13, May 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

The mood “for the dollar”, provided by the head of the ECB statements on last Thursday, continued to have an impact on the currency market and at trading. Draghi’s hint that the European regulator is ready to begin monetary policy easing next month continued to support the dollar. U.S. trade deficit slightly narrowed in March, slightly cheered about the GDP results for the first quarter possible revision in a better way and economic optimism index from IBD/TIPP fell again - after a jump to 48.0 in March, it returned in April to the level of 45.8.

The retail sales for April expected to see 0.5% m/m increase after +1.1 % m/m previously, NAHB index testifying about the houses builders’ mood, probably points to growth in May to 49 after 47 previously.

The pound fell after the UK industrial production in March release which fell by 0.1 % m/m, whereas no change was expected. Manufacturing index rose by 0.5 % m/m, beating 0.3 % prognosis growth - for the 1st quarter of this year, growth in the manufacturing sector was the highest in nearly 15 years (1.4 % q/q). The pound stabilized after NIESR prognosis, according to which the British economy growth accelerated. UK GDP growth was 1% in the three months till April (against 0.8 % the previous month) which is the fastest growth since June 2010.

The Japanese yen also fell against the dollar on Friday. Obviously, the market general mood “for the dollar”, as well as technical factors, identified strong support have an impact on the pair USD/JPY. In addition, some growth in the stock market in Japan and the U.S., as well as the stop price rises to “Treasuries” could help to “green” to boost its popularity against the yen.