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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.
Concerning the first point it will be interesting to see the market reaction to the FOMC this week. On the second point, the growth that is losing strength and the inflation that struggles to approach 2% are the reasons that support the prudence of Draghi. A bit of weakness is back on the Pound, Yen and Australian Dollar in the month of the recovery of the greenback. Let's now see in detail the technical conditions of the main exchange rates.
After a long period in a tight trading range (1.22 / 1.24), EurUsd has finally unlocked the technical situation by dropping below 1.22 and immediately heading towards 1.20. This level represents the first level of support to which the bears could aspire, also because here we can find the top of September 2017. Even using the Ichimoku technique we can see how this support area has the same importance that it had in October when EurUsd stationed for a little while above 1.15 before starting again. We will see if the behaviour will be similar, but in case of a failure of 1.20 there would be no big doubts about the next target that would be positioned around 1.17, transit zone of the 38.2% of the Fibonacci retracement.
After touching 105, UsdJpy has started pushing itself below the 200-day moving average currently in transit at 110. Graphically we should be facing a typical return move on the previous support levels. In fact, after the bearish break of 110 in January, there has been a fall and then the current rebound. Even if UsdJpy shows the willingness to rise further, it would find a further significant barrier in the downtrend line at 111.50 which combines the tops of 2017. A stretch over this resistance would completely change the scenario on UsdJpy ending the downward phase.
An extremely disappointing growth rate has weakened the British pound. The Cable has thus fallen from 1.437 on April 17th to 1.37 on Friday, threatening now the uptrend trend line well accompanied by the 200-day moving average. Also, as we can see from the graph, we could witness a formalization of a double top at 1.43 whose consequences would be particularly serious for the Cable as it would interrupt the sequence of rising tops in 2017. Attention then to 1.365: considering the oversold reached till now we still consider the long Gbp side to be preferable.
AudUsd has a similar structure to that of GbpUsd. A peak in January at 0.81 and then a vertical fall up to 0.75, curious behaviour at a time when raw materials were closer to the tops of January. Probably AudUsd could anticipate a slowdown of the economic cycle (and therefore the commodities), but also for the Australian Dollar there is a risk of a double top. A failure of 0.75 would confirm this scenario with target the low of February 2016.
May 15, 2018
This month is once again particularly eventful for the emerging world.
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.
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.
June 28, 2017
The month of June was characterized by the good strength of the currency commodity then damped in the final phase. New Zealand, Canadian and Australian dollars have been the most important currencies with their divergence and the disappointing performance of the commodities.