Daily Market Analysis by ForexMart

GBP/USD Fundamental Analysis: January 18, 2017


The GBP/USD pair exhibited heightened volatility during the previous trading session as the dollar lost strength and the sterling pound regained much of its footing in the market. Theresa May’s speech yesterday helped in clearing up some of the murkier parts of the Brexit process, and this has helped in placating various investors and has minimized concerns surrounding the Brexit process, thereby increasing the value of the sterling pound. This has then prompted investors to pull out their funds from the USD, thereby causing the dollar to drop in value.


Theresa May has highlighted in her speech yesterday that the UK will indeed be going for a hard Brexit and will be eliminating any kind of access from the eurozone. However, the PM has reiterated that the UK government will be negotiating with eurozone leaders in order to have a different kind of trade relations with the European bloc. Since this has eliminated confusions surrounding Brexit matters, thereby increasing the pair’s volatility levels. The GBP/USD pair initially dipped to 1.2015 points prior to Theresa May’s speech but quickly climbed up to a daily high of 1.2414 points.


However, there are still a handful of concerns surrounding the Brexit process, and the expected invocation of Article 50 is also seen as a possibly risk for the stance of the currency pair as well as the UK economy. As such, these are expected to continuously pressure the GBP in the next few days.
For today’s session, UK will be releasing its claimant count change data as well as its average earnings data, while US will be releasing its CPI data later today. It remains to be seen whether these data sets would be continuing the string of good economic data during the past few days. If the UK data comes out as positive, then this push the pair upwards to 1.2500 points, although this might not be enough to actually push the currency pair beyond this particular barrier.

USD/JPY Technical Analysis: January 18. 2017

The JPY increased significantly in value against the USD after the majority of investors fled the USD after Donald Trump expressed his concerns that the US dollar might be becoming too strong for the US economy to handle. The US 10-year Treasury Yields plummeted to 2.307% during the early hours of yesterday’s trading session, possibly its lowest intraday levels since November 2016.

This has then lended support for the bears of the USD/JPY pair after the currency pair traded at the lower regions of 112.67 points before making a slight recovery. However, there came a slew of negative US data, such as the New York Empire State Manufacturing Index, which dropped to 6.5% from its previous reading of 9.0%.

This reading is indicative of slower business growth in the region for this month. Since the USD/JPY was able to extend over 114.00 points, the currency pair is more than ready to extend sideways.

The pair’s 4-hour chart shows that its momentum indicator retains its bearish stance and is still within the negative side of the chart, while RSI indicators for the currency pair are pointing to the downside. The 100 SMA for the USD/JPY pair has also lowered significantly.

Support levels for the USD/JPY are expected to manifest at the 112.65 points, while resistance levels could possibly appear once the pair hits 113.35 points.

USD/CAD Fundamental Analysis: January 18, 2017

The Prime Minister of UK, Theresa May laid out few ground rules yesterday regarding the possible flow of the Brexit process. Global risks were also expected to lessen and in whatever time it might occur, it will likely weigh on the dollar.

The greenbacks were seen to be on its weaker stance prior this event that will hit the currency much harder. This will caused for the USD/CAD to test 1.3000 over and over, there is also a sudden solid bounce upwards.

The USD continued to suffer from the drawbacks due to the risky environment from Trump’s administration which continue to confuse traders and investors because of its vague plans.

Moreover, the expected thrice rate increase of the Fed will likely be supported by the dollar with the medium and long term, however the near-term risk that surround the new US government causes the dollar to soften.

Another test of lows is assumed to occur in case the Canadian data will present an optimistic result. Since the economic data from the region is relatively strong and identify whether this upbeat is from the BOC statement about rate policy or from the media conference of the BOC Governor.

Furthermore, the BOC is scheduled to hold its rate for today, in case the statement cam

GBP/USD Technical Analysis: January 18, 2017

There are high expectations that the Jobless Rate and Average Earnings will present green figures. Yesterday, bulls were able to take the driver’s seat in a moderate tone. The GBP/USD successfully fill the gap last Monday with the help of an extreme short-term rally.

The sterling pushed 1.2100 during the Asian hours and reached 1.2200 prior the opening session of Europe. The momentum of the pound became short-lived as the level were being tested. The price had tone down, however, continued to stick at the 1.2200 level. Meanwhile, the 4-hour chart presents the price escalated and test the 50-EMA. It continued to advance under the moving averages and resume to moved lower. The resistance hit the 1.2200 region, support is at 1.2100.

MACD strengthen which signaled weak position against the sellers. RSI stayed in a neutral stance.

Should the Cable close above 1.2200, a fresh bullish pressure is expected to see. While the daily close on top of 1.2200 bears further risk as the pair rise towards 1.2300. In case the barrier maintains the price, it has a tendency to be in the red again and renewed lows near 1.200.

EUR/USD Technical Analysis: January 18, 2017

German economic sentiment did not meet investor’s outlook. Meanwhile, the market concentrates on the statistics of CPI from EU and Germany.

The pair resumed its short-term upward momentum yesterday. Bulls were able to dominate the market and drove the price higher amid the Asian session. The European currency rallied and take out 1.0650 in the middle Asian hours. The euro expanded its gains and touched 1.0700 level during the EU session.

The price rebounded in the 100-EMA and pass over the 50-EMA upwards, it further settled on top of the moving averages with a bullish slope as indicated in the 1-hour chart. Resistance is seen at 1.0700, support jump in the 1.0650 region.

The MACD increased which favored strength for the buyers. RSI oscillator escaped from the neutral territory and turn back to the positive area.

The technicals displayed a bullish pattern. The EURUSD headed near its immediate resistance at 1.0700. The barrier broke the next level and fixates on 1.0750. We do not rule out the possible decline in profit taking subsequent to the rally took place on Tuesday. Sellers are also able to remove few of its losses if it pushed the price below 1.0650 region and advanced towards 1.0600.

USD/CAD Technical Analysis: January 18, 2017

The greenback slumped on Tuesday’s trading session testing at 1.30 level. The trend moves downward from 1.3598 level. If the downtrend holds the current resistance, then the downtrend could persist towards the next target at 1.2900 level. The strong resistance stands at 1.3189 level and and a break higher than this level completes the downtrend.

If the market could break lower, it is possible for the price to trade below the 1.30 handle. Oppositely, if the price breaks above the candle formed on Tuesday trading session, this could be a buying opportunity while hoping for the oil prices to decline. Yet, it seems that the sellers will sustain the current trend.

January 18, 2017

Chinese Government’s Countermeasure for Decline in Home Prices

Residential property in Guangzhou climbed by 0.7 percent in December according to the report from Bureau of Statistics’ data. It is the only city who opposed the deflation program of residential properties in China.

Twenty local and provincial officials have seeked out counter measures to control loans and restrict second-home buyers to lessen the risk of elevated prices that may lead into dire repercussions. When this countermeasure has been implemented home prices from first and second tier cities steadied implying a positive change for the economy. As for the city of Beijing, he pledged that the prices of new homes will be kept unchanged for this year.

January 18, 2017


India’s Demonetization Impacts the Economy


India presented consecutive growth for less than 7 percent in the past three-quarters during December 2012 and June 2013 based on the statement from an India economist at Soc Generale, Kunal Kumar Kundu.

SocGen also mentioned the fiscal growth rate of the country for 2017 is 6.6 percent versus the previous result of 7.3 percent. The bank further expects for a 7.2 percent, lesser than the earlier prediction of 7.7 percent, for the fiscal year 2018 which will end on March 2019.

India laid out its demonetization program since November with more than 50 days from now, causing an 86% impact on the currency circulation within the country.

The 500 ($7.35) and 1,000 ($14.70) rupees were replaced with 500 and 2,000 rupee notes.

The Jakarta-based investment firm reviewed the research from All India Manufacturers' Organization (AIMO), which showed that there are 35% job losses within the small scale and micro industries and suffered 50% decline in the revenue, 34 days after the demonetization program is set forth. However, in March 2017, the figures will likely drop into 60% in employment while 55% reduction in revenue as stated by AIMO, it’s because these sectors are highly dependent on cash transactions.

January 18, 2017

Pound Surges, USD Plummets after Trump, May Comments

The sterling pound finally increased in value after a long slump after UK PM Theresa May outlined her plans for the hard Brexit process, therefore clearing up some of the Brexit-related confusions and placating investors. Meanwhile, US president-elect Donald Trump has recently commented on the strength of the dollar, saying that the USD’s current value might be “too strong” for the US economy to handle. This has then prompted USD investors to vacate the dollar and move to riskier assets such as stock markets and has caused the dollar to drop in value.

EUR/USD Fundamental Analysis: January 19, 2017

The US dollar finally regained the majority of its losses yesterday after the country released a series of positive economic data, as well as from a handful of fundamental adjustments which occurred in the country during the previous trading session. However, although the dollar strength has already returned, it remains to be seen whether this will eventually continue to become a long-term trend or merely dissipate as a short-term correction for the USD, and with Trump’s inauguration tomorrow, the US dollar is in for some interesting movements in the future.

The USD remained docile during the entirety of yesterday’s Tokyo and European trading session. However, the EUR/USD failed to make significant developments after going through 1.0700 points since it was relying on economic data in order to make actual progress. The CPI data from the US was eventually released and met market expectations, inducing more upward pressure on the USD but was immediately lost in the face of increased volatility in the market. But the real game-changer was Yellen’s speech later in the day, wherein the Fed chair reiterated that if the slew of positive economic data from US continues, then the market could be in for another Fed rate hike anytime soon. This dollar-positive movement has then caused the EUR/USD pair to climb up to 1.0620 points and has now settled just above this particular region. The pair is expected to undergo more pressure as the dollar continues its winning streak across the board.

The ECB will be releasing its rate statement during today’s trading session and will be subsequently followed by a press conference from the central bank. There are no changes expected from the ECB, however it is expected that the central bank would probably highlight its most recent achievements to the market audience. US will also be releasing the Philly Fed Index as well as the Unemployment Claims data, both of which are expected to increase volatility and lend additional support for the USD.

GBP/USD Fundamental Analysis: January 19, 2017

The GBP/USD pair was unable to sustain its hold over 1.2400 points and eventually dropped to 1.2300 points, mostly due to the return of the dollar’s strength, which was expected by investors to come back anytime soon. The UK released a string of highly positive economic data yesterday, such as the average earnings data and the claimant count data. However, these were relatively minor data, and had little effect on the movement of the sterling pound. But it is important to note that in spite of the general uncertainties surrounding the Brexit process, UK still manages to release very positive economic data from their region.

The majority of market players instead chose to focus on economic data coming from the US, but the sterling pound’s weakness had already taken effect during this time after receiving pressure from Yellen’s statement that the Fed could possibly go for another interest rate hike if the economic data from the US continues to be positive in the coming months. This has then caused the dollar to increase in value and has caused the currency pair to drop to 1.2300 points.

Market players are generally expecting that the GBP/USD pair will continue its losing streak, and since the dollar continues to strengthen, the currency pair could be in for more losses both in the short run and long run. There are no major data set to be released today from the UK, and with nothing to counter the movement of the USD, the currency is more likely to be subject to more downward pressure as the day progresses.

AUD/USD Technical Analysis: January 19, 2017

The Australian Dollar presented some optimism compared with its U.S peer that receives support from the dynamic pricing of oil. The awaited data from the labour market is deemed to support the Aussie at the same time.

The tone of the market remains to be positive. The AUD/USD is confined on its 2-week highs near the 0.7550 level. The price hovered around a very tight range and tends to go into a lower position. The 4-hour chart showed the spot stick on top of the moving averages. The 100 and 50-EMAs preserved its bullish tone while 200-EMA is flat. Resistance hit 0.7550 mark, support is found at 0.7500 range.

MACD lied in the same level which confirmed buyer’s strength once again. The RSI is currently on the consolidation period and entered the overvalued zone.

Forecasts mentioned for a further short-term downward correction. In case the closing trades are set under 0.7750, the price will impose a sell signal. The possible target of the bears is 0.7500.

GBP/USD Technical Analysis: January 19, 2017

Hard Brexit issues continued to affect the cable pair. The British currency weakened in spite of the upbeat in the labor market data as the unemployment stat maintained its rate and Claimant Count Change rose.

The sterling is in the red versus its American rival on Wednesday. The GBP/USD climb the edge of the overbought area and pointed downwards amid Asian hours. Sellers take out the 1.2400 level during the morning trades and tested the mark 1.2300 in the EU session. However, the mark stalled the progress of sellers. Having touched the level, the price reduced and stayed on top of the region prior to the onset of NY trading.

According to the 4-hour chart, spot bounced off to 200-EMA. The entire moving averages moved downwards. Resistance highlighted 1.2400 region, support entered 1.2300 area.

The MACD slowed down which favored seller’s strength. RSI kept intact in the overbought zone.

Moreover, the 4-hour chart showed a prevailing bearish tone.The primary target 1.2200 showed some signs as it will be going short followed by the consolidation phase, the pair is expected to move ahead through 1.2100 handle.

EUR/USD Technical Analysis: January 19, 2017
The American dollar was able to rub out its losses versus the euro prior to the speech of Yellen yesterday. The greens further acquired some support from the consumer price index of U.S which met the expectations of investors. Moreover, the decision of the ECB about its interest rate will be announced later this day.
The market structure remained to be bullish on Wednesday. The single European currency executed an upside impulse and return from its weekly high towards 1.0716.
The ongoing rebound is deemed to be corrective during the profit-taking behind the current rally. The EUR/USD retreated under the 1.0700 level amid morning trades on Wednesday and it hovered throughout the level as the EU session took place.
The 4-hour chart shows the price resumed its advancement on top of the moving averages. The 100 and 50-EMAs continued to be bullish while 200-EMA stayed on the neutral position shown in the same time chart. Resistance sits at 1.0700, support lies at 1.0650 region.
The MACD histogram falls which indicate weak position of the buyers. The RSI oscillator kept around the overvalued territory.
The pair is expected to moved near the immediate support 1.0650. In case the level breaks, the support will return to 1.0600. However, the EUR will receive short-term support as much as 1.0500 remained intact.

USD/CAD Technical Analysis: January 19, 2017


The USD/CAD pair surged on Wednesday as it broke the downtrend on the chart. It started from the 1.3598 level forming until 1.3018 level completing the current downtrend. The support level is found at 1.3135 and if a clear break is seen, the price could further go down towards the 1.2800 mark. Alternatively, if the price breaks higher than the current uptrend line, the price could move up towards the next target at 1.3500 level in the next days to come.


A rebound in the price trend could being the sellers back soon and dominate the market as the prices are about to go higher influenced by the oil market. However, if the oil prices become unstable then the prices could further go up and the break lower than the 1.30 level gives a negative sign to the market.

USD/CAD Technical Analysis: January 19, 2017


The USD/CAD pair surged on Wednesday as it broke the downtrend on the chart. It started from the 1.3598 level forming until 1.3018 level completing the current downtrend. The support level is found at 1.3135 and if a clear break is seen, the price could further go down towards the 1.2800 mark. Alternatively, if the price breaks higher than the current uptrend line, the price could move up towards the next target at 1.3500 level in the next days to come.


A rebound in the price trend could being the sellers back soon and dominate the market as the prices are about to go higher influenced by the oil market. However, if the oil prices become unstable then the prices could further go up and the break lower than the 1.30 level gives a negative sign to the market.

EUR/JPY Technical Analysis: January 19, 2017
The EUR/JPY pair amped up for some time on yesterday morning indicating signs of steadiness in the market. This may not stay long and traders may face some roughness in trading as it reach below the 120 handle. Then, the buyers would lead the market.

After some days, the price could reach the 124 level again as the current 120 level could further go down towards the 118.50 level as long as the support holds. It is not recommended to sell the market as of now.

NZD/USD Technical Analysis: January 19, 2017

The New Zealand dollar fell in the beginning of trading session on Wednesday. The market was able to reverse this and formed a hammer pattern in the charts. It seems very bullish and if the break is successful to break beyond the top of the hammer, the price could further go up towards the 0.73 level. Oppositely, if the price breaks lower at the bottom of the hammer then this indicates a negative sign towards the 0.71 handle. There is an inclination for the pair to reach the overbought area but it seems that the buyers are quite finished. Nevertheless, it is anticipated for a high volatility in the market.

January 19, 2017

Australia’s Increase in Employment

The Australian Bureau of Statistics released an official data on Thursday showing an upsurge in employment. The number of people employed increased by 13, 500 which is higher than the expected figures of 10, 000. The number of people who work full time expand by 9, 300 and the participation rate reached 64.7% in December while 64.6% for November.


Annette Beacher, Chief Macro Strategist of Asia-Pacific Research at TD Securities, mentioned that there were about 92,000 additional jobs created last year. However, these jobs are only part-time because full-time occupation declined in 2016.


Moreover, the stability of the labor market will be based on the actions of the Reserve Bank of Australia for 2017, according to an economist at Morgan Stanley, Daniel Blake.On one side, there are few analyst who believes on the positive impact of the employment statistics.

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January 19, 2017
Proposed U.S. Tax Cut Favors Canadian Economy
The Bank of Canada’s Overnight rate target uphold the 0.50 percent as the economic outlook remains the same. It is forecasted that the economy will recuperate to its maximum potential in the middle of 2018 driven by the infrastructure program of Federal government which could affect the economy.

The proposed tax cuts may be favorable for Canadian exports and business confidence but this may have an opposite effect for other states in America. Hence, this tax cut may not affect the economy of Canada. Even though the Canadian economy recovered solidly in the third quarter of 2016, it is forecasted since October to rise up to 2.1 percent until next year

GBP/USD Fundamental Analysis: January 20, 2017

The GBP/USD pair spent the rest of yesterday’s trading session consolidating amid a bullish bias as the dollar’s strength waxed and waned during the duration of yesterday’s session. Since there were no major economic data coming from both the UK and US yesterday, the GBP/USD pair traded within a tight boundary in spite of the marked volatility from other currency pairs. This trend is expected to continue during today’s session as the market looks for a definitive direction for the currency pair.

The US dollar as well as the sterling pound are both expected to undergo a period of heightened volatility and could go through significant changes for this year. This is because the newly-minted Trump administration could possibly usher in increased spending and infrastructures, along with a lot of concerns and uncertainties regarding the new administration’s economic and fiscal policies, while the UK continues to struggle with issues surrounding the Brexit process. These events are expected to leave permanent effects on both currencies, and it will all depend on how both economies will be responding to these burgeoning changes in the future. However, one common thing that these two countries have is that both are exhibiting relatively good economic data, which is good news for long-term investors. But then again this does not remove the fact that both currencies will be highly volatile in the near future.

UK will be releasing its retail sales data during today’s European session, with the market expecting the data to come out as generally positive in accordance to the recent trend of positive economic outputs from the region. The GBP/USD pair could possibly test the 1.2400 range if the retail sales data meets market expectations.

USD/CAD Fundamental Analysis: January 20, 2017

The USD/CAD continued to exhibit a strong trading streak during the previous trading session as the after-effects of the BoC’s economic policies continue to have an effect on the Canadian dollar, with the CAD weakening across the board during the previous session as a result. The USD/CAD is trading just above 1.3300 points and could be in for more consolidation within its trade highs for today unless the US dollar suddenly drops in value.

The Bank of Canada has already made it clear that the Canadian economy has not made any substantive progress during the past months, and this stagnation might prompt the central bank to make interest rate adjustments in the coming months. Economic data coming from this region was generally good, but low oil prices have already become a matter of concern for the BoC since the country is hugely reliant on oil, and this is why it is highly possible that the BoC might decide to implement rate cuts towards the end of 2017. This is also why the CAD continues to drop in value, and why corrections in this particular currency has always been met with strong buys. If the currency pair manages to reach 1.3500 points, then the pair could possibly reach up to 1.4000 which could be easily achieved within the year if the Fed hikes its interest rates and the BoC implements a rate cut.

Canada will be releasing its CPI data as well as its retail sales data during the New York trading session, and if any of these two data comes out as weak, then this will be merely a confirmation of a weakening Canadian economy, and the pair could possibly go upwards to 1.3400 and could even reach 1.3500 points.

EUR/USD Fundamental Analysis: January 20, 2017


The EUR/USD pair underwent a lot of volatility during yesterday’s trading session after it initially plummeted to 1.0600 points for a short period but eventually climbed towards the higher trading regions and is now continuing to trade within these price highs. The euro currency is known for its resilience against the fluctuations of the USD, and while other currencies become adversely affected with the movement of the US dollar, the euro has always been able to counter these effects and the USD always finds it hard to oppose the movements of the EUR.


The ECB released its statement regarding the central bank’s rates yesterday which was immediately followed by a press conference, and Draghi had already stressed that the central bank is not very keen on minimizing the bank’s QE anytime soon. Moreover, Draghi also stated that the ECB chose not to act on the region’s inflation issues since this was mainly caused by the surge in energy prices. This statement from the central bank stirred some concerns from market investors, therefore putting downward pressure on the EUR/USD pair and causing the currency pair to drop to 1.0600 for a brief period. However, the euro was again able to revert its losses during the North American trading session even though there was no actual reason behind the dollar weakness. The USD continues its losing for today and is expected to undergo more consolidation as the day progresses.


There are no scheduled economic data to be released from both the EU and the US for today, and as such, the current market trends are expected to be dominant in the financial market for today.

EUR/USD Fundamental Analysis: January 19, 2017

The US dollar finally regained the majority of its losses yesterday after the country released a series of positive economic data, as well as from a handful of fundamental adjustments which occurred in the country during the previous trading session. However, although the dollar strength has already returned, it remains to be seen whether this will eventually continue to become a long-term trend or merely dissipate as a short-term correction for the USD, and with Trump’s inauguration tomorrow, the US dollar is in for some interesting movements in the future.

The USD remained docile during the entirety of yesterday’s Tokyo and European trading session. However, the EUR/USD failed to make significant developments after going through 1.0700 points since it was relying on economic data in order to make actual progress. The CPI data from the US was eventually released and met market expectations, inducing more upward pressure on the USD but was immediately lost in the face of increased volatility in the market. But the real game-changer was Yellen’s speech later in the day, wherein the Fed chair reiterated that if the slew of positive economic data from US continues, then the market could be in for another Fed rate hike anytime soon. This dollar-positive movement has then caused the EUR/USD pair to climb up to 1.0620 points and has now settled just above this particular region. The pair is expected to undergo more pressure as the dollar continues its winning streak across the board.

The ECB will be releasing its rate statement during today’s trading session and will be subsequently followed by a press conference from the central bank. There are no changes expected from the ECB, however it is expected that the central bank would probably highlight its most recent achievements to the market audience. US will also be releasing the Philly Fed Index as well as the Unemployment Claims data, both of which are expected to increase volatility and lend additional support for the USD.