Bias Strongly Bearish

Dukascopy Fundamental Analysis EUR Moody's reduced credit rating of 16 Span's banks, citing a rise in bad debts in the country's financial sector and overall deterioration of the economic environment. The decision came after shares of Bankia lost another 14%. The largest banks such as Banco Santander and BBVA were downgraded while ten out of 17 banks were put on negative watch, implying that further credit rating cuts are possible. USD As the U.S. dollar gets stronger, investors are concerned that aggravating debt crisis in Europe will reduce demand for oil. Therefore, oil shows decline for a third week. Crude oil lost 25 cents yesterday and reached the 6-month low of $92.56. Brent oil for July delivery slid 0.5 percent to finish at $106.99. GBP Following a downgrade of 16 Spanish banks, ...

With the lack of market thrillers, risky assets rebound on a normal pullback after the recent savage selloff looking with an eye of hope towards the world’s leaders meeting (G8) today. Markets woke up on sharp selloff with the start of the trading session, where majors printed new lows against the greenback before rebounding. The EUR/USD reached 1.2640 just above 2012 low at 1.2621, currently baring earlier losses trading around 1.2713. Stochastic has provided an early sign of recovery in the form of a bullish divergence and currently regaining the bullish momentum. However the upside remains limited as markets jitters are far from over. Thus 1.2660 should form an intraday ceiling today, as trading ranges will get thinner approaching the weekend. The British pounds rebounded sharply ...

Dukascopy Fundamental Analysis EUR Mario Draghi, the ECB President, insisted on Greece to stay in the Euro bloc during his public speech on Wednesday regarding the possibility of Greece withdrawal from the Eurozone. Nevertheless, according to him, the ECB will stick to its anti-inflation mandate. The ECB President's comments came after Irish and Belgian central banks reported that Greek exit would not be disastrous for the Eurozone. USD Jobless claims in the U.S. didn't live up to the expectations that it will decrease by 5K and remained unchanged, at 370K level, in the week from 6th to 12th of May. Amount of people on rolling unemployment claims increased by around 18K while the number of people on prolonged payments decreased by around 45K. 31 out of 52 states or territory's reported ...

Majors resumed the bearish tone against the greenback after a slight recovery with the start of the trading session, where the U.S dollar headed to new highs and continues to bag meaty gains against its major counterparts. The overall scene is clearly derived by Greek jitters, while a care-taker government leads the country until June’s fresh elections. It seems that markets have already started the pricing process of a Greece exit; if that is true, the selloff we have seen is just the beginning. Spain weighed on markets as well, the country dipped technicaly into recession as the economy contracted by 0.3% in the first quarter which is the second consecutive contraction. while Moody`s rating agency plans an immenent yp to 21 Spanish banks downgrades according to Spanish newspaper ...

Dukascopy Fundamental Analysis EUR Stoxx Europe 600 index have dropped for third consecutive day and reached the lowest level since the start of this year as specialists speculate that elections in Greece could take place as early as 10 of June. The index lost 0.5% of its value by noon in London and around 10% from its peak this year in mid-March. USD Facebook increases the share offering by 25% to 421.2M shares to collect near $16B. At the offering's price of $34-$38 per share Facebook is rushing towards the largest technology IPO in the history. Production of utilities, mines and factory's in the U.S. surpassed expected 0.6% level and increased by 1.1% in April. GBP The number of unemployed people for January-March decreased to 2.63 million, 45,000 down on the quarter, the Office for ...

Dukascopy Fundamental Analysis EUR Investors battered European stocks, dumped the bonds of Spain and Italy, and bid the euro down against the dollar Monday after the collapse of weekend coalition talks in Greece edged that country closer to an exit from the euro zone. USD Retail sales in the U.S. rose in April at the slowest pace of the year, showing unseasonably mild weather and pre-Easter shopping may have pulled consumers to stores the prior month. GBP Governor Mervyn King looks set to leave the door open to more support for the struggling economy when he presents the Bank of England's new economic outlook on Wednesday, which is likely to show a tricky mix of lower growth and higher inflation ahead. CHF Swiss stocks lost ground on Monday on concern Greece will exit the Eurozone. ...

Dukascopy Fundamental Analysis EUR Industrial production in the 17 countries that use the euro fell unexpectedly in March, leaving little doubt the region contracted for a second straight quarter in the first three months of the year and returned to recession, data by Eurostat showed Monday. USD Stocks fell, commodities declined to their cheapest level this year and the euro weakened to a three- month low on concern that Greece will exit the single European currency and after German Chancellor Angela Merkel’s party lost a state election. GBP The government, and many economists, say the U.K.'s austerity plan has succeeded in reassuring financial markets that the government is focused on wrestling down the country's debt, which had ballooned to the highest levels since World War II. As a ...

Forex News and Events: As anticipated in Friday’s newsletter, China cut its Reserve Requirement Ratio for the second time this year. Shielded by easing inflation, Chinese authorities relaxed their grip on banks’ cash reserves parked at the PBoC through a 50 basis point cut effective starting May 18. This measure will allow the RRR to drop to 20% for the main national financial institutions and will release an estimated CNY 400bn in capital into the market. The move came after the publication of a weaker-than-expected Chinese Trade balance on Thursday, indicating exports and imports grew by 4.9% and 0.3% y-o-y respectively, a far cry from the 10 and 11 percent goals for the year. The near-zero import growth could be explained by the piling up of metal domestic inventories and might affect ...

Dukascopy Fundamental Analysis EUR European stocks declined as company earnings missed estimates, talks on forming a Greek government entered a fifth day and JPMorgan Chase & Co. posted a $2 billion trading loss. Asian shares and U.S. futures fell. USD Wholesale prices in the U.S. fell in April for the first time in four months, led by a decline in fuel costs that signals inflation may cool. The producer price index dropped 0.2 percent after no change in March, Labor Department figures showed today in Washington. GBP Britons turned gloomier last month as a slump in construction pointed to an even deeper recession and producers ramped up prices, highlighting the long and difficult road back to economic health. CHF Swiss stocks fell for the seventh day, heading for the biggest weekly ...