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Market Review February 21, 2014

 

February 21, 2014 

                   

The Australian Dollar currently doesn’t look too attractive for various investors. The AUD/USD is losing ground, and the Chinese report on Thursday didn’t help.

 

The Australian Dollar didn’t have an easy time this week. Investors have been looking for a safe harbor in order to avoid risks emerging from developing economies, and China brought a few unpleasant surprises.

 

The HSBC report on the tentative index of business activity in manufacturing sector in February showed the decline to 48.3. The figure has been under important psychological level of 50 and can’t recover above it. Investors are concerned, regardless of obvious numbers on the inflow of foreign capital to China, which was supposed to prove stability of the economic system.

 

Australia traditionally perceives China as the biggest strategic partner, which is why it reacts on such reports.

The pair’s performance was also undermined by unemployment statistics, which appreciated up to 6%.

 

At the upcoming meeting of the RBA they will decide to downgrade the interest rate from the current 2.50%. Which would be quite reasonable.

 

 

TECHNICAL ANALYSIS

 

EUR/USD

 

The Euro continues to decline. The rate has already crossed the support. But still has not been a decisive break beneath it. So the support is about to be tested, and the outcome will determine future trend of the currency pair.

 

USD/JPY

 

Yesterday the rate attempted to rise past the 102.60 area but failed. Now the rate is sliding down from that peak. Upside resistance still holds. The outlook remains bearish.

 

GBP/USD

 

The pair has been ascending from the height at ~ 1.6823 for a few days. Meanwhile no patterns are able to slow down or reverse the trend. The forecast is bearish.

 

 

 

ECONOMIC CALENDAR

 

09:30    GBP  Core Retail Sales (MoM)    

09:30    GBP  Core Retail Sales (YoY)    

09:30    GBP  Retail Sales (MoM)      

09:30    GBP  Retail Sales (YoY)      

13:30    CAD  Core CPI (YoY)      

13:30    CAD  Core CPI (MoM)      

13:30    CAD  Core Retail Sales (MoM)    

13:30    CAD  CPI (MoM)      

13:30    CAD  CPI (YoY)      

13:30    CAD  Retail Sales (MoM)      

14:00    MXN  Mexican GDP (YoY)    

15:00    USD  Existing Home Sales    

15:00    USD  Existing Home Sales (MoM) 

18:10    USD  FOMC Member Bullard Speaks            

18:45    USD  FOMC Member Fisher Speaks