Market Analysis

The euro is trading lower against the dollar

FOREX

The euro is trading lower against the dollar during the early stages of Wednesday’s session, following the publication of disappointing German retail numbers. Recent eurozone data has been generally positive, reflecting the ongoing recovery in the continent. Nevertheless, the fact that retail activity in the region’s largest economy fell short of expectation reminds investors that the crisis isn’t yet over and, despite the improved outlook, Europe still lags behind the US. America continues to lead the pack of Western economies emerging from the worst crisis of the last 70 years, with yesterday’s manufacturing data surprising to the upside and adding strength to the case that, facing an explosion in economic activity and the growing threat of inflation, the Fed may soon have to start thinking about tapering its policies.

Ricardo Evangelista – Senior analyst, ActivTrades

 

EUROPEAN SHARES 

European shares fluctuated after the opening bell, carrying on the trend from Asian markets, amid uncertain market sentiment. While market volatility is slowly decreasing this week, the price movements seem to be increasingly lacking in direction as many investors remain torn between the global economic recovery and inflation concerns. Most traders are now waiting for fresh catalysts before taking any significant decision on their exposure to riskier assets such as stocks. Many are already cautiously eyeing macro data from both the US and Europe, where positive results could seriously dent central banks’ monetary dovish stance and bring a new bearish driver to markets. While waiting for this week’s US NFP report, investors are likely to focus on the ECB and the BoE today as both Christine Lagarde and Governor Bailey will speak later in the afternoon.

The SMI-20 from Zurich is the old continent’s best performer so far, trading above 11,460pts with the resistance at 14,525pts in sight.

Pierre Veyret– Technical analyst, ActivTrades

 

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