EURUSD Slow and Steady Uptrend

Key Highlights

• Euro traded higher versus the US Dollar Intraday, and registered a new weekly high as buyers were optimistic after a report which points that better growth is possible in the Euro Area.

• Japanese Labor Cash Earnings, which is a major indicator for the average income, before taxes, per regular employee released by the Ministry of Health, Labor and Welfare posted a rise of 0.1% in March 2015, compared to the same month a year ago.

• Chinese Manufacturing Purchasing Managers Index (PMI) highlighting business conditions in the Chinese manufacturing sector released by the China Federation of Logistics and Purchasing (CFLP) remained stable at 50.1 in April 2015, better than the forecast.

• Australian Producer Price Index helping measuring the average changes in prices in the Australian markets by producers of commodities released by the Australian Bureau of Statistics increased by 0.5% in the first quarter of 2015, compared to the preceding quarter.

• In terms of the yearly change, the Australian Producer Price Index rose by 0.7%.

• Japanese Nomura/JMMA Manufacturing PMI providing an early snapshot of the health of manufacturing sector in Japan came in at 49.9 in April 2015.

• EURUSD has a major support at 1.1220-00 area where buyers might take control.

UK Mortgage Approvals

Earlier during the London session, the UK Mortgage Approvals which represents the number of various Mortgage Approvals was released by the Bank of England. The forecast was lined up for a rise from the last reading of 61.760K to 62.400K in March 2015, compared to the preceding month. However, the result was worse than expected, as the UK Mortgage Approvals declined to 61.341K. Moreover, the last reading was revised down to 61.532K.

Furthermore, the UK Consumer Credit, highlighting the amount of money that individuals borrowed in the previous month was also published. The market was expecting an increase from the last reading of £0.740B to £0.800 in March 2015. This time the outcome was above the forecast, as the UK Consumer Credit managed to rise to £1.242B. There was a minor revision for the last time as well, up to £0.785B.

The UK M4 Money report also referred as "broad money" helping in analyzing all the sterling in circulation, encompassing notes and coins as well as money held in bank accounts rose by 0.3% in March 2015, compared to the preceding month. The report was on the high side, compared to the last decline of 0.2%. Considering the yearly change, the UK M4 Money registered a decline of 0.6, higher compared to last fall of 3.2.

The report highlighted that the “Households’ holdings of M4 increased by £2.3 billion in March, compared to the average monthly increase of £3.2 billion over the previous six months“.

Technical Outlook – EURUSD

The Euro was one of the best performers as the pair traded higher to test the 1.1270 level, and looks set to challenge the 1.1300 level. A few other pairs struggled during the London session, but EURUSD managed to hold the ground and moved higher.

More Fundamental Analysis