United Kingdom and it was one of the reasons why consolidation had formed.

The dollar bulls hope to get some support from the hawkish speech of Yellen but the bulls were disappointed as she did not cite any hints about economic strength or the timetable of the next interest hike.

This pushed the greenbacks towards the back seat and further helped the pair to remain to trade in a stable approach which is close to the peaks of the range. The PPI data was mainly on expected lines and did not mess up the markets.

Ultimately, there are no major releases from the United Kingdom except for the significant CPI and retail sales from the United States which is projected to cause a lot of volatility in the near-term. A strong data is possible to move the greenbacks higher and bring into view the 1.28 mark for the GBPUSD.


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The U.S. dollar against the Japanese yen dropped significantly during the Friday session following bleak reports from the United States.It breaks through the 113 level and will attempt to move towards the 112 level which is an important region as it could become massively supportive. Traders will presumably try to push the market down although there is no assurance.

A short-term drop is anticipated but long-term traders are looking for charts since there is a relevant support level close to the 110 level. The Market will be kept steamed up.

Selling for short-term is probably the best move. Yet, long-term traders will explore for signs of support before trading this pair. Although, soon enough hunters return to the market. It is undergoing consolidation for long-term.

The interest rate differential is favorable for the United States no matter what were the data results on Friday. Patience is needed until ]buying opportunities show up. Nonetheless, short-term traders take advantage of the U.S. dollar decline.


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The European yields edged lower, however, outperformed the US Treasuries that pushed the euro-dollar pair to rebound from its lows and close around the peaks of the North American session. The yield differential resumed moving after the single European currency following the dovish remarks of Yellen in front of Congress in the previous week. This would likely lead the Fed to a decision in maintaining its rates until December.

Recently, the Fed fund futures on September priced at 8% possibility to move within the said month. The meeting of the European Central Bank held on Thursday could probably be the headline for the week, as Mario Draghi is possible to get inclined with the June script and attempt to slow down pressure regarding tapering.

The decline in Eurozone HICP inflation to 1.3% on year in June will actually trigger more the disagreement of the doves at the central bank of the European Union. While the spreads of the euro area will be release this morning since the peripheral bond markets became more profitable.

The EURUSD closed at the renewed 14-month high and bound to test the 1.1616 target resistance around the highs of May 2016. The support of the pair highlighted the 1.1414 region near the 10-day moving average. The consolidation period generated a bull flag formation which is a respite that stimulates higher.

The momentum came in neutral while the MACD histogram printed close to the zero index level with a flat trajectory that suggests consolidation.

The Australian currency rallied during Tuesday trading session on daytime and broke the 0.79 handle. The market broke out to the upside and appeared to go moving upwards.

After breaking the level above 0.7750, which is really bullish, the market would likely resume to trailed higher and eventually, the next target is found at 0.80 region.

Shorting the market is not ideal as the pullback still have a value. This is basically true since the gold market also rallied since the Aussie acts a proxy for the gold markets. It seems that value hunters will remain present in this market.

The level below 0.7750 is expected to be the floor in this market and staying at that point will be a buyer.

A pull back is needed to establish a stable momentum in order for the 0.80 region be best-selling, however, it may take some time to reach that zone.

It is recommended to buy pullbacks and the market could go to the upside when the break out will persist. A move over the 0.80 region enables buyer to enter the market and expand their positions


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The New Zealand dollar attempted to move uphill during the Wednesday session but the 0.7375 is a strong barrier. This was followed by a pulled back directed towards the 0.7350 level below. This is an area where buyers are coming back as it is where it broke out before.

The depreciation of the U.S. dollar was a concern as the New Zealand dollar tries to trade in short positions towards 0.75 psychological level. This has a big influence on the price and is largely resistive. Hence, short-term buying of pullbacks is the way to move forwards and it is best to wait until it breaks below the 0.73 level before shorting this pair.

Volatility will continue in the market. As for the U.S. dollar, this is being sold off against other currencies worldwide which is most likely similar to other markets. Choppiness will stay longer in this market as it is expected to move to and fro regarding the greenback as a whole. The 0.73 below is massively supportive.

The target would be at 0.75 level which is massively resistive. If the market breaks above the said level, the New Zealand dollar would stay in a “buy and hold” situation. Selling should be put on hold as it breaks lower than the 0.7275 handle which is not a good sign and push this market lower directed to 0.72 level below.


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The market had a difficulty trading the British pound against the U.S. dollar pair for the past week. After the release of the weaker CPI and retail sales data from the U.S. last week, the pair surged to 1.3030 region and reach beyond the 1.31 region for a short period of time for that day. The traders anticipate the trend last week to be continued since the greenback is not performing well as of now.

The weakened dollar did not help the pound that frustrated traders. The pair underwent correction lower than 1.30 level during the early days of the week which was influenced by the minor recovery of the dollar which was also exhibited by the euro. It resulted to poor performance in the lower channel. Moreover, the less-than-expected economic data from the U.K. deviated the strong trend of data in the past few months. Although, it is anticipated that the market could recover when the dollar depreciated once again but it failed.

The dollar weakened as the end of the week approaches with the outcome of investigations regarding the business transaction of Trump concern rises. Although, most of other currencies take advantage of this situation to move higher. As for the GBP/USD pair, it stays relatively calm. Despite the strong data of retail sales report from the U.K., it was not sufficient to push the pair higher as it closed the week lower than 1.30 level. It seems that there are risks to incur losses in the coming week influenced by the uncertainty from Brexit which continues to affect the British currency.

For today, there are not many economic events for the week as the end of the month approaches and data subsided. For next week, the FOMC statement from the U.S. is anticipated to be announced. Hence, the GBP/USD pair is anticipated to proceed with a weaker trading condition close to the 1.3030 regions as a significant psychological level.


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