Vang SJC

Yesterday (22/12), EUR / USD extends rally momentum as the US economic data is not satisfactory as expected. The pair ranged $ 1.09012 to $ 1.09829 before closing at $ 1.09548, up 0.36% from the opening price $ 1.09126.

Euro appreciation causes were analyzed in detail here.


Fundamental Analysis

Although the US Federal Reserve (Fed) decision economic tightening in the two-day meeting of 15-16 / 12, USD is facing the strongest monthly decline since January 04/2015 replaced because of price increases. The US dollar index measuring the greenback’s strength versus the basket of six other major currencies was down 2% in the context of gloomy economic data late last week and early this week.

Open Market Committee (FOMC) is expected to be 4 times the tightening over the next year, the goal of bringing interest rates to 1.4% by the end of 2016. Fed Chairman Janet Yellen said she institutions will raise interest rates one way slowly and depend on economic data to make decisions about the timing and amplitude of tightening, PMI manufacturing data and services to low, add the existing home sales falling doing reducing the Fed raised interest rates in the first quarter / 2016. Meanwhile, according to data compiled by Bloomberg, and only 51% suggested that the Fed will tighten economic meeting in May 4. Prospects greenback has not gained in the short term is to put pressure on Dollar and supports the pair going up.

However, it should be noted that, next year’s council vote FOMC will change, three members tend to tighten (hawk) and 1 members tend to loosen (dove) will replace a hawk, one dove and 2 neutral. Therefore, the balance will tilt towards more economic tightening and the FOMC is expected to aggressively than in 2015.

Today, in Europe there is no important data in the United States will announce a series of important economic news. The first is the number of orders for durable goods in November excluding transport (Core Durable Goods Orders). This is important because it’s index, said demand for both domestic and foreign, from which the manufacturer may decide to increase or reduce investment in production, which affect the labor market. The index is expected to rise by 0.1% compared to December 10 after already has skyrocketed by 0.5% compared with September-strong growth after two months of no growth or negative growth.

Besides, the Bureau of Economic Analysis (BEA) of the US Commerce Department will also release personal expenditure index excluding food and energy in November (core PCE) inflation gauge the Federal Reserve’s favorite. The index rose from 0-0.1% since January 12/2014 and is forecast to continue growing at a rate of 0.1% in May 11. For the year, the index rose PCE of 1.25%, still far behind with 2% inflation target. Fed Chairman, Mrs. Janet Yellen said she expects inflation will reach 1.6% of the US in 2016 and is confident that the factors constraining the inflation in current oil prices plunged and a stronger US dollar will soon set. At the same time, BEA also announced growth in personal income, is forecast at 0.2%, down from growth of 0.4% in October. While household spending is the backbone of the US economy, the personal income data will contribute to reflect the level of spending growth in the future.

At 10:00 pm GMT + 7, the US Census Bureau will report new home sales. Yesterday, existing home sales led the market fell 10.5% disappointed when the lowest level in 19 months back at 4.76 units, down sharply from 5:32 million metric units in October and forecast 5:35 million units. According to analysts, the number of new houses sold in November will reach 507,000 units, up 8,000 units compared to January 10. Meanwhile, the University of Michigan also provides confidence index of consumers in December, is expected to be 92.1 points, the highest level since August.

It can be seen, the figures today mainly reflect the demand side of the economy. The data report will give a positive signal positive development in the future, supporting the greenback went up, dragging the pair drops.


Technical Analysis

Currently, at 14:26 GMT + 7, the pair is trading at $ 1.09289, off 0.24% compared with the opening price $ 1.09549.

After three consecutive gains, prices are on the decline, which broke through the block at $ 1.09400 and 23.6 towards 38.2 at $ 1.09135 clearance.

Tools MuaEA medium TREND signal SIGNAL early afternoon Asian session, currently earn about us new 9 points.

We can see, yesterday, prices peaked at $ 1.09800 date 3/12 and turned down. Earlier on 17/12, also low price but not at $ 1.07935 overcome bottom has set the date 7/12. Observe the H1 chart may see the pair are creating two waves rather symmetrical. According to this trend, Euro likely decline today.

Psychological Analysis
The Fed raised interest rates make dollar becomes more attractive investment channels in the eyes of investors due to the higher interest rate. In its meeting of 15-16 / 12, the FOMC is expected to raise interest rates by 4 times in 2016 showed that dollar could still rise next year. Besides, considering the risks Europe faces as migrant status, slow growth, the threat of terrorism … the prospect of parity between the Euro coins and dollar still in sight, ability cause downward pressure on the pair in the short term.
Observe the H1 chart, with 6 candles down from 3 candles rose, suggesting strong selling than buying in the following three consecutive days the pair prospered.



In the last trading day of the year and the holiday eve, many investors and financial institutions have prepared key moves the window and portfolio balance after one year holding dollar long position pickup awaiting Fed rate hike. The hedge funds and other large speculators have reduced bets will increase from US $ 8 major currencies, in three reports last week from the Association of futures market transactions (Commodity Futures Trading Commission -CFTC). Position buy dollar dropped from 428.298 322.224 16/12 Tuesday 24/11.

Observe the H1 chart, prices are likely to re-establish the top yesterday at $ 1.09800.

Market commentary

Today, the pair is capable discount first session after the momentum of prosperity lasted for three consecutive days, the falling price forecast $ 1.08600.

However, as discussed in the Risk, the pair is still likely to rise to the threshold price $ 1.09900.

Analyses of Group If24h

Linh Nhan