14, October 2014

Fundamental analysis

EUR/USD (a 4-hour chart)

The US dollar could compensate some lost ground - the dollar index basket (USDX) finished the last week at 85.81. The pair EUR/USD decreased by 0.5% amid the investors’ escape from the risky assets. Absolutely all the world's leading stock indecies came under a sales wave on Friday, prompting asset managers to get rid of the decreased euro. There was no important the US and eurozone macroeconomic statistics publication.

During the day the pound also was under pressure as well as the euro. Even the August UK positive trade balance has not helped the British currency. The negative balance was reduced to the level of 9.09 billion pounds in August that is significantly better than the forecasted medians. Inflation expectations became lower in Britain that calls into question the monetary policy tightening by the Bank of England in early 2015. In this regard, traders are afraid to open "longs" within the GBP/USD and we observe the downward trend development.

The USD/JPY was trading within a range of 107.60- 108.00. Amid the empty macroeconomic calendar the traders’ attention is focused on the US and Japan stock markets trade dynamics. Despite the fact that the US dollar was strengthening along the entire market against the Japanese yen, it finished the trading day in the "red zone." That bearish trend on the stock markets did not allow the dollar/yen to overcome October 9 high.