Forex research

UK Opening Call from Alpari UK on 8 May 2013

Europe boosted by better Chinese trade data

Today’s UK opening call provides an update on:

• Chinese data encouraging, although not necessarily reliable;
• UK retail sales fall heavily in April due to earlier than normal Easter;
• Little economic data out on Wednesday.

European indices are expected to open around a quarter of a percentage point higher on Wednesday, following the release of some encouraging trade data out of China.

China’s trade surplus rose to 18.16 billion in April, easily beating expectations of a 15.05 billion surplus and far better than March’s small deficit. The most encouraging thing here was the substantial improvement in both imports and exports , with both once again coming in well above expectations and easily beating March’s figures. If we continue to see these kinds of figures, the recent concerns over a slowdown in China will appear a little premature.

That said, these figures have proven to be extremely volatile in the past, so the probability of a repeat performance even next month isn’t very high. On top of that, questions will always be raised about such strong improvements in Chinese trade data, especially when the other economic releases have been pointing to a slowing of growth. Clearly the markets aren’t overly concerned about this right now, however this is likely to limit any upside that will come as a result of these figures.

The BRC retail sales data showed a 2.2% drop in the UK in April, compared with a year ago. This is the first drop in the figure since October and the biggest fall since the same month last year. I think the first thing this highlights is just how fragile the recovery is in the UK, despite stronger than expected growth in the first quarter and an improvement in the PMIs in April.

On the other hand, the fact that Easter fell in March this year is certainly going to have an impact on the figure. It’s actually pointless comparing the figure to April last year, which is why I expect the impact of the large drop to be minimal. It may have even been priced into the markets to a degree.

It’s going to be another quiet day in terms of economic releases. Yesterday we saw markets rally strongly off the back of some encouraging German factory orders data, as little else was providing any direction for the markets and trading volumes were down. We could see a similar scenario on Wednesday, with the only economic releases in Europe being the Halifax house price data out of the UK, which is expected to show a marginal increase in April, and German industrial production, which is expected to have fallen heavily from a year ago. Given yesterday’s surprise to the upside in German factory orders, I wouldn’t be surprised to see a similar beat in the data this morning.

EURUSD

The euro is trading higher this morning, after finding support once again from the middle bollinger band on the daily chart. As I mentioned yesterday, a break below the middle band would be quite a significant move for the pair and could prompt a significant move lower. However, the fact that it found support here once again, suggests there may still be some upside left in the pair. If we do see it push higher, the pair should find resistance around 1.3131, 1.3158, 1.3178 and 1.3241. On the other hand, despite finding significant support here, we could see further attempts in the coming days to break below this middle band, which if successful should see the neckline of the double top come under significant pressure, around 1.3030.
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GBPUSD

Sterling is looking quite bearish after breaking below the midpoint of the ascending channel yesterday. This had provided support for the pair over the last week or so, as the pair rallied towards 1.56. The bounce off the 50 fib level and now the break below the mid point of the channel is quite a clear bearish signal for the pair and should now prompt a move back towards 1.54. Here the pair should find support from the bottom of the ascending channel. This is also a previous level of support and resistance, which should make this an even bigger support level. A break below here would be a very bearish signal for the pair and could prompt a move back towards March’s lows around 1.4830.
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USDJPY

The dollar is continuing its slow ascent back towards 100 this morning. We’re currently seeing another small retracement in the pair, which if previous retracements are anything to go by, should see the pair pull back towards 98.22, the 50% retracement of the move from last weeks’ lows to this weeks’ highs. While the ascent has been slow following the rapid move higher last month, there has been a very clear pattern, in that each retracement has clearly respected the fib levels, in particular the 50 and 61.8 levels. Therefore, I see no reason why this will be any different. If we do see the pair pull back to this level again, it should find support along the way around 98.63 and 98.40.
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Ahead of the open we expect to see...

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pboyles said:
What is Alparis connection to Jagero Ltd, a company that offers an unregulated managed forex account? Does Alpari support this sort of illegal activity?
Click to expand...

pboyles said:
Are you planning on ignoring my question?
Click to expand...

Hi pboyles,

Alpari (UK) Ltd doesn’t support any unauthorised party carrying out regulated activities. Should we find this is to be the case with any partner, we will terminate our relationship with them.

Alex

________
Alexander Chadwick
Alpari (UK) Representative
 
US Opening Call from Alpari UK on 8 May 2013

DAX at new record highs as data beats expectations

Today’s US opening call provides an update on:

* Europe higher as DAX hits new record highs;
* Sentiment up on improved Chinese trade balance figure;
* German industrial production figure much better than expected;
* Fed voting member Jeremy Stein speaks later.

It’s been a positive start to the European session this morning, after the DAX became the latest index to hit record highs despite the fact that the eurozone is stuck in recession.

A significant improvement in the Chinese trade balance data in April has been largely responsible for the gains seen in Europe this morning. Last month, China reported a small trade deficit, which, along with other data, led to growing concerns that we are seeing a slowdown in the worlds’ second largest economy. April’s figure suggests otherwise, after a surge in both imports and exports left China with a surprisingly large surplus of $18.16 billion.

The problem with this data is that a lot of people are very sceptical about how accurate it actually is. The fact that most people don’t see the data as reliable isn’t stopping them buying into the equity rally though, which highlights the problem that we have. It doesn’t seem to matter whether the data is good or bad, anything is being turned into a reason to buy. Either it’s good, which is seen as a positive sign that the economy is recovering, or it’s bad which means the central banks will intervene. This is not sustainable.

Helping to push the DAX higher this morning has been the industrial production figure for March, which followed the factory orders data yesterday, in coming out much better than expected. Ordinarily, I don’t think these figures would have had such a big impact on the markets, but with trading volumes so low and investors looking for any reason to get in on the rally, they’re clearly having a big impact at the moment. I think we’re now setting ourselves up for a big fall.

It’s going to be another quiet day in terms of economic data on Wednesday, with no significant releases in the US. We will hear from Jeremy Stein, a voting member of the Fed, at the start of the US session, which is likely to attract a lot of attention. The Fed vowed to remain flexible when it comes to its QE3 program after the meeting last week, which suggested we could see the amount of purchases rise as well as fall.

However, these comments came before the release of the jobs report on Friday, which painted a much better picture of the economy than had been expected. Not only were more jobs added in April than had been forecast, March’s number was revised significantly higher as well. On top of this, the unemployment rate fell again. It will be interesting to find out what impact, if any, these figures have on the Fed’s monetary policy in the coming months.

Ahead of the open we expect to see..

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UK Opening Call from Alpari UK on 9 May 2013

All eyes on the UK ahead of BoE rate and QE decision

Today’s UK opening call provides an update on:

• No change in monetary policy expected from the BoE on Thursday;
• Slight improvement expected in UK industrial and manufacturing production;
• No surprises expected from the ECB monthly report;
• US jobless claims expected to remain low.

The UK is going to be back in the spotlight on Thursday, not long after data confirmed the country avoided a triple dip recession in the first quarter.

The Bank of England is expected to leave monetary policy unchanged following Sir Mervyn King’s penultimate meeting as Governor. Mark Carney will take over this role in July, and you get the feeling that most members are not interested in committing to anything until the transition is complete.

This has been clearly evident recently by King’s inability to convince the six members who voted against more quantitative easing to join him in the “yes” camp. In the past, the BoE has always announced additional QE within two months of King voting in favour. This is no longer the case.

Given the improvement seen in the data recently, including the first quarter GDP figure that saw the UK avoid a triple dip recession with relative ease, we could even see King give up in his attempts to convince the other policy makers, instead voting against more stimulus and just seeing out the final months of his term. We won’t find out if that has happened though until the minutes are released on 22 May.

Staying in the UK, we have a few major pieces of economic data out this morning, including industrial and manufacturing production figures for March. A small improvement is expected here in March, compared to a month earlier, however this doesn’t cloud the fact that both have contracted significantly compared to a year earlier. A third monthly improvement in four months is encouraging, however unless we see a massive improvement in the months ahead, both are going to continue to weigh on the economy.

The NIESR GDP estimate for the three months to April will watched closely again on Thursday, although its unlikely to be as important as it was a month ago. The UK may have avoided recession in the first quarter, but that doesn’t change the fact that we’re likely to see the economy stagnating this year. Any improvement here will obviously be positive for the British pound and the FTSE, however this seems unlikely.

No surprises are expected from the ECB monthly report. The fact that the central bank cut the main refi and marginal lending rates last week, and discussed the prospect of cutting the deposit rate, currently at 0%, clearly highlights the dire economic situation currently facing the eurozone. I can’t think of anything we could see in this report that will tell us what we don’t already know.

Next it’s over to the US for the release of the weekly jobless claims. A slight increase to 335,000 is expected here, although this is still extremely low and seen as an encouraging sign for the US economy, especially following the better than expected jobs report on Friday. The initial jobless claims figure has beaten market expectations in three of the last four weeks, so I wouldn’t be surprised to see it happen again today, with another figure around 325,000.

EURUSD

The euro made some strong gains again on Wednesday, after another piece of German data easily beat expectations. The pair has been stuck in a range since the start of the month, between 1.30 and 1.32, however that appears to have tightened slightly, with the middle bollinger band now providing strong support for the pair. The fact that the German data has had such a big impact on the euro in the last few days suggests to me that traders are looking for any excuse to long the euro. We could therefore see a significant break above 1.32 over the next week or so, with strong resistance then being found around 1.3227, from the 50 fib level. If the pair breaks above here, the next target will be 1.3341, the 61.8 fib level. I don’t expect it to rally much beyond here as I still think that all we’re seeing at the moment is a retracement of the longer term downtrend. If the pair does break above the 50 fib, it should find strong resistance again around 1.3250, which has previously been a key level of support and resistance.
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GBPUSD

Sterling is trading slightly higher this morning, as traders continue to ditch the greenback in favour of more risky currencies. The pair is finding strong resistance again this morning around 1.5540, from the mid-point of the ascending channel. The fact that it is struggling to break above here is quite a bearish signal, and suggests we could see a move back to 1.54 in the coming days. Around here, we should see the lower bollinger band, on the daily chart, cross with the bottom of the channel to provide significant support. If we see a break of this level, it would be extremely bearish, potentially prompting a move back towards this years’ lows of 1.4830. Before that though, the pair should find support around 1.5479, 1.5445 and 1.5422, 38.2 fib level.
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USDJPY

A breakout in this pair may be closer that first thought. The recent price action has seen this pair consolidate further to the point that we’re not longer looking at an ascending triangle so much, as a pennant. This could bring the breakout forward to as early as next week. As it stands, it looks like we’re going to see another test of the ascending trend line before we see an assault on the all important 100.0 level. Currently, the pair is finding support around 98.63, if we see a break below here, it should find additional support around 98.40, 98.21, 50 fib level, and 97.92, 61.8 fib level.
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Ahead of the open we expect to see...

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I know Alpari have been heavily fined and are under stricter supervision but the unregulated forex account is in a different league.
 
pboyles said:
I know Alpari have been heavily fined and are under stricter supervision but the unregulated forex account is in a different league.
Click to expand...

This is incorrect. We are not under stricter supervision. We adhere to the same FCA guidelines as other brokers.

In addition, any individual trading forex on a personal account does not have to be regulated. It is money managers that do.

Alex

________
Alexander Chadwick
Alpari (UK) Representative
 
US Opening Call from Alpari UK on 9 May 2013

Sterling rallies ahead of BoE decision on improved data

Today’s US opening call provides an update on:

* UK manufacturing and industrial production improves again in March;
* BoE likely to leave monetary policy unchanged;
* Commodity currencies lead the gains following strong employment data from Australia and New Zealand;
* US weekly jobless claims up next.

It’s been a positive start to the morning for the UK, with industrial and manufacturing production figures for March coming out much better than expected. Both figures are still deep in negative territory compared to a year earlier, but the fact that we’ve seen a third month on month improvement in the last four months is encouraging.

The recent improvement in the economic data has all but ended any hope of further stimulus from the Bank of England while Sir Mervyn King is still Governor. King couldn’t even convince the remaining six policy makers to vote in favour of additional purchases when there was a real threat of a triple dip recession. Now that the threat has gone, for now at least, he doesn’t really stand a chance.

In fact, when the voting is revealed on 22 May, I expect to see the voting shift more in favour of no more QE, with either King or Pail Fisher, or even both, changing their vote.

We’ve seen a strong start to the session from the commodity currencies this morning, after both Australia and New Zealand released some strong employment figures. Both central banks have been active recently, with the Reserve Bank of New Zealand admitting to selling its currency last month in a bid to halt its appreciation, while the Reserve Bank of Australia went for the more conventional measure of cutting interest rates to all time lows.

Based on these moves, it would have been safe to assume that both economies are struggling and that the data released would reflect that. This was far from the case, with New Zealand unemployment dropping from 6.9% to 6.2% in the first quarter, while Australia’s fell from 5.6% to 5.5% in April. On top of this, the number of people employed rose by more than 50,000 despite expectations of a small increase.

Later on the focus will switch to the US, with initial jobless claims once again being watched closely. Fears of a slowdown in the US appear to have eased now, after the jobs report on Friday showed more jobs added in April than was expected, while March’s woeful figure was revised significantly higher.

Another strong figure here today, in the region of 320,000 to 330,000 should help keep sentiment high in the markets and could push US indices back into positive territory, with futures currently pointing at a lower open.

Ahead of the open we expect to see...

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Alpari UK said:
This is incorrect. We are not under stricter supervision. We adhere to the same FCA guidelines as other brokers.

In addition, any individual trading forex on a personal account does not have to be regulated. It is money managers that do.

Alex

________
Alexander Chadwick
Alpari (UK) Representative
Click to expand...

It's a managed forex account, advertised to the public, it should be regulated.

As for the supervision the NFA states "the percentage of Alparis APs who had previously worked at disciplined firms was such that the firm triggered the NFAs enhanced supervisory requirements".

http://www.nfa.futures.org/basicnet/CaseDocument.aspx?seqnum=3341
 
So we have a managed forex account, totally unregulated, using virtual office addresses and run from a flat in Dagenham. What is Alpari going to do to disassociate itself from this quite obviously dubious scheme? They are after all using your name and status as a regulated company to convince members of the public to give them money.
 
pboyles said:
It's a managed forex account, advertised to the public, it should be regulated.

As for the supervision the NFA states "the percentage of Alparis APs who had previously worked at disciplined firms was such that the firm triggered the NFAs enhanced supervisory requirements".

http://www.nfa.futures.org/basicnet/CaseDocument.aspx?seqnum=3341
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I am not here to discuss Alpari (US). However, I’m happy to help with any queries you may have with regards to Alpari (UK).

pboyles said:
So we have a managed forex account, totally unregulated, using virtual office addresses and run from a flat in Dagenham. What is Alpari going to do to disassociate itself from this quite obviously dubious scheme? They are after all using your name and status as a regulated company to convince members of the public to give them money.
Click to expand...

I quite agree. If it is a managed forex account it should be regulated. When we become aware of people misusing our name, we take whatever action is available to us.


Alex

________
Alexander Chadwick
Alpari (UK) Representative
 
UK Opening Call from Alpari UK on 10 May 2013

German trade data highlights further imbalance in eurozone

Today’s UK opening call provides an update on:

• Nikkei surges as USDJPY moves above 100.0 for the first time in four years;
• German and UK trade balance figures due out this morning;
• G7 meeting likely to be uneventful;
• Ben Bernanke speaks for the first time since the jobs report was released on Friday.

European indices look like following in the footsteps of their US counterparts on Friday, after stocks in the US closed lower for the first time this week.

The rest of the week has seen the US indices hitting record high after record high, so it’s no surprise to see investors take a breather. The same cannot be said for investors in Japan, where the Nikkei 225 jumped almost 3% over night, after the dollar moved above JPY100 for the first time in four years. The pair is currently trading around 101 and could hit 101.50 before the markets close tonight..

The economic calendar is looking pretty light again on Friday, with the only noteworthy releases being the trade balance figures out of Germany and the UK. Germany has arguably done very well out of the debt crisis so far, with borrowing costs currently at record lows and the country’s trade surplus near the levels last seen at the end of 2007.

Germany is expected to report another large trade surplus again in March, of around EUR18 billion, the largest surplus since August last year. When you see figures like this, it’s no surprise that other countries in the euro area are calling on Germany to do more to help with the rebalancing in the region, such as encouraging the German public to buy more goods from other eurozone countries.

The UK is facing a different problem altogether. The country has been running a trade deficit for years and efforts by the coalition government to reduce this are having absolutely no impact. This has been put down to the debt crisis in the eurozone so far, with it being the UK’s largest trading partner. This is why more efforts are being made to boost trade with other countries such as the US and China, in order to reduce the UK’s reliance on the eurozone. This will take time though, which is why another large deficit of GBP8.9 billion is expected today.

The two day G7 meeting, which starts on Friday, is likely to be a much more low key event than those we have become used to recently. With the situation in the eurozone looking a little more stable, the focus at this meeting is likely to be on growth, trade and financial reform. The finance ministers are also likely to discuss the recent moves by a number of central banks, although I think it’s been made very clear already that all members of the G7 support the efforts of the central banks to boost the domestic economy.

Finally, we’ll hear from a few members of the Federal Reserve this evening, most notably Fed Chairman, Ben Bernanke, who is due to speak at the annual conference in Chicago. It will be interesting to see here whether Bernanke still sees potential for an increase in the asset purchase program now that the jobs data last week suggested that we’re in fact not seeing a slowdown in the second quarter. If not, then questions will once again be raised about when we can expect to see the Fed taper its asset purchases.

EURUSD

There was a major sell-off in the euro yesterday, after it once again found strong resistance around 1.32. The pair could now be viewed as quite bearish when looking at the daily chart, despite once again failing in its attempts to break below 1.30. The euro sell-off yesterday resulted in a bearish engulfing pattern on the daily chart, while the pair also broke below the middle bollinger band which has previously been a key level of support and resistance. That said, the pair has now found strong support from both the 50 day SMA and the neckline of the double top, which formed over the last month or so. This is going to be a very difficult level to break and could in fact prompt a move back towards 1.32. If this level is broken, we should see a move back towards 1.28, based on the size of the formation.
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GBPUSD

We’re seeing further weakness in sterling this morning, following a major sell-off yesterday. The pair failed again to break above 1.56 yesterday, which has been a significant resistance level over the past couple of weeks. The sell-off may be brief though, with the pair already coming up against a major support level, between 1.54 and 1.5422. A combination of the 38.2 fib level and the middle bollinger band on the daily chart is going to make this a significant support level. On top of that, the level has previously acted as a key level of resistance. This could now prompt a move back towards 1.56, with a move above here setting up a move towards the 61.8 fib level around 1.5788. If it breaks below this support level, it should find additional support around 1.5375, from the bottom of the ascending channel. It’s worth noting that unless we see a significant rally today, we’ll have a bearish engulfing pattern on the weekly chart, which could suggest we’re about to see another sell-off.
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USDJPY

Yesterday’s rally in the dollar saw this pair finally break above the 100 level yesterday. The pair is currently trading around 101.20 and should push on to 101.50 today, where it will find strong resistance, with it being a previous level of resistance. From here I expect to see some weakness in the pair as it comes back to test the 100 level as a new area of support before continuing its move higher. We should then see the pair target 105.57, the 61.8 fib level, of the move from 2007 highs to 2011 lows, although this will probably take a few months.
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Ahead of the open we expect to see...

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US Opening Call from Alpari UK on 10 May 2013

US indices to open higher ahead of Bernanke speech

Today’s US opening call provides an update on:

* BT Group lead gains in the FTSE after reporting better full year profits;
* Trade balance data shows further imbalances in the eurozone;
* UK trade deficit marginally shrinks in March, but misses expectations;
* G7 meeting likely to be a non-event;
* Bernanke speaks in Chicago, a week after the much improved jobs report.

European markets are trading higher again on Friday, continuing what has been a very good week in the equity markets.

BT Group are leading the gains in the FTSE this morning after reporting higher than expected profits for the year ending 31 March. The company also increased its dividend by 14% which has clearly helped boost its share price this morning. Investors will also be encouraged by the company’s attempts to lure in new customers by offering free premier league football as part of its package, something that Sky currently charges a premium for.

Apart from that, it’s been a relatively quiet start to the session on Friday. A lack of market driving news early in session, combined with very little in terms of economic data has left the markets with no clear direction. European indices had looked like opening marginally lower before the open but clearly investors still see some scope for more upside before the end of the week.

The little economic data that we have had out this morning has caused few surprises. Germany’s trade surplus fell marginally in March to EUR17.6 billion, although this is still a far better figure than what we’re seeing from the other eurozone countries, highlighting the imbalance in the region which is generally getting worse rather than better.

The UK’s trade deficit fell slightly to GBP9.1 billion in March, although this was a worse figure than had been forecast which is probably why we’re seeing sterling continue to struggle this morning, in particular against the US dollar. UK Chancellor, George Osborne’s efforts to fix this imbalance clearly aren’t having the desired effects so far, although this should improve in the coming years with the government efforts to improve trade with more emerging economies.

The G7 meeting over the next two days is likely to be a bit of a non-event. Finance ministers are due to discuss a number of issues including ways to get the global economy moving again, as well as the controversial topic of central banks. So far, they have attempted to distance themselves from suggestions that certain central banks are intentionally devaluing their currencies in order to increase competitiveness, but with more central banks cutting rates and announcing large stimulus programs, it could only be a matter of time until we see their tone change.

Finally today, we’ll hear from Fed Chairman, Ben Bernanke, when he speaks at the Fed annual conference in Chicago. At the last press conference, Bernanke left the door open to a possible increase in the Fed’s asset purchase program if the economic data warrants it. It will be interesting to see if this is still an option they’re considering, or if the improvement in the jobs data on Friday has changed that.

Ahead of the open we expect to see...

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Are the finances of Alpari (UK) seperate from their main company in Moscow ?
And follow fsa regulations ?
 
Pat494 said:
Are the finances of Alpari (UK) seperate from their main company in Moscow ?
And follow fsa regulations ?
Click to expand...

Hi Pat494,

Good question.

We know that regulation is important for your peace of mind. That is why we’d like to take the time to explain how Financial Services Authority (FSA) regulations work and make sure you know the facts.

FSA regulation – understanding the facts

In order to be licensed and regulated by the FSA, we need to adhere to the regulator’s rules and obligations. The FSA performs frequent checks to ensure businesses are fully compliant.

Under FSA client money rules, Alpari UK is required to segregate all retail client funds from our own funds. This separation of accounts ensures that your money can never be used as a recoverable asset by Alpari UK's general creditors.

These funds are held in separate bank accounts. We take great care and diligence in their selection. Currently the client funds are held in Barclays, Bank of America Merrill Lynch and Royal Bank of Canada, three of the world's top-tier banks. In addition to these, company funds are also held in Morgan Stanley.

It’s also important to know that the FSA requires regulated businesses to maintain a minimum capital adequacy at all times to ensure businesses remain financially stable.

Your money is protected

In the unlikely event that Alpari UK is unable to meet its financial obligations, you can submit a claim to the Financial Services Compensation Scheme (FSCS). This scheme protects up to GBP50,000 per person.

The FSCS also protects the money in our segregated retail accounts. If a bank holding the funds you have deposited with Alpari UK goes into liquidation you will be able to claim up to GBP85,000 per person and per institution.

Eligibility depends on the status and the nature of your claim.

You can find out more from this booklet (PDF) or on the FSCS website.

Treating customers fairly

We put your interests at the centre of our business to ensure we comply with FSA Principle 6: “Pay due regard to the interest of its customers and treat them fairly.” Read more about how this principle is applied across all areas of our day-to-day business activities.

If you would like to discuss this or any other matter further, please feel free to contact our team on live-chat, via email or on +44 (0) 207 426 2900. We're here to help.

Alex

________
Alexander Chadwick
Alpari (UK) Representative
 
UK Opening Call from Alpari UK on 13 May 2013

China kicks things off as attention shifts to economic data

Today’s UK opening call provides an update on:

• G7 continues to support BoJ efforts to end deflation;
• More emphasis on data this week;
• Chinese retail sales and industrial production watched closely;
• US retail sales could suffer as a result of payroll tax and rising energy costs.

The G7 conference over the weekend was, as expected, a lot of hype about nothing. Once again, the G7 came out in support of Japan’s loose monetary policy, despite the huge weakness seen in the yen in recent months. This didn’t come as a surprise though, the G7 have backed themselves into a corner slightly by supporting Japan’s efforts at recent meetings. To come out now just because the yen has weakened to levels everyone was expected would not send the right message. Especially at a time when central banks around the world are also easing aggressively.

There’s going to be a lot more emphasis on economic data this week, with the US, UK, eurozone, China and Japan all due to release some hugely important figures. Monday is going to be a little quieter compared to the rest of the week, with a couple of pieces of data out of China and the US the only noteworthy releases.

China will get things underway this morning with the release of its retail sales figures for April. Retail sales are expected to have increased by 12.8% last month, a small improvement on March’s figure but still significantly below the kinds of improvement we became accustomed over the last few years.

Chinese industrial production figures will also be watched very closely. These figures have come in well below market expectations over the last couple of months, which suggests that the slowdown globally is continuing to have a negative impact on Chinese growth. This month, expectations are far lower, which should mean that the data has less chance of disappointing. What it probably means though is that if it does miss, the disappointment in the markets will be that much greater.

Fixed asset investment is another thing that’s been closely monitored recently, with China suggesting that this will be reduced in the coming years as the economy shifts its focus from investment and exports to domestic activity. We haven’t really seen any signs of this yet, although the process is likely to be very gradual and therefore the impact on this figure is likely to be minimal. As a result, I don’t expect any surprises here, with markets currently expecting an increase of 21.1%.

The first half of the European session should be a lot more calm, with sentiment likely being driven by the figures out of China. At the moment, futures are pointing to a slightly higher open in most European markets, however this can all change very quickly if the Chinese data shows further signs of a slowdown in the global economy.

With no data out of Europe this morning, the focus will therefore quickly shift to the US, where we’ll get some retail sales figures for April shortly before the opening bell. Retail sales are expected to have fallen slightly again in April, which could once again raise concerns about the impact of the payroll tax at the end of the year and the sequester.

Falling energy prices have helped cushion the blow of the increase in the payroll tax so far this year, which is why we’ve seen little impact so far in the data. However, these prices did bottom out in mid-April which means the figures we see in April and May are unlikely to be as easy on the eye. If the data starts to take a turn for the worse, we could see that pull back in the markets that most people have been concerned about for so long.

EURUSD

The euro is trading higher against the dollar this morning, although the overall tone in the pair is a bearish one. The pair broke below a key support level on Friday, around 1.3040, the neckline of the double top on the daily chart. Based on the size of the formation, this should now prompt a move back towards 1.28, which is the neckline of the much longer term head and shoulders on the weekly chart. Adding to the bearish outlook in the pair, it also broke below the middle bollinger band on the daily chart towards the end of last week, as well as the 200 day SMA, which is acting as resistance so far this morning. If we do see the pair edge lower again today, it should find support around 1.2935, Friday’s lows, followed by 1.2950 and 1.29.
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GBPUSD

Despite a strong performance over the last couple of months, this pair is looking pretty bearish on the weekly chart, with last weeks losses leading to the formation of a bearish engulfing pattern. The pair also found strong resistance around 1.56, the 50 fib level, over the last couple of weeks which suggests the recent sterling strength was nothing more than a retracement of the longer term downward trend. That said, there is clear support in this pair around 1.53, so as long as this remains in tact, we could still see another move to the upside. On the daily chart, the pair has found strong support from the bottom of the ascending channel, which could prompt a move higher again. If we do see this, it could find resistance around 1.54, the middle bollinger band on the daily chart, and 1.5530, the mid-point of the ascending channel. If the pair breaks below the channel then we could see a significant move lower towards this years’ lows around 1.4830.
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USDJPY

The yen began its second wave of weakening last week, when the pair broke above the key 100.0 resistance level. It didn’t take long for the pair to hit 101.50, the next major resistance level, and we could even see it break through here with relative ease following the G7 meeting over the weekend when the leaders once again supported the Bank of Japan’s large stimulus program. The pair started the week above this level and now appears to be finding support here, so we could now see the first move towards 110.0. The next big resistance level though should come around 103.76, which was previously a big support level for the pair. In the shorter term, the pair should find resistance around 102.42 and 103.0.
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Ahead of the open we expect to see...

Read the full report at Alpari News Room​
 
Alpari UK said:
Hi Pat494,

Good question.

We know that regulation is important for your peace of mind. That is why we’d like to take the time to explain how Financial Services Authority (FSA) regulations work and make sure you know the facts.

FSA regulation – understanding the facts

In order to be licensed and regulated by the FSA, we need to adhere to the regulator’s rules and obligations. The FSA performs frequent checks to ensure businesses are fully compliant.

Under FSA client money rules, Alpari UK is required to segregate all retail client funds from our own funds. This separation of accounts ensures that your money can never be used as a recoverable asset by Alpari UK's general creditors.

These funds are held in separate bank accounts. We take great care and diligence in their selection. Currently the client funds are held in Barclays, Bank of America Merrill Lynch and Royal Bank of Canada, three of the world's top-tier banks. In addition to these, company funds are also held in Morgan Stanley.

It’s also important to know that the FSA requires regulated businesses to maintain a minimum capital adequacy at all times to ensure businesses remain financially stable.

Your money is protected

In the unlikely event that Alpari UK is unable to meet its financial obligations, you can submit a claim to the Financial Services Compensation Scheme (FSCS). This scheme protects up to GBP50,000 per person.

The FSCS also protects the money in our segregated retail accounts. If a bank holding the funds you have deposited with Alpari UK goes into liquidation you will be able to claim up to GBP85,000 per person and per institution.

Eligibility depends on the status and the nature of your claim.

You can find out more from this booklet (PDF) or on the FSCS website.

Treating customers fairly

We put your interests at the centre of our business to ensure we comply with FSA Principle 6: “Pay due regard to the interest of its customers and treat them fairly.” Read more about how this principle is applied across all areas of our day-to-day business activities.

If you would like to discuss this or any other matter further, please feel free to contact our team on live-chat, via email or on +44 (0) 207 426 2900. We're here to help.

Alex

________
Alexander Chadwick
Alpari (UK) Representative
Click to expand...

Well thankee for such a full answer. Sets my mind to rest over the money issues.
 
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