Market Review for the week from 18 to 22 March

The U.S. dollar has strengthened its position in the period from 18 to 22 March as the euro zone debt again exacerbated the problem, and to improve their macroeconomic statistics from the U.S. gives every reason to believe that the Fed in 2013, can minimize the program of quantitative easing. This option does not deny, and Ben Bernanke, despite the fact that he supports the continued implementation of the program QE3. He stressed that the regulator will closely monitor the situation on the labor market, and, in the case of a signal on a steady growth may withdraw monetary stimulus, as they will not be strictly necessary. USDX dollar index against this background that added 0.4%.

The European currency has come under pressure since the beginning of the week. Events in Cyprus moved quotation of EUR/USD down to around 1.2850. After that, she went to the area 1.2980 and consolidated in this range, while participants expected outcome of this drama. Euro ignored key macroeconomic statistics on an index of purchasing managers in the industry in Germany and France, which were much worse than expected. Did not impress the participants and negative surprise to Ifo. On Friday, the EUR/USD moved up without waiting for the decision of the Parliament of Cyprus. Toward the close of the week he compensated for a significant portion of the losses, reaching 1.30.

The British pound is feeling a little more confident. The Bank of England published the minutes of the last meeting, of which it became clear that the regulator is still concerned about inflation and is not ready to go to the targeting of economic growth at any cost. In addition, retail sales data related to key macroeconomic indicators have been very strong. Accordingly, been strong pound for the week, up 0.5%.

The Australian dollar has confirmed his intention to form a steady upward trend. The AUD/USD broke resistance at 1.0380, despite the strengthening of the dollar, and moved toward 1.0480. And supported by economic data from China, where the PMI index for February was much better than expected. Toward the close of the week, it was quoted at 1.0430.

The USD/JPY after rising from Monday to Thursday, trying to form a new impetus towards $ 100 yen. It increased to around 95.80, but «rolled» down and tried again on the strength of last week’s lows at 94.15. The active phase of growth associated with the expectations of easing monetary policy is coming to an end. Then the participants will be expected concrete steps from the new government and the new head of the Bank of Japan, but because there have been some recording profits.

Forecast for the week, 25 — 29 March

The main event of the week, may have an impact on the dollar will be the publication of a report on orders for durable goods (March 26, 16:30 GMT). Traditionally, it has little impact on the currency market, but can cause movement in the stock markets. Dollar in recent months demonstrates a positive correlation with the indexes, and a significant movement can make adjustments to its dynamics. Bernanke Speech (March 25, 21:00 GMT) is unlikely to surprise markets, as Fed chairman gave a detailed press conference following the meeting of the Monetary Policy Committee last week.

Overall, the U.S. has the potential to continue its strengthening. From a fundamental point of view of its position now look the strongest of all the currencies of the developed economies of the world. Fed will be the first central bank to abandon the monetary stimulus. However, he was somewhat overbought and may need to be corrected, allowing the competitor to strengthen.

Tenderers for the pair EUR/USD, the coming week could be very intense. On Monday, the expected denouement in the drama in Cyprus. The Parliament of the island state, likely to vote «for» the introduction of a one-time tax on contributions, because removing the ECB to provide liquidity to commercial banks of the country threatens to default for a number of major banks. Predict the response of the European financial markets, this event is difficult. All will balk at the extent to which they believe that this measure will be of targeted. However, if we take into account how calm the euro took the news of the ultimatum, we believe that the single currency has already charged more for growth. In this case, the goal of the movement can be 1.3125.

For the British pound in the economic calendar for the coming week is not planned significant news and events. His position strengthened after several recent publications «minutes» and figures on retail sales. In addition, the pair GBP/USD looks oversold positions with technical analysis. Things can get a deeper correction up to around 1.5325 in the case of overcoming the resistance of 1.52.

Australian dollar will continue to move us in a previously designated area 1.0480. Significant macroeconomic statistics, may have an effect on his position, not planned. Of events to highlight the speech of the Reserve Bank, Glenn Stevens on Tuesday, March 26 at 9:45 EDT.

Prospects for the dollar against the yen is still positive. No one doubts that the new prime minister and the new head of the Bank of Japan will implement its plans to mitigate the monetary policy and inflation on output target level of 2%. However, the new growth may be postponed until the announcement of specific solutions. Announcement of the next meeting of the Bank of Japan is scheduled for April 4. Accordingly, a correction is possible and, as a number of participants have received significant profits in the growth phase of expectations. In case the pair USD/JPY may have a specific interest in the areas of purchasing 93.50 and 92.70.


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Market Review for the week from 18 to 22 March | Web Trade For All - Forex trading, analytical reviews of the market and help for beginners