05, May 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

The EUR/USD continued to work out the negative U.S. GDP release for Q1in the absence of its own economic reports. In a moment the quotations reached 1.3888 level, the “bulls” had neither the strength nor the desire for a further growth. The ISM production report was published. In April, the index rose up to the level 54. 9, showing the growth for 3 consecutive months. The positive data supported the moderate demand for the U.S. dollar.

The first report from the Center of Macroeconomic Research Markit Economics for the manufacturing sector showed an increase after four months of falling down. That supported a moderate demand for the British currency. Optimism in the manufacturing sector increased which is favorable for the UK economy. Amid this the GBP/USD quotes grew up to the level 1.6918. However, the “bulls” couldn’t consolidate above 69 figure due to the moderately positive macroeconomic statistics from the United States where there was a lock in profits on long positions observed.

The day before, the USD/JPY enjoyed a moderate demand. The growth in the world's leading stock exchanges played a positive factor for the “bulls”, but it is clearly not enough for the formation of a good upward trend. The ISM manufacturing index for April also could not cheer the “bulls” – despite that the output data was better than the median forecast, the investors remain concerned about the strong contraction of GDP in the first quarter. The weak economic growth in the United States carries some negative for the Japanese economy, as a strong trade relationship between the two countries has been developed.