Daily Market Analysis from ForexMart

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  1. #891
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    Daily Market Analysis from ForexMart
    USD rises ahead of Fed's meeting

    The US dollar fell slightly due to durable goods orders data. Shortly after, it was trying to strengthen against a basket of six major rivals. Today, the most anticipated event of the week will take place - the FOMC meeting. Yet, many experts think that Fed Chairman Jerome Powell is unlikely to announce certain changes to the monetary policy. So, his testimony will hardly surprise market participants. Moreover, the Fed will clarify its position in the Jackson Hole meeting which is scheduled for September. However, investors are still awaiting the current meeting with bated breath. The main question is how the market will react to the Fed's meeting.

    Currently, China's stock market is in the spotlight. It has collapsed significantly due to the ongoing tightening of regulation on large IT companies. Sharp fluctuations in China's equity market may adversely affect stock markets in other countries.

    Hence, demand for safe-haven currencies is rising after the fall in government bond yields. Treasuries are declining despite expectations of the reduction in the bond-buying program. Usually, this would lead to an increase in government bond yields.

    The greenback seems to have resumed bullish momentum. It may soar to new highs amid turmoil in the market. Besides, the US currency may strengthen if the Federal Reserve hints about the probable reduction of the bond-buying program.

    The yen rose moderately following a sell-off in China's stock market. The rebound of the Japanese stock market from the recent low was much more modest in comparison with other countries.

    The US dollar index is growing moderately before the Fed's meeting. Maybe traders have already started factoring in Jerome Powell's hawkish remarks.

    The EUR/USD pair, as the main barometer of risk sentiment in the market, opened the trading day with a decline. Yesterday, it remained almost unchanged. The pair may even climb to 1.1900 if the Fed's meeting outcome does not stir panic in the market.

    If Powell does not provide new comments about the bond-buying program, the euro will continue to fluctuate between the levels of 1.1700 and 1.1800 with possible rebound to the 19th mark. Investors are certain that the Fed will not reveal anything new until the Jackson Hole meeting in autumn where it will discuss whether to raise the debt ceiling.

    Experts believe that the euro will rally in the near future. For instance, economists at Commerzbank assume that the pair may return to the area of 1.1860-1.1930.

    Strong resistance levels are located at 1.1884 and 1.2008. These level may halt the pair's growth. After breaking through 1.1750, the next target will be the area of 1.17041.1600.
    Regards, PR-Manager ForexMart

  2. #892
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    EUR/USD and GBP/USD: Trading recommendations for novice traders for July 30, 2021

    Economic calendar for July 30

    Today, in terms of the economic calendar, we have preliminary data on inflation in Europe, where it is predicted that consumer prices will rise from 1.9% to 2.0%.

    Given the growth of the European currency over the past days, inflation indicators could have already been taken into account in the quotes.

    Inflation in the EU - 09:00 UTC

    We study and analyze

    The consumer price index is prepared by Eurostat, which determines the change in prices of a selected basket of goods and services for a given period. This indicator is considered a key indicator for assessing inflation. From the point of view of fundamental analysis, the rise in inflation is a positive signal for the national currency, but when consumer prices rise faster than forecasted, it is not considered the best signal.

    Trading plan - EURO/DOLLAR for July 30

    Analyzing the current Euro/Dollar trading chart, you can see that the resistance level at 1.1900 puts pressure on buyers, which leads to a slowdown and a rebound in the price.

    In this situation, traders consider two possible scenarios of price development at once:

    The first plot proceeds from the natural basis of the past, associated with the resistance level of 1.1900, which contributes to the increase in the volume of short positions.

    In simple terms, traders are looking at a rebound from 1.1900 towards 1.1830.

    The second plot assumes that the correction from the pivot point 1.1750 will remain relevant in the market and after a short stagnation along the 1.1900 level, it will still be broken by the price along an upward trajectory. For the trading scenario to coincide on the market, the quotes must hold higher than 1.1915 in a four-hour period, this will open the way in the direction of 1.1950-1.1975.

    Trading Plan - Pound/Dollar for July 30

    Analyzing the current Pound/Dollar trading chart, you can see that the area of the psychological level of 1.4000 acts as a resistance in the market, which leads to a slowdown and a rebound in the price. The logical basis of the past associated with this level can play into the hands of sellers, which will lead to an increase in the volume of short positions.

    In simple terms, the rebound stage may well lead to a downward move towards the 1.3900 level.

    An alternative scenario for the development of the market will be considered by traders if the price is kept above 1.4050 in the daily period. In this case, the chances of buyers will increase to return the quotes to the area of the local high of the medium-term upward trend.
    Regards, PR-Manager ForexMart

  3. #893
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    Analysis and trading recommendations for EUR/USD and GBP/USD on August 2

    Analysis of transactions in the EUR / USD pair

    Euro fell on Friday despite good GDP and inflation reports from the Euro area.

    Trading recommendations for August 2

    EUR / USD will again move depending on the economic reports that the Euro area will release today. Strong data on manufacturing activity will lead to a price increase, while a weaker than expected report could result in another decline in the market. Then, in the afternoon, a similar report will be published from the US. This time, if the data expectations exceeds, dollar will regain its strength, which could lead to a decline in the pair.

    For long positions:

    Open a long position when euro reaches 1.1882 (green line on the chart), and then take profit at the level of 1.1920. Demand will increase if the Euro area publishes strong economic data. But before buying, make sure that the MACD line is above zero, or is starting to rise from it.

    It is also possible to buy at 1.1857 and 1.1818, but the MACD indicator line must be in the oversold area in order to bring about a market reversal to 1.1882.

    For short positions:

    Open a short position when euro reaches 1.1857 (red line on the chart), and then take profit at the level of 1.1818. A decline will occur if the Euro area releases weak economic reports. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.

    It is also possible to sell at 1.1882 and 1.1920, but the MACD line must be in the overbought area in order to provoke a market reversal to 1.1857.

    Analysis of transactions in the GBP / USD pair

    Pound did not hit the local high last Friday. To be more specific, it was the multiple failed attempts to break through 1.3975 that led to the closure of many long positions in the market.

    Trading recommendations for August 2

    Pound will trade today depending on the data on UK manufacturing activity. If the figure turns better than the forecast, then GBP/USD will increase rather sharply. Then, in the afternoon, a similar report will be published from the US. This time, if the data exceeds expectations, dollar will regain its strength, which could lead to a decline in the pair.

    For long positions:

    Open a long position when pound reaches 1.3910 (green line on the chart), and then take profit at the level of 1.3956 (thicker green line on the chart). GBP/USD will climb up if UK publishes good PMI data. But before buying, make sure that the MACD line is above zero, or is starting to rise from it.

    It is also possible to buy at 1.3885 and 1.3846, but the MACD line should be in the oversold area in order to set off a market reversal to 1.3910.

    For short positions:

    Open a short position when pound reaches 1.3885 (red line on the chart), and then take profit at the level of 1.3846. A decline will occur if UK releases weak economic reports. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.

    It is also possible to sell at 1.3910 and 1.3956, but the MACD line should be in the overbought area in order to trigger a market reversal to 1.3885.
    Regards, PR-Manager ForexMart

  4. #894
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    Another trillion dollars for the American economy

    Yesterday, the leading US stock indexes fell slightly, but in general they continue to be near their absolute highs and can update them any time. All three leading indexes, the S&P 500, Dow Jones, and NASDAQ Composite, maintain upward trends. We have already mentioned earlier why this is happening. First, the Fed continues to buy bonds and mortgage-backed securities from the open market, saturating it with liquidity. And all the cash immediately flows into the most profitable stocks that can provide profit to their investors in the future. Moreover, the profit is not even a dividend, but a profit due to a constant increase in value. The dividends of almost all American companies are already below the current inflation. Therefore, it is extremely difficult to make a profit from dividend payments in the near future. However, since investors do not have much choice, and stocks are the most common investment tool, it is the stock market that capital continues to flow.

    At the same time, the US Senate agreed on a new package of assistance to the US economy. Previously, it appeared under the name "infrastructure package". It can be recalled that Joe Biden offered two stimulus packages for the American economy, each of about $2 trillion. As you can see, the final version of the first package is half as small. However, we have not yet seen the second package, which is the "social" one. The infrastructure package will be aimed at investing in roads, bridges, ports, the internet, and other facilities over the next 5-8 years. It is noteworthy that the source of the formation of this package is planned to be tax revenues, but not the attraction of loans. In other words, the US government will not climb into even greater debts to finance this $1 trillion package. Of course, we cannot judge where this money will come from. In America, they really like to live on credit, and the size of the public debt in the United States already exceeds the volume of GDP. Simply put, the States owe more money than their economy is worth. In fairness, it should be noted that about half of the debts are debts to themselves. Simply put, the American government owes American investors, various American funds, the Fed, and so on. For example, the United States owes China or Japan only $1 trillion, which is not so much. Thus, a default is unlikely to threaten Washington. Moreover, the money is spent on improving infrastructure, which will attract new investors to America even more in the future. The Fed can also print money in almost any volume without fear of hyperinflation, since the dollar remains the world's number one currency. One way or another, the US economy continues to accelerate and will continue to do this for many years to come.
    Regards, PR-Manager ForexMart

  5. #895
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    in ro ham eslah kon:
    Forecast for USD/JPY on August 4, 2021

    USD/JPY

    Yesterday, the yen continued strengthening against the dollar and overcame the target level of 109.20. The Marlin Oscillator is declining and the price is expected to move towards the target of 108.35, but for this the yen still needs support from external markets, which is now weakening.

    Yesterday, the US stock index S&P 500 gained 0.80%, this morning the Chinese Shanghai Composite added 0.69%, only the Japanese Nikkei 225 lost 0.16%. The dollar index is in a neutral position. Consolidating above 109.20 may lead to growth to the nearest target of 109.80.

    On the four-hour chart, the signal line of the Marlin oscillator continues to develop inside the wedge, the exit from which statistically predominates downward, but due to the reversal of the signal line from its lower border, a double convergence of the price with the oscillator has formed, and this is already a sign of an upward breakthrough.

    The result is an uncertain situation, although rather an expectant one. The price movement in either direction can be fast and deep, so investors are in no hurry to get ahead of events. Together with the market, we will also wait.
    Regards, PR-Manager ForexMart

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