Technical and Market Analysis by Vistabrokers - page 32
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Market Pulse 07/06
On Monday, the most busy with statistics is the US trading session, when in the United States will be published such important data as the ISM non-manufacturing PMI index, and in Canada - Ivey PMI index.
06:00 ** Factory Orders - May (Germany)
Moderate impact on the market (EUR). Changes in total industrial orders received by industrial enterprises. It is often a leading indicator of the industrial production dynamics for several months. The excess of the forecast is favorable for the currency.
07:15 ** Consumer Price Index - June (Switzerland)
Moderate impact on the market (CHF). Inflation is one of the key indicators in Forex, because the monetary policy often depends on it. The growth of the rate (or the forecast exceeding) are positive for the currency.
14:00 *** ISM Non-Manufacturing PMI - June (USA)
14:00 ** ISM Non-Manufacturing Employment Index - June (USA)
Strong impact on the market (USD). Data above 50 shows increase in activity compared to the previous month. In June, indexes are expected to increase.
14:00 *** Ivey PMI - June (Canada)
14:30 ** Bank of Canada Senior Loan Officer - June (Canada)
Strong impact on the market (CAD). The Ivey index is based on a survey of purchasing managers. It shows improvement (> 50) or degradation (<50) of the situation in comparison with the previous month. The growth of the rate or the forecast exceeding are favorable for the currency.
Vista Brokers: EUR / USD Was in Narrow Range prior to Referendum
On Friday, trading volumes in Forex were low due to the US Independence Day. Vista Brokersanalysts note that EUR / USD was traded in a narrow range prior to a referendum in Greece, scheduled for Sunday. At the end of the day the pair has risen by 0.17% to 1.1102.
Friday's statistics in the euro zone was mixed. Thus, retail sales in May in the region have increased by 0.2% mom and by 2.4% yoy, exceeding forecasts of 0.1% and 2.3%, respectively. The PMI index for the services sector in Germany has fallen from 54.2 to 53.8, while zero growth was expected. A similar index for France has remained at 54.1 as expected.
Note that the results of the referendum, which was held yesterday in Greece, showed that the majority of citizens said "no" to requirements of the ECB, the EU and the IMF, and therefore it is unlikely that Athens will agree with the "troika" regards the new financial program. The consequences of this decision may be serious enough - skeptics say not only about the exit of Greece from the euro zone, but also the disintegration of the monetary union itself. Left-wing parties, such as the Greek, "Syriza" take quite a strong position in many countries of the region. If such forces come to power in Italy or Spain, it is likely that these countries will go the same way as Greece.
EUR / USD.
Never a Moment's Peace
The US employment data published on Thursday (rescheduled
due to the celebration of Independence Day
) together with the market's reaction on the results
of the plebiscite in Greece (the people spoke against the agreement with creditors on
current
conditions) continue to
influence the dynamics of
the market. As a result,
it is very difficult to work, because
the reaction of remaining
market
players in response to certain statements
of
political leaders (on the
bailout
program
for
Greece)
clearly can not be taken
as a basis for trading decisions. Thus, if the consideration of the agreement will be delayed again, it is expected that
the
market's attention to this topic
will
reduce. As a consequence of the continued uncertainty quotes
are
currently
moving
in the framework of a tapering price channel,
that we may call by stretching a point a
"symmetrical triangle".
At this stage, it is recommended to focus on macro-economic indicators, with
a
corresponding reaction to
a
probable break of the "triangle" boundaries. Alternatively, if range trading continues,
we should
use oscillators to detect conditional overbought and oversold zones.
Volatility: 44%
Trend:
s
ide
ways
Fundamental background:
moderate
USD / JPY.
Investors Are Interested in
Safe-
H
aven
Assets
Today,
after
release of
the information about the Greek people will,
b
ears made an attempt to overcome the lower boundary of
the
graphic figure "triangle". The Japanese currency
is
traditionally
considered as a safe-haven asset more t
han the US
one
, which leads to significant price
fluctuations
, even when
the market
receive
s
the news,
that
at first glance,
has no relevance to it.
However, quotes have already returned to the above
-mentioned
pattern
borders
, and now
we see some
preconditions for the development of an upward movement.
Today, it is recommended to
stay out of the market
, waiting for the stabilization of the situation or the real
exit of quotes
beyond the "triangle."
Volatility: 67%
Trend:
s
ide
ways
Fundamental background:
moderate
Vista Brokers: Oil Fell to 3-Month Low
On Monday, oil drops amid results of the referendum in Greece. Vista Brokersanalysts say that investors prefer safe-haven assets such as precious metals in the commodity market and the Japanese yen in the currency one. According to the results of the referendum the majority of Greeks said "no" to reforms that require the ECB, the EU and the IMF, and therefore the unstable situation in the euro zone will worsen.
Today, on the ICE Futures Exchange in London, August Brent futures have reached the lowest level since April at $ 59.38. Later, the price has rebounded slightly - to $ 59.67. Thus the decline since the trading opening was 1.07%.
Meanwhile, on the New York Mercantile Exchange crude oil futures for delivery in August, have fallen in price by 0.84% to $ 55.05. Earlier today, these futures have also reached the lowest level since April - $ 54.55. The spread between Brent and WTI has increased to $ 4.62 from $ 3.39 by close of trade on Thursday .
Thus, the Greek saga continues – the Prime Minister Alexis Tsipras has expressed a positive attitude towards the results of the referendum and said that negotiations with creditors will continue to resolve the situation with the banking sector. Recall that banks in Greece do not work for a week. The European Central Bank has not yet announced a decision on the supply of liquidity in the Greek financial system. If the flow of financing stops, the banking system would be destroyed within a few days.
In a surprise move, Greek Finance Minister Yanis Varoufakis resigned. He argued his departure that "some European participants " believe that the absence of Varufakis in the negotiations will help to reach an agreement. So he leaves the post to facilitate Tsipras negotiations with the "troika".
Analysts say that today the situation in all financial markets is highly volatile and it is difficult for traders to make trading decisions based on comments about Greece and interpretations which are now influencing the dynamics of many financial instruments.
Market Outlook According to the Method of Bill Williams:GOLD
We have closed the short position from 1173.59 on a signal of the red Alligator's line crossing (1173.22), that is almost the opening price. Soon we have opened a new position to sale from 1165.87, which is currently relevant. Recall that after a referendum in Greece, as a result of which requirements of creditors were rejected, it was a price gap up. Thus, it has closed soon, so the total uncertainty remains.
Volatility: 7%
Trend: bearish
Fundamental background: weak
Market Outlook According to the Method of Bill Williams: USD/JPY
The order to sale from 122.59 has activated. Meanwhile, the market is still burning in fever because of Greece, which causes unpredictable price fluctuations. Thus, after a spurt down at the opening of trades quotes have returned to initial levels and even higher, which means that we should closely monitor the position to fix the result at the right time.
Volatility: 67%
Trend: sideways
Fundamental background: weak
Market Outlook According to the Method of Bill Williams: EUR/USD
We have fixed a formally profit on the short position from 1.1110 at the level of on of the bars' closure above the red Alligator's line. After today's morning fluctuations we have started to sale again, but the result of this position is close to zero yet. It seems that the market is waiting for the reaction of European senior ranks on Greek referendum results. We should be prepared to sharp volatility leaps.
Volatility: 44%
Trend: bearish
Fundamental background: moderate
Market Outlook According to the Method of Bill Williams: GBP/USD
The position to sale from 1.5671 is still relevant, because after a short-time two-step dance the upward movement has continued. We have red zone signals as well as signals from indicators (АО – «saucer», АС – «3 red bars below zero», «zero crossing») to add volume to the position. The value of the red Alligator's line is below 1.5620, which gives us reasons to expect a positive result from this position.
Volatility: 32%
Trend: bearish
Fundamental background: moderate
Market Pulse 07/07
Tuesday is rather saturated with the important statistics that will be published in different countries.
4:30 *** RBA Interest Rate Decision - July (Australia)
4:30 *** RBA Rate Statement - July (Australia)
Strong impact on the market (AUD). It is expected that the Reserve Bank of Australia keeps the interest rate unchanged. The accompanying statement may contain some interesting comments or hints on the future strategy of the RBA.
5:45 ** Unemployment Rate - June (Switzerland)
7:00 ** Foreign Currency Reserves - June (Switzerland)
Moderate impact on the market (CHF). According to the forecast the unemployment rate in June remains at the same level. Regarding the volume of foreign currency reserves, the rate has started to attract attention of market players with the beginning of SNB interventions. From the volume changes investors can judge about interventions.
08:30 *** Industrial Production - May (UK)
8:30 ** Manufacturing Production - May (UK)
Strong impact on the market (GPB). Changes in the level of industrial production in the previous month. Often production carries a small contribution to GDP, but it allows to predict the dynamics of interest rate. Growth or the forecast exceeding are favorable for the currency.
12:30 *** Trade Balance - May (Canada)
Strong impact on the market (CAD). The trade balance is the difference between exports and imports for the period. Positive values are favorable for the currency, reflecting the inflow of money into the country.
12:30 *** Trade Balance - May (Canada)
Strong impact on the market (USD). The trade balance is the difference between exports and imports for the period. Positive values are favorable for the currency, reflecting the inflow of money into the country.
14:00 ** JOLTs Job Openings - May (USA)
Moderate impact on the market (USD). Job openings in the private sector at the end of the reporting month. The increase reflects an improvement in the labor market situation in the country, showing a high demand for workers.
Vista Brokers: US Statistics Did not Meet Expectations
On Monday, a strong influence on financial markets had the results of Sunday's referendum in Greece, which showed a negative attitude of the majority of Greeks to a financial bailout program from the "troika" and to reforms associated with it. Vista Brokers analysts note that the dollar was shooked with the weak data from the US, although, of course, the US currency is still more stable compared to the euro.
During the US trading session the Institute of Supply Management (ISM) has published the non-manufacturing PMI index. In June, the index has risen from 55.7 to 56.0, but the forecast assumed the increase to 56.5. The ISM non-manufacturing employment index has decreased during the first summer month from 55.3 to 52.7.
Analysts say that the results of the referendum in Greece intensifies fears that the country will leave the euro zone. International creditors have commented on the situation, stressing that Greece will continue to get funds only in return for long-term and large-scale reforms. Will Greek banks still receive liquidity from the ECB – it remains questionable. Euro zone leaders will gather at a conference today to discuss the situation in Greece and the future strategy. Markets continue to closely monitor the course of events.
Vista Brokers: Asian Markets Move Multidirectional
On Monday, during the Asian trading session, stock markets in Japan and Australia were increasing, while in China they were declining. Vista Brokers analysts say that over the weekend Chinese authorities have taken some measures to calm markets worried with the situation in Greece (brokers and various financial companies are obliged to buy shares, with the support of the government). However, it does not help - today Shanghai Composite has fallen by 3.19%, while the Hang Seng index – by 1.17%.
In Japan, the Nikkei 225 has risen by 1.38% and the Australian S & P / ASX 200 – by 1.44%, after it became known that the Reserve Bank of Australia left its key interest rate unchanged - at the level of 2.0%. Key thought of the RBA accompanying statement is that further decline of the Australian dollar is desirable and necessary. Amid this AUD / USD has dropped to 0.7482.
It should be noted that the situation in Greece continues to affect markets. Today, Prime Minister Alexis Tsipras took a difficult telephone conversation with the head of the International Monetary Fund Christine Lagarde about missed payments on 30 June. Lagarde said unequivocally that the policy prohibits the lending of arrears, while employees of the organization can provide technical assistance to the country if Athens asks for it. A week ago, Greece has officially become the first developed country that has joined the list of IMF defaulters. Also note that it is a new finance minister in Greece - Janis Varufakis, who had suddenly resigned yesterday, was replaced by Deputy of Minister for Foreign Affairs Euclid Tsakalatos.
US stock markets (overnight) have declined compared with the closing on Monday. Dow Jones Industrial Average - by 0.26%, S & P 500 index – by 0.39%, NASDAQ Composite index – by 0.34%. The reason was the data on the non-manufacturing PMI index, published by ISM. In June, the index has risen from 55.7 to 56.0, but the forecast assumed an increase to 56.5. The ISM non-manufacturing employment index has decreased during the first summer month from 55.3 to 52.7.
EUR / USD. Apocalypse
Was
Cancelled!?..
We should definitely
mention
a
kind of immunity that markets had to develop over the endless Greek tragedy.
Thus
,
earlier
market experts
were expounding various
apocalyptic scenarios about the collapse of the synthetic formation called "the euro
zone
"
in
a
case of
Greek
default,
but now
forecasts have become much more modest, given that the market has remained fairly stable after Sunday's referendum and
earlier
(when Greece
has
missed
the payment
to
IMF). One of the
key
technical analysis
postulates
states that "prices
take everything into account
", which means that all projections and assumptions
are already accounted
in current prices. Earlier we
have
mentioned the formation of
the
graphic
figure
like
"symmetrical triangle", where were converging graphic
borders.
So,
if the price leaves its borders,
it will give
us the
reason
to
open a position in the direction of the break
through
, and
it is
meaningless to talk about "
t
o be or not to be".
A
ny trade action
will
not
be
justified
u
ntil the market itself show
s
the direction.
It is recommended to
focus on "triangle" border
s
and
use
their breakthrough as a signal to enter the market in the direction of the break
through
.
Volatility: 47%
Trend:
s
ide
ways
Fundamental background:
moderate
GBP / USD
Sees how the Land Lies
The British currency could catch hold of the
important support line, thereby interrupting a decline in
borders of a
short-term downward correction. Here, according to the first
re
boun
d
, bulls are
going
to resume
the
interrupted
trend
, using current techn
ical opportunities
, and not just
them,
because today is also expected
a
fundamental
reason to buy
. Thus,
at
08.30 GMT
in theUK will be published May
industrial production data, which in case of predicted values exceeding
may
act as a catalyst of growth.
It is recommended to go long i
on a breakthrough
of 1.5631 to reach the resistance line of the current downtrend. A break of this line will open GBP / USD the way to June high
s
above 1.59.
Volatility: 67%
Trend:
b
earish
Fundamental background:
moderate
Vista Brokers: Oil Is Recovering after Falling
On Tuesday, crude oil futures are rising in price. Vista Brokers analysts note that the "black gold" restores the position after yesterday's strongest decline in the last three months. Oil was pressured with talks on Iran and Greece, as well as concerns over a slowdown in China's economy.
During the European trading session on the ICE Futures Exchange Brent futures for August have risen in price by 0.38% to $ 57.38 per barrel. A day earlier, these futures have fallen by 6.27%, to close at 3-month low of $ 56.54 per barrel.
Meanwhile, on the New York Mercantile Exchange crude oil futures for August delivery have risen by 0.27% to $ 53.14 per barrel. On Monday, futures have lost 7.73% to close at the low of April 10, at $ 52.53 per barrel.