Even if you’re at the beach or having a mountain escape surrounded by fresh air, at FXStreet we’re always looking forward to providing you the best information to keep trading while you’re on your holiday. This time, the best Forex experts want to help you to have a global vision of the upcoming events that will take place in the next six months.
Do you want to be the first one to know what directions may follow financial markets? Keep on reading and check the five exclusive previews by Valeria Bednarik, Haresh Menghani, Dhwani Mehta and Omkar Godbole.
Our Chief Analyst Valeria Bednarik points at the flawed results of “the three arrows” of Abenomics policy and expects more of the same for the second half of the year. The thing in Japan is that even if the government and the BoJ announce aggressive policies, JPY bulls continue to gain ground: “Yen’s continued strength suggests that, at this point, speculative interest is seeing this announcement as another bluff, after the many offered by the BOJ over these last four years.”
On the technical side of the USDJPY pair, Valeria foresees a bearish outlook, with targets under 100 level and upside gains limited around 106.
EURUSD Forecast H2 2016: Europe won’t be the same after Brexit by Valeria Bednarik
Brexit referendum fallout is set to continue taking the spotlight during the second half of the year, and the Eurozone will probably feel the consequences. Our Chief Analyst Valeria Bednarik is skeptical on the future of the common currency: “At this point, rather than wondering with the EU will come out of its crisis, the world is asking who will be the next to fall. Italy leads the scoreboard with its banking issues but Greece, who lately has been silent, is still a ticking bomb”.
Technically, Bednarik reflects on the long-term range the pair has been stuck for the past months: “The EUR/USD pair has been trading mostly within 1.0800 and 1.1460, measly 600 pips, since early 2015. A year and a half without a certain directional trend. There were a couple of spikes above the high and dips below the low of that range, but were quickly reverted, proving unsustainable. It seems that Mario Draghi is not the only one who does not know what to do with the common currency”.
Our Analyst Haresh Menghani sees the Pound dropping substantially from current levels on the second half of the year: “Numerous uncertainties concentrating in such a short-period of time might exert more selling pressure on the British Pound. Consequently, we believe that the GBP/USD pair remains vulnerable until end-2016 and should witness a substantial drop even from current levels”.
He mentions Brexit fallout as the main reason, with a possible UK recession, negative effects on Inflation and Labor Market and more easing from the BoE also coming up.
After a “sharp reversal” in the first half of the year, our gold analyst Dhwani Mehta points to central bank easing, US elections and safe-haven demand as main reasons to more strength for the yellow metal price: “Any dip in the gold prices in the months ahead should be considered a good buying opportunity, as the above-mentioned fundamental drivers are likely to keep the rally alive. Should the Fed turn dovish this year or Trump win the US presidential elections, we could see fresh buying in the yellow metal, which could trigger a bullish break from the falling channel formation, taking this year-end rally all the way back to April 2013 levels around $1475-$1525.”
Our analyst Omkar Godbole weighs the different scenarios the Dow Jones may see on what he expects to be a very eventful second half of the year. With Fed interest rate policy and US election as the main points of interest, he believes a Trump victory could kill the prospect of a rate hike and derail the main US index: “mix of Clinton lead in polls + range bound or rallying oil prices ad absence of remote risks like banking crisis in Europe could keep the Dow happy. Note the corporate results could see an improvement in Q3, especially in the oil sector given the oil prices have rallied. On the other hand, trump lead could single handedly derail the rally.”
With DJIA at record highs, Godbole warns of possible technical reversals that could bring a sell-off to Fibo 38.2% and 23.6% retracement levels.
Let’s see what happens next and remember, stay informed with us to read the latest currencies reports, news and more!