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July 05, 2017
The emerging world starts the month of July under unfavourable conditions. June has been a difficult month for some currencies, first of all the Russian Ruble and then the Brazilian Real, due to rising rates in the US, but also to the continued deterioration in oil prices.
Let's look at the chart of major emerging exchange rates and prospects for the month of July.
Our positive view of the Mexican peso proved to be correct and in fact the relative strength of Mxn was confirmed by the fact that in June it was the best currency against both the Dollar and the Euro. An appreciation over 3% that allowed the Peso to confirm the bearish breakdown and, above all, to confirm the signal on the Macd emerged some months ago, the basis of our positivity. Perspectives are still bearish for UsdMxn with a bearish break of the 38.2% of retracement of the last rise to 18.18; UsdMxn can head to area 17. There is still a substantial under-valuation that should strengthen our view on a market that seems to have definitively set the risk of an Anti-Mexico Trump aside.
Among the currencies that showed the greatest ability to defend themselves in June, we can find the South African Rand. In this case the uncertainty for the autumn elections will keep this standing-off for months. What we have noticed, however, is the inability of UsdZar to push under the tight support band of 12 / 12.25, an ideal ground for raising prices. Going below these supports might give new strength to the Rand with target 10.90.
We are still not so positive on the Russian Ruble and the newly closed month has confirmed this with a return to area 60 of UsdRub. Our negativity towards the Russian currency is supported by fundamental but also technical speeches (the Ruble is not certainly cheap). The oscillators have been showing the intention to move counter-current for weeks on the weekly charts and the drop in oil price has generated the sell opportunity. UsdRub has stopped exactly behind 60, a static resistance that in 2015 and 2016 has stopped the downward trend. Now this level has become a resistance and it is clear that its overcoming will be very negative for the Ruble.
This is a very volatile month for the Brazilian Real, after the political affair of the current President that may slow the government activity into the economic reform process. UsdBrl had an oscillation of 3700 pips, a record level in 2017, but not remarkable if we consider that this volatility in 2016 was exceeded for 3 months. Certainly, the market is still quite tense and does not know what direction to take and that Real is not a cheap currency. Technically, 3.50 could still act as a resistance, but in this case the feeling is that a bottom might form soon, causing weakness to the Brazilian currency in the medium term.
February 03, 2019
The GBPUSD pair has seen a strong rise in 2019 so far. The technical picture on the daily chart even suggests that there's more upside ahead.
May 15, 2018
This month is once again particularly eventful for the emerging world.
May 04, 2018
The dollar is the protagonist again thanks to the combined effect of 10-year US yields at 3% and a less aggressive ECB pressing on the need to normalize the monetary policy in Europe.
April 22, 2018
Bitcoin has been in a falling trend since the start of the year, but the cryptocurrency is currently attempting to break above resistance.
April 19, 2018
The month of April is proving to be full of events for emerging currencies which have suffered from the intensification of trading tensions between United States and China concerning duties, but also from the renewed political tensions between United States and Russia over the Syrian issue.
April 05, 2018
After the month of March we are now entering the month of April, in which the seasonality produces its effects.
March 22, 2018
The emerging currency market is waiting for the evident rise in rates in the United States from the Federal Reserve.
March 08, 2018
A more “hawkins” Powell than expected gave a nice boost to the US dollar with the 2-year interest rates back to 2.25%.
February 21, 2018
February has been quite a volatile month so far for the emerging currencies market together with some interesting strengthening stories (South African Rand) and others not so much (see Brazilian Real and Russian Ruble).
February 08, 2018
The month of February started with a weak Dollar against all the major world currencies, a situation that, in a slightly disordered way, Draghi first and then Trump tried to contain with the usual declaration of the need for a strong Dollar.
January 24, 2018
The month of January was quiet with some currencies that emerged against the US dollar.
December 21, 2017
December has not been volatile so far on emerging currencies as in other years when movements on exotic currencies tended to be more important.
December 07, 2017
The usual analysis of the beginning of the month starts with the main exchange rates in a very interesting month for many reasons.
November 24, 2017
The month of November is proving to be very tormented for emerging currencies, but there is much more than this.
November 07, 2017
November started with a somewhat anonymous Federal Reserve meeting that still does not dismantle the market expectations of a new rate hike in sight for the latest 2017 meeting in December.
October 25, 2017
A negative September for emerging currencies that lost 3% against the Dollar from the peak of the ninth month of the year.
October 13, 2017
In the month of October a lot of attention will be focused on Europe for political reasons as well as for economic reasons.
September 27, 2017
In September, the two major banks in the world have shown how the normalization of the monetary policy will continue, but at the same time will be accompanied by a long period of low rates.
September 24, 2017
When Charles Dow invented swing trading in the late 1908, he could not imagine such a great diffusion of this simple global yet very effective technique.
September 13, 2017
The ECB meeting of last Thursday officially reopened the final part of 2017 for financial markets.
September 07, 2017
September is usually a particularly interesting month for every financial market because it follows August miserable macroeconomic data and appointments with major central banks.
August 18, 2017
August is usually a volatile month for emerging currencies but it is also useful in estimating possible entry points for any tactical trade in the last part of the year.
August 03, 2017
In the month of July the Dollar has been the negative protagonist and the Euro the positive one, with other currencies more commodity-oriented and capable of earning different positions.