Forex

Forex Weekly Outlook August 8 – 12

Published

8 years ago

August 7, 2016

The US labor market added stunning 255,000 jobs to the payrolls in July, even with an uninspiring 1.2 percent second quarter GDP growth rate and weaker than expected orders. The labor market doesn’t seem to be slowing down anytime soon. Both wages and average work week also surged in July, confirming the strength of the jobs created as it cuts across manufacturing, healthcare, retails, temporary-help agencies and leisure and hospitality industries.

Even though, the unemployment rate remains low at 4.9 percent in July. The General concerns remain the divergence between the US labor market and the economic growth rate. While labor market is skyrocketing, the economic growth is below 2.6 percent expected by economists in the second quarter — raising questions about the US economic outlook in 2016, if it will be enough to raise rates this year.

Nevertheless, the US dollar gained part of its losses against all its counterparts on Friday.

In the United Kingdom, the Bank of England cut rates by 25 basis points to record low on Thursday and extends stimulus to safe the economy from the aftermath of the Brexit. The pound has since lost about 1.7 percent against the dollar to 1.3061.

While the Reserve Bank of Australia also lowered its official cash rate by 25 basis points to contain surging Aussie dollar and boost exports as explained last week, but sadly the local currency continued to gain against the US dollar after investors abandoned the greenback for the Japanese yen prior to the job report released on Friday. Prompting economists to think the RBA will have to do more to get its consumer prices up.

This week, the Reserve Bank of New Zealand is widely expected to cut rates by at least 25 basis points from current 2.5 percent to 2 percent on Thursday, and another 25 basis points in November to 1.75 percent if Kiwi gains must be capped and inflation target met. The RBNZ Governor Graeme Wheeler said earlier that the higher exchange rate is damping the growth outlook and that action will be taken as deem appropriate.

In Canada, a total of 31,200 jobs were lost in July and trade balance deficit dipped to 3.6 billion in June, more than 2.6 billion expected, while the unemployment rate rose to 6.9 percent. The Canadian dollar tumbled the most since June on Friday, after the nation’s labor market showed the most jobs were lost since November 2015. Yes, things are not looking good for the loonie, especially with weak consumer spending, weak manufacturing sector and falling oil prices.

This week, EURUSD, USDCAD, USDCHF and AUDUSD top my list.

EURUSD

For the past six weeks this pair has top my list, largely because the greenback is the most balanced currency with clear cut policies to envisage future occurrences. While Euro-single currency has struggled since the U.K. exit the European Union, currently the Euro-manufacturing sector is moderately okay but the risks in the region outweigh its offering investment wise. Another reason why I think this pair could offer a substantial sell opportunity is positive US non-farm payrolls report, what we want to do is ride the sentiment as it becomes clearer.

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Not forgetting, that even at dollar worse moments last week, the Euro-single currency has failed to gain enough against the US dollar to cross the ascending channel started in November to confirm a bullish continuation. So this week, I remain bearish on the EURUSD with 1.0821 as the target, provided 1.1233 resistance holds.

USDCAD

Last week I mentioned the USDCAD and the possibility of what it holds, this week I remain bullish on this pair after breaking 1.3142 resistance amid dwindling Canadian employment rate. The double bottom formed by the last two candlesticks last week aligned with the higher-lows trend line, a technical break above 1.3142 will confirm our bullish continuation. As long as price remains above 1.3142, I am bullish on USDCAD with a 1.3387 target.

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USDCHF

Last week, I explained the viability of the USDCHF following the decision of the Swiss National Bank (SNB) to intervene in the forex market. Since my last analysis the USDCHF has gained 89 pips to close at 0.9809.

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This week, I remain bullish on USDCHF because the new found strength of the US labor market will likely continue to pressure this pair as investors struggle to decipher the situation with SNB, I believe a sustained break of 0.9843 resistance will open 1.0000 parity level, then our target 2 at 1.0093.

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To read AUDUSD analysis click here

Last Week Recap

The GBPJPY lost 199 pips to close at 132.93 on Friday — below the long established downward trend line and short of our 129.86 target. This week I am bearish on GBPJPY with 129.86 as the target.

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USDJPY

This pair lost 139 pips before the US dollar gained back part of its losses to the Japanese yen to closed at 101.77, this week I am standing aside on this pair.

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For update on AUDUSD pair click here.

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Samed Olukoya

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Forex

Yen Hits 34-Year Low Against Dollar Despite Bank of Japan’s Inaction

Published

6 hours ago

April 26, 2024

Samed Olukoya

The Japanese yen plummeted to a 34-year low against the US dollar, sending shockwaves through global financial markets.

Despite mounting pressure and speculation, the Bank of Japan (BOJ) chose to maintain its key interest rate.

The yen’s relentless slide, extending to 0.7% to 156.66 against the dollar, underscores deep concerns about Japan’s economic stability and the efficacy of its monetary policies.

BOJ Governor Kazuo Ueda’s remarks at a post-meeting news conference did little to assuage fears as he acknowledged the impact of foreign exchange dynamics on inflation but downplayed the yen’s influence on underlying prices.

Investors, already on edge due to the yen’s dismal performance this year, are now bracing for further volatility amid speculation of imminent intervention by Japanese authorities.

The absence of decisive action from the BOJ has heightened uncertainty, with concerns looming over the potential repercussions of a prolonged yen depreciation.

The implications of the yen’s decline extend far beyond Japan’s borders, reverberating across global markets. The currency’s status as the worst-performing among major currencies in the Group of Ten (G-10) underscores its significance in the international financial landscape.

Policymakers have issued repeated warnings against excessive depreciation, signaling a commitment to intervene if necessary to safeguard economic stability.

Finance Minister Shunichi Suzuki reiterated the government’s readiness to respond to foreign exchange fluctuations, emphasizing the need for vigilance in the face of market volatility.

However, the lack of concrete action from Japanese authorities has left investors grappling with uncertainty, unsure of the yen’s trajectory in the days to come.

Market analysts warn of the potential for further downside risk, particularly in light of upcoming economic data releases and the prospect of thin trading volumes due to public holidays in Japan.

The absence of coordinated intervention efforts and a clear policy stance only exacerbates concerns, fueling speculation about the yen’s future trajectory.

The yen’s current predicament evokes memories of past episodes of currency turmoil, prompting comparisons to Japan’s intervention in 2022 when the currency experienced a similar downward spiral.

The prospect of history repeating itself looms large, as market participants weigh the possibility of intervention against the backdrop of an increasingly volatile global economy.

As Japan grapples with the yen’s precipitous decline, the stakes have never been higher for policymakers tasked with restoring stability to the currency markets. With the world watching closely, the fate of the yen hangs in the balance, poised between intervention and inertia in the face of unprecedented challenges.

Naira

Dollar to Naira Black Market Today, April 25th, 2024

As of April 25th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,300 NGN in the black market, also referred to as the parallel market or Aboki fx.

Published

1 day ago

April 25, 2024

Samed Olukoya

Naira to Dollar Exchange- Investors King Rate - Investors King

As of April 25th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,300 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,260 and sell it at N1,250 on Wednesday, April 24th, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate declined when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.

Black Market Dollar to Naira Exchange Rate

Buying Rate: N1,300
Selling Rate: N1,290

Naira

Dollar to Naira Black Market Today, April 24th, 2024

As of April 24th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,260 NGN in the black market, also referred to as the parallel market or Aboki fx.

Published

2 days ago

April 24, 2024

Samed Olukoya

As of April 24th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,260 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,250 and sell it at N1,240 on Tuesday, April 23rd, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate declined slightly when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.