25, September 2015

Fundamental analysis

EUR/USD (a 4-hour chart)

There was a multidirectional trend in the Forex market yesterday. According to the US Labor Department the initial jobless claims number increased to 267 thousand. The forecasted median was 271 thousand vs previous 264 thousand.

The pair EUR/USD had increased by the end of the day amid the EUR/GBP growth as well as the short positions profit-taking. The ECB President Mario Draghi said that "if necessary," the ECB may change the quantitative easing rate. The investors’ reaction was sluggish, but sufficient to close the euro with a plus. Also investors reacted vaguely to the euro area business activity weak indicators. The September manufacturing PMI fell from 53.3 to 52.0 while it was expected 52,0, the service sector PMI fell from 54.4 to 54.0 while it was expected 54.2. The Markit manufacturing PMI came out worse than expected with the preliminary assessment for September: 53.0 vs. 53.3, but, nevertheless, it is the same level as in August.

The pair GBP/USD had decreased amid the UK government bond yields decline relative to the US counterparts. According to the trading day results, the British pound fell. There is only an 18% chance the Fed will raise interest rates in October and 41% in December. After the decrease the pair is consolidating.

The pair USD/JPY had symbolically decreased amid the bearish sentiment in the US stock market which has caused demand for the yen as a funding currency.