Market Review for March 13

Retail sales did not disappoint, giving the market exactly what he had so long waited. Finally, we have seen the closure of European currencies than the opening level. As a result, EUR/USD completed a day of 1.2960, and the GBP / USD — 1.4930 at.

EUR/USD opened the day at 1.3032 and then even managed to gain a foothold to a daily high of 1.3064 in anticipation of the Italian auction. However, resistance remains a serious obstacle on the way up, and the results of the American release put an end to the current rally. Retail sales rose to the challenge: 1.1% vs. 0.5%. This sent the pair to 1.2922 minimum, but the closing price fell back to 40 points.

Meanwhile, GBP/USD was in no hurry to fall against the U.S. release. We warned that the pound seriously oversold, so the way down will be quite thorny. Yesterday the pair opened the day at 1.4898, 1.4980 and peaked closed 50 points lower. However, the prospects for further decline remain, and below we will tell you why.

But USD/JPY was surprised so restrained reaction. Couple all day behaved very calmly, and the dynamics after sverhpozitivnyh data from the U.S. has been quite sluggish. Pair from the opening level of 96.07 to become stronger throughout the day could only to a maximum of 96.25, and then lost all my earnings to the end of the trading day. Concerns about allegations Iwata still constrain movement of the pair up.

Forecast for Thursday, March 14, 2013

As long as all the players’ attention was drawn to the events in the U.S., the euro continued to supply new arguments supporting a further decline in the economy. French labor market and manufacturing all E-17 fell short of forecasts, and all this against the backdrop of a recovering U.S. economy.

Think about it, in yesterday’s U.S. retail sales were more likely not to reach even up to expectations. If the transfer barriers, the key, of course, increase the tax burden and uncertainty of sequestration, but there is also a delay in the recovery of taxes, which were caused by the «fiscal cliff.» Still, consumer spending has not decreased even more emphasizing a more stable state of the U.S. economy against the backdrop of an infinite chain of problems in the eurozone. That is why we believe that further falls below 1.2920 will still take place. Perhaps closer to Friday in preparation for the meeting of FOMC, scheduled for next week.

As for the GBP/USD, a pair of very cautious with the lower boundary of the breakdown, but honestly, the forces for the growth of her either. UK economic calendar is empty, but the most important event in the near future will be the publication of the minutes of the last meeting of the MPC. And the closer the event, the more bears on the pound sterling will be returning to the market. According to our scenario, GBP/USD still be able to go below 1.4870 on strong retail sales outlet with the immediate goal at 1.48.

Now for the USD/JPY. It seems that everything goes smoothly, and the market knows almost all the actors in the camp of the Bank of Japan, but without Iwata «peace part.» Ask what caused this obsession? The fact is that Mr. Iwata has argued in favor of additional supervision by the Bank of Japan, which altogether would unleash Abe hands in achieving its goals (2% inflation and a loose monetary policy). DEPUTY if not approved, it can be seen as the first political failure of the Prime Minister, which will have a short-term pressure on the USD/JPY. Do not rule out rollback in the 95.50 area.

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