12, August 2014

EUR/USD Fundamental analysis

EUR/USD (a 4-hour chart)

The EUR/USD closed the trading day with the quotations growth on short positions profit taking. The macroeconomic statistics showed a mixed background - the German trade balance indicator came out worse than the forecasted medians while the France industrial production release gave the market a pleasant surprise, showing an increase to the level of 1.3%. The market was full of the euro short positions as traders fully played this technical oversold in the last days.

The UK trade balance negative report cheered the bears for opening the GBP/USD "shorts". The June deficit has increased which is directly related to the British pound strong rate against the dollar and the euro. Against this backdrop, investors dumped the pound.

The BoJ, at its next meeting, signaled to market participants about the Japanese manufacturer's hard times. This negative process impacts on the export process and directly affects the economic growth rate. However, the monetary regulator refused the possibility of short term stimulus volume increasing again. Against this background, we observed sales in the Japanese stock market and the USD/JPY in the first half of the day.