The Russian Ruble May Weaken if Interest Rate Goes Down

Fundamentals

Yesterday traders were glued to the UK news and to retail sales figures, which exceeded expectations. Retail sales in February increased by 1.4%.
At 12:45 PM GMT, Janet Yellen spoke, but the markets didn’t react. The Fed’s Chair basically say nothing that might have shed any light on the monetary authorities’ future policy.
It’s worth mentioning that the US economy continues to strengthen. The regular report on jobless claims released on Thursday showed that the number of benefit claims had decreased. In contrast, the new home sales rose to 592,000.
In Russia, the Central Bank’s international reserves increased to $395.7В.
Today the Central Bank will decide on the interest rate. No monetary easing is expected, but the Bank of Russia might lower the rate right now. If it does, we can except a short-term rise in the stock market and a weakening of the ruble.
Back in the US, the February durable goods orders report is worth watching at 12:30 PM GMT. The figure is expected to rise by 1.1%.
In Canada, the February CPI is released at that same time. The CPI is expected to grow by 0.2%.

Stocks

In Russia, Magnit and Raspadskaya report their earnings Friday. Magnit’s revenue is expected to be RUB 4.8B, while the EPS is forecast to come in at RUB 100.97.
No major reports are expected from the US stock market today.
Facebook, Inc., traded on the NASDAQ, is behaving very much like Apple. The market cap is growing, while on 1W charts, the price and the MACD are diverging. If the trend reverses, the support may be at $135 per share.
The Russian market corrected on Thursday. But it is premature to talk about a reversal of the short-term trend in MICEX Index, as growth may continue. The target is still at 2,090, which is 38.2% Fibo retracement. As for positive signals, both the MACD on 1W charts and the 9-week EMA are reversing. However, in terms of Elliott’s theory, the Russian benchmark may now enter the correction wave, which is a negative signal.

Currency Market

The EUR/USD pair is flat. The bears are still defending, not allowing the bulls to seize the initiative and break through 1.0800. Looking at daily charts, we can see that traders are likely to go negative. This may make sense, given the fundamentals and the Eurozone risks, especially political ones.
As for the NZD/CHF pair, the bears hold the initiative in the short term. An inverted flag is forming on the daily charts. According to Elliott’s theory, the wave forming now very much resembles a classic correction zigzag. If the bulls succeed in counterattacking the resistance, the new resistance may be at 0.7040.

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