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    Yen performs solo in the exchange market


    The turbulence of stock markets, constant attempts to push energy prices further down, doubts about the Fed decisiveness to follow tough monetary policy this year make Japanese currency attractive as a shelter-currency. Now it is the most desirable asset in the exchange market. Yesterday against the background of collapse in stock markets the common currency also managed to regain losses, sustained after Friday’s report on labor, and returned above 1.1200, still, players keep in mind coming session of the ECB scheduled for the beginning of March. The pair needs the support in the form of positive European statistics. Others are not so lucky. Trade currencies are under pressure against the background of another fall in oil prices and British pound has difficulties after the messages that negotiations on retaining the U.K. membership in the EU weren’t without challenges.

    Considering today’s notable events, there is almost only European news. In the Eurozone the data on industrial production will be published, plus the data on trade and payment balances of Germany. However, these reports don’t attract close attention, as a rule. For a year industrial production has shown quite volatile results, and balances haven’t had problems at all during last years. Nevertheless, the positive on these indicators is very desirable for euro. It can help the pair to renew annual maximums to fix current growth trend. Today the report on British foreign trade will be published too. The indicator is weak due to chronic deficit, pound’s reaction to it is usually limited. Still, under the lack of other news GBPUSD pair can show violent reaction depending on changes of the balance.

     

    Trade tactics:

    The return of EURUSD pair above 1.1200 is a positive sign to continue growth. However, it is necessary to close the day at new maximums to confirm it. The question remains whether market players will risk continuing pair’s purchases on the eve of tomorrow speech of Janet Yellen. Our technical indicators show mixed signals. Now we are going to continue keeping long positions, we recommend pulling stop to 1.1070.

     

    Any opinions, advice, news, research, analyses, prices or any other information presented on this webpage is provided as general market commentary and does not constitute investment advice. "Vector Securities" shall not be liable for any loss, including loss of profit, which may arise directly or indirectly from the use of this information.


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