Updated May 15, 2013 10:12:41 PM
Written by Chris Tedder
Last week the renminbi reached its highest level against the US dollar in 19 years. Since mid-2005 USDCNY has been on a controlled decent from a fixed position around 8.2765 to its low of 6.1307. If not for the intervention of Beijing the decrease would have been more of a collapse. However, is the renminbi still undervalued? From a fundamental perspective the Chinese currency is more fairly valued now than it was a decade ago, [...] Continue Reading ...
Updated May 15, 2013 3:15:00 PM
Written by Eric Viloria, CMT
On May 8, we suggested that NZD/USD may fall towards its 200-day simple moving average (SMA) and channel support. The pair not only tested that level, but it broke below the notable support zone. Today, NZD/USD is seeing a bit of a rebound after finding horizontal support ahead of the 0.8170/80 area (also the 55-week SMA). A rally in the pair may present a technical opportunity as previous support often becomes resistance. The key level [...] Continue Reading ...
Updated May 15, 2013 2:55:00 PM
Written by Chris Tevere, CMT
The Mexican Peso has been the strongest performing major currency in 2013, presently +5.14% higher relative to the US dollar year to date, however USDMXN may be due for a correction higher over the next few weeks. Technically, it appears the move below 12.0000 in USDMXN last week was a potential bear trap, as it quickly reversed back higher within 36-hours. On a weekly closing basis, 12.00/0500 proved to be a key support zone [...] Continue Reading ...
Updated May 15, 2013 1:50:00 PM
Written by Eric Viloria, CMT
EUR/USD continued to decline as this morning’s disappointing Eurozone GDP figures outweighed the weakness in US economic data releases (i.e. negative Empire manufacturing, soft PPI, larger than expected drop in IP). The data showed Q1 GDP contraction of -0.2% q/q which was lower than the consensus expectations of -0.1% and the sixth consecutive quarter of negative GDP growth. EUR/USD is now trading below the 200-day simple moving average (SMA) which we highlighted as a key [...] Continue Reading ...
Updated May 15, 2013 9:00:00 AM
Written by Kathleen Brooks
The short answer is it depends on how long the data stays soft for. Disappointing Empire manufacturing and PPI data today has taken the edge of USD. The Empire Manufacturing report was a real disappointment as it fell to its lowest level since January. New orders and number of employees also fell. The producer price data was also weaker than expected, the headline rate fell 0.7% last month, on the back of weaker energy [...] Continue Reading ...
Updated May 15, 2013 6:50:00 AM
Written by Kathleen Brooks
Bank of England Governor Mervyn King is well-known for his downbeat manner and fairly gloomy outlook on the UK economy, not so for his final Inflation Report. Maybe the thought of impending retirement is boosting King’s mood, but he even managed a smile this time. So what was in the Report that caused King to raise a smile? • Growth: The UK’s growth forecast for this year has been revised higher; the report expects [...] Continue Reading ...
Updated May 15, 2013 4:00:00 AM
Written by Kathleen Brooks
It’s been another torrid start for the euro, not only is the single currency getting battered by the resurgent dollar, but also by dismal domestic economic data. The Q1 GDP report due at 1000 BST/ 0500 ET is expected to confirm the sixth consecutive quarter of negative growth. Highlights from the individual reports include: • Germany: missed expectations, only grows 0.1% • France: missed expectations, shrunk -0.2% • Netherlands: growth falls 0.1% • [...] Continue Reading ...
Updated May 15, 2013 1:10:00 AM
Written by Chris Tedder
The Nikkei 225 was propelled higher today by a positive lead from US markets and a depreciation of the yen overnight, with the index breaking 15,000 for the first time since January 2008. It seems every time the yen breaches a key level the Nikkei rallies, which is understandable as a weaker yen boosts company profits, especially manufacturers and exporters. USDJPY breached 102.00 overnight and continued on to a session high around 102.45. If [...] Continue Reading ...
Updated May 14, 2013 7:54:55 PM
Written by Chris Tedder
As we have previously stated AUDJPY is testing a key support level, a break of which would be bearish. AUDNZD is in a similar situation, albeit the possible conclusions were drawn using different technical indicators. For a fundamental perspective, the aussie is ripe for a sell-off at any time but that doesn’t rule out a push higher in the interim. AUDNZD has formed a pennant formation which is an indication that the pair’s prior [...] Continue Reading ...
Updated May 14, 2013 6:13:48 PM
Written by Chris Tedder
This pair has been consolidating in a triangle formation since mid-April, after the pair pushed back from its highest level since November 2007. Recently, however, it has been a case of which currency was weaker, resulting in some sideways movement. With AUDUSD below parity and USJPY above 102.00, and both pairs with the ability to push lower and higher respectively, what becomes of AUDJPY? AUDJPY is at key juncture as it approaches a very important [...] Continue Reading ...
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