Forex Technical Analysis 02.07.2015

 Forex Technical Analysis EUR USD, "Euro vs US Dollar"

Eurodollar is under pressure and continues falling; it has formed the central part of its continuation pattern. We think, today, the price may test level of 1.1100 from below and then fall towards level of 1.0965. After that, the pair may return to level of 1.1100 once again and then continue falling to reach level of 1.0930.

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GBP USD, "Great Britain Pound vs US Dollar"

Pound has broken its consolidation channel downwards right now is extending this descending structure. We think, today, the price may reach level of 1.5560, at least. Later, in our opinion, the market may return to level of 1.5715.

USD JPY, "US Dollar vs Japanese Yen"

Yen is moving to return to the center of its consolidation channel. We think, today, the price may continue forming the current descending wave to break the minimum and reach level of 120.60. Later, in our opinion, the market may grow to return to level of 122.22 to test it from below and then form another descending structure to reach level of 119.00.

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Forex trading fundamental report 2015/07/01

Greece is in a default, but the euro is unfazed

The main currency pair is unusually calm on Wednesday morning: the Greek technical default took place, although no one has given this definition of the lack of payment.

Default is the most popular hashtag on the Greek instagram. In my opinion, this is popularity: the economic problems of Athens are watched more than kittens and other fun things. However, for Greece itself it is now unlikely to be convenient and comfortable, in fact, starting from July 1st, it has two months to figure out how to pay off it debts. If the solution does not appear by September, the country will declare itself bankrupt for real.

The euro/dollar is stable on Wednesday morning, and the pair is trading around 1.1130.  Athens owes most of their money to Germany, Spain and Italy. Well, the International Monetary Fund, of course. Despite the fact that on paper, there is some budget surplus, there is almost no money in the treasury. Before Greece was also in arrears with payments and tried to negotiate more favorable conditions of service credit lines. But now all this is in the past: Greece will not see the tranche of almost 7 billion euro until it pays off the debt.

The market is talking about whether Russia will pay the 1.6 billion euro for Greece. I think it will not. On SPIEF there were talks about loans, but Moscow will keep its neutrality in this matter. At the moment it makes no sense to direct the focus of the Old World on itself.

Greece, as a result of recent events, has become the first of the developed countries, who could not repay the loan to the IMF. The precedent has been created, and who knows what will happen next in the story of the rich lenders and the poor borrowers.

The behavior of the euro/dollar is very interesting in this context. Most likely, in the coming days, the instrument will play on any comments on this subject, but the entry to the bottom of the medium-term range will happen only if the dialogue, as vague as it is, will turn in an unexpected direction.

Forex trading online -forex technical analysis Report 01.07.2015

EUR USD, “Euro vs US Dollar”-forex technical analysis Report

Eurodollar has eliminated the gap and almost completed its correctional structure. We think, today, the price may start another descending movement towards level of 1.1090 and then return to level of 1.1185. After that, the pair may continue falling to reach level of 1.0930.

GBP USD, “Great Britain Pound vs US Dollar”

Pound has tried to expand its consolidation channel both downwards and upwards. We think, today, the price may expand it downwards again, to reach level of 1.5560 and then form another ascending structure with the target at level of 1.5940. After that, the market may continue falling inside the downtrend.

Forex Trading blog uk Daily analysis report EURUSD,

EURUSD, Daily Forex Trading blog uk Daily analysis report EURUSD,

The Swiss National Bank has confirmed it engaged in a currency intervention yesterday in EURCHF as the bank sees CHF being too expensive versus EUR (EURCHF being too low). This supported both EURCHF and to certain degree other EUR pairs in yesterday’s trading.  As a result EURUSD moved through the resistance level at 1.1130 and spike up to 1.1278 before falling down again. As per EURUSD futures today’s trading has been careful with light volumes after yesterday’s strong volatility. Strong movement higher from a support suggests that there is further upside ahead in EURUSD. I am seeing intraday support between 1.1110 and 1.1140 while significant daily support and resistance levels are at 1.1006 and 1.1292.

According to ECB’s Coeure Grexit can no longer be excluded. The executive board member said in France’s les Echos that a Greek exit from the Eurozone can unfortunately no longer be excluded, even if the ECB and Eurozone institutions want Greece to stay. Coeure said the European proposals gave Greece time and autonomy to take reform steps, adding that it was Greece’s decision to end the negotiations. Coerue also said that a “No” in the referendum would make it very difficult to continue the political dialogue.

Many commentators are now asking what Greece will be voting on this Sunday. For EU Commission President, the July 5 referendum will be a vote on Greece’s future in Europe, for the Greek opposition it is a vote on EMU membership, but for Tsipras and Syriza it is a way to change bailout terms. The Greek government is still selling a “No” to the creditor’s bailout offer as a chance to get improved conditions, but in reality, the offer will likely no longer be on the table on July 5 and without a bailout program in place the ECB will have difficulties defending its ongoing ELA assistance, which effectively turns it into a lender of last resort and the financier of the Greek government, something the Eurozone treaties clearly rule out. For now Draghi just decided to freeze the amount of ELA, but with the bailout program running out tomorrow, the ECB’s review of the situation on Wednesday could not only end re-financing for Greek banks, but also the Greek government, at least within the Eurozone system.

Yesterday US Dallas Fed manufacturing index improved to -7.0 in June after falling to -20.8 in May. This is a 6th consecutive month that the regional index has been in contractionary territory (below zero), which is mainly a function of the recession in the oil sector. US pending home sales rose 0.9% to 112.6 in May, it’s a 5th straight monthly gain, from a revised 2.7% increase April to 111.6 (was 112.4). Regionally, sales were up in the Northeast (6.3%) and West (2.2%), but lower in the Midwest (-0.6%) and South (-0.8%). Compared to last year, sales are up 8.3% y/y from 12.6% y/y.

Greece: how bad is the latest development for financial markets?

Forex trading Economic news -fundamental Analysis  Report- Forex Trading blog uk

In a word, not yet. Yes, EURUSD gapped down at the Sunday open - the low was 1.0955, since then the EURUSD has managed to retrace 50% of the decline and is now testing 1.1060. Considering Greece’s position in the currency bloc is in the balance and default hangs like Damocles’ sword over Tsipras’s and co.’s heads, I can’t help but be impressed by the single currency’s relative “resilience”.

Can markets get over the Greek crisis?

There is an air of inevitability in the markets today that the endgame has arrived. Greece is likely to be booted out of the currency bloc, but the Eurozone will survive. That doesn’t mean that all is well, however, markets are waiting to hear updates from Greece to find out: 1, will they default on Tuesday or 2, will they be offered debt relief. Hence the mini recovery in the markets so far.

Maybe one reason for the relative calm is that reports suggest that the European Commission offered Greece debt assistance/ relief late on Sunday. We still need to hear more about this, but the latest news reports suggest President Obama and the US Treasury Secretary have also made calls to Merkel and Hollande to reduce Greece’s debt burden. If this can happen quickly enough then will Greece have to default tomorrow?

Believe it or not, but uncertainty in the market is actually keeping things fairly calm early on Monday, but we would note that EURUSD volatility spiked to its highest level since 2011 earlier, so one rogue headline could see risky assets take another lurch lower (EUR included).

The rush to safe havens:

EURJPY has fared the worst, it is down some 1.5% since the open. This is not unexpected since the JPY is considered the ultimate safe haven. But even this pair is making a comeback today, and found support at the 100-day sma at 133.53. The Swiss National Bank (SNB) announced that it had intervened overnight to try and stem the safe haven flow into the Swissie. 1.0314 was the low, but even after intervention, EURCHF is still below Friday’s high.

EURUSD volatility surged to its highest level since 2011 in the immediate aftermath of the news; however, it has backed away from these 4-year highs since the European open. Overall, this tells us a couple of things, on the one hand the fundamental bias for the EUR remains bearish as we await further Greek updates, and one rogue headline could send the markets into another tailspin; however on the other hand the EUR may not come under sustained pressure until we see contagion spread to other markets.

Grexit not a cause for contagion right now:

Although Greek events take the Eurozone into unknown territory, the real risk was the fallout to other countries. However, the contagion effect so far has been limited at best. Italian and Spanish yields have been drifting higher in recent days but after jumping on the back of the news about Greek capital controls they are now retreating from recent highs. German bunds remain safe haven flavours of the month, but until we get another dire Greek headline even German bund yields could stabilise.

How bad is this for Europe?

Some news reports have called events in Greece, Europe’s Sarajevo moment (when Archduke Franz Ferdinand was assassinated leading to the outbreak of the First World War 6 weeks later). We don’t think that we are at this stage yet, however if another European state gets into trouble  in the coming months or years then Eurozone exit is likely to be priced in fairly quickly.

For now, the market is obviously concerned with what is going on, but it is willing to sit back and wait to see how this plays out. After all, there’s still a referendum in Athens that is scheduled to take place next Sunday, and we haven’t heard from the Eurogroup or European Commission to see if debt forgiveness is a real possibility. Until then watch this space…