Vector Securities - Analytics

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    Dollar closes this quarter in poor condition


    Yesterday the market continued to regain Yellen’s comments, expressed the day before. Besides, European statistics in the form of preliminary data on German inflation were better than predicted. It facilitated growth of European currencies. EIA data on oil products in the U.S.A. facilitated increase in energy prices what provoked growth of trade currencies. Still, later this increase was corrected by the IEA head Fatih Birol comments that energy market will remain weak this year.

    This day is the last one of the month and the 1st quarter. Dollar bulls are obviously demoralized, though there is no surrender yet. Today expected events aren’t optimistic for dollar bulls either. The focus is on German retail sales and unemployment and preliminary data on inflation in the Eurozone as a whole for March. Forecasts promise quite good results. Taking into account yesterday’s data on inflation in Germany, the data are likely to be better than predicted in general. This suggests that current tendencies will remain. Expected speech of NY Fed head Dudley doesn’t give dollar hopes either. His view of monetary policy has practically always something in common with Yellen’s opinion. Probably, he will comment on increase in rates cautiously. There are still risks of continued decrease for dollar.

     

    Trade tactics:

    Yesterday EURUSD pair failed to overcome the range 1.1370 – 1.1380, though came close to it. Herewith the price of closure is maximal since last October. Further growth of the pair is restrained by overbought signals at short-term charts, respite is necessary before next spurt. Once again, we face difficult choice – to keep position or fix profit. Now we see more arguments for retaining the position. If the pair fails to break through above 1.1400 today, then we will consider closure of the position.

     

    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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