After a strong rising start on the
first day of the week, the EURUSD dollar pair assumed a bearish (falling) bias
after the release of the US Durable Goods orders report on Monday, halfway
through the London session. Durable Goods had not been giving very good
readings in previous months, but the latest report beat both expectations and
the prior outcome. Thereafter, on Tuesday, US Markit Purchasing Managers Index (PMI)
figures added to the feeling of positivity for the Greenback.
Then, on Wednesday, albeit after a
somewhat puzzled reaction at first, market participants decided to interpret
the Fed Monetary Policy statement as more hawkish than dovish, which is to say
that it was taken to mean that interest rates will in fact rise in the US this
year, possibly in September.
The fall in the pair (a fall in
EURUSD means a strengthening dollar) gained further momentum yesterday
(Thursday), when it became known that US GDP had risen on a quarterly basis,
although the year-on-year figure was a little less than had been hoped for. But
a quarterly rise was enough.
OmiCronFX has traded these developments using the Mandelbrot algorithmic trading system. Development of the OmiCron Mandelbrot software has been guided by the principles outlined in the OmiCron Forex Trading Manual, which is available from Amazon.
OmiCronFX has traded these developments using the Mandelbrot algorithmic trading system. Development of the OmiCron Mandelbrot software has been guided by the principles outlined in the OmiCron Forex Trading Manual, which is available from Amazon.
Eurozone
inflation today will also impact EURUSD
The fate of the most traded pair on
the Forex market is, of course, tied to the notion of a divergence in monetary policy
between the US and the Eurozone. While the US is expected to begin monetary
tightening in the form of an interest rate rise regime in the not-too-distant
future, in the Eurozone it is easing, by means of a continuation of Quantitative
Easing (QE), which is the order of the day.
That EZ easing will either be
strengthened or checked by the release of Core Consumer Price Index numbers by
Eurostat later this morning.
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