Forex Analysis: EUR/USD, GBP/USD, AUD/USD.
SGT Markets | May 18, 2017 03:46AM ET
EUR/USD
Eurozone GDP (Preliminary release) pared expectations, nice ZEW Economic Sentiment and Trade Balance.
U.S. Retail Sales and U.S. Core CPI (Inflation data) were worse than expected.
In its spring economic outlook, the ECB raised euro area GDP growth forecast to 1.7% from 1.6%.
The forecast for 2018 growth was 1.8%, unchanged from its winter economic outlook.
Consumer inflation is expected to rise to 1.6% this year from 0.2% in 2016.
U.S. Producer Price Index (PPI) rose way over the expectations and this plays an important role in defining the level of price heat in the U.S.: this may have impact on Fed Interest Rate next decisions.
US. Nonfarm Payrolls and Unemployment Rate solid better than expected.
Retail Sales and German Unemployment Change again better than expected (the latter confirms a positive 7-month strike). Eurozone GDP preliminary release stable at 1.7%, as expected.
On the other hand, U.S. GDP (Preliminary) was lower than the expected.
Potential extension to 1.11 already hit. But consider we are in both technical and fundamental overbought setup, so 1.095 is likely to be broken on the downside again.
Our special Fibo Retracement is confirming the following S/R levels against the monthly and weekly trendlines obtained by connecting the relevant highs and lows back to 2012:
Weekly Trend: Overbought
1st Resistance: 1.1100
2nd Resistance: 1.1194
1st Support: 1.0950
2nd Support: 1.0856
EUR
Recent Facts:
14th of February: German GDP (Preliminary release) + German ZEW Economic Sentiment + Eurozone GDP (Preliminary release)
German GDP worse than expected, German ZEW worse than expected, Eurozone GDP worse than expected.
15th of February, Eurozone Trade Balance
Better than expected.
21st of February, German Manufacturing PMI
Better than expected.
23rd of February, German GDP
Worse than expected.
1st of March, German Manufacturing + German Unemployment Change
German Manufacturing worse than expected, German Unemployment Change better than expected.
2nd of March, Eurozone Inflation data
In line with expectations.
3rd of March, German Services PMI + Eurozone Retail Sales
Worse than expected.
7th of March, Germany Factory Orders
Worse than expected.
8th of March, German Industrial Production
Better than expected.
Get The News You Want
9th of March, ECB Interest Rate decision + ECB Press Conference
Interest Rates unchanged, ECB President Dovish (can be cut again in the future if necessary).
14th of March, German CPI + German ZEW Economic Sentiment
German CPI as expected, German ZEW worse than expected.
24th of March, German Manufacturing PMI
Significantly better than expected.
30th of March, German CPI
Lower than expected.
31st of March, German Unemployment Change + Eurozone CPI
German Unemployment Change better than expected (for the sixth time in a row), Eurozone CPI worse than expected.
3rd of April, German Manufacturing PMI
As expected.
11th of April, German ZEW Economic Sentiment
Better than expected.
21st of April, French Manufacturing PMI + German Manufacturing PMI
Better than expected.
23rd of April, French Elections (first round)
Centrist Emmanuel Macron, a pro-EU ex-banker and former economy minister, emerged as the leader of the first round of voting and qualified for a May 7 runoff alongside the second-place finisher, far-right leader Marine Le Pen.
24th of April, German Ifo Business Climate
Better than expected.
27th of April, ECB Interest Rate decision + ECB Press Conference
Unchanged, eyes on next Inflation data.
28th of April, CPI (Preliminary)
Higher than expected.
2nd of May, German Manufacturing PMI
As expected.
3rd of May, German Unemployment Change + Eurozone GDP (Preliminary)
German Unemployment Change Better than expected (for the 5th time in a row).
Eurozone GDP (Preliminary) As expected.
7th of May, French Elections
Centrist pro-EU Macron Won French Elections.
12th of May, German GDP (Preliminary release)
As expected.
16th of May, Eurozone GDP (Preliminary release) + Trade Balance + ZEW Economic Sentiment
Better than expected.
17th of May, Eurozone CPI
As expected.
USD
Recent Facts:
2nd of December: Nonfarm Payrolls + Unemployment Rate
Better than expected.
27th of January, GDP + Durable Good Orders
GDP Significantly worse than expected, Durable Good Orders as expected.
1st of February, ADP Nonfarm Unemployment Change + U.S. Institute for Supply Management Manufacturing
Better than expected (ISM Manufacturing at its highest level since November 2014).
3rd of February, Nonfarm Payrolls + Unemployment Rate
Nonfarm Payrolls better than expected, Unemployment Rate worse than expected.
14th of February, Producer Price Index (PPI)
Better than expected.
15th of February, Core CPI (Consumer Price Index) + Retail Sales
Better than expected.
16th of February, Building Permits + Initial Jobless Claims + Philadelphia Fed Manufacturing Index
Better than expected.
21st of February, Manufacturing PMI + Services PMI
Worse than expected.
27th of February, Core Durable Good Orders + Pending Home Sales
Worse than expected.
28th of February, GDP (Preliminary release)
Worse than expected.
3rd of March, ISM Non-manufacturing PMI + Fed Chair Yellen Speech
ISM Non-manufacturing PMI better than expected, Yellen noted that a rate increase at next meeting "would likely be appropriate" insisting on the condition that data on employment and inflation have to move in line with expectations.
8th of March, ADP Nonfarm Employment Change
Better than expected.
10th of March, Nonfarm Payrolls + Unemployment Rate
Better than expected.
14th of March, Producer Price Index
Higher than expected.
15th of March, Core CPI + Retail Sales
As expected.
15th of March, FOMC Economic Projections + FOMC Statement + Fed Interest Rate Decision + FOMC Press Conference
The Federal Reserve increased interest rates by 0.25% to a 0.75-1% range. Dovish speech of Chairwoman Yellen.
24th of March, Manufacturing PMI + Services PMI (preliminary release)
Worse than expected (4th time in a row).
28th of March, Conference Board Consumer Confidence
Better than expected (the highest since December 2000).
30th of March, GDP
Better than expected.
5th of April, ADP Nonfarm Employment Change + ISM Non-Manufacturing Employment + ISM Non-Manufacturing PMI
ADP Nonfarm Employment Change better than expected.
ISM Non-Manufacturing Employment + ISM Non-Manufacturing PMI worse than expected.
7th of April, Nonfarm Payrolls + Unemployment Rate
Nonfarm Payrolls worse than expected, Unemployment Rate better than expected.
14th of April, Core CPI + Retail Sales
Core CPI (Inflation) Lower than expected.
Retail Sales worse than expected.
20th of April, Philadelphia Fed Manufacturing Index
Worse than expected.
27th of April, Durable Good Orders + Pending Home Sales
Worse than expected.
28th of April, GDP (Preliminary release)
Worse than expected but Price Index higher than expected.
3rd of May, ADP Nonfarm Employment
ADP Nonfarm Employment better than expected.
5th of May, Nonfarm Payrolls + Unemployment Rate
Better than expected.
11th of May, U.S. Producer Price Index (PPI)
Higher than expected.
12th of May, U.S. Retail Sales + Core CPI (Inflation data)
Worse than expected.
Eyes on today release: Initial Jobless Claims + Philadelphia Fed Manufacturing Index.
GBP/USD
Eyes on today UK Retail Sales. UK Job Market data slightly worse than expected.
UK Inflation (CPI) higher than expected gave new vitality to GBP.
UK Manufacturing Production and Trade Balance worse than expected. U.S. Retail Sales and U.S. Core CPI (Inflation data) worse than expected too (also house market showed some softness).
The Bank of England made no changes to monetary policy at the outcome of its meeting. Left interest rates on hold at current record lows and warned that living standards will fall this year as the headwinds from Brexit mount.
U.S. Producer Price Index (PPI) rose way over the expectations and this plays a very important role in defining the level of price and next Fed’s Interest Rate decisions. US. Nonfarm Payrolls and Unemployment Rate solid better than expected. In the last FOMC Meeting Statement the Fed reiterated its view that monetary policy remains accommodative to support both an uptick in labour market conditions and a sustained return to 2% inflation.
UK Services PMI and Construction PMI better than expected, and also last UK Manufacturing PMI was pretty higher than expected.
UK GDP (Preliminary release) was worse than expected and this was probably ignored too quickly.
And there are still some unresolved tensions with Scotland and Northern Ireland, which voted against leaving the EU. Theresa May provided no clear plan about the comprehensive “free-trade” partnership with EU members she wants to achieve.
Sterling jumped as Theresa May called for early general elections on June 8. She said Britain needed a strong and stable leadership going into Brexit talks and beyond.
Now market is ranging between 1.283 and 1.298 levels, in general overbought setup. Possibilities to get down to 1.27 area are high but only in case of expected bad news from the UK. In the opposite case, a strong breakout of 1.2978 will lead up to 1.3185 area.
Our special Fibo Retracement is confirming the following S/R levels against the monthly and weekly trendlines obtained by connecting the relevant highs and lows back to 2001:
Weekly Trend: Overbought
1st Resistance: 1.2978
2nd Resistance: 1.3185
1st Support: 1.2705
2nd Support: 1.2530
GBP
Recent Facts:
4th of August, Bank of England Interest Rates decision (expected a cut)
Bank of England lowers Interest Rates as expected (record low of 0.25%) and increases purchase program.
20th of January, Retail Sales
Worse than expected.
26th of January, GDP (Preliminary release)
Better than expected.
2nd of February, Construction PMI
Worse than expected.
3rd of February, Services PMI
Worse than expected.
10th of February, Manufacturing Production
Better than expected.
14th of February, Consumer Price Index (CPI)
Worse than expected.
15th of February, Job Market
Better than expected.
17th of February, Retail Sales
Worse than expected.
1st of March, Manufacturing PMI
Worse than expected.
2nd of March, Construction PMI
Better than expected.
3rd of March, Services PMI
Worse than expected.
10th of March, Manufacturing Production + Trade Balance
UK Manufacturing Production worse than expected, Trade Balance better than expected.
15th of March, Job Market
Better than expected.
16th of March, Interest Rates Decision + BoE Meeting Minutes
A Bank of England policymaker unexpectedly voted to raise interest rates.
21st of March, CPI
CPI higher than expected.
23rd of March, Retail Sales
Better than expected.
31st of March, GDP YoY
Worse than expected.
3rd of April, Manufacturing PMI
Worse than expected.
5th of April, Services PMI
Better than expected.
7th of April, Manufacturing Production
Worse than expected.
11th of April, UK CPI
Higher than expected.
12th of April, UK Job Market
Worse than expected.
21st of April, UK Retail Sales
Worse than expected.
28th of April, UK GDP (Preliminary release)
Worse than expected.
2nd of May, Manufacturing PMI
Better than expected.
3rd of May, Construction PMI
Better than expected.
4th of May, Services PMI
Better than expected.
11th of May, UK Manufacturing Production + Trade Balance + BoE Interest Rate Decision
Manufacturing Production + Trade Balance worse than expected.
The Bank of England made no changes to monetary policy but warned that living standards will fall this year as the headwinds from Brexit mount.
16th of May, UK CPI (Inflation data)
Higher than expected.
17th of May, UK Job Market
Worse than expected.
Eyes on today release: Retail Sales
USD
Recent Facts:
See above.
AUD/USD
Australia Employment Change better than expected (it is the 5th time over the last 6 months).
U.S. Retail Sales and U.S. Core CPI (Inflation data) worse than expected. Also U.S. house market showed softness.
The RBNZ (New Zealand's central bank) left its benchmark interest rate unchanged at 1.75%, in a widely expected move but the central bank surprised markets by saying it expects to tighten monetary policy in late 2019 (and not around the first half of 2019 as expected).
Australia Retail Sales worse than expected.
U.S. Producer Price Index (PPI) rose way over the expectations and this plays a very important role in defining the level of price heat in the U.S.: this has impact on Fed Interest Rate next decisions. US. Nonfarm Payrolls and Unemployment Rate solid better than expected.
The Reserve Bank of Australia held Interest Rates at 1.5% as expected signalling that further interest rate cuts were off the table as wage gains are weaker than hoped, though house prices in some markets remain a worry. Australia New Home Sales and Trade Balance below expectations.
OPEC and non-OPEC oil producers look likely to extend their agreement to limit supplies beyond its June expiry to help clear a glut.
A very important Support (0.7408) was retested in these days. Overbought started around 0.7472. Now we will likely see a correction down to 0.7408 back again.
Our special Fibo Retracements are confirming the following S/R levels against the monthly and weekly trendlines obtained by connecting the relevant highs and lows back to 2012:
Weekly Trend: Neutral
1st Resistance: 0.7472
2nd Resistance: 0.7570
1st Support: 0.7408
2nd Support: 0.7310
AUD
Recent Facts:
1st of November, RBA Interest Rates Statement
RBA’s Governor Lowe signals tolerance for weak inflation and bets seem off for future rate cuts.
3rd of November, RBA Monetary Policy Statement + Retail Sales
RBA said it is focused on the medium-term inflation target.
Retail Sales better than expected.
8th of November, ELECTION OF THE 45th PRESIDENT OF THE UNITED STATES
Donald Trump elected President.
9th of November, Reserve Bank of New Zealand Interest Rate Decision + Monetary Policy Statement
Interest Rates cut to 1.75% from 2.00% as expected.
19th of December, Mid-Year Economic and Fiscal Outlook
Scott Morrison announced lower than an original prediction of A$37.1 billion, investors see it as promising to stave off a downgrade of its AAA (triple A) rating from S&P Global.
9th of January, Retail Sales
Worse than expected.
19th of January, Employment Change
Better than expected.
25th of January, CPI (Consumer Price Index measures the change in the price of goods and services from the perspective of the consumer)
Lower than expected.
1st of February, AIG Manufacturing Index
Worse than expected.
2nd of February, Building Approvals + Trade Balance
Better than expected.
7th of February, RBA Interest Rates Decision + RBA Rate Statement
RBA held steady as expected at a record low 1.50%, while noting better economic conditions with China.
8th of February, New Zealand Interest Rate Decision + RBNZ Monetary Policy Statement
Interest Rates unchanged and RBNZ’s agenda contains no changes for 2017.
16th of February, Employment Change
Better than expected.
28th of February, New Home Sales, Current Account, Private Sector Credit.
1st of March, Australia GDP
Better than expected.
16th of March, Employment Change + Unemployment Rate
Worse than expected.
2nd of April, Retail Sales
Worse than expected.
4th of April, RBA Interest Rate Decision
Interest Rates unchanged, as expected. Dovish tone in Philip Dowe’s Speech.
9th of April, Home Loans
Worse than expected.
13th of April, Australia Employment Change
Better than expected.
18th of April, RBA Meeting Minutes
Dovish.
26th of April, Australia CPI
Lower than expected.
2nd of May, RBA Interest Rate Statement
RBA holds Rates at 1.5%.
4th of May, Australia New Home Sales + Trade Balance
Worse than expected.
9th of May, Australia Retail Sales
Worse than expected.
18th of May, Australia Employment Change
Better than expected.
USD
Recent Facts:
See above.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.