March 2016

Brexit: sterling strength is a dollar story – BTMU

In respect of a Brexit, analysts at Bank of Tokyo Mitsubishi explained that, indeed, the advance of the pound is very much a US dollar story.

Key Quotes:

"The BOE’s broad trade-weighted index is actually roughly unchanged in March which highlights the continued poor performance of the pound amid increased concerns over the economic outlook. The poor performance of the pound has continued despite some good news from opinion polls recently."

"The ‘WhatUKthinks’ poll of polls has shown a widening in favour of ‘Remain’ over the month of March. This partly covers the period following the terrorist attacks in Brussels that some believed would harden support to leave. Quite the opposite it would seem."

"‘WhatUKthinks’ also ran two polls asking voters 1) whether the UK would be better able to defend itself by remaining or leaving the EU and 2) whether the terrorist attacks in Brussels would change how they intended to vote. The first poll result showed 40% responded being better able to defend by remaining versus 38% by leaving while the second poll result showed 83% responded that the attacks would not change how they intended to vote."

"This week also saw the publication of research from Populus and an independent polling analyst who correctly predicted last year’s general election result that concluded polling errors are taking place again like during the general election last year and these skewed results that show a smaller gap between ‘Remain’ and ‘Leave’ are inaccurate. The report shows that in reality, the ‘Remain’ campaign has an even larger portion of the vote than current polling results suggest."

In respect of a Brexit, analysts at Bank of Tokyo Mitsubishi explained that, indeed, the advance of the pound is very much a US dollar story.

(Market News Provided by FXstreet) [...]

U.S. stocks closed

U.S. stocks swung between gains and losses, amid the best month in five, as the March rebound that had global equities on the brink of erasing losses for 2016 faltered. The dollar headed for its worst quarter in more than five years. The Standard &amp... [...]

Get set for China’s March PMIs – TDS

Analysts at TD Securities reminds us of the big data ahead, besides tomorrow's nonfarm payrolls that is, we have China’s March PMIs coming up tonight.

Key Quotes:

"China’s official NBS manufacturing PMI is expected to potentially show a seasonal bounce, helped by aggressive Q1 credit disbursement, but the underlying details are likely to remain unconstructive.

Higher frequency Chinese data, such as the PMIs may take increasing importance for markets, given the Fed’s seemingly heightened focus on global growth factors in policymaking."

Analysts at TD Securities reminds us of the big data ahead, besides tomorrow's nonfarm payrolls that is, we have China’s March PMIs coming up tonight.

(Market News Provided by FXstreet) [...]

Argentina: We expect the economy to improve – Wells Fargo

According to the institute of statistics, Argentinean GDP grew at a rate of 0.8% during the fourth quarter and 2.1% in 2015. Analysts from Wells Fargo warned that results are very preliminary, subject to revisions and expect the economy to improve during 2016.

Key Quotes:

“With a preliminary reading of 0.9 percent on a year-earlier basis for Q4 2015, the Argentine economy managed to post a 2.1 percent growth rate for the whole of 2015. It is important to mention that these results are “very” preliminary and most likely will be revised considerably once the results for the first quarter of 2016 are released at the end of June. This is because Argentina’s statistical institute is in the process of fixing all of the data issues left by the previous administration, which means the revisions are expected to be important.”

“This preliminary release included information on the supply side of the economy but not on the demand side. However, some of the results on the supply side have hinted at a weak consumer as the year ended.”

“Although the new administration will face several challenges with inflation in 2016, we expect the economy to improve as the political and regulatory environment for the private sector improves. However, until the statistical institute releases its revisions to the data on the economy it will be quite difficult to gauge the true direction of the Argentine economy. That said, all indicators point to better times ahead for the country in the next several years.”

According to the institute of statistics, Argentinean GDP grew at a rate of 0.8% during the fourth quarter and 2.1% in 2015. Analysts from Wells Fargo warned that results are very preliminary, subject to revisions and expect the economy to improve during 2016.


(Market News Provided by FXstreet) [...]

EUR/USD consolidating above 1.1350, up 4.75% in March

EUR/USD hit a fresh sixth month high earlier at 1.1411 but failed to hold above 1.1400 and pulled back modestly. The retreated found support at 1.1375 and currently it trades at 1.1385/90, about to post the strongest daily close since October.

The euro is being able to consolidate above the 1.1350 area that during February and March capped the rally. The next technical challenge for the euro is to post a weekly close above 1.1450. Tomorrow in the US, the NFP will be release and it is likely to boost volatility, that could send the pair to test that key level.

A good quarter, a great month

EUR/USD is about to end the first quarter with a gain of 4.75%; all gains were in March, when it rallied and did not retreat (like it happened in February) and actually broke above 1.1350.

A weak US dollar pushed the pair to the upside, particularly during March, despite the decision of the European Central Bank to introduce more stimulus including a rate cut. In the US, the decision of the Federal Reserve to leave rates unchanged, weight on the USD.

Trade the nonfarm payrolls report - Live Coverage & Analysis


EUR/USD hit a fresh sixth month high earlier at 1.1411 but failed to hold above 1.1400 and pulled back modestly. The retreated found support at 1.1375 and currently it trades at 1.1385/90, about to post the strongest daily close since October.


(Market News Provided by FXstreet) [...]

USD/JPY: Yen strength still proving resilient – BTMU

Analysts from The Bank of Tokyo-Mitsubishi UFJ, see the USD/JPY neutral ahead of the next week, with price moving between 110.50 and 114.50.

Key Quotes:


“Many Japanese investors will likely sell foreign assets at the beginning of FY16 to realize gains. But such active cross border flows may not support USD/JPY, as many such investors have not determined their investing strategies for FY16 yet. They may take just enough gains the first week of April before making their next steps. After that, USD/JPY will likely stay calm.”

“Forthcoming US economic data, particularly nonfarm payrolls and ISM manufacturing on April 1 may support another Fed rate hike and a USD rally. However, the data could also hurt US stock prices, so USD selling may limit USD/JPY topside at around 114.”

“USD/JPY may decline because of lingering JPY repatriation by Japanese exporters and investors. Real flows may still support a JPY rally.”

Trade the nonfarm payrolls report - Live Coverage & Analysis


Analysts from The Bank of Tokyo-Mitsubishi UFJ, see the USD/JPY neutral ahead of the next week, with price moving between 110.50 and 114.50.


(Market News Provided by FXstreet) [...]

USD/CHF hit fresh 6-month lows under 0.9600

<!--TITOL:

USD/CHF hit fresh 6-month lows under 0.9600

FITITOL--> The swiss franc continues to climb against the US dollar and today is about to post gains for the fourth day in a row and the strongest close since October.

USD/CHF accelerated the decline during the European session and broke below yesterday’s low on American hours. It bottomed at 0.9571 and then bounced to the upside and it was trading at 0.9594/98, down 0.55% for the day.

The euro and the Swiss franc are among the top performer on Thursday's ahead of Friday’s US employment report. EUR/CHF is modestly lower for the day, after reaching earlier at 1.0953, the highest in two weeks.

USD/CHF technical levels

To the upside, resistance level might now lie at 0.9600, 0.9620 (20-hour MA) and 0.9665 (daily high). On the opposite direction support could be seen at 0.9570 (daily low), 0.9525 (Sep 18 low) and 0.9495 (Oct 16 & 20 low).

Trade the nonfarm payrolls report - Live Coverage & Analysis


The swiss franc continues to climb against the US dollar and today is about to post gains for the fourth day in a row and the strongest close since October.


(Market News Provided by FXstreet) [...]