What I'm seeing this week...
Salam my friends,
Last week, currency markets were largely seen moving in the same sideway direction since early June. Volatility is still high with economic data giving mixed indication towards recovery. Economists kept on mentioning a new term called 'green shoots' - positive economic data that indicates that the economy is recovering, slowly.. Interesting to see this term picked up across the globe..they like to create catchy phrases which people could remember.. just like 'decoupling' some time ago..hehe
Ok, now let's see what is the fundamental and technical analysis for this week (I'll try to be short and concise this time..no promise..hehe ):
Fundamental
This week, the key economic data would be the rate announcement by RBA and BOE. Both are expected to maintain their respective current rate. This follows the same decision by FOMC made during its last meeting. Analysts are expecting FOMC to maintain the rates at 0.25% at least by the end of the year. The same thing goes to other major countries.
I think markets has already pricing-in the rate decision but what is more important is to hear what RBA and BOE say about the future outlook of the economy.
There would be no major economic data from the US this week except for ISM non-manufacturing index which is forecasted to improve. Following the negative result from NFP on Thursday, any further negative news could potentially see the bear taking control.
However, strong earnings result from Alcoa who will kick-start the earning season as well as positive outcome from the G8 summit could prevent the slide.
In the Euro zone, key economic data would include UK manufacturing production, German IP and revised 1Q09 GDP. Any surprises from these results could have an impact to the market.
Based on the expected mixed data, I am thinking that the currency markets would remain sideways at best, and possibly heads down further as investors become more risk-averse if more bad economic data came out.
Technical
Cable - My bias would be towards sell. My LT upward TL has been broken and price could find its next support level at around 1.6220-1.6240. This represents 100pips return based on the closing price on Friday. If the price breaks that level, we could see potential retracement towards the 1.60 level( Fib 23.6) . Risk: +ve ISM Non-manufacturing index on Monday.
Fibre - I am not too sure about this pair. Although the upward TL has already been broken, the last daily candlestick formation on Friday is a 'hammer', which could indicate a reversal of trend, i.e price could went up. As the reversal signal is of low reliability, I will wait for the next price action to decide on my strategy.
Aussie - Same as Fibre, I don't see any clear signs. Again, the upward trendline is still intact (red line) but I can also see that it is trading in a downward channel (purple lines). If the price breaks below the trendline, we could potentially see the price reach 0.77-0.78 levels. My indicators are also pointing a decline.
P/s: This is a summary of what my analysis is telling me based on my readings. It is intended for my own record. Forex is a risky business so pls don't follow blindly! TAYOR!
Ok, now let's see what is the fundamental and technical analysis for this week (I'll try to be short and concise this time..no promise..hehe ):
Fundamental
This week, the key economic data would be the rate announcement by RBA and BOE. Both are expected to maintain their respective current rate. This follows the same decision by FOMC made during its last meeting. Analysts are expecting FOMC to maintain the rates at 0.25% at least by the end of the year. The same thing goes to other major countries.
I think markets has already pricing-in the rate decision but what is more important is to hear what RBA and BOE say about the future outlook of the economy.
There would be no major economic data from the US this week except for ISM non-manufacturing index which is forecasted to improve. Following the negative result from NFP on Thursday, any further negative news could potentially see the bear taking control.
However, strong earnings result from Alcoa who will kick-start the earning season as well as positive outcome from the G8 summit could prevent the slide.
In the Euro zone, key economic data would include UK manufacturing production, German IP and revised 1Q09 GDP. Any surprises from these results could have an impact to the market.
Based on the expected mixed data, I am thinking that the currency markets would remain sideways at best, and possibly heads down further as investors become more risk-averse if more bad economic data came out.
Technical
Cable - My bias would be towards sell. My LT upward TL has been broken and price could find its next support level at around 1.6220-1.6240. This represents 100pips return based on the closing price on Friday. If the price breaks that level, we could see potential retracement towards the 1.60 level( Fib 23.6) . Risk: +ve ISM Non-manufacturing index on Monday.
Fibre - I am not too sure about this pair. Although the upward TL has already been broken, the last daily candlestick formation on Friday is a 'hammer', which could indicate a reversal of trend, i.e price could went up. As the reversal signal is of low reliability, I will wait for the next price action to decide on my strategy.
Aussie - Same as Fibre, I don't see any clear signs. Again, the upward trendline is still intact (red line) but I can also see that it is trading in a downward channel (purple lines). If the price breaks below the trendline, we could potentially see the price reach 0.77-0.78 levels. My indicators are also pointing a decline.
P/s: This is a summary of what my analysis is telling me based on my readings. It is intended for my own record. Forex is a risky business so pls don't follow blindly! TAYOR!
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