Daily Market Review - 02/07/2014

EUR/USD

After an abrupt rally the pair is correcting itself. Most likely we are going to see some retracement following that impressive spike yesterday. Afterwards an upward trend should resume.

USDJPY

There was a quite unexpected trend reversal for the pair. Around 101.28 it jumped up and now looks bullish. At the moment it approaches 102.40. That is upside goal, an important challenge on its way up.

GBPUSD

From the technical analysis point of view consolidation period for the Pound is over and the pair is moving up. The upper boundary of the channel is breached, so the outlook in the near term is bullish.

Market Overview

The Pound on Thursday in the second part of the day was trading in a quite reserved manner; it almost didn’t react to the decisions of the BoE to leave things as they are.

February meeting of the BoE couldn’t stabilize the rate of the British Pound. Thinks remained the same in terms of the monetary policy. For instance the interest rate remained on the level of 0.5%; the volume of purchased assets remained at the level of 375 billion Pounds.

In general things remain the same without any significant changes. The Bank of England sticks to non-interference policy, allowing economic system to recover on its own.

The program of assets’ purchase of BoE was realized in the full volume a year ago and now exists nominally. The Pound is now going to look for support either in its own statistics or in reaction of the EUR/USD pair.

Last summer the BoE let its investors understand, that any new step would depend on how British economy would be recovering. Unemployment rate has almost reached 7%. Now investors expect the BoE to correct partly its monetary views.

An important statistics for the Pound is planned for February 12. It will be report on inflation to be more specific.

Economic Calendar

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