Forex Today's Highlights:
17:30 MSK. US data on crude oil inventories from the Department of Energy in April (previous value -1,034M; -1,300M forecast).
Euro Dollar EUR / USD forecast for today 04/26/2017
On Tuesday, the currency market the euro has established a new maximum in the last six months. Tomorrow will be a meeting of the ECB, where all the attention of investors and forex traders will be focused on the speech of M. Draghi. "Super Mario" is likely to react negatively due to lower core inflation to its lowest level in 11 months, as well as reducing the rate of growth of the trade surplus for the first two months of the year. The current rise in the euro is not advantageous for the ECB - it leads both to a reduction in the trade surplus, and to reduce inflation. Traders should not expect verbal intervention from Mario Draghi that the euro will lower to 1.08.
It is worth noting two more reasons for the reduction of quotations of the single currency. The first reason for the decline - this is a high demand for risky assets and capital outflows from safe assets (the yen, Swiss franc and gold). The euro was also included in the group of safe assets in connection with this, you can expect a decrease in prices. The second reason for the development of the downward trend - the dynamics of the commodity market. Investors are selling this week, crude oil and gold, which in turn is a positive factor for the US currency as commodity prices are quoted in dollars.
EUR / USD recommendation 26/04/2017: Sell 1,0935 / 1,0970 and take profit 1,0835.
Pound Dollar forecast GBP / USD on 04/26/2017
Today there is no news from the UK and the US, but it does not mean that today there are no ideas for trading. Investors should wait for reduction of quotations pound for two reasons.
First , the credit market yield on 10-year UK government bonds is reduced in relation to their counterparts in the United States and Germany, which reduces the attractiveness of investments in British assets.
Second , tonight I expect reduction of quotations of gold on the black background of the increase in US oil production. Over the last week the number of horizontal platforms (shale oil) increased by 12 units, and vertical platforms 2 units. When we have seen an increase in both indicators, the production is always increasing. Lower oil prices generally has a negative impact on the cost of the British currency.
GBP / USD recommendation 26/04/2017: Sell 1,2835 / 1,2860 and take profit 1,2755.
Dollar Yen Forecast USD / JPY today 26/04/2017
During the day, we can expect growth of quotations on the background of sustained "risk appetite". Indices of fear in the United States and Europe show a decrease, which together with positive quarterly reports of corporations pushes up the leading stock exchanges. Who is the primary and, in fact, the only driver of growth in prices. Japanese Yen - it is the base currency, which is used in carry trade operations, and in this context, the dynamics of the stock markets has a significant impact on the yen quotes. As a confirmation of the high "risk appetite" is the dynamics of gold. Precious metals show weakness, which is negative for the yen, as between the two instruments observed a direct correlation.
USD / JPY recommendation for today 26.04.2017: Buy 110,98 / 110,55 and take profit 111,57.
Aleksandr Goryachev
Company analyst FreshForex
