24, October 2014

Fundamental analysis

EUR/USD (a 4-hour chart)

The US dollar was able to strengthen its position against its major competitors despite the many investors’ expectations. The pair EUR/USD lost 0.4% at the end of the trading amid the CPI moderately positive data in the United States. The September inflation remained unchanged at the level of year -on -year 1.7% that is 0.1% better than the forecasted medians. We observed the US 10-year bond yields sharp increase against this background.

The GBP/USD also remained under pressure during the day amid the Bank of England last meeting negative reports. There are still only two monetary control representatives – Weal and McCafferty vote for a rate increase. The other IFA members hold more conservative views. The Bank of England is now focused on its main trading partner (the euro) problems, and therefore it expects the UK economic growth slowdown.

The Japan trade balance poor statistics for September cheered bulls up within the pair USD/JPY for opening "longs". The September negative balance again increased due to the strong imports growth. Japanese exporters began to feel much better with the national currency devaluation in September. The US moderately positive statistics on inflation has increased the dollar demand.