Weekly Market Review September 12

Possibilities that the Federal Reserve might raise policy rates soon, have had quite an important impact on the US dollar. Starting this week on a feeble note, the US dollar was saved from additional losses due to dovish expectations on hike in rates. Currencies such as the Euro gained by 0.1 percent against the US dollar while the Yen was pushed higher due to the greenback’s feeble state. As the Bank of Japan looks out for solid solutions for bond yielding, the Yen is expected to stay bullish.

Elsewhere, crude prices fell more on the Asian trade as a freeze in output of crude looks quite impossible to occur in this month. However on November 30, OPEC members may meet in Vienna so as to resume talks of freezing output. Traders are looking forward to this opportunity which is expected to boost crude prices and create unique trading opportunities. U.S. crude for October delivery fell by 1.79 percent to settle at $45.06 a barrel while Brent fell by 1.60 percent.

This week, economic events are a little low while today the market will resume gradually with the absence of vital economic data. Earlier tomorrow China’s industrial production data will be delivered while UK CPI data is awaited at 08:30 GMT and German Zew economic sentiment will be released at 09:00 GMT. Moving on to Wednesday, the UK Average earnings index including bonus is expected at 08:30 GMT and at the same time the Claimant Count change data will be delivered. By the side of the US, the crude oil inventories data will be released at 14:30 GMT. On Thursday, UK retail sales data releases at 08:30 GMT while in the interest rate decision is awaited at 11:00 GMT. U.S. core retail sales data is expected on the same day at 12:30 GMT. More by the side of the U.S. is awaited with the PPI and retail sales data releases awaited at 12:30 GMT. On Friday, U.S. core CPI data will be released at 12:30 GMT.

Technical Analysis:
The European Central Bank indicated towards more easing to be adopted in the near future which could pose a threat to the Euro. On this note, the European common currency was dragged in the lower territory of the chart against the US dollar. However, the USD is also not in its best form since the start of this week. As of last week, the EURUSD pair did attain the 1.1306 level but now the same area has become resistance spot for this pair. On Friday, the pair EURUSD was dragged lower to the 1.120 level and earlier today it was seen at the 1.123 level. It’s the start of the week, do not rush and keep an eye on this pair.
Higher volatility was seen for the USDJPY pair as risk aversion caused the Yen to up higher while the US dollar weakened. Earlier today, the pair USDJPY was seen around the 102.5 level and may continue to trade within a range starting from that point during the whole day. On Friday, the pair USDJPY hiked up to the 102.9 level but unfortunately the pair did not maintain gains around this level. Incurring losses, the pair was dragged lower to the 102.6 level on Friday where the session closed. As of this week, traders prepare for Fed’s upcoming policy rates. Therefore, vigilance on this pair is required.

Nothing is right for the pair GBPUSD with the continuity of bearish candles for a month now. Despite the US dollar has been keeping a low trading range, this pair failed to keep up the sentiment on this chart. On Friday, the pair GBPUSD edged lower again and was brought down to the 1.324 level. The 1.338 level is the new resistance level for this pair here and much is expected to happen in UK with important data releases expected throughout this week. Currently the GBP remains weaker than the US dollar, therefore traders are advised to verify this pair’s trend starting today.
Economic Calendar