Fundamental Analysis – 18/01/2016

Jan 18

FUNDAMENTAL ANALYSIS BY NSFX 18.01.2016

  • BY:
  • January, 18th, 2016 1:25 +00:00

Good Morning, 

EURUSD climbed on Friday benefiting from safe haven trades as oil prices continued to fall stressing global markets. Next week’s BoC meeting is a close call, with risks rising of a cut. The unremitting slide in crude oil prices will likely continue for some time to come. Gold broke a four-day losing streak on Friday, adding value on the back of poor equity market performances and concerns of a global slowdown connected to Chinese economic stagnation. USDCHF is trading at 1.0013 while USDCAD is trading at 1.4577. 

GBPUSD was the worst performing currency this week falling to trade at 1.4257 getting hit all week but Friday alone GBP fell 156 points. Long EURGBP positions make the most sense due to the large short positioning that is already in the markets, where the break above 0.7500 was a bullish signal. European Central Bank will be forced to slash its inflation target as markets have lost faith. EURCAD is trading at 1.5915 while EURGBP is trading at 0.7660. 

Our bullish JPY view appears to be playing out even faster than we expected. The dairy auctions in New Zealand are showing signs of weakness once again. Expect less strength against EUR and weakness versus JPY given global asset volatility. GBPCHF is trading at 1.4262 while EURCHF is trading at 1.0930.

Daily Performances (4.00 am. GMT); 

Currencies / Indices / Commodities

Performance

NZDUSD

-          0.55%

GBPJPY

-          0.16%

USDJPY

-          0.16%

AUDUSD

-          0.07%

EURUSD

0.11%

USDCAD

0.28%

EURGBP

0.13%

CAC 40 Index

-          2.38%

BIST 100 Index

-          1.22%

IBEX 35 Index

-          2.78%

Euro Stoxx 50 Pr

-          2.37%

FTSE 100 Index

-          1.93%

OMX Copenhagen Index

-          3.39%

Swiss Market Index

-          2.39%

I hope you all have a nice day.

All the figures are as at the writing time.