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www.varengoldbankfx.com – Promotional Document

Wednesday, May 25, 2016

Good morning from Hamburg and welcome to our latest Daily FX Report of this week. Asianindex futures climbed amid a rally in U.S. and European shares as sentiment toward the

prospect of higher American interest rates shifted, with investors focusing on evidence of

strength in the world’s biggest economy. The dollar held gains and oil rose. Mounting conviction

that the Federal Reserve will boost borrowing costs some time in the next two months propelled

the greenback higher against major peers, including the yen. Japanese index futures jumped 1.6

percent in Osaka, while contracts on other Asian stock gauges also rallied as the S&P 500 Index

surged the most in two months.

Anyway, we wish you a successful trading day!

Market Review – Fundamental Perspective

The dollar remained near a two-month high against the euro as traders boosted wagers that

U.S. interest rates will rise, starting as early as next month. The greenback strengthened versus

most of its major peers Tuesday after Federal Reserve Bank of Philadelphia President Patrick

Harker said Monday he could see two to three rate increases this year, echoing remarks by the

San Francisco Fed Bank’s John Williams. Futures are indicating for the first time since March a

better-than 50 percent chance that the Federal Open Market Committee will raise rates by its

July meeting. The U.S. currency is getting a boost as officials talk up the possibility of tighter

policy, reigniting speculation that dollar-denominated assets will benefit from policy divergence

with central banks in other parts of the world that are either extending or maintaining monetary

stimulus. Futures trading signals a 45 percent chance of a deposit-rate cut by the European

Central Bank this year. The dollar was little changed at $1.1142 per euro as of 7:49 a.m. in Tokyo

from Tuesday, when it reached the strongest level since March 16. It was unchanged at 109.99

yen. The Bloomberg Dollar Spot Index, a gauge of the greenback against 10 major peers,

slipped less than 0.1 percent. The currency’s gains follow the greenback’s most prolonged slump

since 2013. The dollar sank more than 8 percent from mid- January through early May,

prompting analysts and investors to question whether the divergence trade had run its course.

With Fed speakers increasingly signaling a hike in the next few months, that trade has reignited.

Gold fell a fifth day, with bullion for June delivery slipping 1.8 percent to $1,232.20 an ounce. The

prospect of higher U.S. rates damps the precious metal’s appeal as a store of value.


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Daily Technical Analysis

EUREX.FDX (H1)

The german stock index found in the beginning of May a support at around 9782 points. After

reaching this level, bears covered shorts and a strong pullback started but bulls failed to exceed

the 10K level sustainable. Yesterday this support was confirmed the 4th time and a strong rally to

the upper range started. A sustainable break out over 10100 points should be considered.

Support & Resistance (Hourly)

Support Levels around Resistance Levels around

9782 10102

N/A N/A

N/A N/A


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USD/CZK (Daily)

This exotic currency pair declined with very strong movements over the last months. While the

greenback slumped down to new lows, the Relative Strength Index were touched three times at

the oversold area, as you can see on the bottom. Bears started catching profits while the value

has fallen close to 23 CZK. This constellation could be a very interesting reversal setup.

Support & Resistance (Daily)


23.4 24.8

N/A 25.5

N/A N/A


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EUR/JPY (D1)

The shared currency weakened over the last six months very sharply versus the Japanese yen.

Until now, the bearish trend is very sustainable but slowed down in this month. If the one

important support around 121.8 JPY stops the bears, it might be possible that a correction will

start above the next resistance level.

Support & Resistance (Daily)


121.8 126.2

N/A 128.1

N/A 131.8


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Daily Calendar & Key Events

Date Time (GMT) Economic Indicator Last Survey

25/05/2016 08:00 GE IFO Business Climate 106.6 106.8

25/05/2016 14:00 CA Bank of Canada Rate Decision 0.5% 0.5%

If you have any questions, please contact us for further assistance. 24 hours a day:

German: +49 40 66 86 49 – 96

English: +49 40 66 86 49 – 96

24 h Trading Support: +49 40 66 86 49 – 32

Turkish: +49. 40. 66 86 49 – 0


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DISCLAIMERIMPORTANT NOTIFICATION TO BE READ IN CONJUNCTION WITH THE CONTENTS OF THISPROMOTIONAL DOCUMENT

This document “Daily FX Report” is a promotional document and is created and published by VarengoldBank AG. This Promotional document serves exclusively for information purposes. It is exclusively aimedat German business partners and customers who make their own investment decisions at their own risknotwithstanding the contents of this promotional document. Investment decisions should be made on thebasis of a preceding consultation with an independent financial advisor and prospectus, but not on thebasis of this promotional document.Depending on the individual investor's investment goals, investment horizon or financial situation, thecontents of the present promotional document may not be suitable at all or only in part. This promotional

document is not aimed at persons with residence and / or place of business and / or branches abroad,particularly in the United States of America, Canada, Japan or Great Britain. This promotional document isfor information only and especially does not constitute a public offer, an advice, recommendation or aninvitation to submit an offer for purchase or selling of or subscription to securities or other financialinstruments. This Promotional document does not constitute investment advice or investmentrecommendation.This promotional document does not constitute a financial analysis. Therefore it does not fulfil the legalrequirements ensuring the impartiality of financial analyses. This promotional document is not subject tothe prohibition of trades before the publication of financial analyses. With this promotional document noindividual investment advisory and / or information relationship with Varengold Bank AG is established.All declarations, statements or assessments included in this promotional document are those of thisdocument's author; they do not imperatively correspond to third party statements. Varengold Bank AG hastaken the entire information on which the promotional document is based from sources considered serious

and reliable, but without verifying the entire information. This is why Varengold Bank AG does not givepromises or guarantees regarding precision, completeness or accuracy of the information or opinionsincluded. Varengold Bank AG does not assume any liability for losses and direct or consequential damagecaused by the use and / or distribution of this promotional document and / or associated with the use and /or distribution of this promotional document. The contents of the promotional document correspond to thestate of information as of the date of its preparation. It may be outdated on account of future developmentswithout this promotional document having been modified. Any complete or partial reproduction or anyother usage and /or distribution of this promotional document and / or its content is forbidden and subjectto publisher's prior written consent.

Warning notice:Trading the foreign exchange market carry a high level of risk and may result in substantial loss in part orall of an investment and is therefore not suitable for every investor. Any past performance is not an

indication or guarantee of future performance.

Publisher:

Varengold Bank AGGrosse Elbstrasse 2722767 Hamburg, GermanyT+49.40.66 86 49 0F+49.40.66 86 49 49

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