Overcoming the resistance

By GG Analyst in Reviews 0 Comment

EUR/USD

Against our expectations, yesterday proved to be quite a busy day. The initial impulse to sell the euro has been quickly played out and then followed by purchases of the currency starting at 1.2870. In the mid of the US session EURUSD rose to 1.2870 at some point and during trading in Asia today almost hit 1.2880. Yet, the growth impulse is almost exhausted. Most commentators attribute appreciation of the pair to the selling pressure in the dollar, which was caused by the poor Manufacturing PMI data  from ISM. Against the expected preservation, the growth rate slowed down in March. The more…

EUR took advantage of the verdict to the Cyprus banking future

By GG Analyst in Reviews 0 Comment

EUR/USD

After a week of markets’ and investors’ tortures, Cyprus has eventually found what it can sacrifice to prevent the uncontrolled swift crash of its financial system. Frankly speaking, Cypriots agreed to a slow and gradual dying of their banking sector. You see, in exchange of €10bln from the international creditors (the EU, the IMF, the ECB) Cyprus makes the second largest creditor of the country – Laiki- a “poor bank”, which in addition to its own debts will get toxic debts of the Bank of Cyprus. Deposits above 100K won’t suffer restructing and won’t be taxed. However, big investors may lose more…

An opportunity for the rate cut in EU

By GG Analyst in Reviews 0 Comment

EUR/USD

The single currency is still in the downtrend. On Friday EURUSD was depreciating. At some point its quotes went below 1.30 and now the pair is trading right at this level. Thus, already now the decline in the pair is deeper than at the beginning of the year. The dollar index is at the highest level for the last 6 months. Yet, it’s worth mentioning that in August and July the index was supported by decline of the euro. Now support is coming from other currencies (the yen, pound, Loonie, Aussie), while the euro feels quite well. However, in view of more…

Draghi is not satisfied with the more expensive euro

By GG Analyst in Reviews 0 Comment

EUR/USD

Mr Draghi met our expectations. Not that he spoke openly about depreciation of the euro or threatened with quantitative easing to weaken the euro, but still he pointed out that the increase in the euro, though reflecting that the eurozone is again trusted, may hamper the recovery. In our opinion, the markets were especially sensitive to the phrase that quick growth of the euro may impair price stability. And this implies that the CB will be ready to act should the euro keep growing. At the moment investors are puzzled which of the CBs is the least tolerant to the high more…

Broad USD decline

By GG Analyst in Reviews 0 Comment

EUR/USD

The dollar’s antirally continues. It is a relatively new trend, as earlier the euro was growing against the dollar almost alone. Now appreciation of risk-sensitive assets is getting all-round. Yesterday the euro bears were defending fiercely and didn’t give up 1.36. But in the Asian session today purchasing of the euro became more intense. That was largely caused by growth in EURJPY, which has been on the rise for 11 out of the recent 12 weeks and is now relentlessly sweeping stops before itself. Yet we shouldn’t think that the euro itself has nothing to do with it. Yesterday’s employment data more…