MARKET BRIEFING – LONDON OPEN 04.09.2015
Yesterday’s ECB press conference did not hold many surprises however the markets took their cue from the Central Bank chief as the Euro promptly sold off.
As expected the outlook for both inflation and Euro Area growth dominated Thursday’s event with Mr Draghi saying that the ECB had cut its forecasts for both.
The ECB chief said that he expected inflation to remain extremely low for a considerable time. It would appear that the issue of extremely low inflation in the Euro Area has now become a chronic problem.
On economic activity, Mario Draghi said that Euro Area growth will rise at a slower pace than had been earlier predicted.
Due to the continuing concerns over both inflation and growth Mario Draghi hinted that the ECB would be ready to add to an already large programme of stimulus.
The ECB yesterday kept interest rates on hold at 0.05% which was expected. In terms of other numbers, the ECB has revised its forecast for growth to 1.4% instead of 1.5% for 2015 and 1.7% instead of 1.9% for 2016.
The global outlook was also mentioned with Mr Draghi pointing to the problems facing the emerging markets and China during the month of August. According to ECB chief, these global issues had increased the risks and could impact Eurozone growth.
Draghi and his colleagues have now put out the message that they are ready to expand the Euro Areas Quantitative Easing programme by either spending more on a monthly basis, putting back the end of the QE programme to after September 2016, increasing the scope of the assets that can be purchased or a combination of all of the above.
I taking such a dovish stance the Euro should ultimately weaken value against the Green Back. The days of EURUSD trading above the 1.1000 level could potentially end soon.
EURUSD
The intraday technical outlook
Trend 1 hour: Down
Target 1: 1.1275
Target 2: 1.0969
Projected range in ATR’s: 0.0153
Daily control level: 1.1240
GBPUSD
The intraday technical outlook
Trend 1 hour: Down
Target 1: 1.5370
Target 2: 1.5140
Projected range in ATR’s: 0.0115
Daily control level: 1.5330
USDJPY
The intraday technical outlook
Trend 1 hour: Down
Target 1: 121.64
Target 2: 118.48
Projected range in ATR’s: 1.58
Daily control level: 120.70
USDCHF
The intraday technical outlook
Trend 1 hour: Up
Target 1: 0.9854
Target 2: 0.9610
Projected range in ATR’s: 0.0122
Daily control level: 0.9695
USDCAD
The intraday technical outlook
Trend 1 hour: Down
Target 1: 1.3315
Target 2: 1.3045
Projected range in ATR’s: 0.0135
Daily control level: 1.3325
AUDUSD
The intraday technical outlook
Trend 1 hour: Down
Target 1: 0.7113
Target 2: 0.6917
Projected range in ATR’s: 0.0098
Daily control level: 0.7060
GOLD
The intraday technical outlook
Trend 1 hour: Down
Target 1: 1141.01
Target 2: 1109.01
Projected range in ATR’s: 16.00
Daily control level: 1142.00
OIL
The intraday technical outlook
Trend 1 hour: Up
Target 1: 49.68
Target 2: 44.29
Projected range in ATR’s: 2.70
Daily control level: 43.50
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