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25.08.202009:41 विदेशी मुद्रा विश्लेषण और समीक्षा: Trading plan for EUR/USD and GBP/USD for 08/25/2020

It may seem that nothing happened yesterday at all and the quotes remained unchanged. This is generally expected, since the macroeconomic calendar was entirely empty yesterday and there was no news that could have an impact in the market. However, the market did not remain in place - at first, the dollar was weakening and by the end of the day, it returned back. In many ways, this is a very risky movement based on the securities market. After all, investors still need at least some guidelines, and without other news, the currency market relied on the debt market. Moreover, the pound was exclusively driven, following the Euro. But initially, the dollar's weakening was caused by exactly what was happening in Europe.

Exchange Rates 25.08.2020 analysis

It particularly started in Germany, where the yield on 12-month government bonds rose a bit, but it would be more accurate to say that their loss ratio has declined. The yield on German debt securities rose from -0.601% to -0.575%, and investors still have to pay more for them, although not as much as before.

Yield on 12-month government bonds (Germany):

Exchange Rates 25.08.2020 analysis

The dollar began to recover its positions along with the placement of French bonds. But the situation is not as good as with Germany. Of course, yield on the 3-month bonds increasing from -0.571% to -0.568% can cause optimism, but they are still negative. Investors are worried about the yield of longer bonds which has only declined. Accordingly, the yield on 12-month bonds fell from -0.571% to -0.578%, while the yield on the 6-month bonds remained almost unchanged, falling from -0.605% to -0.606%.

Yield on 12-month government bonds (France):

Exchange Rates 25.08.2020 analysis

The US debt market only consolidated the current situation, which developed after the French debt securities was placed. It could not affect the situation because the yield on 6-month bills remained unchanged at all. However, the yield on 3-month bills has declined from 0.105% to 0.100%, which means that it still remained unchanged. It is clear that American debt securities bring at least some profit, while the European market brings only losses.

Yield on 3-month government bills (Germany):

Exchange Rates 25.08.2020 analysis

Now, the relative stability of the currency market can be observed, although Germany has already published a second estimate of GDP for the second quarter, which, incidentally, turned out to be better than the first. It was assumed until this morning that the rate of economic decline rose from -2.2% to -11.7%, while the second estimate of GDP showed that they rose to -11.3%. However, the changes are insignificant, so there was no market reaction.

GDP growth rates (Germany):

Exchange Rates 25.08.2020 analysis

Today's data on the housing market in the United States is very interesting. This data will determine the mood of market participants and it is expected to be relatively good. So, sales of new homes may grow by 1.0%, that is, from 776 thousand to 784 thousand. However, the rate of growth in housing prices should slow down from 3.7% to 3.6%, but they should still grow by 0.3% in monthly terms. Nevertheless, the growth in sales volumes fully compensates for the relative stability of prices. Moreover, the forecasts for prices are unclear, as it is assumed that the growth rate of house prices can grow to 3.8%. Therefore, the dollar retains its growth potential.

New Home Sales (United States):

Exchange Rates 25.08.2020 analysis

The euro/dollar currency pair, moving along a downward direction from the local high of 1.1965, reached the variable level of 1.1800, where it slowed down and formed an amplitude of 1.1790/1.1850. It can be assumed that if one or another amplitude breaks down, there will be a local jump of activity with the prospect of 50 points, regardless of the breakdown.

Exchange Rates 25.08.2020 analysis

The pound/dollar pair, showing high activity during the past week, managed to slow down within the 1.3050 area, forming a local rebound. To resume the downward movement, the quote must consolidate below 1.3050, otherwise variable turbulence within the values of 1.3050/1.3140 cannot be stopped.

Exchange Rates 25.08.2020 analysis

*यहां पर लिखा गया बाजार विश्लेषण आपकी जागरूकता बढ़ाने के लिए किया है, लेकिन व्यापार करने के लिए निर्देश देने के लिए नहीं |

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