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Fundamental Analysis
Fundamental updates by Solid ECN
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[QUOTE="Solid ECN, post: 206710, member: 83167"] [HEADING=1][JUSTIFY]Morning Market Review[/JUSTIFY][/HEADING] [JUSTIFY][/JUSTIFY] [HEADING=2][JUSTIFY]EURUSD[/JUSTIFY][/HEADING] [JUSTIFY]The European currency is trading with a slight decrease against the US dollar during the Asian session, testing 1.0900 for a breakdown and updating local lows from March 9. Market sentiment correlates with the predominantly "bearish" trend in EURUSD since the end of last week. Investors are assessing the prospects for further acceleration of inflation in the region as the EU considers the introduction of another package of sanctions against the Russian economy after evidence of war crimes in the Ukrainian city of Bucha. It is expected that the new restrictions will affect the import of coal for 4 billion euros per year, as well as equipment for the gas industry, transport and other industries for 10 billion euros per year. The sanctions will also affect the ban on investment, in particular; it is planned to introduce new measures against financial institutions and state-owned enterprises, as well as a number of representatives of the Russian authorities and their families. The European Union will stop buying fertilizers, timber and a number of food products from Russia, which in the current realities is estimated at about 5.5 billion dollars a year. Imports of Russian oil, as well as natural gas, remain practically unchanged, since for many EU countries this is a fundamental issue of energy security. In particular, Germany and Hungary oppose a complete embargo. Macroeconomic statistics from Europe published on Tuesday turned out to be restrainedly optimistic, but did not have a noticeable impact on the market. The Composite Manufacturing PMI in the eurozone in March rose from 54.5 to 54.9 points with a neutral forecast. The Services PMI for the same period increased from 54.8 to 55.6 points, while analysts did not expect any changes here either. [/JUSTIFY] [HEADING=2][JUSTIFY]GBPUSD[/JUSTIFY][/HEADING] [JUSTIFY]The British pound is trading ambiguously against the US currency during the morning session, consolidating near 1.3070. The day before, the instrument showed a rather active decline, despite the fact that in the first half of the day the pound traded with predominantly upward dynamics. Moderate support for the instrument during the European session was provided by optimistic data on business activity in the EU and the UK, which gave hope that some of the negative forecasts about a sharp economic slowdown due to anti-Russian sanctions may not come true. The UK Services PMI from Markit strengthened in March from 61 to 62.6 points, while investors did not expect any changes. With the opening of the US session, the focus of the market's attention shifted to the statistics from the US, and here the picture was not so unambiguous. Indices from Markit showed a moderate decline: the services sector fell from 58.9 to 58 points in March. In turn, similar statistics from ISM supported the buyers of the US currency: the Services PMI in March strengthened from 56.5 to 58.3 points, ahead of its forecasts at the level of 58 points. [/JUSTIFY] [HEADING=2][JUSTIFY]AUDUSD[/JUSTIFY][/HEADING] [JUSTIFY]The Australian dollar is consolidating against the US dollar during the Asian session near 0.7500, waiting for new drivers. The instrument still retains a fairly strong "bullish" momentum, formed at the end of last week. The day before, AUDUSD showed a sharp increase, having updated record highs since June 2021; however, by the close of the day session, the "bulls" had lost most of their gains. The active growth appeared due to the statements of the Reserve Bank of Australia (RBA) after the meeting on the interest rate, where, as expected, the monetary policy parameters were left unchanged. At the same time, representatives of the regulator complained about the growing inflation, and also promised to continue to be less restrained in the issue of tightening monetary policy conditions. Analysts regarded these words as a possible signal that the interest rate may be increased during the June meeting of the committee. The development of the "bullish" dynamics for the instrument was also constrained by macroeconomic statistics from Australia, published on Tuesday. Commonwealth Bank Composite PMI in March declined from 57.1 to 55.1 points. The Services sector in March fell separately from 57.9 to 55.6 points, while analysts expected the same level of activity to be maintained. [/JUSTIFY] [HEADING=2][JUSTIFY]USDJPY[/JUSTIFY][/HEADING] [JUSTIFY]The US dollar shows weak gains against the Japanese yen in Asian trading, testing 124.00 for a breakout. The USDJPY pair is developing an uptrend, formed at the end of last week, and is updating local highs from March 29. Moderate support for the US currency is provided by moderately optimistic macroeconomic statistics from the US on business activity from ISM. At the same time, the general situation on the market is changing little and the demand for the dollar is still held against the backdrop of deteriorating growth prospects for the global economy. In addition, traders expect further steps from the US Federal Reserve towards tightening monetary policy. In May, the American regulator will meet for a regular meeting, following which the interest rate can be increased immediately by 50 basis points. The Bank of Japan, in turn, is forced to maintain a soft monetary policy in an effort to overcome deflationary risks. Tuesday's macroeconomic statistics from Japan turned out to be ambiguous. Thus, the Jibun Bank Manufacturing PMI in March strengthened from 48.7 to 49.4 points. At the same time, Overall Household Spending in February slowed down sharply from 6.9% to 1.1%, which turned out to be noticeably worse than analysts' forecasts at the level of 2.7%. [/JUSTIFY] [HEADING=2][JUSTIFY]XAUUSD[/JUSTIFY][/HEADING] [JUSTIFY]Gold prices are changing little during the Asian session, holding near 1920.00. The day before, the instrument showed a restrained decline, which was quite an expected reaction of the market to the publication of relatively optimistic macroeconomic data from the US. In particular, the ISM Services PMI in March showed a fairly active growth from 56.5 to 58.3 points, ahead of its forecasts at 58 points. This once again strengthened the market's confidence that the US Federal Reserve will take a more "hawkish" stance on monetary policy in the near future. As early as May, the rate is expected to rise by 50 basis points at once, and the Fed is expected to launch a quantitative tightening program in order to reduce its balance sheet. The rhetoric of the European Central Bank (ECB) is also gradually tightening as inflationary risks soar and prospects for improvement are not yet visible. Russia continues to conduct a special military operation on the territory of Ukraine, and the European Union is preparing a new package of sanctions against the Russian economy, which threatens a new round of rising prices for energy resources and a number of other goods.[/JUSTIFY] [/QUOTE]
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