NetoTrade - Analytics

    NetoTrade

    382.50 7.00/10
    83% of positive reviews
    Real

    Greece Resumes Negotiations 20.03.2015

    Greeks Fight to Stave Off a Default Ahead of Steep Repayments

    With deposits in Greek banks being pulled at escape velocity and reaching levels not seen since February, the Greek Government is desperately negotiating for the release of further bailout funds to prop up the beleaguered economy.  Repayments due to the IMF later today are likely to create a further cash crunch with the Government forced to borrow money from state utility companies in order not to default on existing obligations.  With the nation unable to finance itself via debt markets, without another tranche from the Troika, the nation’s days are numbered.  After rising nearly 400 pips following the FOMC Statement, EURUSD has since retraced all of the gains as the reality of Greece sets back in.  Without any definitive compromise between Greece and creditors, EURUSD is likely to test key support at 1.0500 once more.

    Across the Atlantic, macroeconomic data continues to largely disappoint expectations with manufacturing especially weak.  Yesterday’s Philadelphia Fed Manufacturing Index missed expectations by a wide margin, printing at the weakest levels in over a year as concerns about the outlook remain pervasive.  With the Federal Reserve planning to stay "data dependent” when considering hiking interest rates, economic figures remain unsupportive of higher rates.  According to the manufacturing index, the employment, new orders, and expenditures elements are foreshadowing further fragility in the sector which is likely to weigh heavily on the Fed’s decision.  While the dollar has managed to rebound from the lows seen after the most recent Federal Reserve meeting, equities remain mostly unchanged after soaring higher following the statement.

    The Japanese economy continues to face serious obstacles to growth as evidenced by the latest revelations by the Bank of Japan.  The impressive and unprecedented monetary easing program is continuing to reduce liquidity conditions in key asset classes as the Bank of Japan buying spree is running out of available assets to purchase under its current mandate. According to current projections, the BoJ is forecast to run out of available ETFs and REITs to purchase and might have to resort to buying individual equities on the open market to continue the current pace of monetary easing.  This is increasing the risks to the broader economy as the Central Bank begins to absorb substantial quantities of financial assets as the bidder of last resort.

    Economic Calendar

    XAUUSD Downward Trending Channel Trading Opportunity

     
    Gold prices continue to falter as a stronger dollar and disinflation pressure precious metals downward.  Although the FOMC Statement saw a brief rally in gold prices, part of the move has been retraced to the downside with gold remaining firmly in both a medium and longer-term downtrend.  With no rebound in inflation forecast for the next few months and the possibility of further dollar momentum higher in the near-term with the prospect of higher interest rates, pressure will continue to mount on gold.  The downward trending channel has a bearish bias with optimal short positions initiated at the top of the channel and closed at the bottom of the channel.  Long positions that fight the trend are not suggested due to worsening risk-reward characteristics.

     

    Resistance: 1180/1191

     

    Support: 1150/1132


    To leave a comment you must or Join us


    By visiting our website and services, you agree to the conditions of use of cookies. Learn more
    I agree