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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).
In the midst of all this, the American dollar is still weak and dominates the scene beginning to create some annoyances in economic areas like China and Euroland itself. Let's now look at the evolution of the main emerging currencies in detail.
The increase in rates in Mexico has allowed the Peso to consolidate the gains of the last few weeks in a still positive context for the Central American currency, as we can see from the inclination of the now descending oscillator.
The graph shows a typical bearish head and shoulder figure in formation with neck line in transit in area 18. Only a downward break of this level would favour a decisive upgrade in favour of the Peso with very ambitious targets between 14 and 15. For the moment we must take note that we are going through a consolidation phase after Trump post-election downward excesses. Technically, there are enough conditions for further downturns of UsdMxn and above all in light of a seasonality of March that seems to be very favourable to the Peso, strengthening in 16 of the last 20 years.
UsdZar is attacking the last supports, technical levels between 11.50 and 12 representing the last support line according to the Fibonacci fan line technique. This price zone is very important from a technical point of view also because in these parts we can find the tops of 2008, a level that UsdZar violated in 2015 before launching towards the historical tops of area 18. The news of the resignation of President Zuma has given force to the Rand that since December had shown signs of appreciation for the outcome of the general elections. Now that the political process will have an acceleration, will the South African Rand have the strength to overcome the important medium-term supports?
The exit attempt from the lateral phase by UsdBrl seems to have failed for the moment. The weakness of the Brazilian Real in a context of relative weakness also for the US dollar produced nothing but a shift from one side of the technical triangle to the other. Even if the resistance of 3.30 has been strong enough till now, the support of 3.10 could be pressurized. Only the exit from one of these two sides would clearly determine a trend that has been absent for over a year on UsdBrl.
Our view is still favourable to the Turkish Lira against the Dollar. UsdTry should in fact resume the bearish march interrupted in recent months after a first major fall from the top of 3.96. We can see a critical support level at 3.70 in the undergoing consolidation without major problems in case of a fall down to 3.60, a transit zone of the moving average and the bullish trend line in place since 2014.
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 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.
July 31, 2017
August is traditionally a volatile month for the currency and financial world in general and therefore the economic data that could represent a market mover must be kept under close observation.
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.