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Otmane El Rhazi from Dukascopy Bank SA.

European shares extend losses European stock markets declined for a second consecutive week amid geopolitical concerns. The stock markets were hit after Malaysia Airlines passenger jet was downed in over Ukraine on 10 July. The markets also absorbed several economic data releases, one of which was German ZEW Economic Sentiment that came out worse than expected for the seventh month in a row. The Stoxx Europe 600, which represents European large, mid and small capitalization companies, ended

Otmane El Rhazi from Dukascopy Bank SA.

Roberto Mialich, Director Senior G10 FX Strategist, on the GBP How do you evaluate the current performance of the British Pound? We remain relatively positive on the Sterling, because to our mind the BoE will start hiking rates after the summer. I anticipate that the first rate hike will take place as early as in November, which should continue to offer at least a cash into a downside for the GBP. However, the biggest part of this scenario is already priced in by the market. Thus, there may be

Otmane El Rhazi from Dukascopy Bank SA.

HKD/JPY 1H Chart: Rising Wedge Comment: HKD/JPY has been locked in a narrowing trading range bounded by two steadily converging, upward-sloping lines for the last 64 hours. Now the pair of two Asian currencies is headed towards the lower trendline of the rising wedge pattern but the 50-hour SMA at 13.0911 is preventing HKD/JPY from confirming the pattern’s limit one more time. Technical indicators suggest the pair is not likely to overcome this resistance in the next hour but there may be a

Otmane El Rhazi from Dukascopy Bank SA.

Technical Analysis EUR/USD breaks 1.35 “The gradual widening in interest rate differentials in favour of the U.S. also adds to the argument that EURUSD has scope to fall further as we target 1.32 on our trade recommendation.” - BNP Paribas (based on CNBC) Pair’s Outlook Regardless of the bullish indicators on a monthly time-frame, EUR/USD has finally closed beneath the major level at 1.35, meaning the currency pair has now confirmed its long-term bearish intentions. The immediate support is at

Otmane El Rhazi from Dukascopy Bank SA.

Fundamental Analysis EUR “The market is completely ignoring the European news. So when the dollar moves, it’ll move, but anything European-specific is not enough. Euro-dollar is also seemingly ignoring all geopolitical noises, whether it’s Russia and Ukraine or Gaza.” - Brad Bechtel, the managing director of Faros Trading LLC Since November 2013, when Mario Draghi slashed the minimum bid rate to 0.25% expectations for a fresh easing have been heating up till June 2014. However, it seems that

Otmane El Rhazi from Dukascopy Bank SA.

Market Highlights ASIA-PACIFIC REGION China’s economic growth accelerates in Q2 China’s economy grew faster than expected in Q2, exceeding estimates for the first time in the last three quarters. The world’s second biggest economy expanded 7.5% in April-June period compared to a previous quarter’s reading of 7.4%. Experts predicted GDP to grow to 7.4% in Q2. Meanwhile, separate data releases fortified the view that economy is gaining pace. Banks increased lending activity in June, with loans

Otmane El Rhazi from Dukascopy Bank SA.

USD/CAD 1H Chart: Channel Up Comment: A dive to a 10-month low of 1.0620 in the very beginning of July provoked a long-lasting appreciation of the greenback versus the loonie performed within the area bounded by two parallel upward-sloping lines. The pair now is located near the lower trend-line and may remain there as the 50-hour SMA at 1.0739 is blocking the upswing, while the pattern’s support is preventing the pair from a bearish exit. Meanwhile, traders’ sentiment on the SWFX is almost

Otmane El Rhazi from Dukascopy Bank SA.

Technical Analysis EUR/USD looks too heavy to rise “The U.S. dollar seems to be showing more sensitivity to what’s happening at the front end of the U.S. yield curve.” - National Australia Bank (based on Bloomberg) Pair’s Outlook A rally after a test of 1.35 turned out to be quite shallow, as the currency pair was sold of as soon as it approached the monthly S1 and up-trend line. As a result, right now EUR/USD seems to be more inclined to move lower from here than to regain bullish momentum.

Otmane El Rhazi from Dukascopy Bank SA.

Fundamental Analysis EUR “Despite the euro’s break below the 1.3500 level observed last week we haven’t, as yet, broken below the lows this year at 1.3477. A move through here could well be the trigger point for a move towards the November 2013 lows at 1.3300.” - Michael Hewson, chief market analyst at CMC Markets UK The single European currency advanced 0.15% on Monday and was changing hands around 1.3539 at the time of writing, erasing some of the losses that were logged during the last 20

Otmane El Rhazi from Dukascopy Bank SA.

Relative Currency Strength After spending the entire previous period in the depreciation area, the U.S. dollar index managed to recover and have a successful week. The world’s largest economy’s currency strengthened against almost all of its observed peers, only failing to surpass the yen, which was on an uptrend throughput the whole period. The period is especially remarkable with the USD Index finally bringing one of its longer-term changes up to a positive value - something it was