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The Yen Paradox

Posted on: 17 August 2017 , by: Darren Sinden , category: Market Review

The Yen Paradox Weekly Analyst Insight by Darren Sinden. What next for Japan's economy and the Yen?   ... Continue reading...

Boris and Kathy Forex Weekly 14/8/2017

Posted on: 14 August 2017 , by: Boris & Kathy , category: Market Review

How Bad is Nuclear War for the Dollar? The biggest driver of currency flows this past week had nothing to do with monetary policy or economic data. Instead, the escalation of tensions between the U.S. and North Korea sent USD/JPY sharply lower as investors worry that this heated exchange could result in military action. Although we firmly believe that the threat of war, let alone nuclear war is slim, this has been one of the most unpredictable eras in history so we have to be prepared for the impossible. Many of our readers are asking how far the dollar could fall if the U.S. goes to war with North Korea but before discussing this, we want to point out that while the dollar is down sharply this week versus the yen, it strengthened against other major currencies such as sterling, the Australian and New Zealand dollars. So while there’s no question that war is negative for USD/JPY it can initially drive the dollar higher against high beta currencies such as AUD and NZD. As a rule of thumb, the Japanese yen and Swiss franc perform best during times of war, which means all of the Yen crosses including USD/JPY will weaken.    ... Continue reading...

Analyst Insights: Euro Dollar and the Germany 30

Posted on: 08 August 2017 , by: Darren Sinden , category: Market Review

Analyst Insights: Euro Dollar and the Germany 30 Weekly Analyst Insight by Darren Sinden. Euro strength is closely correlated to Germany 30 index weakness. We look at the prospects of a continuation of both trends. ... Continue reading...

Boris and Kathy Forex Weekly 7/8/2017

Posted on: 07 August 2017 , by: Boris & Kathy , category: Market Review

Has AUD, GBP, NZD Peaked? 2017 has been defined by strong exaggerated moves in many major currencies and after months of relentless uptrends, we are finally beginning to see signs of a top. Sterling, the Australian, New Zealand and Canadian dollars all experienced losses against the greenback but there were some currencies, namely the euro that continued to march higher. Lower highs and lower lows or consolidation followed by rejection of key levels for currency pairs like GBP/USD, AUD/USD and USD/CAD has many investors wondering if deeper corrections lie ahead. To answer this question, we have to recognize that U.S. dollar weakness is the primary reason why the euro and Australian dollar are up more than 10% year to date. What’s remarkable about these uptrends is that they occurred while the Federal Reserve was raising interest rates, which means investors were skeptical about the central bank’s hawkishness from the very beginning.    ... Continue reading...

Boris and Kathy Forex Weekly 31/7/2017

Posted on: 31 July 2017 , by: Boris & Kathy , category: Market Review

Will NFP, RBA and BoE Reverse Course for Currencies? We’ve drawn to a close with yet another brutal week for the U.S. dollar. The greenback experienced losses against all of the major currencies except for the Swiss franc. Although the dollar only experienced modest declines on a percentage basis, these small changes mask the bigger story, which is that the greenback dropped to 2-year lows against the euro, sterling, Australian, Canadian and New Zealand dollars. Friday’s U.S. GDP report sealed the dollar’s fate with weaker than expected growth sending the currency tumbling. The U.S. economy expanded by only 2.6% in the second quarter slightly less than the 2.7% consensus forecast. While this is a significant acceleration from last quarter’s levels, investors honed in on the downward revision to Q1 growth, the headline miss and the dramatic slowdown in price growth. Even the uptick in personal consumption or the positive revision to the July University of Michigan consumer sentiment index failed to help the greenback.    ... Continue reading...

Boris and Kathy Forex Weekly 24/7/2017

Posted on: 24 July 2017 , by: Boris & Kathy , category: Market Review

The Greatest Risk for Euro This Week We are drawing to a close this week marked by multi-year highs for many currencies. The biggest milestone was reached by the Australian dollar, which climbed to its strongest level in more than 2 years versus the greenback. The euro was not far behind, marking a 23-month high while the Canadian dollar and Swiss franc hit one-year highs. Sterling and the New Zealand dollar hit 10-month highs although GBP/USD gave up its gains to end the week slightly lower. The consistency of these moves tell us that they were driven by U.S. dollar weakness and while that is true, improving prospects in some of these countries also make their currencies more attractive. But many are overbought on a technical basis, leading forex traders to wonder how much further these currencies can rise.    ... Continue reading...

Boris and Kathy Forex Weekly 17/7/2017

Posted on: 17 July 2017 , by: Boris & Kathy , category: Market Review

Dollar Crushed, Will ECB Disappoint Too? What was supposed to be a strong week for the U.S. dollar turned into a crushing one for the greenback. The USD traded lower against all of the major currencies, losing more than 2% of its value versus the Australian dollar. The weakness of the buck took AUD/USD to its strongest level in a year, USD/CAD to a 14 month low, EUR/USD to a 1 year high and GBP/USD to an 8 month high.  ... Continue reading...

Boris and Kathy Forex Weekly 10/7/2017

Posted on: 10 July 2017 , by: Boris & Kathy , category: Market Review

Will Yellen Drive USD/JPY to 115 This Week? At first glance, it was a mixed week for the U.S. dollar, which saw gains versus the British pound, Japanese yen, Australian and New Zealand dollars but incurred losses against the euro and Canadian dollar. However, the greenback’s end of week performance tells us that investors are snapping up dollars ahead of Janet Yellen’s testimony on the economy and monetary policy this week. They are banking on her optimism and expecting hawkish comments from the Fed Chair ... Continue reading...

Boris and Kathy Forex Weekly 3/7/2017

Posted on: 03 July 2017 , by: Pepperstone Support , category: Market Review

Forex – New Month, New Quarter, New Opportunities This week marks a new month, a new quarter and the beginning of the second half of the year. While many U.S. traders will be off enjoying their July 4th holidays Monday and Tuesday, the rest of us are thinking about new opportunities. What makes this time even more interesting is the recent shift in monetary policy guidance by major central banks. In June, Fed Chair Janet Yellen, ECB President Mario Draghi and Bank of England Governor Mark Carney all turned hawkish. Although we haven’t heard much from Bank of Canada Governor Poloz, both of his Deputy Governors have suggested that rates could rise. These “new” views caused a flurry of activity in the foreign exchange market that first involved short covering and then later buying. So as we head into the new month and quarter investors will be looking to data for confirmation.  ... Continue reading...

Boris and Kathy Forex Weekly 26/6/2017

Posted on: 26 June 2017 , by: Boris & Kathy , category: Market Review

A Summer Squeeze or Summer Doldrums? By all counts, it was an extremely quiet week in the foreign exchange market. There was very little change in the U.S. dollar, which traded unevenly against all of the major currencies. We haven’t seen this type of listless trading in months and while the summer holidays in the Northern Hemisphere are partly to blame, it is monetary policy and political uncertainty that are trapping currencies. The greenback traded higher versus the Australian dollar, British pound, Canadian dollar and Japanese yen, was unchanged versus the euro and lower against the Swiss franc and New Zealand dollar. With that in mind, all of the moves were less than 1%. This week’s data calendar is light but with more Fed speak and the House of Commons vote in the UK that could determine whether Prime Minister May keeps her job, the summer doldrums could turn into a summer squeeze. ... Continue reading...

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