Euro \ dollar: The results of last week and the forecast for the coming period.
Forex forecast assumed - original pair decrease in the price zone of 1.1070 ÷ 1.1034, and then turn the course of the single European currency to rise to the established target levels.
Indeed, after the opening of trading, EUR \ USD resumed its decline, the driver of which were weak regional data on business activity in the industrial sector and the service sector, published in the Eurozone. Subsequent statistics from the region on business sentiment and economic expectations also proved negative. Against this background, the pair continued to decline, the rate of the single European currency has reached the target forecast levels (1.1070, 1.1034) and then exceeded them by testing at least at the level of 1.0957. Next, a pair of course, as we expected, turned to the upward movement. The euro had - weak US statistics on business activity in the services sector and the fall in stock markets, as a result of which investors get rid of shares and securities by buying the currency with the funding - EUR. However, it was not possible to develop upward momentum to our forecasted goals. Strong data on GDP growth for the 4th quarter, published in the US, he returned to the market expectations of another interest rate increase for federal assets. The rise of the pair against this background was stopped and the level of 1.1068 euro exchange rate reversed the decline.
In terms of fundamental factors: the dollar in the past two weeks rehabilitates himself, showing growth in tandem with the single European currency. In this he was helped by the fact that investors' doubts about the growth of the US economy is weakening. After the release of positive data on US GDP growth, industrial production, inflation, durable goods to the players returns expectation of rate hikes this year. Therefore, traders forecast that almost completely eliminate the Fed's tightening of monetary policy, hoping for a long-term weakness of the dollar, are not consistent with the reality, according to which the US economic growth ahead of other developed countries. However, it is not necessary at this forget that at this stage - it is only a corrective pullback in the pair continued upward trend. The main growth of the US currency is expected later, roughly, at the end of the 2nd quarter, when, probably will be another increase in interest rates the US Fed.
With regard to technical factors: We have said that from December 3rd of last year EUR \ USD is forming a new upward trend, in which a pair of the course was held on the rise more than 800 points and now corrects the previous rise. On descending from the rollback reached maximum (1.1375) quote currency tested a significant support level passing through the 2.5-month trend.
At the end of trading week closing level pair fell below weekly and daily pivot points, indicating that the continuing impact of the previous downward trend in the price movement of the single European currency.
Technical indicators on the weekly and daily timeframes provide mixed readings. In this day «Stochastic» has left the oversold zone and signals the impending rise. In turn, the short-term indicators (4-hour and hour) also demonstrate "bullish" divergence and deployed on the rise. On the resumption of lifting warned us and wave structure of the pair.
The same conclusion can be drawn from the analysis of the Report on the Commodity Futures Trading Commission last week, because once again the report showed lower total "clean" position to sell the euro, which confirms the continued "bullish" mood of the market.
Thus, considering all these factors we can assume in the zone reached price levels - a reversal of the course of the single European currency and the resumption of its upward movement.
Forex forecast for the euro for the week 29.02-04.03.3016 assume - the completion of decrease in pair close to the current price levels, and then turn the course of the single European currency to rise to the target levels: 1.0970; 1.0990; 1.1034; 1.1070; 1.11; 1.1130; 1.1150 and above towards the key resistance level of 1.12.
GBP \ USD: The results of last week and the forecast for the week.
Our previous forecast assumed - the continuation of the correction and restoration of pairs of lifting rate of the British currency to the established target levels. However, the actual price dynamics pairs very significantly changed our expectations. In the course of currency trading intervened force majeure. Unexpectedly, one of the most popular politicians of England, London Mayor Boris Johnson spoke out against UK membership in the EU reached an agreement with the European Union. In addition, 6 more government ministers announced that they would agitate citizens to withdraw from the EU structure. This dramatically changed the mood of the British.Polls have shown that the number of supporters of the UK release of the EU has increased significantly and now accounts for a large part of the population. The market reacted to the aggressive sales of the pound, the rate of which is paired with the US dollar has fallen to the price level of 1.4056. Another factor strengthening the "bearish" pressure on the pair was a speech by the head of the Bank of England Governor Mark Carney. In his comments, he said that, if necessary, an additional stimulation of the national economy, the Bank may decide on a new reduction of the interest rate, or an increase in the volume of purchases of assets. Market response to the intensified sales of the British currency by fixing a new 7-year low at around 1.3877. The publication of positive data on the UK economy, as well as easing market fears over the country's exit from the European Union boosted demand for the pound and the corrective pullback from the previous decrease in pair. However, an attempt to "bull" to win back losses to nothing lead. Strong economic statistics from the US stopped the rise of the pair and the level of 1.4041 pound deployed to reduce.
In terms of fundamental factors: The situation of the British currency at the moment looks unenviable: economic statistics have not yet been able to maintain a steady growth of the pound, and a referendum on the topic of EU output of the UK remains a constant source of "bearish" pressure on the pair. The technical picture is also far from ideal - the January restore couple never moved beyond the correction; the key resistance levels were not breached, but the strong support level 1.4080 turned out to be lost.
However, it should be remembered that the weakening of the pound, basically, was the result of panic and when a negative factor in the referendum will be weakened pound could regain the status of market leader.Especially because the fundamentals remain constructive. We have said earlier that the growth of the UK economy - the second highest economic growth among the countries of the "Big Seven". In this regard, we believe that the British pound in the immediate short term, will complete its current downward trend, and the pair will resume.
With regard to technical factors: The increased opposition supporters and opponents of the UK exit from the EU structure provoked the fall of the British currency last week to 550 points from the closing level of the previous week. The price of this closing was below the weekly and daily pivot points, reflecting the continuing impact of the downward momentum in the price movement of the pair.
Technical indicators on the weekly and daily timeframes also continue to signal the decline of the British currency. The same caution and the downward trend in the volume of the balance indicator OBV. Thus, the overall technical picture for this pair still has a "bear" character.
At the same time, the indicator «Stochastic» on the daily and 4-hour and hour timeframe is deep in oversold territory, which limits the potential downward movement. In addition, "the MACD" indicator on the weekly and daily timeframes shows "bullish" divergence, warning thus, the imminent change in the direction of the price movement of the pair. The wave structure of the pair also spoke about the resumption of rise.
In turn, the report by Commodity Futures Trading Commission on the results of last week once again showed a reduction of short positions on the pound and lower total "clean" position on the sale of foreign currency, which is also evidenced by the preservation of "bull" market sentiment towards the UK currency.
On this basis, we believe that the probability of resumption of the upward movement of the pair is still relevant.
Foreus forecast the pound dollar for the week 29.02 - 03.04.2016 assume - the completion of the current decrease in pair and turn the British currency to rise to the target levels: 1.3916; 1.3952; 1.40; 1.4041; 1.4074;1.41 and above.
It is worth considering that if the opening of the weekly trading, "bears" will be able to push the minimum level of Friday's 1.3852, and consolidate below it, the current decline will continue to key support levels 1.38 and 1.37, and then to unfold on the corrective recovery couples to the above target levels .
Economic statistics next week.
Rakie macroeconomic indicators coming out next week, may be of interest to traders?
In macroeconomic statistics coming out next week, the following indicators can be identified:
The economic calendar Monday - investors' attention will draw data from the UK in terms of volume of consumer and mortgage lending, the volume of loans to individuals and the number of approved applications for mortgage loan in January, as well as US data on the volume of unfinished transactions for the sale of property and business activity index from the Federal Reserve . Chicago and manufacturing activity from the Dallas Fed
considerable interest in the euro area will cause the publication of the February consumer price indices and the German data on the volume of retail trade and the index of import prices in January.
Among the other news of the day - Australia is to publish the January change in lending volume of the private sector; February inflation data and quarterly data on volumes of the Company's operating income and commodity stocks in warehouses. In New Zealand, changes come January the volume of building permits issued; February indicator of economic confidence indicator of the business environment and expected economic activity. Japan will report on changes in the volume of retail trade; the volume of industrial production; the volume of orders in the construction sector and the volume of bookmarks foundations of new residential construction in January. In Switzerland, it will be published index of leading economic indicators for February fevral.Italiya present indices of consumer prices. Canada will publish the January price indexes for raw materials and producer prices, as well as the balance of the current account of balance of payments for the 4th quarter.
And in the United States will be held an auction for the sale of 3- and 6-month bonds of public debt.
The economic calendar on Tuesday in the center of market attention will be the decision of the Reserve Bank of Australia on the basic interest rate and the accompanying statement to the decision. The changes are not expected, the rate will be maintained at the same level - 2%.
In other highly significant figures will be published in the United States, Japan, Australia, China, Great Britain, Switzerland and Canada - February index of business activity for the production sector. The corresponding figures will be published in the Eurozone, as well as the region's leading economies - Germany, France, Italy and Spain.
The significant interest will also publishing ISM manufacturing index - in the United States; the index of business activity in the non-manufacturing sector in China; GDP volume growth in December - in Canada; German labor market data, which include: change in the number of unemployed and the unemployment rate in the country (the previous figure - 6.2%). Unemployment rates are also published in the euro area (10.4%) and Italy (11.3%).
Among the other indicators - New Zealand is to publish the terms of trade index for the 4th quarter of last year.Australia will publish balance of payments current account balance; changes in the volume of building permits issued and the share of net exports in the GDP structure. Japan will present data on the January labor market, including the level of unemployment (previous rate - 3.3%); the proportion of the economically active population, as well as changes in the volume of capital expenditure for the 4th quarter and the January level of household expenditure. In Switzerland come the January data on the real volume of retail trade. Italy will report on the December GDP growth. And in the US it will be published the January speaker volume in the construction sector costs.
On the economic calendar, the environment at the center of market attention will be the publication of the February data on the change in the number of employed in the private sector of the US economy - from the agency ADP; economic survey of the US Federal Reserve regions "Beige Book", as well as the Australian data on GDP growth for the 4th quarter of 2015 the volume of housing sales in the primary real estate market in January. Similar data on GDP growth will be presented in Switzerland.
Considerable interest of investors cause hearing BOE Committee on Economic Affairs of the British Parliament and published in the UK in February index of business activity in the construction sector.
Among other indicators - Japan will report on the February changes in the monetary base volume. Spain will publish data on the change in the number of unemployed.
The euro zone will present the dynamics of producer prices, and US statistics will be published - the index of mortgage lending in February, as well as data on stocks of gasoline, crude oil and distillate - from the US Department of Energy.
The economic calendar Thursday - the focus of the market will be published in Australia, Japan, China, the UK and the US index of business activity in the services sector. Similar indicators and composite indices, which include the combined figures for both sectors, will be published in the Eurozone and in the leading economies in the region -. Germany, France, Italy and Spain
Considerable interest of investors cause as well - in the US publication of the composite ISM index for non-manufacturing scope and weekly data on the number of initial applications for unemployment benefits; January retail volume changes -to the euro area, as well as the outcome of the balance of foreign trade in January - in Australia.
In other news - Japan will introduce the February data on the volume of foreign investments in the country's economy and the volume of capital invested abroad.
UK is to publish price indexes for February to housing and the amount of official foreign exchange reserves, and in the US it will be made public - quarterly data on labor productivity in the non-manufacturing sector and the level of labor costs, as well as the volume of industrial orders in January.
In Friday's economic calendar in the center of market attention will be the main report on non-farm employment in the public sector of the US economy and the unemployment rate in the country (the previous figure - 4.9%), as well as changes in the number of people employed in the manufacturing and the private sector; the proportion of the economically active population; . changes in the average hourly and average weekly working hours pay
significant attention of investors and attract totals Balance US and Canadian foreign trade in January, including export and import volumes,
the February index of business activity and quarterly data on the level of labor productivity - in Canada and the January changes the volume of retail trade - in Australia.
in other news - The euro zone, Germany, France and Italy will publish February's index of business activity for the retail sector. Switzerland will present the annual report for 2015. Italy will report on the growth of GDP for the 4th quarter. In Japan, there are data on changes in the level of wages and real incomes of the working population in January.
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