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Forex Fundamental Analysis & Forecast by RoboForex

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  • RF roboforex
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    The Yen remains in the range. Overview for 19.01.2021


    USDJPY continues trading sideways; market players can’t decide on their attitude towards “safe haven” assets.

    The Japanese Yen remains within the sideways channel against the USD. The current quote for the instrument is 104.00.

    Investors haven’t yet decided on their attitude towards “safe haven” assets. One day they need the Yen to avoid risks, the next day their sentiment gets better and the Yen starts correcting.

    The revised report on the Industrial Production in Japan showed -0.5% m/m in November against both previous and expected readings being at zero. This is the first decline over the last 6 months. The components of the report show that the largest decreases came from motor vehicles (-4.5% vs. 6.8% the month before), chemicals (-4.0% vs -0.1%), business-oriented machinery (-3.3% vs 4.0%), and transport equipment (-3.1% vs 4.8%).

    On YoY, the indicator showed -3.9%, while the Capacity Utilization lost 2.9% m/m

    It’s quite understandable why industrial companies do not increase production – they are not sure of the final demand. The Japanese industry is export-oriented and the coronavirus pandemic makes export prospects rather unclear and dim.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
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    The Euro dropped to its six-week lows. Overview for 18.01.2021


    EURUSD continues falling amid European lockdowns and expectations of a new stimulus package in the USD.

    Early in another January week, the major currency remains weak. The current quote for the instrument is 1.2070.

    The statistics published by the USA last Friday were rather mixed but market players are not taking heart and still hoping for the best. The US Retail Sales dropped by 0.7% m/m in December after being -1.4% m/m in November and against the expected reading of zero. The Core Retail Sales lost 1.4% m/m after reducing by 1.3% m/m the month before and against market expectations of -0.1% m/m. These declines mean that consumers are very cautious about the future economic outlook and don’t want to spend much money.

    On the other hand, the Industrial Production in the USA added 1.6% m/m in December after expanding by 0.5% m/m in the previous month and against the expected growth by 0.5% m/m. The Capacity Utilization Rate rose from 73.4% to 74.5% over the same period.

    A preliminary report on the Consumer Sentiment from the University of Michigan was an unpleasant surprise as it dropped to 79.2 points in January after being 80.7 points in December and against the expected reading of 79.5 points. It might not be very bad or scary for the beginning of the year but let’s wait and see what will happen next.

    The key highlight of this week is the swearing-in of newly-elected US president Joseph Biden, of course. In his official comments as the country’s next President, Biden might talk about the stimulus package to be implemented in the nearest future – this is one of the reasons that provide the “greenback” with so much support these days.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Euro remains under pressure. Overview for 15.01.2021


    At the end of this trading week, EURUSD remains weak; the USD is looking more attractive.

    The major currency pair has been falling for the third consecutive trading session in a row. The current quote for the instrument is 1.2140.

    Investors remain quite positive towards the “greenback” due to expectations of a new stimulus package to support the American economy, which don’t scare them anymore: the package is obviously offering more pluses than minuses.

    The statistics published yesterday were rather mixed. A weekly report on the Unemployment Claims showed 965K after being 784K the week before and against the expected reading of 785K.

    There are several fundamental reasons for this growth. First of all, the government extended the period of time for claiming supplement benefits until March 14th. The benefit amount is $300 and it’s quite logical that more unemployed people decided to apply for it. Secondly, earlier the government expanded financial help to those who had already “depleted” their benefits, as well as self-employed and freelancers. Taken together, these people made the weekly reading increase.

    As a reminder, December was the first time over the last 8 months when the American economy cut the number of jobs. Possibly, it might take the labor market several years to completely recover after the coronavirus pandemic.

    There will be a lot of interesting reports from the USA today. for example, the Retail Sales, the PPI, the Core PPI, the Industrial Production, and the Capacity Utilization Rate for December. In addition to that, the country is scheduled to publish a preliminary report on the Consumer Sentiment from the University of Michigan for January, which is expected to decrease a little bit.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The USD has taken the upper hand. Overview for 14.01.2021


    A rebound in EURUSD was pretty short indeed; the USD is in demand again.

    After a short correction, the major currency pair is back to falling. The current quote for the instrument is 1.2145.

    The CPI and the Core CPI in America revived a little bit in December, just as expected. The indicators showed 0.4% m/m and 0.1% m/m respectively after being both 0.2% m/m in the previous month. Most likely, prices went up in December due to an increase in the petrol price.

    Energies continue getting more expensive in January, that’s why another increase in the CPI may be expected later.

    However, this slight surge in inflation shouldn’t have any influence on the White House’s plans to implement the stimulus package. Of course, there are risks of accelerating inflation but they are quite small because the Core CPI didn’t change.

    Expectations of the US economic recovery with a lot of help from the American government and the Fed were in favor of the USD despite lockdowns in Europe and a high burden of the COVID-19.

    Later today, the European Central Bank is scheduled to publish the Monetary Policy Meeting Accounts but it is very unlikely to contain anything that market players didn’t know before. In the evening, the USA will publish a weekly Unemployment Claims report: the indicator is expected to reduce a little bit and it might be a good signal.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    A rebound in EURUSD may be over. Overview for 13.01.2021


    EURUSD significantly recovered yesterday but investors aren’t so positive today.

    On Wednesday afternoon, the major currency pair can’t decide on where to move, although it took advantage of the rebound yesterday. The current quote for the instrument is 1.2202.

    Yesterday’s correction in the pair happened due to the decrease in the US bond profitability, which reduced optimism in the “greenback” and allowed the European currency to regain some positions. Today, everything is not so clear and investors can’t decide on the direction.

    Earlier, the 10-year bond profitability reached its nine-month high amid expectations of decisive actions and expenses of the White House to fight the pandemic. At the moment, the indicator is correcting.

    Later today, one should pay attention to the numbers to be published by the USA. For example, the CPI and the Core CPI, which are expected to show 0.4% m/m and 0.1% m/m in December after both being 0.2% m/m in November. The more neutral the readings, the better for the USD – its enthusiasts are expecting a new stimulus package from the government and the fed soon. Accelerating inflation is a serious risk no one can see right now.

    In addition to that, in the evening the USA is scheduled to publish the Beige Book. As a rule, market players barely pay attention to this report but it might be very important for understanding what is happening in the country’s economy.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Pound is slowly falling. Overview for 12.01.2021


    GBPUSD is slowly falling being pressured by the USD and Brexit.

    The British Pound is slightly retreating against the USD, thus building a new descending tendency. the current quote for the instrument is 1.3530.

    On January 4th, the Pound “touched” the high at 1.3704, and then bears took charge.

    Yes, the British currency is currently “suffering” from the USD strengthening. A positive effect of the Brexit deal made at the very end of 2020 by the United Kingdom and the European Union has been slowly fading away and may be replaced by concerns and carefulness. In addition to that, investors are worried about the possibility of implementation of negative interest rates by the Bank of England and that’s another risk that puts pressure on the Pound.

    The fact that the United Kingdom may introduce more serious quarantine restrictions because of the coronavirus pandemic, means that the 1st quarter of 2021 may face a more significant slump than before. It’s a serious factor that puts much pressure on the British regulator’s stance – the BoE doesn’t want but has to consider different options, including the further loosening of its monetary policy as early as during the February meeting.

    CFTC says that the bullish tendency in the Pound hasn’t been very strong for the fifth week in a row. It means that market players are very concerned about the Pound outlook and don’t expect it to grow in the nearest future.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Euro is retreating too fast. Overview for 11.01.2021


    After updating its highs, EURUSD is correcting quite fast; the “greenback” has been strengthening for the fourth consecutive trading session.

    The major currency pair continues retreating on Monday. The current quote for the instrument is 1.2170.

    The fact that the Democratic party won the majority in the Senate makes “greenback” enthusiasts happy. It’s rather unusual because the democrats are actively lobbying (and might approve it in the case of the majority) the stimulus package to support the country’s economy. It appears that a possible positive influence of the package results beats some minor issues, such as an increase in the money supply.

    The labor market statistics published by the USA last Friday showed that the Unemployment Rate remained unchanged at 6.7% in December against the expected reading of 6.8%. The Non-Farm Employment Change was -140K over the same month, which was a rather unpleasant surprise because the indicator was expected to add 60K after expanding by 336K the month before.

    One may assume that the NFP dropped due to a seasonal factor when the tertiary industry was cutting jobs intended for Christmas and New Year.

    At the same time, the Average Hourly Earnings added 0.8% m/m in December after expanding by 0.32% m/m in November and against the expected reading of +0.2% m/m. Probably, this positive report compensated for the weak NFP number a little bit but the increase in the indicator can be logically explained: due to fewer employees, companies managed to increase their salaries.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Euro is going higher and higher. Overview for 30.12.2020


    EURUSD is keeping its positive momentum in the middle of this year’s last trading week.

    The major currency pair is looking good on Wednesday. The current quote for the instrument is 1.2281.

    Those few investors, who are still on the market, remain quite positive but it’s not difficult due to celebrations of the catholic Christmas and New Year.

    Another positive factor is the start of vaccination against the coronavirus in Europe and that’s an excellent reason for market players to buy. Europeans are very committed, that’s why there is a hope that lockdowns may be canceled much earlier than expected, thus helping economies to recover faster.

    The Treasury Currency Report published by the USA yesterday didn’t leave any impression on market players.

    Later today, one should pay attention to the Chicago PMI, which may fall to 56.6 points in December, and the Pending Home Sales, which may add 0.1% m/m in November after losing 1.1% m/m the month before.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Euro is growing. Overview for 29.12.2020


    EURUSD continues rising amid global positive.

    The major currency pair intends to continue growing on Tuesday morning. The current quote for the instrument is 1.2240.

    Financial markets are overwhelmed with positive emotions after US President Donald Trump signed the budget for 2021, $900 billion of which is a stimulus package. Not as if it was a surprise but market players, who returned to the market for a short period between Christmas and New Year, duly appreciated the good news. A thin pre-New Year market only inspires volatility growth.

    Another positive news for bulls is the start of the vaccination against the coronavirus in Europe. Investors have high hopes for it, although the logic says that a lot of time will pass before the vaccination proves to be effective.

    In addition to that, there are always risks of new aggressive COVID-19 strains. However, right now market players are trying to stay focused on positive news.

    No statistics worth paying attention to have been published recently. In today’s economic calendar, one should pay attention only to US Treasury Currency Report but investors are highly unlikely to ignore it. Prices will probably continue moving by inertia driven by a positive attitude on the market.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Pound is consolidating. Overview for 28.12.2020


    GBPUSD stopped growing; after the Christmas celebration, the asset is consolidating.

    The British Pound slowed down its growth against the USD due to the Christmas calmness on the market. The current quote for the instrument is 1.3566.

    So, the United Kingdom and the European Union managed to make a deal on the trade agreement just days shy of the deadline. The agreement, which has 1,246 pages, covers aspects of fishing, borders, and arguable points of trade relations. Starting from December 31st, when London is scheduled to exit the alliance, trade operations will be made without quotas and fees. However, it doesn’t cover services and financial proposals.

    Probably, the catalysts for finding a final decision was the closure of the border between France and the United Kingdom due to a new strain of the coronavirus, which was considered by many as more aggressive and dangerous. It was a vivid picture of what might happen if the alliance countries had borders with the UK. Even if it didn’t happen, market players still had an excellent opportunity to see a possible collapse, which might have taken place without the Brexit agreement.

    From now on, investors will have to go with the flow and just watch how the parties are going to fulfill their parts of the agreement. One can say almost certainly that there will be updates and revisions but they will deal with technical matters.

    Reaching an agreement finally is a good sign for the Pound but later the British currency will bend with the wind.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Pound is waiting for a miracle. Overview for 24.12.2020


    GBPUSD is rising on Thursday morning in anticipation of the results of the Brexit talks.

    The British Pound is trying to keep its positive momentum against the USD. The current quote for the instrument is 1.3553.

    Today’s economic calendar is rather poor in reports and numbers due to the Christmas eve in Catholic countries. However, the “weather” in the United Kingdom is pretty hot despite the end of December: The Brexit negotiators were discussing topical issues all night long and don’t seem to stop. In the meantime, the Brexit transition period is just two weeks away.

    Last night, the media reported that the parties had reached some results in discussing the trade agreement.

    Noteworthy is that London, which had been standing its ground relating to trade border and fishing all autumn, softened its stance by the end of December and said it was ready for a compromise. The only problem is that there is no time left for it.

    It became known that there was a possibility to resume talks, at least the part that is left, the next year – this information came from French negotiators, who said that the EU had new requirements for London.

    It seems like the Pound won’t have dull moments in the next 24 hours.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The USD continues strengthening. Overview for 23.12.2020


    EURUSD is falling while financial markets are becoming less active.

    The major currency pair continues falling on Wednesday. The current quote for the instrument is 1.2182.

    Yesterday, the USA reported on the GDP for the third quarter of 2020. After stimulus packages, the country’s economy added 33.4% q/q against the first estimate of 33.1% q/q. As a result, the third quarter completely eliminated the decline of the second one. So, the economy is still not alright but at least doesn’t look sick.

    Later today, there will be more data from the USA and less time for work – the Catholic Christmas is almost here. America is planning to publish such reports as the Core Durable Goods Orders, which is expected to show +0.5% m/m in November after being +1.3% m/m the month before, and the Durable Goods Orders, which may add 0.6% m/m after increasing by 1.3% m/m over the same period of time.

    Personal Spending is expected to lose 0.2% m/m in November after adding 0.5% m/m in October. On the other hand, Personal Income may lose 0.3% m/m after decreasing by 0.7% m/m over the same period.

    Also. Investors will see the New Home Sales report, which is expected to fall a little bit in November, and the Revised University of Michigan Consumer Sentiment, which may correct down to 81.0 points in December after being 81.4 points in the previous month.

    In other words, there will be a lot of numbers and market players will try to use the most interesting of them right here and right now because Christmas is around the corner.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The USD is interesting once again. Overview for 22.12.2020


    EURUSD has reversed after the world faced a new coronavirus strain.

    The major currency pair is barely moving to the downside on Tuesday morning. The current quote for the instrument is 1.2220.

    Last weekend, the US Congress finally approved an additional stimulus package in the amount of $900 billion to support the country’s economy. The package is targeted, so one can be sure that the money will be spent as intended.

    It’s the second-biggest package ever approved for the American economy. The first one of $2.3 trillion was in March 2020. This time, it was supposed to be $1.2-1.5 trillion but the final approved sum is also very good.

    In this case, direct payments to individuals imply a $600 and $300 increase in unemployment benefits. In addition to that, billions will be spent to support small businesses, provide food assistance, distribute the COVID-19 vaccine, and improve the country’s health care system.

    $25 billion within the package are intended to extend the suspension of foreclosure of the right of redemption and leasehold.

    However, Democrats are standing their ground and believe that the country’s economy will need more stimulus packages before the coronavirus pandemic and its consequences are over.

    In this light, the USD is acting like a “safe haven” asset.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Pound is afraid of new strains. Overview for 21.12.2020


    GBPUSD is falling towards its two-week lows and may move much lower due to a harsher lockdown in the United Kingdom.

    The British Pound is getting weak quickly against the USD on Monday afternoon. The current quote for the instrument is 1.3240.

    The Brexit complications, which worried everybody last weekend, were put on the back burner because the United Kingdom is introducing a new lockdown due to a new COVID-19 strain, a more aggressive and mobile than the previous one.

    The Scientific Advisory Group for Emergencies (SAGE) has already reported that the strain that was identified in the United Kingdom has a very high attack rate and may infect many more people than expected earlier.

    All somehow COVID-related severe restrictions will remain in effect until the vaccination procedure starts. However, there are no ready vaccines, which proved to be totally efficient.
    In the meantime, December 31st, the date when the United Kingdom must exit the European Union after agreeing on all trade and economic issues, is just 10 days away.

    All this taken together makes the Pound rather nervous with the possibility of further decline.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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  • RF roboforex
    replied
    The Yen took a break. Overview for 18.12.2020


    USDJPY has plunged pretty much recently, now it’s time to correct.

    After updating its local highs, the Japanese Yen took a break against the USD. The current quote for the instrument is 103.35.

    The December meeting of the Bank of Japan was over today and the interest rate remained unchanged at -0.1%. This decision was widely expected but the data on inflation published a bit later was truly disappointing.

    The BoJ itself says that it requires to take a break and assess all that is happening. However, it will be quite difficult to invent something conceptually new and successful: probably, the regulator just has to take the situation as it comes to adopt inflation as a norm that can be varied. In this case, there might be new possible ways of working with such a price environment.

    Seeing the damage done to the country’s economy by the coronavirus pandemic, the Bank of Japan made a decision to expand all current stimulus measures for another six months.

    The Yen was significantly rising in December in response to the declining USD rate and that wasn’t good – the Japanese exporters weren’t happy at all.

    Forecasts for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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