UK GDP Up 0.3% – In line with expectations

May 11, 2016 Forex Analysis

GBPUSD, H1

The NIESR (National Institute of Economic and Social Research) confirmed its GDP estimate for the UK at 0.3% for the three months to April. This was in line with expectations, with the previous figure upgraded to 0.4% from 0.3%.

The UK continues to grow but it’s stumbling along, the Brexit debate and the global outlook continues to hang over growth prospects. This is no surprise and ammunition for both sides in the EU referendum debate.

Following the poor production data earlier today sterling came under pressure but has recovered, GDPUSD currently trades at 1.4440 whilst the EURGBP is now over the 0.7900 level.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

jmuta Janne Muta is a seasoned industry professional with over 16 years experience in the global markets. Originally from Finland, Janne has worked for institutions in both Helsinki and London as an institutional fund manager, global market analyst and FX educator.

Traders and fund managers from around the world have benefited greatly from Janne’s technical analysis methods. The indicators and price action based trading models he has developed, have, after rigorous testing, proven to be invaluable in identifying high probability trades.

“My mission is to help you to become a confident and successful trader”

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

UK Production Falls

May 11, 2016 Forex Analysis

GBPUSD, H1

U.K. industrial production rose 0.3% m/m in March, in line with forecast, but a tad below consensus, with the narrower manufacturing figure missing expectations and rising just 0.1% m/m, after a -0.9% m/m contraction in the previous month. Overall production was down -0.2% y/y, the first annual drop since December, while the decline in manufacturing accelerated to -1.9% y/y from -1.6% y/y in February. This was the biggest annual fall since 2013. The earlier timing of Easter this year may have distorted numbers somewhat, which the much weaker than expected French and German data yesterday already suggested, but shutdowns in the steel industry due to global overcapacity also added to pressure. The ONS meanwhile said that the figures do not point to any revision of the GDP estimate for Q1, partly due to back-revisions to the broader measure of industrial output, which now show output up 0.1% y/y in February, compared to a -0.5% y/y drop reported initially.

GDPUSD unchanged on the data at 1.4418 whilst the EURGBP struggles with 0.7900.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

GBPAUD trending higher

May 11, 2016 Forex Analysis

GBPAUD, 60 min

UK think tank NISER think sterling could fall 20% in the event of Brexit, which would cause a “significant” economic shock that would trim 0.8 of a percentage point of growth in 2017 and weaken GDP by between 1.5% and 7.8% by 2030. Currency weakness would then lead to a 2-4 percentage point rise in inflation, and the group even reckon that exports wouldn’t benefit due to lost access to EU markets. “Leave” supports will be chomping at the bit to refute these claims. The referendum is now just over six weeks away. UK bookmaker Ladbrokes is presently giving 71% odds for the UK remaining in the EU.

The worst Brexit fears evaporating has supported GBP lately. At the same the AUD has been hit by the RBA’s trimonthly Statement on Monetary Policy, which slashed forecasts for underlying inflation to 1-2% for 2016 from 2-3%. GBP has now been strengthening against AUD for over three weeks in a row. This has lifted the pair over 6.9% since April 18^th. In the daily timeframe this has mean market rallying higher with only a couple of down days and Stochastics moving above the overbought threshold. GBPAUD is getting nearer a significant resistance area at 1.9890 – 1.9995 that has potential to turn this pair lower again. However, this level is still some way off and the pair is still trending higher. I’m seeing support at 1.9520 – 1.9560. This area coincides with 4h Bollinger Bands and 30 period SMA. I’m looking for long entry signals inside this buy area with Target 1 at 1.9694 – 1.9740 and Target 2 at 1.9795 – 1.9820

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

US Inventories and JOLTS – Both positive

May 10, 2016 Forex Analysis

USDIndex, H4

US JOLTS report showed job openings increased 149k to 5,757k in April after edging up 4k to 5,608k in March (revised up from 5,445k). The rate rose to 3.9% from 3.8% (revised from 3.7%). But, hirings dropped 218k to 5,292k after the 285k March rebound to 5,510k (revised from 5,422k). The hire rate slipped to 3.7% from 3.8%. Quitters increased 25k to 2,980k following a 104k increase to 2,955k previously (revised from 2,950k). The rate was unchanged at 2.1%. Fed Chair Yellen is a big fan of the JOLTS report, and especially the quit component.

U.S. wholesale sales jumped 0.7% in March, while inventories rose 0.1%. These are the first increases in sales and inventories since September. The 0.2% February decline in sales was not revised, but February inventories were bumped down to -0.6% from -0.5%. Strength in sales was in petroleum thanks to the surge in oil prices. Excluding petroleum, sales dipped 0.2%. The rise in inventories was supported by drugs and autos. The inventory-sales ratio was steady at 1.36, holding just off the cycle high of 1.37 from January — the steep spike in the ratio from the 1.20 level from July 2014 is typically only seen in recessions.

Two relatively good pieces of news for the US economy, although the FX markets rather unmoved on the news. The USDIndex remains around 94.00, USDJPY north of 109.00 and EURUSD south of 1.1400.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

Risk on, stocks up and gold down

May 9, 2016 Forex Analysis

Gold, Daily

Gold prices have come off (-0.88%) as money has flowed into equities and markets are in a risk on mode. German Dax is up by 1.49% together with Eurostoxx 50 rising by 1.5%. Elsewhere, Indian CNX Nifty index is up by over 1.7% at the time of writing. The price of gold created a bearish doji candle in the weekly chart last week. In the daily time frame price has created a lower high. Both of these technical factors suggest weakness in the price of gold and increase chances of price moving lower in the coming days. Also, Stochastic oscillator (daily) is pointing lower.

There was a minor support at 1270 – 1272 that gold has now broken. We could see gold move all the way down to between 0.5 and 0.618 Fibonacci retracement levels where the 30 and 50 period moving averages currently reside. Should gold move to these levels, it’d be near the rising channel low and fairly oversold. I am therefore looking for long entry signals inside my buy area at 1243.80 – 1255.50 range with Target 1 at 1265.50 – 1276 and Target 2 at 1281.80 – 1291.40.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

AUDUSD – Hits Target 1 as USD gains ground

May 9, 2016 Forex Analysis

AUDUSD, Daily

On Friday (May 6^th) I identified a low risk, high probability trade based on both the fundamental news and a coincidence of technical indicators. The RBA had cut interest rates on Tuesday May 3^rd and then had also cut Inflation expectations for 2016 on Thursday May 5^th. The initial Target 1 (0.7330) saw a confluence of the Daily and Weekly Fibonacci levels, together with a key psychological area that was likely to be tested.

Additionally, the uncertainty surrounding the Australian federal election (the 54 day campaign started today for the July 2^nd election) is likely to hang over the AUD.

The USD strengthened in the Asian session and has gained ground in the European session today as USDJPY trades north of 108.00 and EURUSD falls to nine-day lows at 1.1380.

Further down we have 200 DMA, support and Target 2 at 0.7260. The Monthly chart turned down during April and shows support at 0.7050 and then 0.7000.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

Crude oil hits Target 1 as Canada fires rage

May 9, 2016 Forex Analysis

Crude Oil, 240 min

On May 5^th I wrote about wildfires in Canada’s oil producing regions and about US oil production dropping to lowest level since Sept 2014, sinking by more than 100k barrels a day in the week up to April 29th. Based on the fundamentals suggesting less supply and technicals indicating that the prices could move higher I said that I’d be interested in long entry signals inside my buy area at $43.20 – $44.00 with Target 1 at $45.00 – $45.50 and Target 2 at $46 – $46.70.

Crude oil retraced to my buy area on Friday, gave a buy signal and hit target 1 on the same day. Now price has rallied further and has almost touched the target 2. According to Reuters oil producers and refiners braced today for further supply constraints from the wildfires that have shut one half of Canada’s vast oil sands capacity and forced BP and other big oil firms to warn they would not be able to deliver on some contracts.

Price is currently trading near the upper daily Bollinger Bands and the recent highs. Therefore resistance levels of the recent trading range are near but at the same time the price of oil has created two higher reaction lows in the 4h chart. The higher lows increase the probabilities of this market breaking higher.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

AUDUSD – Bearish on RBA Inflation Forecast

May 6, 2016 Forex Analysis

AUDUSD, Daily

The RBA cut its forecast for underlying inflation in 2016 to 1-2% from 2-3% in the Statement on Monetary Policy. The Bank’s forecasts for growth and the labour market were little changed from the February Statement on Monetary Policy. Further rate cuts look likely this year amid increased risk that inflation expectations remain persistently lower for longer than the Bank currently expects. AUDUSD fell 0.8% to 0.7400 from 0.7460 as the Australian dollar lost value against the U.S. dollar following the release of the Statement.

I last updated the AUDUSD pair April 27th before the RBA meeting last week and the rate cut and last night’s reduction in the inflation target. My headline then was “Australia Where has the inflation gone?” yesterday’s announcement cemented my thoughts. I also suggested that the 0.7450 level was a key support level; this was robustly and significantly broken in the last 24 hours.

Technically we now have Daily support and downside Target 1 at 0.7330 – the 50% Fib level, which also coincides with the Weekly retracement levels. Further down we have 200 DMA, support and Target 2 at 0.7260. The monthly chart turned down during April and shows support at 0.7050 and 0.7000.

2016-05-06_12-55-37

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

EURUSD attempts to rally from support

May 6, 2016 Forex Analysis

EURAUD, 60 min

US Employment for April is out later and should reveal a 210k (median 208k) headline for the month following larger increases of 215k in March and 245k in February. Initial claims improved dramatically during April which could help lift the headline but consumer confidence measures and ADP were subdued.

Two days ago while EURUSD was still trading at 1.1490 I wrote that “the 1.1532 to 1.1570 should be a challenge for the bulls and this Sell Area has potential to turn the pair down again. We will follow the price action to see if market supplies us with sell signals. Should this happen my target one is at 1.1480 and target two at 1.1410.”

The pair rallied almost to my sell area but turned lower 4 pips below it. Market then moved down to hit both of the targets and is now reacting higher from a support created by the April 20th and 21st highs.

After moving considerably lower in last three days it seems that EURUSD is now likely to retrace some of the move which might provide us with entries on the short side after a rally. In the event that the rally I’m anticipating takes price all the way up to my sell aera I will be looking for sell signals between 1.1453 and 1.1474 with T1 at 1.1409 – 1.1425 bracket and T2 at 1.1360 – 1.1377 range.

Remember to manage the risks adequately and avoid highly geared positions when the US Non-Farm Payrolls are published. If you don’t know how to manage your risks professionally we recommend you attend our educational and interactive webinars.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”

US Initial Jobless Claims Surge

May 5, 2016 Forex Analysis

EURUSD, 240

U.S. initial jobless claims surged 17k to 274k in the week ended April 30, the highest level in five weeks. The 17k U.S. initial claims pop to 274k in the final week of April extended the 9k rise to 257k from a 42-year low of 248k in the April BLS survey week, as claims nearly return to the 276k recent peak in the week of Good Friday. Despite the sharp rise, the extremely tight mid-month readings signal upside risk for our 210k April payroll estimate. The claims roller-coaster ride since late-March, with high readings then and now with a deep trough in between, is likely due at least partly to the difficulties of seasonal adjustment with this year’s early Easter. Note that non-seasonally adjusted (NSA) claims fell 2k alongside the 17k seasonally adjusted (SA) rise. Claims averaged a lean 259k in April despite the late-month climb, versus higher recent averages of a still-lean 265k in March, 261k in February, 282k in January and 277k in December. The 248k April BLS survey week reading undershot recent already-tight BLS readings of 259k in March, 260k in February, 291k in January and 275k in both November and December.

EURUSD remains rather unmoved by the data, with support around the 1.1400 level and resistance at 1.1470-1.1480. All eyes now on tomorrows Non-Farm Payroll (NFP) figures.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Janne Muta

Chief Market Analyst

If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:

http://www.topforexbrokerscomparison.com

About Janne Muta, HotForex’s Chief Market Analyst

“My mission is to help you to become a confident and successful trader”