DAILY MARKET COMMENTARY
30 March 2012 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BULLISH A rise through 1.3386 would signal extension of gains to the key high of 1.3486. Support lies at 1.3252.
USDJPY BEARISH The pair is testing the key support at 81.96; a close below the level would be an important bearish development to open 81.47 next. Resistance is at 82.50.
GBPUSD BULLISH Resistance targets this week's high of 1.6001; a clear break of the level would open 1.6096. Support lies at 1.5861.
USDCHF BEARISH A move below the recent low of 0.9016 would open up the way towards 0.8961, the 62% retracement of Oct/Jan rally. Resistance is at 0.9137.
AUDUSD BEARISH Trend is bearish; a move below yesterday's low of 1.0305 would open 1.0260. Resistance is at 1.0463.
USDCAD NEUTRAL Trend conditions are unclear; initial resistance is at 1.0034 ahead of 1.0052, while support lies at 0.9947.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Initial resistance is at 0.8395 ahead of the key bull trigger at 0.8424. Support lies at 0.8300.
EURJPY NEUTRAL Support at 108.49 is still intact; a rise above the mid-point of recent sell-off at 110.01 would signal resumption of gains and open 111.26.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
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Friday, March 30, 2012
30th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
30 March 2012 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Price action in Asia was dominated by month-end and quarter-end flows into the Tokyo fix, on this the last day of Japan's fiscal year. The euro, and Australian and New Zealand dollars received a boost, but USDJPY remains heavy as UST yields continue to drift lower. We are wary of joining the rally in commodity currencies given the likelihood of a weak official Chinese March PMI over the weekend, and we would expect risk appetite to begin next week on a softer tone. The latest US economic data was uninspiring with jobless claims falling to 359k from (a revised up) 364k. Q4 GDP growth was unchanged at a 3.0% annual rate though. Fed Chairman Bernanke completed his four-part economics lecture series noting the pace of recovery has been "extremely sluggish" and that the unemployment rate remains "painfully high". He did acknowledge though that the economy's need for Fed support will diminish "at some point". Fed President Plosser said he has not participated in any discussion about so-called sterilized QE - an idea first floated in a Wall Street journal article a month ago. The remarks suggest any discussion about this as a possible policy tool is still at a very preliminary stage.
Asian equities were mixed after the S&P500 recovered most of its losses into the New York close. Ahead today, we have the Eurozone finance ministers meeting, plus US personal income/spending and consumer sentiment data. Tonight, the IMF may release a quarterly report on the currency composition of FX reserves. Given the BoE's revelations of overseas buying interest in Gilts in Q4, the sterling composition of reserves will be of particular interest this time around. The SNB has already published its reserve composition for Q4, showing an uptick in sterling holdings to 5% (prev. 4%) of total reserve assets.
EUR
A meeting of Eurozone finance minister is due to start at 0800 GMT today. The key objective is to agree a final design for the combined EFSF/ESM lending facility that is due to become operational in July. Wire reports are likely to focus on the headline figures, and Germany's Finance Minister Schaeuble has already floated a figure of EUR800 bn, which he said should be enough to convince markets. We expect to hear a final announcement on this later today or over the weekend, but it has been well telegraphed, so the FX reaction should be relatively modest.
Our fixed income strategists note that the Dutch government is facing difficulties passing additional austerity measures to meet the Maastricht deficit criteria by 2013. Meanwhile Spanish and Italian 10y sovereign yields are rising again amid newswire reports of a clearing house raising margins.
JPY
Inflation in Japan picked up in February, but there are still plenty of reasons to expect further rounds of BoJ easing ahead. The BoJ's preferred measure (nationwide CPI excluding fresh food) strayed into positive territory for the first time in five months rising to +0.1% y/y (cons. -0.1%). We do not see this as early evidence of the success of the BoJ's latest round of easing. Rather, higher electricity charges and gas prices were to blame. Also, Tokyo CPI, which is seen as a leading indicator for the nationwide figure, continues to languish in negative territory and fell -0.3% y/y in March.
Tokyo University Professor and former BoJ official Tsutomu Watanabe warned "there's a possibility prices may still be falling" even if consumer prices move towards 1%, the BoJ's recently-adopted inflation goal. He claimed the official statistics understate the degree of deflation in Japan.
Japan's manufacturing PMI rose to 51.1 in March, setting a 7-month high. In particular, the new export orders sub-index rose sharply to 50.2 (prev. 47.1). A weaker yen since the Feb. 14 BoJ policy meeting surely helped here, but we would not be surprised if the prospect of stronger exports to the US also had a positive influence - after all, February's trade data released last week revealed a sharp rise in exports to the US. This also suggests the US economy is picking up steam and supports our stronger dollar view.
It is still unclear who will succeed the two BoJ board members whose terms expire next week. A majority of DPJ members attending a financial affairs committee meeting on Thursday voiced their opposition to Ryutaro Kono's nomination to the BoJ's Policy Board. Party official Shinsuke Amiya asserted "with the main policy goal being measures to get out of deflation, there was doubt expressed on whether the nominee has been making proposals in the same direction". This serves reminder of the considerable political pressure on the BoJ for further easing, reinforcing our view that more concessions are in the pipeline. It also raises the risk that two of the nine policy board seats will be empty when the BoJ holds its next policy meeting on April 10.
A Japan MoF official said that Japan remains on guard in case the yen rises rapidly.
GBP
The BoE announced that mortgage approvals fell to 49k in February, below a revised 57.9k in the previous month. Our economists note the result was disappointing; in fact, the outturn was the lowest since June last year and well below the 53-58k range observed recently. There is no credit story behind the data. The latest BoE credit conditions survey shows that credit availability was broadly unchanged in the three months to March, and the survey also shows that demand for property held up during this period. The BoE also noted that foreign investors were net buyers of GBP9.4 bn in gilts in February.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
30 March 2012 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Price action in Asia was dominated by month-end and quarter-end flows into the Tokyo fix, on this the last day of Japan's fiscal year. The euro, and Australian and New Zealand dollars received a boost, but USDJPY remains heavy as UST yields continue to drift lower. We are wary of joining the rally in commodity currencies given the likelihood of a weak official Chinese March PMI over the weekend, and we would expect risk appetite to begin next week on a softer tone. The latest US economic data was uninspiring with jobless claims falling to 359k from (a revised up) 364k. Q4 GDP growth was unchanged at a 3.0% annual rate though. Fed Chairman Bernanke completed his four-part economics lecture series noting the pace of recovery has been "extremely sluggish" and that the unemployment rate remains "painfully high". He did acknowledge though that the economy's need for Fed support will diminish "at some point". Fed President Plosser said he has not participated in any discussion about so-called sterilized QE - an idea first floated in a Wall Street journal article a month ago. The remarks suggest any discussion about this as a possible policy tool is still at a very preliminary stage.
Asian equities were mixed after the S&P500 recovered most of its losses into the New York close. Ahead today, we have the Eurozone finance ministers meeting, plus US personal income/spending and consumer sentiment data. Tonight, the IMF may release a quarterly report on the currency composition of FX reserves. Given the BoE's revelations of overseas buying interest in Gilts in Q4, the sterling composition of reserves will be of particular interest this time around. The SNB has already published its reserve composition for Q4, showing an uptick in sterling holdings to 5% (prev. 4%) of total reserve assets.
EUR
A meeting of Eurozone finance minister is due to start at 0800 GMT today. The key objective is to agree a final design for the combined EFSF/ESM lending facility that is due to become operational in July. Wire reports are likely to focus on the headline figures, and Germany's Finance Minister Schaeuble has already floated a figure of EUR800 bn, which he said should be enough to convince markets. We expect to hear a final announcement on this later today or over the weekend, but it has been well telegraphed, so the FX reaction should be relatively modest.
Our fixed income strategists note that the Dutch government is facing difficulties passing additional austerity measures to meet the Maastricht deficit criteria by 2013. Meanwhile Spanish and Italian 10y sovereign yields are rising again amid newswire reports of a clearing house raising margins.
JPY
Inflation in Japan picked up in February, but there are still plenty of reasons to expect further rounds of BoJ easing ahead. The BoJ's preferred measure (nationwide CPI excluding fresh food) strayed into positive territory for the first time in five months rising to +0.1% y/y (cons. -0.1%). We do not see this as early evidence of the success of the BoJ's latest round of easing. Rather, higher electricity charges and gas prices were to blame. Also, Tokyo CPI, which is seen as a leading indicator for the nationwide figure, continues to languish in negative territory and fell -0.3% y/y in March.
Tokyo University Professor and former BoJ official Tsutomu Watanabe warned "there's a possibility prices may still be falling" even if consumer prices move towards 1%, the BoJ's recently-adopted inflation goal. He claimed the official statistics understate the degree of deflation in Japan.
Japan's manufacturing PMI rose to 51.1 in March, setting a 7-month high. In particular, the new export orders sub-index rose sharply to 50.2 (prev. 47.1). A weaker yen since the Feb. 14 BoJ policy meeting surely helped here, but we would not be surprised if the prospect of stronger exports to the US also had a positive influence - after all, February's trade data released last week revealed a sharp rise in exports to the US. This also suggests the US economy is picking up steam and supports our stronger dollar view.
It is still unclear who will succeed the two BoJ board members whose terms expire next week. A majority of DPJ members attending a financial affairs committee meeting on Thursday voiced their opposition to Ryutaro Kono's nomination to the BoJ's Policy Board. Party official Shinsuke Amiya asserted "with the main policy goal being measures to get out of deflation, there was doubt expressed on whether the nominee has been making proposals in the same direction". This serves reminder of the considerable political pressure on the BoJ for further easing, reinforcing our view that more concessions are in the pipeline. It also raises the risk that two of the nine policy board seats will be empty when the BoJ holds its next policy meeting on April 10.
A Japan MoF official said that Japan remains on guard in case the yen rises rapidly.
GBP
The BoE announced that mortgage approvals fell to 49k in February, below a revised 57.9k in the previous month. Our economists note the result was disappointing; in fact, the outturn was the lowest since June last year and well below the 53-58k range observed recently. There is no credit story behind the data. The latest BoE credit conditions survey shows that credit availability was broadly unchanged in the three months to March, and the survey also shows that demand for property held up during this period. The BoE also noted that foreign investors were net buyers of GBP9.4 bn in gilts in February.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Thursday, March 29, 2012
29th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
29 March 2012 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BULLISH Recovery stalled at 1.3386; a move above the level would shift our focus to the key high of 1.3486. Support lies at 1.3192.
USDJPY BULLISH Outlook is bullish; a move above 83.39 would pave the way for a climb to the key high of 84.18. Support lies at 82.33.
GBPUSD BULLISH Resistance is at this week's high of 1.6001 ahead of 1.6096. Support lies at 1.5842 ahead of 1.5801.
USDCHF BEARISH Clearance of 0.8961, the 62% retracement of Oct/Jan rally, would open 0.8931. Resistance is at 0.9137.
AUDUSD BEARISH The pair is approaching the last week's low of 1.0336; a break here would open 1.0260. Resistance is at 1.0462.
USDCAD NEUTRAL Initial resistance is at 1.0034 ahead of 1.0052, while support lies at 0.9901.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Clearance of 0.8424 would trigger further gains towards 0.8470. Support lies at 0.8335.
EURJPY BULLISH A recovery through key resistance at 111.44 would expose 111.94. Support lies at 109.18
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
29 March 2012 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BULLISH Recovery stalled at 1.3386; a move above the level would shift our focus to the key high of 1.3486. Support lies at 1.3192.
USDJPY BULLISH Outlook is bullish; a move above 83.39 would pave the way for a climb to the key high of 84.18. Support lies at 82.33.
GBPUSD BULLISH Resistance is at this week's high of 1.6001 ahead of 1.6096. Support lies at 1.5842 ahead of 1.5801.
USDCHF BEARISH Clearance of 0.8961, the 62% retracement of Oct/Jan rally, would open 0.8931. Resistance is at 0.9137.
AUDUSD BEARISH The pair is approaching the last week's low of 1.0336; a break here would open 1.0260. Resistance is at 1.0462.
USDCAD NEUTRAL Initial resistance is at 1.0034 ahead of 1.0052, while support lies at 0.9901.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Clearance of 0.8424 would trigger further gains towards 0.8470. Support lies at 0.8335.
EURJPY BULLISH A recovery through key resistance at 111.44 would expose 111.94. Support lies at 109.18
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
29th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
29 March 2012 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The Australian dollar struggled through the overnight session, weighed down by lingering concern over how severe the slowdown in China could become. A McCrann article in the Australian press added to the selling pressure, claiming that a cut to the RBA's cash rate at next Tuesday's meeting is actually more likely than not. This is not the view of our analysts who instead expect the RBA to remain on hold at 4.25% for the rest of this year. The rates market too is skeptical of the claim, but has seen fit to price in 10bp of easing just in case. The official China PMI for March due out on Sunday is also looming large, especially given the weakness of the private-sector flash PMI released last week. We are certainly alert to the near-term risks for AUDUSD, and reiterate our 3m forecast of 1.00. We are however comforted by the fact that Chinese demand for Australia's main export (iron ore) has not declined and, unlike many other commodities, its spot price is still rising.
Our team is also constructive on iron ore's price outlook as their new quarterly forecasts published overnight indicate. Equity markets still look fragile though - something AUD cannot ignore. The Nikkei-225 is down -0.7% at the time of writing, and the Shanghai Composite has sustained similar losses. A further decline in US initial jobless claims today could help turn sentiment around though, especially if our analysts also get the upward revision they expect to US Q4 GDP. Ordinarily the third estimate of a previous quarter's GDP is not a market-moving affair, but the sterling selloff in the wake of yesterday's downward revision to UK Q4 GDP (-0.3% q/q) is a reminder that investors remain firmly in data-watch mode, and can punish or reward currencies on the narrowest surprise. Fed Chairman Bernanke will continue his college lecture series today, and speeches are due from Fed Presidents Lacker, Lockhart and Plosser.
EUR
The IMF's mission chief in Greece, Thomsen, warned that there is no more scope for tax increases, and further across-the-board cuts in wages or pensions are not feasible either. He implied that the only way forward now is to enforce mandatory public sector redundancies - something the government has been reluctant to do in the past. We note that the Greek unemployment rate had already reached 20.7% by the end of Q4 2011.
Newswire sources from the Eurozone dismissed speculation that Spain might need a financial rescue and said the private sector will meet most of the funding needs for Spanish banks.
Discussion is still ongoing about how to boost the firepower of the combined EFSF/ESM. There is still a difference of opinion on how to utilise the remaining capacity of the EFSF. The possibility of governments making accelerated cash payments into the ESM is also being looked at.
Greek opinion polls suggest that no single party will obtain a clear majority at the upcoming elections - a date for which has still not been set.
JPY
MoF weekly data showed that Japanese investors were actually net buyers of foreign bonds in the week ended March 24. It appears that any fiscal year-end repatriation effects have almost entirely run their course.
GBP
The final Q4 UK GDP release came in below expectations, revised lower to -0.3% q/q from -0.2% q/q. Our economists note that at the margin this will encourage some MPC members to argue for more QE in May, but that decision will depend on the preliminary Q1 GDP print that will be released towards the end of April . As of now, it looks as if the economy will expand by around 0.2-0.3% q/q in Q1. If correct, the UK economy has stagnated in the last 6 months.
BoE MPC Member Posen said he was not as worried about downside risks as before, but if core CPI did not drop then "something is wrong".
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
29 March 2012 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The Australian dollar struggled through the overnight session, weighed down by lingering concern over how severe the slowdown in China could become. A McCrann article in the Australian press added to the selling pressure, claiming that a cut to the RBA's cash rate at next Tuesday's meeting is actually more likely than not. This is not the view of our analysts who instead expect the RBA to remain on hold at 4.25% for the rest of this year. The rates market too is skeptical of the claim, but has seen fit to price in 10bp of easing just in case. The official China PMI for March due out on Sunday is also looming large, especially given the weakness of the private-sector flash PMI released last week. We are certainly alert to the near-term risks for AUDUSD, and reiterate our 3m forecast of 1.00. We are however comforted by the fact that Chinese demand for Australia's main export (iron ore) has not declined and, unlike many other commodities, its spot price is still rising.
Our team is also constructive on iron ore's price outlook as their new quarterly forecasts published overnight indicate. Equity markets still look fragile though - something AUD cannot ignore. The Nikkei-225 is down -0.7% at the time of writing, and the Shanghai Composite has sustained similar losses. A further decline in US initial jobless claims today could help turn sentiment around though, especially if our analysts also get the upward revision they expect to US Q4 GDP. Ordinarily the third estimate of a previous quarter's GDP is not a market-moving affair, but the sterling selloff in the wake of yesterday's downward revision to UK Q4 GDP (-0.3% q/q) is a reminder that investors remain firmly in data-watch mode, and can punish or reward currencies on the narrowest surprise. Fed Chairman Bernanke will continue his college lecture series today, and speeches are due from Fed Presidents Lacker, Lockhart and Plosser.
EUR
The IMF's mission chief in Greece, Thomsen, warned that there is no more scope for tax increases, and further across-the-board cuts in wages or pensions are not feasible either. He implied that the only way forward now is to enforce mandatory public sector redundancies - something the government has been reluctant to do in the past. We note that the Greek unemployment rate had already reached 20.7% by the end of Q4 2011.
Newswire sources from the Eurozone dismissed speculation that Spain might need a financial rescue and said the private sector will meet most of the funding needs for Spanish banks.
Discussion is still ongoing about how to boost the firepower of the combined EFSF/ESM. There is still a difference of opinion on how to utilise the remaining capacity of the EFSF. The possibility of governments making accelerated cash payments into the ESM is also being looked at.
Greek opinion polls suggest that no single party will obtain a clear majority at the upcoming elections - a date for which has still not been set.
JPY
MoF weekly data showed that Japanese investors were actually net buyers of foreign bonds in the week ended March 24. It appears that any fiscal year-end repatriation effects have almost entirely run their course.
GBP
The final Q4 UK GDP release came in below expectations, revised lower to -0.3% q/q from -0.2% q/q. Our economists note that at the margin this will encourage some MPC members to argue for more QE in May, but that decision will depend on the preliminary Q1 GDP print that will be released towards the end of April . As of now, it looks as if the economy will expand by around 0.2-0.3% q/q in Q1. If correct, the UK economy has stagnated in the last 6 months.
BoE MPC Member Posen said he was not as worried about downside risks as before, but if core CPI did not drop then "something is wrong".
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Wednesday, March 28, 2012
28th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
28 March 2012 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BULLISH A move above 1.3386 would expose the key high of 1.3486. Support lies at 1.3192.
USDJPY BULLISH Trend is bullish; a move above 83.39 would pave the way for a climb to the key high of 84.18. Support lies at 82.64.
GBPUSD BULLISH A close above 1.5993 would be an important bullish development to confirm the bull trend and open 1.6096. Support lies at 1.5886.
USDCHF BEARISH The pair remains under pressure; support lies at 0.8961, the 62% retracement of Oct/Jan rally, ahead of the 0.8931. Resistance is at 0.9137.
AUDUSD BEARISH The pair is back under pressure with focus on 1.0336; a break here would open 1.0260. Resistance is at 1.0558.
USDCAD NEUTRAL The pair is trading within a range extending from 1.0052 to 0.9842.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Trend is sideways with resistance at 0.8372 and support at 0.8283.
EURJPY BULLISH Outlook is bullish; a recovery through key resistance 111.44 would expose 111.94. Support lies at 109.18.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
28 March 2012 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BULLISH A move above 1.3386 would expose the key high of 1.3486. Support lies at 1.3192.
USDJPY BULLISH Trend is bullish; a move above 83.39 would pave the way for a climb to the key high of 84.18. Support lies at 82.64.
GBPUSD BULLISH A close above 1.5993 would be an important bullish development to confirm the bull trend and open 1.6096. Support lies at 1.5886.
USDCHF BEARISH The pair remains under pressure; support lies at 0.8961, the 62% retracement of Oct/Jan rally, ahead of the 0.8931. Resistance is at 0.9137.
AUDUSD BEARISH The pair is back under pressure with focus on 1.0336; a break here would open 1.0260. Resistance is at 1.0558.
USDCAD NEUTRAL The pair is trading within a range extending from 1.0052 to 0.9842.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Trend is sideways with resistance at 0.8372 and support at 0.8283.
EURJPY BULLISH Outlook is bullish; a recovery through key resistance 111.44 would expose 111.94. Support lies at 109.18.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
28th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
28 March 2012 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The lack of any economic data releases overnight allowed the US dollar to get back on its feet and reclaim some lost ground. Still tempering the US dollar's upside is the cautious stance of Fed Chairman Bernanke, who said in a transcript of an impending television interview that "it's far too early to declare victory" and while "the recent news has been good&I think we need to be cautious and make sure this is sustainable". In response to a question about further easing, Bernanke noted "we don't take any options off the table...we don't know what's going to happen in the future, and we have to be prepared to respond to however the economy evolves". That said, there is nothing here that alters our view that the US recovery will be sufficiently durable to prevent the Fed from adopting QE3, offering broad support for the US dollar. Indeed, at 70.2 in March, the US Conference Board consumer confidence index held on to most of its hefty February increase (from 61.5 in January to a revised 71.6).
Moreover, the S&P Case Shiller home price index was unchanged m/m in January (consensus -0.3% m/m), and more timely indicators have given even stronger signals of stabilisation. Predictably dovish comments from Boston Fed President Rosengren ("if real GDP does not grow more rapidly and unemployment remains at its current unacceptably high level, monetary policy may need to be more accommodative") were countered by predictably hawkish comments from Dallas Fed President Fisher (QE3 is a "fantasy of Wall Street"). Fisher added that "before you tighten you have to stop accommodating and I don't believe we need further accommodation" - basically summing up the view of our own US economics team. Ahead today, we expect below-consensus prints for total US durables orders in February (UBSe 1.8%, cons. 3.0%) and orders ex-transport (UBSe 1.0%, cons. 1.7%), but the uptrend should remain intact.
EUR
Referring to his own country, Italy's Prime Minister Monti said that if the founding members of the EU do not follow the rules, later additions to the EU family cannot be expected to follow the rules either. He was making the case for why Italy needs to get its fiscal house in order and to lead by example.
Somewhat optimistically, Monti said the crisis in the Eurozone is almost over, and noted that "clever" ECB LTROs had helped Italian interest rates fall. ECB President Draghi said that Eurozone governments should continue to take "decisive measures" after the LTROs have stabilised sentiment, noting "the current stabilisation should not make us pause in our responses".
Spanish PM Rajoy said the budget for 2012 is not completed yet, but there are currently no plans to increase taxes on consumption and the government will not cut civil servants' pay. He again affirmed that the budget will be "very austere".
Spanish Economy Minister Guindos said that the central government is now considering Treasury-backed joint bonds for the regions. This news highlights investor concerns that the Spanish sovereign could compromise its own credit-worthiness by supporting the finances of indebted Spanish regions.
The Irish government set May 31 for Ireland to vote on backing the new fiscal treaty agreed by the EU earlier this year. Under current rules, should voters reject the treaty, Ireland would not have access to Europe's ESM bailout fund when it becomes operational in July. The latest polls suggest that the treaty may receive the public's backing.
JPY
BoJ Deputy Governor Nishimura said that, when it comes to assessing whether the BoJ's inflation goal has been met, the bank would ignore any positive inflation impact arising from a possible increase in the sales tax. Although this is not a surprise, it does make hitting the inflation goal an even greater challenge, and this in turn gives the BoJ license to ease even more aggressively.
BoJ board member Miyao said the BoJ's additional easing in February is one factor behind the yen's retreat. He added that a weaker yen along with rising equities could create a virtuous cycle which further stimulates domestic demand.
In the Diet on Tuesday, Governor Shirakawa noted that the BoJ's "liquidity provision alone can't lift the economy", stressing that measures to nurture new industries and raise Japan's growth potential were also necessary. Moreover, Shirakawa warned that excessive bond purchases could trigger a rise in long-term yields to the detriment of the economy if such actions were interpreted by markets as debt monetisation. There was nothing really new here, but we would note that such concerns did not prevent the BoJ from boosting its APP by JPY10 trn last month.
AUD
The RBA's semi-annual financial stability review noted that global market sentiment has "improved noticeably" largely due to the ECB's use of 3y LTROs. Closer to home, the report observed that the Australian banking system "remains in a relatively strong condition", in part due to households showing "more caution" with their personal finances which should improve the banking system's resilience to possible future shocks.
GBP
BoE Governor King kept the door open to a further round of QE. He does not know yet whether more QE will be needed, and said that if more asset purchases are ultimately required the bank will limit itself to buying only conventional Gilts.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
28 March 2012 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The lack of any economic data releases overnight allowed the US dollar to get back on its feet and reclaim some lost ground. Still tempering the US dollar's upside is the cautious stance of Fed Chairman Bernanke, who said in a transcript of an impending television interview that "it's far too early to declare victory" and while "the recent news has been good&I think we need to be cautious and make sure this is sustainable". In response to a question about further easing, Bernanke noted "we don't take any options off the table...we don't know what's going to happen in the future, and we have to be prepared to respond to however the economy evolves". That said, there is nothing here that alters our view that the US recovery will be sufficiently durable to prevent the Fed from adopting QE3, offering broad support for the US dollar. Indeed, at 70.2 in March, the US Conference Board consumer confidence index held on to most of its hefty February increase (from 61.5 in January to a revised 71.6).
Moreover, the S&P Case Shiller home price index was unchanged m/m in January (consensus -0.3% m/m), and more timely indicators have given even stronger signals of stabilisation. Predictably dovish comments from Boston Fed President Rosengren ("if real GDP does not grow more rapidly and unemployment remains at its current unacceptably high level, monetary policy may need to be more accommodative") were countered by predictably hawkish comments from Dallas Fed President Fisher (QE3 is a "fantasy of Wall Street"). Fisher added that "before you tighten you have to stop accommodating and I don't believe we need further accommodation" - basically summing up the view of our own US economics team. Ahead today, we expect below-consensus prints for total US durables orders in February (UBSe 1.8%, cons. 3.0%) and orders ex-transport (UBSe 1.0%, cons. 1.7%), but the uptrend should remain intact.
EUR
Referring to his own country, Italy's Prime Minister Monti said that if the founding members of the EU do not follow the rules, later additions to the EU family cannot be expected to follow the rules either. He was making the case for why Italy needs to get its fiscal house in order and to lead by example.
Somewhat optimistically, Monti said the crisis in the Eurozone is almost over, and noted that "clever" ECB LTROs had helped Italian interest rates fall. ECB President Draghi said that Eurozone governments should continue to take "decisive measures" after the LTROs have stabilised sentiment, noting "the current stabilisation should not make us pause in our responses".
Spanish PM Rajoy said the budget for 2012 is not completed yet, but there are currently no plans to increase taxes on consumption and the government will not cut civil servants' pay. He again affirmed that the budget will be "very austere".
Spanish Economy Minister Guindos said that the central government is now considering Treasury-backed joint bonds for the regions. This news highlights investor concerns that the Spanish sovereign could compromise its own credit-worthiness by supporting the finances of indebted Spanish regions.
The Irish government set May 31 for Ireland to vote on backing the new fiscal treaty agreed by the EU earlier this year. Under current rules, should voters reject the treaty, Ireland would not have access to Europe's ESM bailout fund when it becomes operational in July. The latest polls suggest that the treaty may receive the public's backing.
JPY
BoJ Deputy Governor Nishimura said that, when it comes to assessing whether the BoJ's inflation goal has been met, the bank would ignore any positive inflation impact arising from a possible increase in the sales tax. Although this is not a surprise, it does make hitting the inflation goal an even greater challenge, and this in turn gives the BoJ license to ease even more aggressively.
BoJ board member Miyao said the BoJ's additional easing in February is one factor behind the yen's retreat. He added that a weaker yen along with rising equities could create a virtuous cycle which further stimulates domestic demand.
In the Diet on Tuesday, Governor Shirakawa noted that the BoJ's "liquidity provision alone can't lift the economy", stressing that measures to nurture new industries and raise Japan's growth potential were also necessary. Moreover, Shirakawa warned that excessive bond purchases could trigger a rise in long-term yields to the detriment of the economy if such actions were interpreted by markets as debt monetisation. There was nothing really new here, but we would note that such concerns did not prevent the BoJ from boosting its APP by JPY10 trn last month.
AUD
The RBA's semi-annual financial stability review noted that global market sentiment has "improved noticeably" largely due to the ECB's use of 3y LTROs. Closer to home, the report observed that the Australian banking system "remains in a relatively strong condition", in part due to households showing "more caution" with their personal finances which should improve the banking system's resilience to possible future shocks.
GBP
BoE Governor King kept the door open to a further round of QE. He does not know yet whether more QE will be needed, and said that if more asset purchases are ultimately required the bank will limit itself to buying only conventional Gilts.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Tuesday, March 27, 2012
27th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
27 March 2012 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BULLISH A clearance of 1.3302 resistance signals scope for further advance towards the key high of 1.3486. Support lies at 1.3192.
USDJPY NEUTRAL Recovery pressures 83.04; a break here would signal a bullish resumption. Support lies at 82.33.
GBPUSD BULLISH The pair targets 1.5993 key resistance, where a break would confirm the bullish trend conditions. Support lies at 1.5801 ahead of 1.5771.
USDCHF BEARISH Fresh downside pressure has developed following the break of 0.9072. Next target support is at 0.8931. Resistance is at 0.9137.
AUDUSD BEARISH Underlying trend is bearish; initial support is at 1.0427 ahead of 1.0336. Resistance is at 1.0596.
USDCAD BEARISH The focus is on the break of 0.9861 to open 0.9842. Resistance is at 0.9999.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Resistance is at 0.8424, while support lies at 0.8283.
EURJPY BULLISH A rally through 110.47 has exposed 111.44 key high. Support lies at 109.18.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
27 March 2012 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BULLISH A clearance of 1.3302 resistance signals scope for further advance towards the key high of 1.3486. Support lies at 1.3192.
USDJPY NEUTRAL Recovery pressures 83.04; a break here would signal a bullish resumption. Support lies at 82.33.
GBPUSD BULLISH The pair targets 1.5993 key resistance, where a break would confirm the bullish trend conditions. Support lies at 1.5801 ahead of 1.5771.
USDCHF BEARISH Fresh downside pressure has developed following the break of 0.9072. Next target support is at 0.8931. Resistance is at 0.9137.
AUDUSD BEARISH Underlying trend is bearish; initial support is at 1.0427 ahead of 1.0336. Resistance is at 1.0596.
USDCAD BEARISH The focus is on the break of 0.9861 to open 0.9842. Resistance is at 0.9999.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Resistance is at 0.8424, while support lies at 0.8283.
EURJPY BULLISH A rally through 110.47 has exposed 111.44 key high. Support lies at 109.18.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
27th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
27 March 2012 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Those hoping for less dovish commentary from Fed Chair Bernanke were mostly disappointed. Although he acknowledged the recent "genuine improvement" in the labour market, he again emphasised that the situation is still "far from normal". What hurt the dollar most was Bernanke's view that "continued accommodative policies" could help boost employment. This is a marvelously vague remark and open to interpretation. While it does not endorse the market's recent decision to price in a rate hike as soon as in late 2013, it does not rule it out either. Furthermore, as our US economists point out, "continued" accommodation does not mean additional accommodation. As such, Bernanke was non-committal about the possible need for further asset purchases without ever mentioning the policy explicitly. The market chose to focus on the lower-for-longer interpretation however, and this provided a positive kick for risk appetite. Among the commodity currencies, we continue to favour the Canadian dollar on the premise that the Bank of Canada may become less dovish sooner than the Fed. We keep our bullish view on USDJPY too.
With the new fiscal year starting next week in Japan, risks should be skewed towards further yen weakness, as yield-hungry Japanese investors look for investment opportunities overseas and the BoJ tees up further easing; April 27 is one potential window for action, coinciding with the release of the Outlook Report. However USDJPY vols are already extremely well bid ahead of the BoJ's April 10 meeting - by which time two new board members may have already been appointed provided parliament can decide who to pick. Despite the recent setback, we remain fundamentally bullish on the US dollar, taking comfort from the fact that Bernanke did not hint at further easing. Our take is that the US recovery will be sufficiently durable to prevent the Fed from adopting QE3, as small firms are feeling better, payrolls should continue to expand, credit activity is improving, core inflation is likely to tick higher, and house prices are stabilising. On the latter, we would not read too much into the soggy January S&P/Case Shiller (SP/CS) Index expected later today. Distressed sales are having an increasingly negative effect on broader measures of home prices such as the SP/CS reading; the rise in non-distressed housing prices provides a more reliable barometer of underlying trends.
EUR
Germany's Finance Minister Schaeuble, speaking hypothetically, said that Germany cannot prevent Greece leaving the euro if the Greeks choose to leave.
German business confidence readings unexpectedly rose to an 8-month high, suggesting Europe's largest economy will return to growth even as the Eurozone debt crisis curbs demand for its exports. The IFO business climate index increased to 109.8 (cons. 109.5). The current assessment index remained unchanged at 117.4 (cons. 117.0). The expectations index clocked 102.7 (cons. 102.6).
CHF
EURCHF got a boost after Switzerland's Economy Minister Schneider-Ammann said the floor should be raised to 1.35-1.40. We note that exchange rate policy in Switzerland is a matter for the SNB and we would not be surprised if the cross surrendered its overnight gains.
GBP
Bank of England MPC member Miles - who voted for an extension of the QE programme at the last meeting - noted that "there is a margin of spare capacity in the UK economy which has been, and will continue, depressing domestically generated inflation pressures". He added that "those domestically generated pressures are a good indication of where the underlying inflationary forces are and it is because they look very muted that monetary policy has been loosened over the recent past".
JPY
Japan's Senior Vice Finance Minister Igarashi said it would be acceptable for foreigners to hold more JGBs. We note this is a significant shift in rhetoric, given that JGB and T-bill buying by China met with a frosty response in 2010. Of course, the yen was on a strengthening trajectory back then, and foreign inflows from China or elsewhere risked aggravating the situation. Now, after six weeks of yen weakness, the MoF may be relaxing its guard on the consequences for the currency and may instead be focusing on the advantages of attracting additional investor interest - especially given the prospect of accelerated JGB issuance over the years ahead.
AUD
RBA Assistant Governor Debelle said AUD is now in the right "ball park", having come a little off its post-flotation highs. Additionally, RBA Board member Corbett noted that the strong AUD is a significant constraint on some sectors such as retail and manufacturing. There is nothing particularly new in these remarks given that other board members such as Deputy Governor Lowe have recently made similar observations. We emphasise that FX intervention is not on the cards, and that the RBA has no ambition to weaken the currency. Instead, Lowe has recently urged industries adversely affected by the strong AUD to adapt to the new environment as this is in the best interests of the economy as a whole.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
27 March 2012 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Those hoping for less dovish commentary from Fed Chair Bernanke were mostly disappointed. Although he acknowledged the recent "genuine improvement" in the labour market, he again emphasised that the situation is still "far from normal". What hurt the dollar most was Bernanke's view that "continued accommodative policies" could help boost employment. This is a marvelously vague remark and open to interpretation. While it does not endorse the market's recent decision to price in a rate hike as soon as in late 2013, it does not rule it out either. Furthermore, as our US economists point out, "continued" accommodation does not mean additional accommodation. As such, Bernanke was non-committal about the possible need for further asset purchases without ever mentioning the policy explicitly. The market chose to focus on the lower-for-longer interpretation however, and this provided a positive kick for risk appetite. Among the commodity currencies, we continue to favour the Canadian dollar on the premise that the Bank of Canada may become less dovish sooner than the Fed. We keep our bullish view on USDJPY too.
With the new fiscal year starting next week in Japan, risks should be skewed towards further yen weakness, as yield-hungry Japanese investors look for investment opportunities overseas and the BoJ tees up further easing; April 27 is one potential window for action, coinciding with the release of the Outlook Report. However USDJPY vols are already extremely well bid ahead of the BoJ's April 10 meeting - by which time two new board members may have already been appointed provided parliament can decide who to pick. Despite the recent setback, we remain fundamentally bullish on the US dollar, taking comfort from the fact that Bernanke did not hint at further easing. Our take is that the US recovery will be sufficiently durable to prevent the Fed from adopting QE3, as small firms are feeling better, payrolls should continue to expand, credit activity is improving, core inflation is likely to tick higher, and house prices are stabilising. On the latter, we would not read too much into the soggy January S&P/Case Shiller (SP/CS) Index expected later today. Distressed sales are having an increasingly negative effect on broader measures of home prices such as the SP/CS reading; the rise in non-distressed housing prices provides a more reliable barometer of underlying trends.
EUR
Germany's Finance Minister Schaeuble, speaking hypothetically, said that Germany cannot prevent Greece leaving the euro if the Greeks choose to leave.
German business confidence readings unexpectedly rose to an 8-month high, suggesting Europe's largest economy will return to growth even as the Eurozone debt crisis curbs demand for its exports. The IFO business climate index increased to 109.8 (cons. 109.5). The current assessment index remained unchanged at 117.4 (cons. 117.0). The expectations index clocked 102.7 (cons. 102.6).
CHF
EURCHF got a boost after Switzerland's Economy Minister Schneider-Ammann said the floor should be raised to 1.35-1.40. We note that exchange rate policy in Switzerland is a matter for the SNB and we would not be surprised if the cross surrendered its overnight gains.
GBP
Bank of England MPC member Miles - who voted for an extension of the QE programme at the last meeting - noted that "there is a margin of spare capacity in the UK economy which has been, and will continue, depressing domestically generated inflation pressures". He added that "those domestically generated pressures are a good indication of where the underlying inflationary forces are and it is because they look very muted that monetary policy has been loosened over the recent past".
JPY
Japan's Senior Vice Finance Minister Igarashi said it would be acceptable for foreigners to hold more JGBs. We note this is a significant shift in rhetoric, given that JGB and T-bill buying by China met with a frosty response in 2010. Of course, the yen was on a strengthening trajectory back then, and foreign inflows from China or elsewhere risked aggravating the situation. Now, after six weeks of yen weakness, the MoF may be relaxing its guard on the consequences for the currency and may instead be focusing on the advantages of attracting additional investor interest - especially given the prospect of accelerated JGB issuance over the years ahead.
AUD
RBA Assistant Governor Debelle said AUD is now in the right "ball park", having come a little off its post-flotation highs. Additionally, RBA Board member Corbett noted that the strong AUD is a significant constraint on some sectors such as retail and manufacturing. There is nothing particularly new in these remarks given that other board members such as Deputy Governor Lowe have recently made similar observations. We emphasise that FX intervention is not on the cards, and that the RBA has no ambition to weaken the currency. Instead, Lowe has recently urged industries adversely affected by the strong AUD to adapt to the new environment as this is in the best interests of the economy as a whole.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Monday, March 26, 2012
26th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
26 March 2012 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD NEUTRAL As long as resistance at 1.3302 holds, we expect the pair to remain under pressure. Support lies at 1.3134.
USDJPY NEUTRAL The sell-off in USDJPY stalled ahead of 81.96, the 62% retracement of the recovery since March 6. Resistance is at 83.04 ahead of 84.18.
GBPUSD NEUTRAL Price action has been choppy over the past week; support is at 1.5763 ahead of 1.5725. Resistance holds at 1.5923 for now.
USDCHF NEUTRAL A closing break below 0.9072 would expose 0.9022 and 0.8931 next. Resistance is at 0.9179.
AUDUSD BEARISH Outlook remains bearish; initial support is at 1.0336 ahead of 1.0261 retracement level. Resistance is at 1.0522.
USDCAD BEARISH The pair pulled back after approaching key resistance at 1.0052. This signals scope for a decline through 0.9948 to open 0.9861.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL The key near-term directional triggers are at 0.8424 and 0.8283.
EURJPY BULLISH Trend is bullish; a recovery through 110.47 would expose 111.44. Key support to watch lies at 107.86.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
26 March 2012 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD NEUTRAL As long as resistance at 1.3302 holds, we expect the pair to remain under pressure. Support lies at 1.3134.
USDJPY NEUTRAL The sell-off in USDJPY stalled ahead of 81.96, the 62% retracement of the recovery since March 6. Resistance is at 83.04 ahead of 84.18.
GBPUSD NEUTRAL Price action has been choppy over the past week; support is at 1.5763 ahead of 1.5725. Resistance holds at 1.5923 for now.
USDCHF NEUTRAL A closing break below 0.9072 would expose 0.9022 and 0.8931 next. Resistance is at 0.9179.
AUDUSD BEARISH Outlook remains bearish; initial support is at 1.0336 ahead of 1.0261 retracement level. Resistance is at 1.0522.
USDCAD BEARISH The pair pulled back after approaching key resistance at 1.0052. This signals scope for a decline through 0.9948 to open 0.9861.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL The key near-term directional triggers are at 0.8424 and 0.8283.
EURJPY BULLISH Trend is bullish; a recovery through 110.47 would expose 111.44. Key support to watch lies at 107.86.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
26th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
26 March 2012 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The last week of Japan's fiscal year got underway overnight, and anticipation is already building that the crossover to the new year will prompt a resumption of the five-week-old USDJPY rally. Softer-than-expected US housing data on Friday forced USDJPY sharply lower, although we see this as only a temporary setback for the pair. The yen selling resumed overnight with USDJPY trading in a range of 82.33-82.78. What happens in the very short term will depend in large part on what Fed Chairman Bernanke has to say when he offers "A View from the Federal Reserve" later today. Generally firmer US economic data would appear to justify a more upbeat tone, although we would expect the chairman to maintain his generally cautious outlook.
A total of eight other FOMC officials will also air their views this week. Whether mainstream Fed opinion has already begun to shift materially is still an open question, but we do expect Fed-BoJ policy divergence to become more pronounced in coming months. Stay on guard for additional BoJ easing via the APP as early as next month - possibly coinciding with the release of the bank's next Outlook Report on April 27, just days after the FOMC meeting. Elsewhere today, the spotlight will come to rest on Germany's IFO survey - especially in the wake of last week's surprisingly weak PMI. UBS expects all IFO indices to fall marginally. Later in the week the euro will likely be sensitive to any headlines around the expansion of the Eurozone's rescue infrastructure. It appears that a consensus is forming that would temporarily raise the bailout firepower to EUR940 bn. This would be a moderately euro-positive development, although any negative reaction by the ratings agencies to an increase in sovereign contingent liabilities could quickly undo the advantage.
EUR
ECB policymakers continue to point towards eventual policy normalisation. After recent overtures from Governing Council member Nowotny and Bundesbank President Weidmann, overnight it was Executive Board member Coeure's turn. He said that a timely exit from nonstandard measures and a return to a less accommodative policy stance are essential once the conditions are ripe.
Italian Prime Minister Monti praised Spain's efforts in the area of labour market reform. However he expressed concern about rising Spanish yields and the risk these pose to Italy given that "it doesn't take much to recreate risks of contagion".
A decision is due this week on how (and by how much) to boost the size of the Eurozone's rescue infrastructure. EU Economic and Monetary Affairs Commissioner Rehn offered reassurances that Eurozone finance ministers "will take a convincing decision on the reinforcement of the firewalls" at the March 30 meeting. The Financial Times reported that Germany "is poised" to allow the combined firepower of both the EFSF and the ESM to be increased, and that a consensus is building behind temporarily raising the combined lending capacity to EUR940 bn. Der Spiegel also reported that German Chancellor Merkel and Finance Minister Schaeuble have abandoned their opposition to raising the ceiling on the combined rescue funds.
A weekend opinion poll showed that public support in Ireland for the fiscal compact treaty has risen; 49% of those polled said they would approve the Treaty at the upcoming referendum, 33% are still opposed and 18% offered no opinion. A referendum date has yet to be set.
NZD
The February trade surplus came in at NZD161 mn vs the NZD153 mn consensus estimate. Both exports and imports were down, with disruptions to ship-loading activity caused by industrial disputes likely magnifying the softness in the former.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
26 March 2012 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The last week of Japan's fiscal year got underway overnight, and anticipation is already building that the crossover to the new year will prompt a resumption of the five-week-old USDJPY rally. Softer-than-expected US housing data on Friday forced USDJPY sharply lower, although we see this as only a temporary setback for the pair. The yen selling resumed overnight with USDJPY trading in a range of 82.33-82.78. What happens in the very short term will depend in large part on what Fed Chairman Bernanke has to say when he offers "A View from the Federal Reserve" later today. Generally firmer US economic data would appear to justify a more upbeat tone, although we would expect the chairman to maintain his generally cautious outlook.
A total of eight other FOMC officials will also air their views this week. Whether mainstream Fed opinion has already begun to shift materially is still an open question, but we do expect Fed-BoJ policy divergence to become more pronounced in coming months. Stay on guard for additional BoJ easing via the APP as early as next month - possibly coinciding with the release of the bank's next Outlook Report on April 27, just days after the FOMC meeting. Elsewhere today, the spotlight will come to rest on Germany's IFO survey - especially in the wake of last week's surprisingly weak PMI. UBS expects all IFO indices to fall marginally. Later in the week the euro will likely be sensitive to any headlines around the expansion of the Eurozone's rescue infrastructure. It appears that a consensus is forming that would temporarily raise the bailout firepower to EUR940 bn. This would be a moderately euro-positive development, although any negative reaction by the ratings agencies to an increase in sovereign contingent liabilities could quickly undo the advantage.
EUR
ECB policymakers continue to point towards eventual policy normalisation. After recent overtures from Governing Council member Nowotny and Bundesbank President Weidmann, overnight it was Executive Board member Coeure's turn. He said that a timely exit from nonstandard measures and a return to a less accommodative policy stance are essential once the conditions are ripe.
Italian Prime Minister Monti praised Spain's efforts in the area of labour market reform. However he expressed concern about rising Spanish yields and the risk these pose to Italy given that "it doesn't take much to recreate risks of contagion".
A decision is due this week on how (and by how much) to boost the size of the Eurozone's rescue infrastructure. EU Economic and Monetary Affairs Commissioner Rehn offered reassurances that Eurozone finance ministers "will take a convincing decision on the reinforcement of the firewalls" at the March 30 meeting. The Financial Times reported that Germany "is poised" to allow the combined firepower of both the EFSF and the ESM to be increased, and that a consensus is building behind temporarily raising the combined lending capacity to EUR940 bn. Der Spiegel also reported that German Chancellor Merkel and Finance Minister Schaeuble have abandoned their opposition to raising the ceiling on the combined rescue funds.
A weekend opinion poll showed that public support in Ireland for the fiscal compact treaty has risen; 49% of those polled said they would approve the Treaty at the upcoming referendum, 33% are still opposed and 18% offered no opinion. A referendum date has yet to be set.
NZD
The February trade surplus came in at NZD161 mn vs the NZD153 mn consensus estimate. Both exports and imports were down, with disruptions to ship-loading activity caused by industrial disputes likely magnifying the softness in the former.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Friday, March 23, 2012
23rd of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
23 March 2012 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH The pair is back under pressure; initial support at 1.3004 ahead of 1.2974. Key near-term resistance is at 1.3302.
USDJPY NEUTRAL Near-term support is at 82.33 ahead of 81.96. Resistance is at 83.47.
GBPUSD NEUTRAL Yesterday's sell-off has exposed support at 1.5763 ahead of 1.5725. Resistance holds at 1.5923 for now.
USDCHF NEUTRAL As long as support at 0.9072 is intact, a recovery through 0.9254 would expose 0.9342.
AUDUSD BEARISH Trend and momentum conditions are bearish; next key support lies at 1.0261 retracement level. Resistance is at 1.0484.
USDCAD NEUTRAL A rise through 1.0052, the February failure high would trigger a bull tone. Near-term support lies at 0.9912.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Support is at 0.8265 whereas resistance is at 0.8372 ahead of 0.8424.
EURJPY BULLISH A move above 110.47 would expose 111.44. Key support to watch lies at 107.86.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
23 March 2012 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH The pair is back under pressure; initial support at 1.3004 ahead of 1.2974. Key near-term resistance is at 1.3302.
USDJPY NEUTRAL Near-term support is at 82.33 ahead of 81.96. Resistance is at 83.47.
GBPUSD NEUTRAL Yesterday's sell-off has exposed support at 1.5763 ahead of 1.5725. Resistance holds at 1.5923 for now.
USDCHF NEUTRAL As long as support at 0.9072 is intact, a recovery through 0.9254 would expose 0.9342.
AUDUSD BEARISH Trend and momentum conditions are bearish; next key support lies at 1.0261 retracement level. Resistance is at 1.0484.
USDCAD NEUTRAL A rise through 1.0052, the February failure high would trigger a bull tone. Near-term support lies at 0.9912.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Support is at 0.8265 whereas resistance is at 0.8372 ahead of 0.8424.
EURJPY BULLISH A move above 110.47 would expose 111.44. Key support to watch lies at 107.86.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
23rd of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
23 March 2012 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The absence of fresh economic data releases overnight did nothing to address lingering investor uncertainty over the sustainability of the global recovery. This made for generally range-bound FX trading conditions, although optimism was momentarily boosted when USDCNY fixed at a new all-time-low of 6.2891. US President Obama and China's President Hu are due to meet in Seoul on Monday. The Japanese government nominated Ryutaro Kono as a new member of the BoJ Policy Board to replace one of two policymakers whose terms end in early April. Our economists note that Kono has hawkish tendencies and his endorsement by parliament - which is a prerequisite for his appointment to the board - is therefore not a foregone conclusion. Former RBA board member Lew criticized the current RBA board for mishandling the mining boom. He urged the bank to cut the policy rate by up to 75bp to ease the pressure on regional economies - which do not benefit directly from the boom but still have to live with the consequences of a strong AUD. US economic data continues to outshine that of other major economies.
Despite the weaker Chinese, French, German and New Zealand data on Thursday, US initial claims are still trending lower, with the 5k drop to 348k providing further evidence of improving labour market conditions. Though USDJPY has stalled in the past 48 hours, any further downside should be limited by the prospect of a sustainable US recovery that will allow the Fed to keep the QE option off the table - as the BoJ continues to ease. If there were any doubts about the latter, BoJ Governor Shirakawa again set the record straight overnight declaring that the BoJ would continue to pursue its easing steps with the aim of overcoming deflation. Fed President Bullard (non-voter) offered a reminder that Fed policy rate forecasts can change and will need to follow the data. He said that a sterilized approach to asset purchases would not make any sense. Chicago Fed President Evans (a non-voter and also a long term dove) said that low rates would be appropriate until inflation reaches 3% or until unemployment falls to 7%. These are the first numerical 'triggers' informally proposed by an FOMC official - instead calendar dates such as mid-2012, or end-2013 have been used in FOMC statements. Today, Canadian CPI, US new home sales, and Fed Chairman Bernanke's speech are due.
EUR
Eurozone PMIs were weak across the board. French manufacturing contracted, coming in at 47.6 (consensus 50.2), while the services sector was flat at 50.0 (consensus 50.3). German PMIs for the two sectors came in at 48.1 and 51.8, respectively, both sharply below expectations of 51.0 and 53.1. The details were also worrying, as manufacturers had reported a sharp and accelerated decline in the new export business, pointing to weaker global trade flows.
S&P said a Portuguese debt restructuring was "not inevitable" as, compared to Greece, the overall debt stock is not as high and "implementation capacity for policy reform" is stronger. Portugal's cabinet approved the European Union's fiscal compact aimed at promoting fiscal discipline among EU member states amid workers' strikes against the austerity measures
Ireland is now technically back into recession after the Central Statistics Office announced that GDP shrank 0.2% in Q4 after a contraction of 1.1% in Q3. GNP, regarded by the government as a more accurate economic barometer, dropped 2.2% in Q4 following a 1.9% fall in Q3. This again brings into question the wisdom of imposing austerity measures without accompanying policies to stimulate near-term growth. It also casts serious doubts on the government's growth expectation of 1.3% for 2012.
JPY
Two positions on the BoJ's Policy Board remain up for grabs as the terms of Seiji Nakamura and Hidetoshi Kamezaki are set to expire early next month. The Board currently consists of a mix of career BoJ officials, academics and corporate officials. Once the two successors are nominated by government, full parliamentary approval will be needed to confirm the appointments. Given the political impetus in favour of further BoJ easing, we think the selection process is unlikely to lead to a yen-positive outcome.
An unnamed Japanese MoF official confirmed that Japan did not buy any of the EUR1.5 bn, 20-year EFSF bonds earlier this week.
GBP
The UK was not spared from the array of bad economic news over the past 24 hours. Overnight, UK Nationwide consumer confidence fell to 44 (cons. 47) but it remains above the all-time lows. This follows February's retail sales released on Thursday which dropped by -0.8% m/m (cons. -0.5% m/m). Our UK economist notes that while the headline print was undoubtedly weaker than expected, it's important to remember that monthly data can be volatile.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
23 March 2012 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The absence of fresh economic data releases overnight did nothing to address lingering investor uncertainty over the sustainability of the global recovery. This made for generally range-bound FX trading conditions, although optimism was momentarily boosted when USDCNY fixed at a new all-time-low of 6.2891. US President Obama and China's President Hu are due to meet in Seoul on Monday. The Japanese government nominated Ryutaro Kono as a new member of the BoJ Policy Board to replace one of two policymakers whose terms end in early April. Our economists note that Kono has hawkish tendencies and his endorsement by parliament - which is a prerequisite for his appointment to the board - is therefore not a foregone conclusion. Former RBA board member Lew criticized the current RBA board for mishandling the mining boom. He urged the bank to cut the policy rate by up to 75bp to ease the pressure on regional economies - which do not benefit directly from the boom but still have to live with the consequences of a strong AUD. US economic data continues to outshine that of other major economies.
Despite the weaker Chinese, French, German and New Zealand data on Thursday, US initial claims are still trending lower, with the 5k drop to 348k providing further evidence of improving labour market conditions. Though USDJPY has stalled in the past 48 hours, any further downside should be limited by the prospect of a sustainable US recovery that will allow the Fed to keep the QE option off the table - as the BoJ continues to ease. If there were any doubts about the latter, BoJ Governor Shirakawa again set the record straight overnight declaring that the BoJ would continue to pursue its easing steps with the aim of overcoming deflation. Fed President Bullard (non-voter) offered a reminder that Fed policy rate forecasts can change and will need to follow the data. He said that a sterilized approach to asset purchases would not make any sense. Chicago Fed President Evans (a non-voter and also a long term dove) said that low rates would be appropriate until inflation reaches 3% or until unemployment falls to 7%. These are the first numerical 'triggers' informally proposed by an FOMC official - instead calendar dates such as mid-2012, or end-2013 have been used in FOMC statements. Today, Canadian CPI, US new home sales, and Fed Chairman Bernanke's speech are due.
EUR
Eurozone PMIs were weak across the board. French manufacturing contracted, coming in at 47.6 (consensus 50.2), while the services sector was flat at 50.0 (consensus 50.3). German PMIs for the two sectors came in at 48.1 and 51.8, respectively, both sharply below expectations of 51.0 and 53.1. The details were also worrying, as manufacturers had reported a sharp and accelerated decline in the new export business, pointing to weaker global trade flows.
S&P said a Portuguese debt restructuring was "not inevitable" as, compared to Greece, the overall debt stock is not as high and "implementation capacity for policy reform" is stronger. Portugal's cabinet approved the European Union's fiscal compact aimed at promoting fiscal discipline among EU member states amid workers' strikes against the austerity measures
Ireland is now technically back into recession after the Central Statistics Office announced that GDP shrank 0.2% in Q4 after a contraction of 1.1% in Q3. GNP, regarded by the government as a more accurate economic barometer, dropped 2.2% in Q4 following a 1.9% fall in Q3. This again brings into question the wisdom of imposing austerity measures without accompanying policies to stimulate near-term growth. It also casts serious doubts on the government's growth expectation of 1.3% for 2012.
JPY
Two positions on the BoJ's Policy Board remain up for grabs as the terms of Seiji Nakamura and Hidetoshi Kamezaki are set to expire early next month. The Board currently consists of a mix of career BoJ officials, academics and corporate officials. Once the two successors are nominated by government, full parliamentary approval will be needed to confirm the appointments. Given the political impetus in favour of further BoJ easing, we think the selection process is unlikely to lead to a yen-positive outcome.
An unnamed Japanese MoF official confirmed that Japan did not buy any of the EUR1.5 bn, 20-year EFSF bonds earlier this week.
GBP
The UK was not spared from the array of bad economic news over the past 24 hours. Overnight, UK Nationwide consumer confidence fell to 44 (cons. 47) but it remains above the all-time lows. This follows February's retail sales released on Thursday which dropped by -0.8% m/m (cons. -0.5% m/m). Our UK economist notes that while the headline print was undoubtedly weaker than expected, it's important to remember that monthly data can be volatile.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Thursday, March 22, 2012
22nd of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
22 March 2012 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH As long as the resistance at 1.3302 holds, our bias would be for a downside. Support lies at 1.3145 ahead of 1.3004.
USDJPY BULLISH A push above 84.18 would signal a bullish resumption and open up the way towards 85.28. Key near-term support is at 83.02.
GBPUSD NEUTRAL Resistance is at 1.5923 ahead of the upside trigger at 1.5993 whereas support lies at 1.5801 ahead of 1.5763.
USDCHF NEUTRAL Our focus is on support at 0.9072 where a break would suggest weakness to 0.8931. Resistance is at 0.9178.
AUDUSD BEARISH The pair trades heavy intraday and cleared the key support at 1.0401. A close below this tonight would expose 1.0359. Resistance is at 1.0560.
USDCAD BEARISH As long as 1.0052, the February failure high is intact, we look for a break below 0.9842 to trigger extension of weakness. Interim resistance is at 0.9969.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Support is at 0.8265 whereas resistance is at 0.8372 ahead of 0.8424.
EURJPY BULLISH A push through 111.60 would expose 113.29. Support is at 109.23.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
22 March 2012 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH As long as the resistance at 1.3302 holds, our bias would be for a downside. Support lies at 1.3145 ahead of 1.3004.
USDJPY BULLISH A push above 84.18 would signal a bullish resumption and open up the way towards 85.28. Key near-term support is at 83.02.
GBPUSD NEUTRAL Resistance is at 1.5923 ahead of the upside trigger at 1.5993 whereas support lies at 1.5801 ahead of 1.5763.
USDCHF NEUTRAL Our focus is on support at 0.9072 where a break would suggest weakness to 0.8931. Resistance is at 0.9178.
AUDUSD BEARISH The pair trades heavy intraday and cleared the key support at 1.0401. A close below this tonight would expose 1.0359. Resistance is at 1.0560.
USDCAD BEARISH As long as 1.0052, the February failure high is intact, we look for a break below 0.9842 to trigger extension of weakness. Interim resistance is at 0.9969.
EURCHF NEUTRAL Resistance is at 1.2082 ahead of 1.2147. Support is at 1.2040.
EURGBP NEUTRAL Support is at 0.8265 whereas resistance is at 0.8372 ahead of 0.8424.
EURJPY BULLISH A push through 111.60 would expose 113.29. Support is at 109.23.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
22nd of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
22 March 2012 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
AUDUSD dropped 100 pips after China's flash PMI estimate for March came in well below February's final print (48.1 versus previous 49.6). The PMI also added to the kiwi's troubles, compounding the selloff that began earlier after very weak New Zealand Q4 GDP. There was positive news too overnight - Japan's trade balance unexpectedly climbed back into surplus territory in February (on a non-seasonally adjusted basis). Surprisingly, stronger exports were the root cause - and even more surprisingly exports to the US in particular grew sharply. This is yet another piece of evidence that the US economic recovery is gaining momentum.
On one hand, a return to a trade surplus is likely to provide some temporary support to the yen, but rising US yields on the back of an accelerating US recovery will likely keep USDJPY aloft. USDJPY should also be supported by a gradually fading 'home currency bias' among yield-hungry Japanese investors entering fiscal 2012 - as highlighted in comments (reported yesterday) by an official at one of the major life insurers, who deemed the BoJ's easing move on Feb 14 to be a "historical turning point" that will boost USDJPY. Advance Eurozone PMI figures for March are due - our European economics team expects the manufacturing survey to come in well below the consensus. Considering Spanish yields are also much higher once again, we think the euro is looking decidedly vulnerable at these levels.
EUR
ECB President Draghi declared that 'the worst is over', and said investor confidence is returning. In a clear nod towards the need for fiscal restraint and perhaps a beefed up EFSF-ESM, he said it is now up to governments to make the Eurozone crisis-proof. Draghi added that LTROs do not fuel inflation and stressed that there is no sign of inflationary pressure. However he warned that 'should the inflation outlook deteriorate, we will immediately take preventative action'.
ECB's Asmussen said that the ECB must "start to carefully prepare an exit", echoing comments by other members of late. It is surprising that the ECB is talking more about exit strategies barely a quarter after they effectively increased stimulus measures. Asmussen also said there were no signs of an asset bubble in the Eurozone, but German house prices need to be closely watched.
The EU Commission said that Portugal's recapitalisation needs would be "challenging" and a few non-state banks will probably need official support. However, the EU-ECB-IMF review last month noted there was no reform fatigue and Portugal remains on track.
Portugal sold March 2013 bills and the yield fell sharply to 3.652% vs. 4.943% last month. The July 2012 auction (size EUR382 mn) was covered 6.7 times at a yield of 2.168%.
GBP
The BoE minutes showed a 7-2 vote for the QE programme, with two members voting for an extension of GBP25 bn. There were some more hawkish comments, with Martin Weale warning that there was a risk inflation would have "more persistence". Our economists note that the overall tone of the minutes remained dovish. The committee acknowledged the improved market conditions following the LTRO, but again highlighted the higher funding costs for lenders.
The public finance net credit requirement was much worse than expected at -GBP7.8 bn. The tax intake shortfall again confirms there is a lot of risk for more fiscal slippage, and net debt has risen to 63.1% of GDP vs. 58.8% a year earlier.
The UK budget turned out to be an economic non-event. Most of the budget was on expected lines, with Chancellor Osborne announcing a corporate tax cut of 1% and income tax cut of 5% starting next year. The GDP growth forecast was revised to 0.8% for 2012, while a growth rate of 2% is projected for 2013.
NZD
Q4 GDP growth came in at just 0.3% q/q, well below the 0.6% q/q market consensus. In y/y terms, Q4 growth was 1.8% vs the 2.2% expected. This should push market expectations of rate hikes further out, and keep NZDUSD on the back foot for now.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
22 March 2012 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
AUDUSD dropped 100 pips after China's flash PMI estimate for March came in well below February's final print (48.1 versus previous 49.6). The PMI also added to the kiwi's troubles, compounding the selloff that began earlier after very weak New Zealand Q4 GDP. There was positive news too overnight - Japan's trade balance unexpectedly climbed back into surplus territory in February (on a non-seasonally adjusted basis). Surprisingly, stronger exports were the root cause - and even more surprisingly exports to the US in particular grew sharply. This is yet another piece of evidence that the US economic recovery is gaining momentum.
On one hand, a return to a trade surplus is likely to provide some temporary support to the yen, but rising US yields on the back of an accelerating US recovery will likely keep USDJPY aloft. USDJPY should also be supported by a gradually fading 'home currency bias' among yield-hungry Japanese investors entering fiscal 2012 - as highlighted in comments (reported yesterday) by an official at one of the major life insurers, who deemed the BoJ's easing move on Feb 14 to be a "historical turning point" that will boost USDJPY. Advance Eurozone PMI figures for March are due - our European economics team expects the manufacturing survey to come in well below the consensus. Considering Spanish yields are also much higher once again, we think the euro is looking decidedly vulnerable at these levels.
EUR
ECB President Draghi declared that 'the worst is over', and said investor confidence is returning. In a clear nod towards the need for fiscal restraint and perhaps a beefed up EFSF-ESM, he said it is now up to governments to make the Eurozone crisis-proof. Draghi added that LTROs do not fuel inflation and stressed that there is no sign of inflationary pressure. However he warned that 'should the inflation outlook deteriorate, we will immediately take preventative action'.
ECB's Asmussen said that the ECB must "start to carefully prepare an exit", echoing comments by other members of late. It is surprising that the ECB is talking more about exit strategies barely a quarter after they effectively increased stimulus measures. Asmussen also said there were no signs of an asset bubble in the Eurozone, but German house prices need to be closely watched.
The EU Commission said that Portugal's recapitalisation needs would be "challenging" and a few non-state banks will probably need official support. However, the EU-ECB-IMF review last month noted there was no reform fatigue and Portugal remains on track.
Portugal sold March 2013 bills and the yield fell sharply to 3.652% vs. 4.943% last month. The July 2012 auction (size EUR382 mn) was covered 6.7 times at a yield of 2.168%.
GBP
The BoE minutes showed a 7-2 vote for the QE programme, with two members voting for an extension of GBP25 bn. There were some more hawkish comments, with Martin Weale warning that there was a risk inflation would have "more persistence". Our economists note that the overall tone of the minutes remained dovish. The committee acknowledged the improved market conditions following the LTRO, but again highlighted the higher funding costs for lenders.
The public finance net credit requirement was much worse than expected at -GBP7.8 bn. The tax intake shortfall again confirms there is a lot of risk for more fiscal slippage, and net debt has risen to 63.1% of GDP vs. 58.8% a year earlier.
The UK budget turned out to be an economic non-event. Most of the budget was on expected lines, with Chancellor Osborne announcing a corporate tax cut of 1% and income tax cut of 5% starting next year. The GDP growth forecast was revised to 0.8% for 2012, while a growth rate of 2% is projected for 2013.
NZD
Q4 GDP growth came in at just 0.3% q/q, well below the 0.6% q/q market consensus. In y/y terms, Q4 growth was 1.8% vs the 2.2% expected. This should push market expectations of rate hikes further out, and keep NZDUSD on the back foot for now.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Tuesday, March 20, 2012
20th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
20 March 2012 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH As long as resistance at 1.3302 is intact, our focus remains on the downside. Support lies at 1.3135 ahead of 1.3004.
USDJPY BULLISH Underlying trend is bullish; a recovery through 84.18 would open up the way towards 85.28. Key near-term support is at 82.81.
GBPUSD NEUTRAL The key upside trigger is at 1.5993, where a break would open 1.6096. Support is at 1.5759.
USDCHF NEUTRAL Key support to watch is at 0.9085. As long as this holds, we look for an upside to 0.9214 initially. If this gives way, scope would be for weakness to 0.8931.
AUDUSD BEARISH While resistance at 1.0640 holds, we anticipate a decline to 1.0423 just ahead of 1.0401.
USDCAD BEARISH Clearance of 0.9873 has opened support at 0.9842, the year-to-date low, ahead of 0.9766, the Sept 19 low. Resistance is at 0.9949.
EURCHF NEUTRAL Resistance is at 1.2147 ahead of 1.2189. Support is at 1.2040.
EURGBP BEARISH Support is at 0.8265 ahead of 0.8222. Resistance is at 0.8351.
EURJPY BULLISH Yesterday's rally through 110.18 has exposed 111.60. Support is at 108.69.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
20 March 2012 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH As long as resistance at 1.3302 is intact, our focus remains on the downside. Support lies at 1.3135 ahead of 1.3004.
USDJPY BULLISH Underlying trend is bullish; a recovery through 84.18 would open up the way towards 85.28. Key near-term support is at 82.81.
GBPUSD NEUTRAL The key upside trigger is at 1.5993, where a break would open 1.6096. Support is at 1.5759.
USDCHF NEUTRAL Key support to watch is at 0.9085. As long as this holds, we look for an upside to 0.9214 initially. If this gives way, scope would be for weakness to 0.8931.
AUDUSD BEARISH While resistance at 1.0640 holds, we anticipate a decline to 1.0423 just ahead of 1.0401.
USDCAD BEARISH Clearance of 0.9873 has opened support at 0.9842, the year-to-date low, ahead of 0.9766, the Sept 19 low. Resistance is at 0.9949.
EURCHF NEUTRAL Resistance is at 1.2147 ahead of 1.2189. Support is at 1.2040.
EURGBP BEARISH Support is at 0.8265 ahead of 0.8222. Resistance is at 0.8351.
EURJPY BULLISH Yesterday's rally through 110.18 has exposed 111.60. Support is at 108.69.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
20th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
20 March 2012 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The RBA sounded a cautious but steady note with its release of policy meeting minutes, but this did not prevent AUD from taking a knock after commercial entities voiced concerns about Chinese demand for resources. The reaction function for the AUD just goes to show how the individual exposures for various currencies matter at this point, especially within the risk bloc, and investors have become more mindful of individual catalysts. Our flow monitor for the past week, in emerging markets for example, showed broad-based liquidation out of these risk currencies in favour of the dollar, yet the past sessions have been characterised by a positive risk environment, another confirmation of our view that the market is continuing to price out the dollar as a funder. So far policymakers appear willing to tolerate the moves.
Dovish Fed member William Dudley yesterday also acknowledged some degree of conditionality and uncertainty about the further need for stimulus in the coming months, though in all likelihood more debate would occur heading into the end of current operations. Fed Chairman Bernanke will be speaking later today, Treasury Secretary Geithner is also set to testify on the international financial system in Washington, and Eurozone observers may be interested in whether the US is any closer to providing funding for their firewall via the IMF at this point. UK CPI figures are also set to show another drop in headline inflation to 3.0% - levels which no longer risk triggering a letter to the Chancellor, which to some extent would confirm the BoE's views on price pressures through the decision to commence the latest round of asset purchases. Nonetheless, rhetoric from the likes of the ECB has been slightly more cautious on price pressures of late, and policymakers will be especially in bind if headline inflation begins to eat into the real economy at the wrong point in the cycle. EURUSD traded 1.3226-1.3245 and USDJPY 83.36-83.50.
EUR
Late on Monday ECB's Nowotny said he could exclude the possibility that high oil prices will increase inflation, but there was no risk for demand-driven inflation in Europe. Although the ECB remains on a cautious footing, it is more attentive to price pressures at this stage and closely monitory second round effects. We don't expect further easing at this point.
The Greek credit default swap auction results are through and show a recovery rate, or a fair value price for Greek bonds, of 21.5 cents to the euro. Holders of the swaps will be paid out a total of $2.5 bn.
The Greek central bank released a report warning that the country needed to strictly implement the troika plan to restore confidence. In addition, it warned that Greek GDP would contract 4.5% this year, and unemployment would exceed 19%. The Greek current account gap was to shrink to 7% of GDP this year, while the economy may start recovering in 2013.
EFSF's Regling expressed optimism, saying that the aid recipients Ireland and Portugal are bolstering their fiscal positions, while Italy is revamping economic policies in a bid to avoid the need for financial help. He added that Greece, which just received a second rescue, is a "very special case".
The EFSF raised EUR 1.5 bn ($2 bn) from the sale of the inaugural 20-year bonds, which were priced to yield 115 basis points more than the benchmark swap rate. The issue attracted almost EUR 4.8 bn of orders, and CEO Regling called it a "success" - further boosting the market's view on Europe's current firewall capabilities.
Greek Finance Minister Venizelos has confirmed his resignation; he will be leading the PASOK Party in the upcoming elections, which are expected to be held around the end of April or early May.
The ECB announced that it did not complete any bond purchases in the week to March 16th, vs. EUR27mln the previous week. German PPI numbers are due on Tuesday.
GBP
CPI figures will be out in the UK on Tuesday. We are slightly below market expectations in looking for a 3% headline print. RPI is also expected to fall to 3.5%.
The focus for the UK this week remains with Wednesday's budget. Our economists note The government is unlikely to alter its macro forecasts so the focus this time will be on details that help unblock the logjam in the credit markets and other initiatives to kick-start economic growth that were announced in the Autumn Statement in November.
AUD
The RBA minutes from the last meeting were released overnight. The RBA, in holding rates, noted that downside risks were 'less likely' to materialise', and it was appropriate for interest rates to be at current levels. The minutes also noted that the impact of a high AUD, and a mining boom were roughly balanced. On the inflation front, the RBA noted some improvement in productivity across the economy was needed to keep inflation contained.
Overall, minutes suggest RBA is on hold, as we expect - unless downside risks materialise, but this seems less likely now. This echoes the comments made by Governor Stevens on Monday.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
20 March 2012 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The RBA sounded a cautious but steady note with its release of policy meeting minutes, but this did not prevent AUD from taking a knock after commercial entities voiced concerns about Chinese demand for resources. The reaction function for the AUD just goes to show how the individual exposures for various currencies matter at this point, especially within the risk bloc, and investors have become more mindful of individual catalysts. Our flow monitor for the past week, in emerging markets for example, showed broad-based liquidation out of these risk currencies in favour of the dollar, yet the past sessions have been characterised by a positive risk environment, another confirmation of our view that the market is continuing to price out the dollar as a funder. So far policymakers appear willing to tolerate the moves.
Dovish Fed member William Dudley yesterday also acknowledged some degree of conditionality and uncertainty about the further need for stimulus in the coming months, though in all likelihood more debate would occur heading into the end of current operations. Fed Chairman Bernanke will be speaking later today, Treasury Secretary Geithner is also set to testify on the international financial system in Washington, and Eurozone observers may be interested in whether the US is any closer to providing funding for their firewall via the IMF at this point. UK CPI figures are also set to show another drop in headline inflation to 3.0% - levels which no longer risk triggering a letter to the Chancellor, which to some extent would confirm the BoE's views on price pressures through the decision to commence the latest round of asset purchases. Nonetheless, rhetoric from the likes of the ECB has been slightly more cautious on price pressures of late, and policymakers will be especially in bind if headline inflation begins to eat into the real economy at the wrong point in the cycle. EURUSD traded 1.3226-1.3245 and USDJPY 83.36-83.50.
EUR
Late on Monday ECB's Nowotny said he could exclude the possibility that high oil prices will increase inflation, but there was no risk for demand-driven inflation in Europe. Although the ECB remains on a cautious footing, it is more attentive to price pressures at this stage and closely monitory second round effects. We don't expect further easing at this point.
The Greek credit default swap auction results are through and show a recovery rate, or a fair value price for Greek bonds, of 21.5 cents to the euro. Holders of the swaps will be paid out a total of $2.5 bn.
The Greek central bank released a report warning that the country needed to strictly implement the troika plan to restore confidence. In addition, it warned that Greek GDP would contract 4.5% this year, and unemployment would exceed 19%. The Greek current account gap was to shrink to 7% of GDP this year, while the economy may start recovering in 2013.
EFSF's Regling expressed optimism, saying that the aid recipients Ireland and Portugal are bolstering their fiscal positions, while Italy is revamping economic policies in a bid to avoid the need for financial help. He added that Greece, which just received a second rescue, is a "very special case".
The EFSF raised EUR 1.5 bn ($2 bn) from the sale of the inaugural 20-year bonds, which were priced to yield 115 basis points more than the benchmark swap rate. The issue attracted almost EUR 4.8 bn of orders, and CEO Regling called it a "success" - further boosting the market's view on Europe's current firewall capabilities.
Greek Finance Minister Venizelos has confirmed his resignation; he will be leading the PASOK Party in the upcoming elections, which are expected to be held around the end of April or early May.
The ECB announced that it did not complete any bond purchases in the week to March 16th, vs. EUR27mln the previous week. German PPI numbers are due on Tuesday.
GBP
CPI figures will be out in the UK on Tuesday. We are slightly below market expectations in looking for a 3% headline print. RPI is also expected to fall to 3.5%.
The focus for the UK this week remains with Wednesday's budget. Our economists note The government is unlikely to alter its macro forecasts so the focus this time will be on details that help unblock the logjam in the credit markets and other initiatives to kick-start economic growth that were announced in the Autumn Statement in November.
AUD
The RBA minutes from the last meeting were released overnight. The RBA, in holding rates, noted that downside risks were 'less likely' to materialise', and it was appropriate for interest rates to be at current levels. The minutes also noted that the impact of a high AUD, and a mining boom were roughly balanced. On the inflation front, the RBA noted some improvement in productivity across the economy was needed to keep inflation contained.
Overall, minutes suggest RBA is on hold, as we expect - unless downside risks materialise, but this seems less likely now. This echoes the comments made by Governor Stevens on Monday.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Monday, March 19, 2012
19th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
19 March 2012 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH Our focus is on resistance at 1.3191 where a break would open 1.3291. Support is at 1.3096 ahead of the key support at 1.2974.
USDJPY BULLISH We view the recent pullback as correction. Support lies at 83.20 ahead of 82.81. A push above 83.68 would expose 84.18, the key upside trigger.
GBPUSD NEUTRAL Resistance is at 1.5883 ahead of the key resistance at 1.5993. Support is at 1.5732.
USDCHF BULLISH The pullback from last week's high at 0.9335 is seen as a correction. Key support to watch is at 0.9133 ahead of 0.9085. A closing break above 0.9243 would signal a bullish resumption.
AUDUSD BEARISH Support lies at 1.0519 ahead of the 1.0401. Resistance is at 1.0670.
USDCAD BEARISH As long as key resistance at 1.0029 holds, we expect downside pressure to persist. Initial resistance is at 0.9951 whereas support lies at 0.9873 ahead of 0.9842, the year-to-date low.
EURCHF NEUTRAL Resistance is at 1.2147 ahead of 1.2189. Support is at 1.2040.
EURGBP NEUTRAL The cross tested the key support 0.8295 to print a low of 0.8293 on Friday. A closing break below this would suggest further weakness and expose 0.8265 ahead of 0.8222. Resistance is at 0.8351.
EURJPY BULLISH Key resistance is at 110.18 where a break would expose 111.60. Support is at 107.90.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
19 March 2012 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH Our focus is on resistance at 1.3191 where a break would open 1.3291. Support is at 1.3096 ahead of the key support at 1.2974.
USDJPY BULLISH We view the recent pullback as correction. Support lies at 83.20 ahead of 82.81. A push above 83.68 would expose 84.18, the key upside trigger.
GBPUSD NEUTRAL Resistance is at 1.5883 ahead of the key resistance at 1.5993. Support is at 1.5732.
USDCHF BULLISH The pullback from last week's high at 0.9335 is seen as a correction. Key support to watch is at 0.9133 ahead of 0.9085. A closing break above 0.9243 would signal a bullish resumption.
AUDUSD BEARISH Support lies at 1.0519 ahead of the 1.0401. Resistance is at 1.0670.
USDCAD BEARISH As long as key resistance at 1.0029 holds, we expect downside pressure to persist. Initial resistance is at 0.9951 whereas support lies at 0.9873 ahead of 0.9842, the year-to-date low.
EURCHF NEUTRAL Resistance is at 1.2147 ahead of 1.2189. Support is at 1.2040.
EURGBP NEUTRAL The cross tested the key support 0.8295 to print a low of 0.8293 on Friday. A closing break below this would suggest further weakness and expose 0.8265 ahead of 0.8222. Resistance is at 0.8351.
EURJPY BULLISH Key resistance is at 110.18 where a break would expose 111.60. Support is at 107.90.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
19th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
19 March 2012 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Ranges were broadly flat overnight but the dollar has checked some of its advance amid fears that data is still not strong enough in the US for the Fed to continue allowing the market to price out expectations for monetary easing. On Friday the University of Michigan consumer sentiment index slipped to 74.3 in early March from 75.3 in February; industrial production was unchanged m/m in February; and the y/y reading for core consumer prices slowed to 2.2% in February from 2.3% in January. Yet, this should not mask the positive momentum in the US economy, as the University of Michigan report included key improvements in labour market assessments, while manufacturing production was up 0.3% m/m in February.
Moreover, at a 1.9% annual rate in the past three months, core consumer prices are still growing at a faster clip than the 1.7% recorded last October. In fact, thanks in large part to what has transpired in the US, our global asset allocation team has declared a secular turning point for bonds into a long-term bear market. Our baseline scenario now pegs 10-year UST yields at 2.7% at the end of 2012 (vs 2.4% previously) and 3.3% at the end of 2013 (vs 3.0% previously), with the Fed starting to hike rates in 2013 - defying the Fed's late 2014 guidance. This should support currency pairs like USDCHF and USDJPY, which tends to track UST-JGB yield spreads particularly well - underpinning our three-month target of 85. These shifts need to take place in the context of a stronger US recovery and ever-widening policy divergence, though further policy guidance from the Fed is needed and at this point it remains too early to be over-expectant on the FOMC alone. In addition, the dovish tone from several minor central banks of late suggest that the 'risk-on, high-yield on' framework could also be changing as these nations are seeing clear downside risks to their manufacturing sectors. Today's speech by New York Fed President Dudley plus appearances by Fed Chairman Bernanke on Tuesday, Thursday and Friday will be closely watched. As long as Bernanke does not drop any 'QE3' hints as we suspect, the US dollar should be well supported. Overnight EURUSD traded in a range of 1.3156-1.3187, USDJPY 83.36-83.56.
EUR
EU Commission chief Barroso said on Friday that members should continue considering mutualising 'part of their debt load' to signal their 'commitment' to Europe's monetary union. However, we note that Northern European nations remain strongly opposed to such a step.
On Friday the euro got a boost when ECB Governing Council member Nowotny said the ECB is working on the design of its exit strategy so that it is ready for use when the time comes. However, we would not interpret these remarks as being hawkish. Instead, the comments were likely intended to be reassuring in the wake of concern over the possible dangers of ample liquidity provision. Nowotny went on to emphasise that the ECB is currently in wait-and-see mode and he does not see any evidence of inflationary pressures.
Referring to the bond-buying facility, Nowotny revealed there is a general reluctance to use it on the ECB's governing council: "I think we are all very cautious about it. It still exists, but my personal view is that it should be used with great care and with great restriction".
Germany's Finance Minister declined to "speculate" on successors to Eurogroup Chairman Juncker, though he said that person will be a Finance Minister. This doesn't rule out Italian PM Monti, who also holds the Finance portfolio for Italy.
An International Monetary Fund staff report warned Friday that Greece's loan programme faces "exceptionally high" risks and said Athens may need further debt restructuring and additional financing that Europe should cover. Officials are particularly concerned about the ability of Athens to politically deliver on the tough economic-overhaul policies, especially considering that the forthcoming elections in Athens may mean new leaders aren't as committed to reforms.
JPY
The biggest move in IMM positioning remains with the yen. Net shorts in the currency have trebled over the past three weeks, and momentum remains strong as USDJPY eyes 85. With the Eurozone seemingly managing Greece-related risks, the US dollar's ascendency now looks wholly dependent on further yen developments, and the FOMC decision last week may have given US dollar longs an extra boost (data as of March 13, the day of the last meeting).
The minutes from the BoJ's February 14 Policy Board meeting - where further easing took place and an inflation 'goal' of 1% was adopted - showed that "most" Board members acknowledged that the Bank's "basic thinking was unchanged on price stability" and that this was simply an effort to communicate more effectively.
However, "a few" members felt a target of 1-2% might eventually be appropriate. One member even went so far as to suggest that the Bank should aim eventually to adopt a target of 2% - specifically to bring it into line with international practice, "so that the foreign exchange rate would not move to a long-term trend of being one-sided". We see the minutes as endorsing our view that the BoJ is likely to keep its easing bias long after other central banks have begun to tighten. This backs up our call for USDJPY to push higher towards 85 on a three-month horizon.
AUD
RBA Governor Stevens noted overnight that recent domestic economy was "not too bad". Although GDP suggested growth below trend, other data point to trend. Monetary policy can play a role in supporting demand, should inflation allow it. On the AUD, he noted that the strong currency is forcing some sectors to restructure, [but] monetary policy cannot lessen the pressure.
Our analysts note the comments suggest the door is still open to a rate cut from the RBA, given the weaker than expected GDP data, but still probably need to see the unemployment rate rise to get the cut. However, RBA is still not linking the relatively high level of Australian rates as a key driver behind the high AUD.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
19 March 2012 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Ranges were broadly flat overnight but the dollar has checked some of its advance amid fears that data is still not strong enough in the US for the Fed to continue allowing the market to price out expectations for monetary easing. On Friday the University of Michigan consumer sentiment index slipped to 74.3 in early March from 75.3 in February; industrial production was unchanged m/m in February; and the y/y reading for core consumer prices slowed to 2.2% in February from 2.3% in January. Yet, this should not mask the positive momentum in the US economy, as the University of Michigan report included key improvements in labour market assessments, while manufacturing production was up 0.3% m/m in February.
Moreover, at a 1.9% annual rate in the past three months, core consumer prices are still growing at a faster clip than the 1.7% recorded last October. In fact, thanks in large part to what has transpired in the US, our global asset allocation team has declared a secular turning point for bonds into a long-term bear market. Our baseline scenario now pegs 10-year UST yields at 2.7% at the end of 2012 (vs 2.4% previously) and 3.3% at the end of 2013 (vs 3.0% previously), with the Fed starting to hike rates in 2013 - defying the Fed's late 2014 guidance. This should support currency pairs like USDCHF and USDJPY, which tends to track UST-JGB yield spreads particularly well - underpinning our three-month target of 85. These shifts need to take place in the context of a stronger US recovery and ever-widening policy divergence, though further policy guidance from the Fed is needed and at this point it remains too early to be over-expectant on the FOMC alone. In addition, the dovish tone from several minor central banks of late suggest that the 'risk-on, high-yield on' framework could also be changing as these nations are seeing clear downside risks to their manufacturing sectors. Today's speech by New York Fed President Dudley plus appearances by Fed Chairman Bernanke on Tuesday, Thursday and Friday will be closely watched. As long as Bernanke does not drop any 'QE3' hints as we suspect, the US dollar should be well supported. Overnight EURUSD traded in a range of 1.3156-1.3187, USDJPY 83.36-83.56.
EUR
EU Commission chief Barroso said on Friday that members should continue considering mutualising 'part of their debt load' to signal their 'commitment' to Europe's monetary union. However, we note that Northern European nations remain strongly opposed to such a step.
On Friday the euro got a boost when ECB Governing Council member Nowotny said the ECB is working on the design of its exit strategy so that it is ready for use when the time comes. However, we would not interpret these remarks as being hawkish. Instead, the comments were likely intended to be reassuring in the wake of concern over the possible dangers of ample liquidity provision. Nowotny went on to emphasise that the ECB is currently in wait-and-see mode and he does not see any evidence of inflationary pressures.
Referring to the bond-buying facility, Nowotny revealed there is a general reluctance to use it on the ECB's governing council: "I think we are all very cautious about it. It still exists, but my personal view is that it should be used with great care and with great restriction".
Germany's Finance Minister declined to "speculate" on successors to Eurogroup Chairman Juncker, though he said that person will be a Finance Minister. This doesn't rule out Italian PM Monti, who also holds the Finance portfolio for Italy.
An International Monetary Fund staff report warned Friday that Greece's loan programme faces "exceptionally high" risks and said Athens may need further debt restructuring and additional financing that Europe should cover. Officials are particularly concerned about the ability of Athens to politically deliver on the tough economic-overhaul policies, especially considering that the forthcoming elections in Athens may mean new leaders aren't as committed to reforms.
JPY
The biggest move in IMM positioning remains with the yen. Net shorts in the currency have trebled over the past three weeks, and momentum remains strong as USDJPY eyes 85. With the Eurozone seemingly managing Greece-related risks, the US dollar's ascendency now looks wholly dependent on further yen developments, and the FOMC decision last week may have given US dollar longs an extra boost (data as of March 13, the day of the last meeting).
The minutes from the BoJ's February 14 Policy Board meeting - where further easing took place and an inflation 'goal' of 1% was adopted - showed that "most" Board members acknowledged that the Bank's "basic thinking was unchanged on price stability" and that this was simply an effort to communicate more effectively.
However, "a few" members felt a target of 1-2% might eventually be appropriate. One member even went so far as to suggest that the Bank should aim eventually to adopt a target of 2% - specifically to bring it into line with international practice, "so that the foreign exchange rate would not move to a long-term trend of being one-sided". We see the minutes as endorsing our view that the BoJ is likely to keep its easing bias long after other central banks have begun to tighten. This backs up our call for USDJPY to push higher towards 85 on a three-month horizon.
AUD
RBA Governor Stevens noted overnight that recent domestic economy was "not too bad". Although GDP suggested growth below trend, other data point to trend. Monetary policy can play a role in supporting demand, should inflation allow it. On the AUD, he noted that the strong currency is forcing some sectors to restructure, [but] monetary policy cannot lessen the pressure.
Our analysts note the comments suggest the door is still open to a rate cut from the RBA, given the weaker than expected GDP data, but still probably need to see the unemployment rate rise to get the cut. However, RBA is still not linking the relatively high level of Australian rates as a key driver behind the high AUD.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Friday, March 16, 2012
16th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
16 March 2012 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH Outlook is bearish with focus on the Feb 16 key low of 1.2974; clearance of the level would open 1.2828. Resistance is at 1.3191.
USDJPY BULLISH USDJPY pulled back to unwind upside extremes; initial support at 82.87 ahead of 81.97. Underlying trend is bullish with initial resistance at 84.18.
GBPUSD BEARISH A move below 1.5603 would pave the way for 1.5525. Resistance is at 1.5748.
USDCHF BULLISH A rally through 0.9342 would open up the door to 0.9596, the year-to-date high. Interim resistance is at 0.9413. Support lies at 0.9140
AUDUSD BEARISH The focus is on key support at 1.0401, where a break would signal extension of losses to 1.0260. Resistance is at 1.0588.
USDCAD BEARISH As long as key resistance at 1.0050 holds, we expect downside pressure to persist. Initial support lies at 0.9873 ahead of 0.9842, the year-to-date low.
EURCHF NEUTRAL Clearance of 1.2147 would expose 1.2189. Support is at 1.2040.
EURGBP NEUTRAL Support lies at 0.8295 whereas resistance is at 0.8360.
EURJPY BULLISH The cross targets 109.93, the year-to-date high; a break here would open 110.18 and then 111.60. Support is at 107.65.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
16 March 2012 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH Outlook is bearish with focus on the Feb 16 key low of 1.2974; clearance of the level would open 1.2828. Resistance is at 1.3191.
USDJPY BULLISH USDJPY pulled back to unwind upside extremes; initial support at 82.87 ahead of 81.97. Underlying trend is bullish with initial resistance at 84.18.
GBPUSD BEARISH A move below 1.5603 would pave the way for 1.5525. Resistance is at 1.5748.
USDCHF BULLISH A rally through 0.9342 would open up the door to 0.9596, the year-to-date high. Interim resistance is at 0.9413. Support lies at 0.9140
AUDUSD BEARISH The focus is on key support at 1.0401, where a break would signal extension of losses to 1.0260. Resistance is at 1.0588.
USDCAD BEARISH As long as key resistance at 1.0050 holds, we expect downside pressure to persist. Initial support lies at 0.9873 ahead of 0.9842, the year-to-date low.
EURCHF NEUTRAL Clearance of 1.2147 would expose 1.2189. Support is at 1.2040.
EURGBP NEUTRAL Support lies at 0.8295 whereas resistance is at 0.8360.
EURJPY BULLISH The cross targets 109.93, the year-to-date high; a break here would open 110.18 and then 111.60. Support is at 107.65.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
16th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
16 March 2012 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Currency markets were mostly indecisive during the Asia session despite the brief episode of dollar buying when Richmond Fed President Lacker explained why he dissented again at Tuesday's FOMC. Even before this, Lacker had revealed his preference for a rate hike in 2013, but this time the FX reaction was more apparent. We see this as a sign that Fed policymaking has overtaken Greece-related issues, and now occupies centre stage in the minds of investors. As a result, the behaviour of US yields seems likely to become an increasingly important driver of FX markets.
Oil continues to exert a secondary influence. Newswires reported that discussions are underway to release crude from the strategic oil reserves of developed economies, but that no final decision has yet been taken. We note that the reserves were tapped last year in the wake of geopolitical tensions in Libya, to release 60 million barrels over a 30-day period. The price of crude fell sharply at the time, and we would not be surprised to see a similar reaction if the reserve is tapped again. Falling oil prices would likely push EURUSD slightly lower by reducing inflationary pressures in the Eurozone.
Meanwhile, US data continues to improve. The downtrend in US jobless claims remains intact, with the latest reading for the week of March 10 dipping further to 351k vs 357k consensus, marking a four-year low. Our analysts expect the unemployment rate to drop to 7 ?% at the end of this year, and 7 ?% at end-2013. Elsewhere, EURCHF finds itself back below 1.21 in the wake of SNB's Monetary Policy Assessment, which affirmed the need to keep the minimum exchange rate target at 1.20. Price action in EURCHF post-decision suggested there were opportunistic EURCHF longs positioned for a stronger rhetoric on the FX floor, only to be disappointed in the end. US CPI, industrial production and Michigan confidence data will be in focus today.
EUR
Our analysts have become less pessimistic on the Eurozone growth outlook for 2012. They still expect a contraction, but now only -0.4% y/y compared with their previous forecast of -0.7% y/y.
The euro got a boost when ECB Governing Council member Nowotny said the ECB is working on the design of its exit strategy so that it is ready for use when the time comes. We would not interpret these remarks as being hawkish. Instead, the comments were likely intended to be reassuring in the wake of concern over the possible dangers of ample liquidity provision. Nowotny went on to emphasise that the ECB is currently in wait-and-see mode and does see any evidence of inflationary pressures.
Referring to the bond buying facility Nowotny revealed there is a general reluctance to use it on the ECB's governing council: "I think we are all very cautious about it. It still exists, but my personal view is that it should be used with great care and with great restriction".
IMF Managing Director Lagarde said late on Thursday that there is no room for slippages in the Greek financing programme and risks are still "exceptionally high". However, she said that Greece had made "tremendous efforts" and the deficit is now reduced "markedly". This comes in the wake of official approval of a EUR 28 bn loan for Greece, in line with expectations.
In an article in the FT, former ECB Executive Board member Lorenzo Bini-Smaghi warned that Portugal and Ireland could require further funding of EUR 100 bn and EUR 80 bn, respectively. However, he also affirmed that the Greek PSI is still a special case for the Eurozone.
EU Economics Commissioner Rehn said that the Portuguese situation is very different from Greece and he "trusted the Portugal programme will remain on track".
The Eurogroup formally announced that the second bailout for Greece had been finalised, and the EFSF would now disburse EUR 39.4 bn to Greece in tranches. The Eurogroup said that this would return the Greek economy to growth and a sustainable path would be "good for everyone".
Greek Finance Minister Venizelos said he will resign after the March 18 elections for the PASOK leadership. Reuters recently reported that Greece will hold new elections by the end of April at the earliest, though this could extend into May. Greece's unemployment rate rose to 20.7% in Q4 from 17.7% in Q3 2011.
CHF
The SNB kept its policy unchanged, leaving the FX floor at 1.20. It revised its 2012 growth outlook higher to 1% from 0.5%, though the inflation path has been lowered further to -0.6% for this year, double the previous figure. The SNB warned that it was still ready to buy "unlimited quantities" of foreign currencies and the ceiling would be enforced with "utmost determination". In addition, the SNB said that it would continue to maintain liquidity in money markets and be ready to take "further measures" at any time given the high uncertainty.
Domestically, the SNB warned that there were growing signs of imbalances in the real estate market and this could spark "considerable risks". We believe the Swiss franc will continue to be driven by external rather than domestic factors. Again, the SNB will staunchly defend the floor should this become necessary, but beyond that, we do not expect any additional measures unless conditions were to take a dramatic turn for the worse. On the other hand, we continue to expect USDCHF to move higher as the Fed may have to further tone down its dovish language in view of solid economic data.
JPY
The BoJ released the minutes from its Feb. 14 policy meeting - a meeting where further easing took place and an inflation 'goal' of 1% was adopted. Despite this, "most" board members acknowledged that the bank's "basic thinking was unchanged on price stability" and that this was simply an effort to communicate more effectively.
However "a few" members felt a target of 1-2% might eventually be appropriate. One member even went so far as to suggest that the bank should aim eventually to adopt a target of 2% - specifically to bring it into line with international practice, and "so that the foreign exchange rate would not move to a long-term trend of being one-sided". We see the minutes as endorsing our view that the BoJ is likely to keep its easing bias long after other banks have begun to tighten. This backs up our call for USDJPY to push higher towards 85 in 3m.
MoF's International Transactions in Securities report showed that Japanese investors were net buyers of foreign bonds (JPY 367 bn) and money market instruments (JPY 32 bn), yet net sellers of foreign equities (JPY 49 bn) last week. In the current quarter to date, the Japanese have sold a net JPY 678 bn of foreign equities, while purchasing JPY 163 bn of foreign money market instruments - and most significantly, JPY 5.9 trn of foreign bonds, refuting any lingering fears of repatriation ahead of the fiscal year-end.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
16 March 2012 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Currency markets were mostly indecisive during the Asia session despite the brief episode of dollar buying when Richmond Fed President Lacker explained why he dissented again at Tuesday's FOMC. Even before this, Lacker had revealed his preference for a rate hike in 2013, but this time the FX reaction was more apparent. We see this as a sign that Fed policymaking has overtaken Greece-related issues, and now occupies centre stage in the minds of investors. As a result, the behaviour of US yields seems likely to become an increasingly important driver of FX markets.
Oil continues to exert a secondary influence. Newswires reported that discussions are underway to release crude from the strategic oil reserves of developed economies, but that no final decision has yet been taken. We note that the reserves were tapped last year in the wake of geopolitical tensions in Libya, to release 60 million barrels over a 30-day period. The price of crude fell sharply at the time, and we would not be surprised to see a similar reaction if the reserve is tapped again. Falling oil prices would likely push EURUSD slightly lower by reducing inflationary pressures in the Eurozone.
Meanwhile, US data continues to improve. The downtrend in US jobless claims remains intact, with the latest reading for the week of March 10 dipping further to 351k vs 357k consensus, marking a four-year low. Our analysts expect the unemployment rate to drop to 7 ?% at the end of this year, and 7 ?% at end-2013. Elsewhere, EURCHF finds itself back below 1.21 in the wake of SNB's Monetary Policy Assessment, which affirmed the need to keep the minimum exchange rate target at 1.20. Price action in EURCHF post-decision suggested there were opportunistic EURCHF longs positioned for a stronger rhetoric on the FX floor, only to be disappointed in the end. US CPI, industrial production and Michigan confidence data will be in focus today.
EUR
Our analysts have become less pessimistic on the Eurozone growth outlook for 2012. They still expect a contraction, but now only -0.4% y/y compared with their previous forecast of -0.7% y/y.
The euro got a boost when ECB Governing Council member Nowotny said the ECB is working on the design of its exit strategy so that it is ready for use when the time comes. We would not interpret these remarks as being hawkish. Instead, the comments were likely intended to be reassuring in the wake of concern over the possible dangers of ample liquidity provision. Nowotny went on to emphasise that the ECB is currently in wait-and-see mode and does see any evidence of inflationary pressures.
Referring to the bond buying facility Nowotny revealed there is a general reluctance to use it on the ECB's governing council: "I think we are all very cautious about it. It still exists, but my personal view is that it should be used with great care and with great restriction".
IMF Managing Director Lagarde said late on Thursday that there is no room for slippages in the Greek financing programme and risks are still "exceptionally high". However, she said that Greece had made "tremendous efforts" and the deficit is now reduced "markedly". This comes in the wake of official approval of a EUR 28 bn loan for Greece, in line with expectations.
In an article in the FT, former ECB Executive Board member Lorenzo Bini-Smaghi warned that Portugal and Ireland could require further funding of EUR 100 bn and EUR 80 bn, respectively. However, he also affirmed that the Greek PSI is still a special case for the Eurozone.
EU Economics Commissioner Rehn said that the Portuguese situation is very different from Greece and he "trusted the Portugal programme will remain on track".
The Eurogroup formally announced that the second bailout for Greece had been finalised, and the EFSF would now disburse EUR 39.4 bn to Greece in tranches. The Eurogroup said that this would return the Greek economy to growth and a sustainable path would be "good for everyone".
Greek Finance Minister Venizelos said he will resign after the March 18 elections for the PASOK leadership. Reuters recently reported that Greece will hold new elections by the end of April at the earliest, though this could extend into May. Greece's unemployment rate rose to 20.7% in Q4 from 17.7% in Q3 2011.
CHF
The SNB kept its policy unchanged, leaving the FX floor at 1.20. It revised its 2012 growth outlook higher to 1% from 0.5%, though the inflation path has been lowered further to -0.6% for this year, double the previous figure. The SNB warned that it was still ready to buy "unlimited quantities" of foreign currencies and the ceiling would be enforced with "utmost determination". In addition, the SNB said that it would continue to maintain liquidity in money markets and be ready to take "further measures" at any time given the high uncertainty.
Domestically, the SNB warned that there were growing signs of imbalances in the real estate market and this could spark "considerable risks". We believe the Swiss franc will continue to be driven by external rather than domestic factors. Again, the SNB will staunchly defend the floor should this become necessary, but beyond that, we do not expect any additional measures unless conditions were to take a dramatic turn for the worse. On the other hand, we continue to expect USDCHF to move higher as the Fed may have to further tone down its dovish language in view of solid economic data.
JPY
The BoJ released the minutes from its Feb. 14 policy meeting - a meeting where further easing took place and an inflation 'goal' of 1% was adopted. Despite this, "most" board members acknowledged that the bank's "basic thinking was unchanged on price stability" and that this was simply an effort to communicate more effectively.
However "a few" members felt a target of 1-2% might eventually be appropriate. One member even went so far as to suggest that the bank should aim eventually to adopt a target of 2% - specifically to bring it into line with international practice, and "so that the foreign exchange rate would not move to a long-term trend of being one-sided". We see the minutes as endorsing our view that the BoJ is likely to keep its easing bias long after other banks have begun to tighten. This backs up our call for USDJPY to push higher towards 85 in 3m.
MoF's International Transactions in Securities report showed that Japanese investors were net buyers of foreign bonds (JPY 367 bn) and money market instruments (JPY 32 bn), yet net sellers of foreign equities (JPY 49 bn) last week. In the current quarter to date, the Japanese have sold a net JPY 678 bn of foreign equities, while purchasing JPY 163 bn of foreign money market instruments - and most significantly, JPY 5.9 trn of foreign bonds, refuting any lingering fears of repatriation ahead of the fiscal year-end.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Thursday, March 15, 2012
15th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
15 March 2012 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH The pair targets 1.2974, the Feb. 16 key low, a break below which would signal scope for deeper pull back towards 1.2828. Resistance is at 1.3191.
USDJPY BULLISH Recent sharp rally has cleared 83.74 and opened the way towards 85.53, the 2011 high. Interim resistance is at 84.79 and support lies at 83.65.
GBPUSD BEARISH Decline through 1.5603 would pave the way for 1.5525. Resistances are at 1.5748.
USDCHF BULLISH Clearance of 0.9300 has opened 0.9342 ahead of 0.9439. Support lies at 0.9229.
AUDUSD BEARISH Yesterday's sharp fall through 1.0428 has shifted our focus on 1.0359. Next support is at 1.0303 and resistance is at 1.0577.
USDCAD BEARISH Support lies at 0.9873 ahead of 0.9842, the year-to-date low. Resistance is at 0.9951.
EURCHF BULLISH The cross has cleared 1.2133 and resistance is now at 1.2147 and 1.2189. Support is at 1.2100.
EURGBP NEUTRAL The cross continues to test 0.8314, the March low; a clear break below this would open 0.8265. Resistance is at 0.8360.
EURJPY BULLISH Break above 109.93, the year-to-date high, would open 111.60. Support is at 107.52.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
15 March 2012 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH The pair targets 1.2974, the Feb. 16 key low, a break below which would signal scope for deeper pull back towards 1.2828. Resistance is at 1.3191.
USDJPY BULLISH Recent sharp rally has cleared 83.74 and opened the way towards 85.53, the 2011 high. Interim resistance is at 84.79 and support lies at 83.65.
GBPUSD BEARISH Decline through 1.5603 would pave the way for 1.5525. Resistances are at 1.5748.
USDCHF BULLISH Clearance of 0.9300 has opened 0.9342 ahead of 0.9439. Support lies at 0.9229.
AUDUSD BEARISH Yesterday's sharp fall through 1.0428 has shifted our focus on 1.0359. Next support is at 1.0303 and resistance is at 1.0577.
USDCAD BEARISH Support lies at 0.9873 ahead of 0.9842, the year-to-date low. Resistance is at 0.9951.
EURCHF BULLISH The cross has cleared 1.2133 and resistance is now at 1.2147 and 1.2189. Support is at 1.2100.
EURGBP NEUTRAL The cross continues to test 0.8314, the March low; a clear break below this would open 0.8265. Resistance is at 0.8360.
EURJPY BULLISH Break above 109.93, the year-to-date high, would open 111.60. Support is at 107.52.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
15th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
15 March 2012 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Broad USD strength amid the post-FOMC rise in US Tresury yields remains the dominant theme. While USDJPY broke above 84 in the Asia session, EURUSD is threatening to slip through 1.30. Although Japanese bonds were under pressure, USDJPY was driven by the widening 2y UST-JGB yield spread on expectations of a Fed-BoJ policy divergence. USDJPY still has upside risk, with the Fed backing away from more QE and BoJ boasting plenty of room to expand, amend, and extend its Asset Purchase Programme (APP) as early as next month - perhaps in conjunction with the release of its Outlook Report on April 27.
Repatriation flows are not yet prominent in the run-up to the March 31 book closing in Japan. MoF data released earlier today confirmed that Japanese investors purchased a net Y 367 bn of foreign bonds last week. Japan names bought foreign bonds worth JPY5.9 trn in 9 of the 10 weeks through March 9. Although Fitch's downgrade of UK ratings outlook to negative from stable didn't add anything new to the equation, cable dipped below 1.5640 and traded heavy.
EURCHF continues to hold above 1.21 after its sudden jump yesterday, with the policy spotlight now on the SNB's quarterly Monetary Policy Assessment. While the SNB may upgrade its growth view alongside a downward revision to the short-term inflation outlook, our baseline scenario assumes the 1.20 floor will remain in place for at least the next 6 months. Apart from our long CADCHF recommendation via a call spread, playing Swiss franc weakness against the US dollar looks attractive. Our central view remains the same: the US dollar and related currencies (CAD, MXN) will continue to performer well as Fed keeps rates on hold and other central banks try taming their currencies ( JPY, CHF). USDJPY traded between 83.65 and 84.18 in the Asia session, with EURUSD at 1.3004-1.3039.
EUR
EU HICP was confirmed at 0.5% m/m and 2.7% y/y for February. Core inflation remained stable at 1.5% y/y (vs the UBS and consensus estimates of 1.6% y/y). EU industrial production for January disappointed, with the 0.2% m/m increase feeding into a 1.2% y/y decline.
The Eurogroup formally announced that the second bailout for Greece had been finalised, and the EFSF would now disburse EUR 39.4 bn to Greece in tranches. The Eurogroup said that this would return the Greek economy to growth and a sustainable path would be "good for everyone".
Italy sold EUR 6 bn in BTPs, at the maximum level targeted. The indicative levels note that borrowing costs on three-year debt are now the lowest in close to 18 months and demand appears resilient.
EU Economics Commissioner Rehn said that the Portuguese situation is very different from Greece and he "trusted the Portugal programme will remain on track". The comments were likely made to allay fears of a PSI for the country.
GBP
Fitch revised the UK's ratings outlook to negative, bringing it in line with Moody's. The agency affirmed that the UK's current fiscal consolidation plan is "credible", but also said the outlook revision is a warning "to anyone who believes there can be deficit-financed giveaway in the UK budget".
UK labour market data for February showed that claimant count unemployment was up by 7.2k, higher than market expectations of 6.0k and the previous 7.0k. Wage growth at 1.4% y/y was much lower than the 1.9% y/y anticipated by markets. Wages ex-bonuses, i.e. underlying wages, expanded by 1.7% y/y instead of the 1.9% y/y expected and the previous 2.0% y/y result.
On the more positive side, the number of people in employment rose by 9k in the 3 months to January, compared with the 3m to October. The ILO unemployment rate (3m) was steady at 8.4% in January..
JPY
MoF's International Transactions in Securities report showed that Japanese investors were net buyers of foreign bonds (JPY 367 bn) and money market instruments (JPY 32 bn), yet net sellers of foreign equities (JPY 49 bn) last week. In the current quarter to date, the Japanese have sold a net JPY 678 bn of foreign equities, while purchasing JPY 163 bn of foreign money market instruments - and most significantly, JPY 5.9 trn of foreign bonds, refuting any lingering fears of repatriation ahead of the fiscal year-end.
The Business Outlook Survey revealed sluggish sentiment in Q1, with the all-industry business conditions DI for large firms coming in at -2.7 after the -2.5 result registered in the previous quarter. The manufacturing index was conspicuously soft at -7.3, reflecting the weakness in exports in the face of the strong yen, weak demand conditions in Europe, and the Chinese New Year. The non-manufacturing DI was far less depressed at -0.1. Growth bulls could at least seek comfort in the outlook DIs, which were more positive for all industries (+1.3 for Q2 and +7.3 for Q3), manufacturers (+2.3 and +9.2), and non-manufacturers (+0.7 and +6.3). Also note that the bulk of the responses were received by February 15, before USDJPY rebounded over the 80 level. Nonetheless, the survey results were far from strong, with smaller firms continuing to lag well behind their larger counterparts.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
15 March 2012 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
Broad USD strength amid the post-FOMC rise in US Tresury yields remains the dominant theme. While USDJPY broke above 84 in the Asia session, EURUSD is threatening to slip through 1.30. Although Japanese bonds were under pressure, USDJPY was driven by the widening 2y UST-JGB yield spread on expectations of a Fed-BoJ policy divergence. USDJPY still has upside risk, with the Fed backing away from more QE and BoJ boasting plenty of room to expand, amend, and extend its Asset Purchase Programme (APP) as early as next month - perhaps in conjunction with the release of its Outlook Report on April 27.
Repatriation flows are not yet prominent in the run-up to the March 31 book closing in Japan. MoF data released earlier today confirmed that Japanese investors purchased a net Y 367 bn of foreign bonds last week. Japan names bought foreign bonds worth JPY5.9 trn in 9 of the 10 weeks through March 9. Although Fitch's downgrade of UK ratings outlook to negative from stable didn't add anything new to the equation, cable dipped below 1.5640 and traded heavy.
EURCHF continues to hold above 1.21 after its sudden jump yesterday, with the policy spotlight now on the SNB's quarterly Monetary Policy Assessment. While the SNB may upgrade its growth view alongside a downward revision to the short-term inflation outlook, our baseline scenario assumes the 1.20 floor will remain in place for at least the next 6 months. Apart from our long CADCHF recommendation via a call spread, playing Swiss franc weakness against the US dollar looks attractive. Our central view remains the same: the US dollar and related currencies (CAD, MXN) will continue to performer well as Fed keeps rates on hold and other central banks try taming their currencies ( JPY, CHF). USDJPY traded between 83.65 and 84.18 in the Asia session, with EURUSD at 1.3004-1.3039.
EUR
EU HICP was confirmed at 0.5% m/m and 2.7% y/y for February. Core inflation remained stable at 1.5% y/y (vs the UBS and consensus estimates of 1.6% y/y). EU industrial production for January disappointed, with the 0.2% m/m increase feeding into a 1.2% y/y decline.
The Eurogroup formally announced that the second bailout for Greece had been finalised, and the EFSF would now disburse EUR 39.4 bn to Greece in tranches. The Eurogroup said that this would return the Greek economy to growth and a sustainable path would be "good for everyone".
Italy sold EUR 6 bn in BTPs, at the maximum level targeted. The indicative levels note that borrowing costs on three-year debt are now the lowest in close to 18 months and demand appears resilient.
EU Economics Commissioner Rehn said that the Portuguese situation is very different from Greece and he "trusted the Portugal programme will remain on track". The comments were likely made to allay fears of a PSI for the country.
GBP
Fitch revised the UK's ratings outlook to negative, bringing it in line with Moody's. The agency affirmed that the UK's current fiscal consolidation plan is "credible", but also said the outlook revision is a warning "to anyone who believes there can be deficit-financed giveaway in the UK budget".
UK labour market data for February showed that claimant count unemployment was up by 7.2k, higher than market expectations of 6.0k and the previous 7.0k. Wage growth at 1.4% y/y was much lower than the 1.9% y/y anticipated by markets. Wages ex-bonuses, i.e. underlying wages, expanded by 1.7% y/y instead of the 1.9% y/y expected and the previous 2.0% y/y result.
On the more positive side, the number of people in employment rose by 9k in the 3 months to January, compared with the 3m to October. The ILO unemployment rate (3m) was steady at 8.4% in January..
JPY
MoF's International Transactions in Securities report showed that Japanese investors were net buyers of foreign bonds (JPY 367 bn) and money market instruments (JPY 32 bn), yet net sellers of foreign equities (JPY 49 bn) last week. In the current quarter to date, the Japanese have sold a net JPY 678 bn of foreign equities, while purchasing JPY 163 bn of foreign money market instruments - and most significantly, JPY 5.9 trn of foreign bonds, refuting any lingering fears of repatriation ahead of the fiscal year-end.
The Business Outlook Survey revealed sluggish sentiment in Q1, with the all-industry business conditions DI for large firms coming in at -2.7 after the -2.5 result registered in the previous quarter. The manufacturing index was conspicuously soft at -7.3, reflecting the weakness in exports in the face of the strong yen, weak demand conditions in Europe, and the Chinese New Year. The non-manufacturing DI was far less depressed at -0.1. Growth bulls could at least seek comfort in the outlook DIs, which were more positive for all industries (+1.3 for Q2 and +7.3 for Q3), manufacturers (+2.3 and +9.2), and non-manufacturers (+0.7 and +6.3). Also note that the bulk of the responses were received by February 15, before USDJPY rebounded over the 80 level. Nonetheless, the survey results were far from strong, with smaller firms continuing to lag well behind their larger counterparts.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Wednesday, March 14, 2012
14th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
14 March 2012 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH The pair targets 1.2974, the key low from the Feb. 16, a break below which would signal scope for deeper pull back towards 1.2828. Resistance is at 1.3191.
USDJPY BULLISH Next resistance is at 83.74 where a break would open the way towards 85.53, the April 2011 high. Support lies at 82.87.
GBPUSD BEARISH Decline through 1.5603 would pave the way for 1.5525. Resistance is at 1.5748.
USDCHF BULLISH The pair tests the resistance at 0.9263 a clearance of which would expose the February failure high at 0.9300. Support lies at 0.9140.
AUDUSD BEARISH Next supports are at 1.0474 and 1.0428. Resistance is at 1.0577.
USDCAD BEARISH Support lies at 0.9873 ahead of 0.9842, the year-to-date low. Resistance is at 0.9951.
EURCHF NEUTRAL Yesterday's rally now targets 1.2114 ahead of 1.2133. Support is at 1.2047.
EURGBP NEUTRAL Our focus is on the key support at 0.8314, the March low. A break below this would open 0.8265. Resistance is at 0.8424.
EURJPY BULLISH The cross tests 108.74, a closing break above this would open 109.93, the year-to-date high. Support is at 107.52.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
14 March 2012 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH The pair targets 1.2974, the key low from the Feb. 16, a break below which would signal scope for deeper pull back towards 1.2828. Resistance is at 1.3191.
USDJPY BULLISH Next resistance is at 83.74 where a break would open the way towards 85.53, the April 2011 high. Support lies at 82.87.
GBPUSD BEARISH Decline through 1.5603 would pave the way for 1.5525. Resistance is at 1.5748.
USDCHF BULLISH The pair tests the resistance at 0.9263 a clearance of which would expose the February failure high at 0.9300. Support lies at 0.9140.
AUDUSD BEARISH Next supports are at 1.0474 and 1.0428. Resistance is at 1.0577.
USDCAD BEARISH Support lies at 0.9873 ahead of 0.9842, the year-to-date low. Resistance is at 0.9951.
EURCHF NEUTRAL Yesterday's rally now targets 1.2114 ahead of 1.2133. Support is at 1.2047.
EURGBP NEUTRAL Our focus is on the key support at 0.8314, the March low. A break below this would open 0.8265. Resistance is at 0.8424.
EURJPY BULLISH The cross tests 108.74, a closing break above this would open 109.93, the year-to-date high. Support is at 107.52.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
14th of March 2012 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
14 March 2012 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The US yield curve was prodded into life by last night's FOMC policy statement. US 2y yields climbed above 35 bp overnight and the 10y has finally hit 2.15%. This kept the yen in particular on the defensive, and the dollar also advanced more generally. USDJPY set an 11-month high trading between 82.68-83.32. Yesterday's Fed and BoJ policy meetings suggest a gradual Fed-BoJ divergence should manifest itself over the months ahead and this should keep USDJPY risks skewed to the upside. Notably, the FOMC upgraded assessments of the US labour market plus capex, and no longer cited "slowing in global growth". Perhaps more importantly, the FOMC now foresees "moderate economic growth" in the longer run, a step up from "modest" previously. Though the late 2014 rate guidance was reaffirmed, US dollar bulls could glean encouragement from the fact that there was no move toward any further QE.
Our team expects the Fed to stay on hold well into next year, before hiking rates in H2 2013. The BoJ is unlikely to be in such a position. Yesterday's decision to leave the Asset Purchase Programme (APP) unchanged should not obscure the easing bias evident in the expansion and extension of the special lending facility for growth industries, not to mention the dissent from Board member Ryuzo Miyao, who proposed a JPY 5 trn boost to the APP. The policy spotlight now shifts to Norges Bank's meeting later today. We expect no change in the headline policy rate, but anticipate significant verbal intervention by Governor Olsen on the strong currency. Overnight, EURUSD traded at 1.3031-1.3121. Finally, our latest fundamental trade recommendation advocates the purchase of a 2-month CADCHF call spread.
EUR
The German ZEW survey was generally mixed. The current situation index was softer than consensus at 37.6, while the economic sentiment reading was stronger at 22.3. Our European economists highlighted the big shift in the inflation outlook as well. For Europe, the balance of opinion changed (by +33.5 points) towards higher inflation over the next 6 months. Consequently, the short rate outlook also increased by 16.2 points.
JPY
The BoJ's monthly report of 'Recent Economic and Financial Developments' acknowledged the yen's latest fall and noted that if yen's decline is sustained it will ease pressure on exports. It also forecast a return to economic growth in Q1 which is likely to continue into Q2.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
14 March 2012 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
WORLD
The US yield curve was prodded into life by last night's FOMC policy statement. US 2y yields climbed above 35 bp overnight and the 10y has finally hit 2.15%. This kept the yen in particular on the defensive, and the dollar also advanced more generally. USDJPY set an 11-month high trading between 82.68-83.32. Yesterday's Fed and BoJ policy meetings suggest a gradual Fed-BoJ divergence should manifest itself over the months ahead and this should keep USDJPY risks skewed to the upside. Notably, the FOMC upgraded assessments of the US labour market plus capex, and no longer cited "slowing in global growth". Perhaps more importantly, the FOMC now foresees "moderate economic growth" in the longer run, a step up from "modest" previously. Though the late 2014 rate guidance was reaffirmed, US dollar bulls could glean encouragement from the fact that there was no move toward any further QE.
Our team expects the Fed to stay on hold well into next year, before hiking rates in H2 2013. The BoJ is unlikely to be in such a position. Yesterday's decision to leave the Asset Purchase Programme (APP) unchanged should not obscure the easing bias evident in the expansion and extension of the special lending facility for growth industries, not to mention the dissent from Board member Ryuzo Miyao, who proposed a JPY 5 trn boost to the APP. The policy spotlight now shifts to Norges Bank's meeting later today. We expect no change in the headline policy rate, but anticipate significant verbal intervention by Governor Olsen on the strong currency. Overnight, EURUSD traded at 1.3031-1.3121. Finally, our latest fundamental trade recommendation advocates the purchase of a 2-month CADCHF call spread.
EUR
The German ZEW survey was generally mixed. The current situation index was softer than consensus at 37.6, while the economic sentiment reading was stronger at 22.3. Our European economists highlighted the big shift in the inflation outlook as well. For Europe, the balance of opinion changed (by +33.5 points) towards higher inflation over the next 6 months. Consequently, the short rate outlook also increased by 16.2 points.
JPY
The BoJ's monthly report of 'Recent Economic and Financial Developments' acknowledged the yen's latest fall and noted that if yen's decline is sustained it will ease pressure on exports. It also forecast a return to economic growth in Q1 which is likely to continue into Q2.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
Tuesday, March 13, 2012
13th of March 2012 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
13 March 2012 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH Support is at 1.3079 ahead of 1.2974, the Feb. 16 key low. Resistance is at 1.3291.
USDJPY BULLISH Focus is now on 82.65, a break here would open 83.13 next. Support lies at 81.87.
GBPUSD BEARISH Decline through 1.5603 would expose 1.5525. Resistance is at 1.5834.
USDCHF NEUTRAL Initial support lies at 0.9072 ahead of 0.9022. Resistances are at 0.9219 and 0.9300.
AUDUSD BEARISH Next supports are at 1.0474 and 1.0428. Resistance is at 1.0577.
USDCAD BEARISH Support lies at 0.9873 ahead of 0.9842, the year-to-date low. Resistance is at 0.9969.
EURCHF NEUTRAL The cross continues to trade choppy in a narrow range. Resistance is at 1.2084 and support is at 1.2040.
EURGBP BULLISH Break above 0.8410 has opened the way towards 0.8433 and 0.8461. Support lies at 0.8343.
EURJPY BULLISH The cross targets 108.74, a break above which would open 109.93, the year-to-date high. Support is at 106.60.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
13 March 2012 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD BEARISH Support is at 1.3079 ahead of 1.2974, the Feb. 16 key low. Resistance is at 1.3291.
USDJPY BULLISH Focus is now on 82.65, a break here would open 83.13 next. Support lies at 81.87.
GBPUSD BEARISH Decline through 1.5603 would expose 1.5525. Resistance is at 1.5834.
USDCHF NEUTRAL Initial support lies at 0.9072 ahead of 0.9022. Resistances are at 0.9219 and 0.9300.
AUDUSD BEARISH Next supports are at 1.0474 and 1.0428. Resistance is at 1.0577.
USDCAD BEARISH Support lies at 0.9873 ahead of 0.9842, the year-to-date low. Resistance is at 0.9969.
EURCHF NEUTRAL The cross continues to trade choppy in a narrow range. Resistance is at 1.2084 and support is at 1.2040.
EURGBP BULLISH Break above 0.8410 has opened the way towards 0.8433 and 0.8461. Support lies at 0.8343.
EURJPY BULLISH The cross targets 108.74, a break above which would open 109.93, the year-to-date high. Support is at 106.60.
SCHEDULE
Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.
A. White
Analyst at Fibosignals.com
DISCLAIMER: Fibosignals.com’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.
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