Binary Options Weekly Outlook: March 24 – March 28

March 24, 2014 – Weekly News

EUR/USD

Last week the EUR/USD pair fell from 1.3948 to 1.3749, means almost 200 pips! The main reason why the pair slid was FOMC Statement and a press conference which followed. Fed (as expected) taper another $10 billion/month from the monetary stimulus and announced that the quantitative easing program will probably finished in fourth quarter 2014. In about 6 month after Fed will stop the monetary stimulus they expect to increase the interest rates. These news were bullish for U.S. Dollar and that’s why we so such a significant movement. This week we should keep an eye on the German Flash Manufacturing PMI on Monday, the German Ifo Business Climate and U.S. CB Consumer Confidence on Tuesday, U.S. Core Durable Goods Orders on Wednesday and U.S. Final GDP on Thursday.

USD/JPY

The USD/JPY pair started last week low around 101.20 and stayed low (below 102.00) until Wednesday when the FOMC Statement was released. The pair immediately reacted and went up to 102.65 where reversed. On Thursday and Friday the pair was moving sideways between 102.00 and 102.60. We should not forget that despite stronger U.S. Dollar, Japanese Yen is also getting some profits as the tension between Russia and EU with U.S. increases. However, it is expected that Bank of Japan may boost monetary stimulus to reduce the impact of the higher consumption tax (from April 1^st the tax is going to increase from 5% to 8%). In that case the Yen should depreciate against major peers. Kikuo Iwata spoke early on Monday morning and said that deflation is caused by stronger Yen. That might signalize some intervention from central bank to make the Yen weaker. This week we should pay attention to Japanese Tokyo CPI and Retail Sales data on Thursday and the U.S. economic data written in previous paragraph.

GBP/USD

Last week the GBP/USD suffered the biggest weekly drop in 4 month due to releases from both central banks. Fed last week indicated that the interest rates will be risen next year which was bullish for U.S. Dollar, however, members of Bank of England voted in March to keep the interest rate unchanged. This week we should expect some important data which should cause higher volatility. On Tuesday we should watch the U.K. CPI and U.S. CB Consumer Confidence, the U.S. Core Durable Goods on Wednesday, The U.K. Retail Sales and U.S. GDP on Thursday and finally the U.K. Current Account and GDP on Friday.

GOLD

Last week after the price reached 6-month high on Monday ($1,392/ounce) spurred by tension in Ukraine, the price started to drop and partially due to good returns from stock market partially due to stronger U.S. Dollar the price dropped all the way to 1,321/ounce where rebounded. Traders were selling the safe haven asset after U.S. and EU put their sanction against Russia which do not hurt economy. With such a low price the physical demand strengthened and pulled the price to $1,340/ounce, however, not for long and the price came back below $1,330/ounce. This week we should pay attention to the Ukraine situation as well as to the FOMC members’ speeches. Dennis Lockhart and Charles Plosser will speak on Tuesday, James Bullard on Wednesday and Charles Evans on Friday.

Economics events (GMT time):