Forex

Forex Weekly Outlook May 15-19

Published

7 years ago

May 14, 2017

Forex Weekly Outlook May 15-19

The US economic data released last week showed the economy is growing at a steady pace ahead of the next Federal Reserve meeting in June.

However, there were noticeable weaknesses in the figures. For instance, while the Producer Price Index rose 0.5 percent in April, the inflation rate rose less than projected –up 0.2 percent from plunging 0.3 percent in March. Suggesting, perhaps the inflation is not rising as previously anticipated by policy-makers.

Similarly, retail sales climbed 0.4 percent in April. Also, below the 0.6 percent expected by experts but more than the 0.1 percent increase recorded in March.

This shows that while consumers are optimistic as shown by the University of Michigan consumer sentiment (97.7), inflation is hardly breaking out and wage remains soft. Therefore, it is unlikely that the Federal Open Market Committee (FOMC) will feel pressure enough to raise rates in June as that would impact wage and hurt consumer spending substantially.

In the U.K, factory production plunged further by 0.6 percent in March after declining 0.3 percent in February. Indicating that rising inflation has started affecting the manufacturing sector.

Also, the Monetary Policy Committee members voted to keep asset purchase at 435 billion with the official bank rate at 0.25 percent ahead of June 8 election.

Overall, the US economy remains resilient ahead of FOMC meeting in June, however, few inconsistencies may hamper June rate hike and possibly put a temporary stop to the current dollar rally as the market looks to the U.K. for clues on the possible direction of the Brexit.

This week, USDJPY and EURGBP top my list.

USDJPY

Last week this pair gave us 156 pips but was 8 pips short of our target 114.43. While I am not convinced that USDJPY would break 114.43 resistance, given current economic data, there is a probability of price hovering between 112-114 price level before a possible break below the descending channel. A sustained break below 112.47 support levels should increase sell orders and pressure price below 111.81 support levels.

Therefore, this week I will be looking to sell this pair as the market looks to decipher FOMC stance ahead of June rate decision. An optimistic outlook would boost this pair rally and vice versa.

EURGBP

This pair closed as a dragonfly doji on weekly candlestick after data showed the U.K. factory output plunged for second consecutive month.

While this pair has failed to honor the head and shoulders formation shown in the chart, it should also be noted that price has remained above the neckline for the past 5 weeks and closed above 0.8471 resistance level for the first time last week.

Again, with inflation rate rising and manufacturing sector slowing down, consumer spending that contributes about 70 percent of the economy would likely start reflecting those weaknesses. Therefore, this week I will be looking to buy this pair above 0.8471 support level with my target 1 at 0.8557 resistance, the 20-day moving average. A sustained break should attract enough buyers to open up 0.8717 resistance.

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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

2 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.