30, December 2014

Fundamental analysis

EUR/USD (a 4-hour chart)

There was a moderate demand for the US dollar - the dollar index basket (USDX) finished the trading day at the mark of 89.92. The EUR/USD trades started trades with a gap at the level of 1.2226, after which traders began to increase short positions. There is still a strong demand for the dollar amid the 3rd quarter US GDP positive release.

The British pound was traded in the down trend. Traders did not hurry to open positions amid the Christmas holidays low liquidity. The macroeconomic calendar was completely empty and traders decided to postpone the active trade until the next year.

From the four leading economic countries only Japan published a set of important macroeconomic statistics. All the key reports came out worse than the forecasted medians. Inflation declined to the level of 2.4% on an annualized basis, the November industrial production decreased by 0.6%. Decrease was observed in the retail sales release by -0.3%. The US and Japan 10-year negative yield spreads grew on the bond market. At the moment the differential was just over 200 basis points, and then in the afternoon the course was stabilized. The pair slightly increased on the yesterday’s trades.