DAILY MARKET COMMENTARY
29 July 2011 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURCHF 1.1374 key support.
EURUSD BULLISH A move above 1.4401 would reinforce the bull trend; next resistance comes in at 1.4536. Initial support is at 1.4187, Fibonacci level.
USDJPY BEARISH Pressure on initial support at 77.39, a move below which would expose 76.25, the key low. Resistance is at 78.17.
GBPUSD BULLISH Clearance of 1.6442 would open 1.6496. Support lies at 1.6262.
USDCHF BEARISH Support lies at 0.7927, a push below which would expose 0.7705, a channel lower drawn off Feb 11 high. Resistance is at 0.8178.
AUDUSD BULLISH Initial resistance is at 1.1081, a break of which would open the way towards 1.1198. Initial support lies at 1.0796.
USDCAD BEARISH A push through 0.9458 would expose 0.9407. Near-term resistance is at 0.9531.
EURCHF BEARISH Key support is at 1.1374, a fall below this would signal weakness towards 1.1288. Near-term resistance is at 1.1663.
EURGBP BEARISH Move below 0.8705 would open the way for further losses towards 0.8657. Resistance is at 0.8806.
EURJPY BEARISH Violation of 110.66 would expose support at 109.58, a key low. Initial resistance is at 112.10.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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, July 29, 2011
29th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
29 July 2011 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The House postponed its vote on the Boehner plan, first until Thursday night, and then indefinitely. USDJPY fell quite significantly on the headline. During the Asia session, EURUSD traded 1.4281-1.4364 and USDJPY traded 77.46-77.87. House Republicans are now due to meet at 1500GMT on Friday to discuss a way forward, which suggests that no House vote is likely before then. The vote itself is likely to be symbolic as Democrats in the Senate have vowed to kill the measure. House Majority Leader Cantor has already said that the Senate plans on being in session during the weekend.
On the data front, US jobless claims were better than expected at 398k, while Pending Home Sales came in better at 2.4%m/m (cons. -2.0%). Although the economic outlook for the US remains troubling, there is no concise evidence that a major downturn is afoot, though many policymakers have warned that failure to raise the debt ceiling and potential disruptions could further undermine the economy. Ahead on Friday investors will continue to follow the US debt ceiling debate, but the data focus will be on US GDP (UBSe. 2.0%q/q) and the Chicago PMI.
EUR
Moody's put Spain's Aa2 on review for a possible downgrade, noting that any actual downgrade would likely be one notch only. S&P currently rates Spain at the same level (AA), while Fitch's rating on Spain is one notch higher (AA+). Moody's cited the increased vulnerability of government finances, and the risk that the recent increases in funding costs will be sustained.
German and French Finance Ministers published a joint article in the Financial Times, stressing the importance of the EFSF's new capabilities, but more importantly displaying a united front and sending a message to investors that the Eurozone's core members remain ready to defend the currency union at all costs.
German unemployment in July fell 11k, slightly lesser than expectations for a fall of 15k. However, the unemployment rate was unchanged at 7.0%.
ECB's Mersch says ECB must prevent second-round effects, and suggested that commodity-price inflation may be more persistent. This falls in line with recent hawkish rhetoric from other ECB members.
JPY
The rhetoric of Finance Minister Noda escalated a notch overnight, but USDJPY still took no notice. He said the yen is strengthening too much, and that has deviated from Japan's economic fundamentals. He added that he hopes to take appropriate action in cooperation with the BoJ on the yen's rise. Implying that his patience was wearing thin he said he will carefully examine how long Japan can leave the latest FX moves unattended.
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 July 2011 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The House postponed its vote on the Boehner plan, first until Thursday night, and then indefinitely. USDJPY fell quite significantly on the headline. During the Asia session, EURUSD traded 1.4281-1.4364 and USDJPY traded 77.46-77.87. House Republicans are now due to meet at 1500GMT on Friday to discuss a way forward, which suggests that no House vote is likely before then. The vote itself is likely to be symbolic as Democrats in the Senate have vowed to kill the measure. House Majority Leader Cantor has already said that the Senate plans on being in session during the weekend.
On the data front, US jobless claims were better than expected at 398k, while Pending Home Sales came in better at 2.4%m/m (cons. -2.0%). Although the economic outlook for the US remains troubling, there is no concise evidence that a major downturn is afoot, though many policymakers have warned that failure to raise the debt ceiling and potential disruptions could further undermine the economy. Ahead on Friday investors will continue to follow the US debt ceiling debate, but the data focus will be on US GDP (UBSe. 2.0%q/q) and the Chicago PMI.
EUR
Moody's put Spain's Aa2 on review for a possible downgrade, noting that any actual downgrade would likely be one notch only. S&P currently rates Spain at the same level (AA), while Fitch's rating on Spain is one notch higher (AA+). Moody's cited the increased vulnerability of government finances, and the risk that the recent increases in funding costs will be sustained.
German and French Finance Ministers published a joint article in the Financial Times, stressing the importance of the EFSF's new capabilities, but more importantly displaying a united front and sending a message to investors that the Eurozone's core members remain ready to defend the currency union at all costs.
German unemployment in July fell 11k, slightly lesser than expectations for a fall of 15k. However, the unemployment rate was unchanged at 7.0%.
ECB's Mersch says ECB must prevent second-round effects, and suggested that commodity-price inflation may be more persistent. This falls in line with recent hawkish rhetoric from other ECB members.
JPY
The rhetoric of Finance Minister Noda escalated a notch overnight, but USDJPY still took no notice. He said the yen is strengthening too much, and that has deviated from Japan's economic fundamentals. He added that he hopes to take appropriate action in cooperation with the BoJ on the yen's rise. Implying that his patience was wearing thin he said he will carefully examine how long Japan can leave the latest FX moves unattended.
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, July 28, 2011
28th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
28 July 2011 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURCHF support 1.1374
EURUSD BULLISH Key resistance is at 1.4578; a break above this would open up 1.4697. Initial support lies at 1.4269.
USDJPY BEARISH A move below 77.41 would expose 76.25, a key low. Resistance is at 78.70.
GBPUSD BULLISH Clearance of 1.6442 would open 1.6496. Support lies at 1.6262.
USDCHF BEARISH Watch for a clear break of 0.8000, psychological level, to extend weakness towards 0.7927. Resistance is at 0.8178.
AUDUSD BULLISH The pair extends gains; resistance is at 1.1081, a clearance of which would pave the way towards 1.1198. Initial support lies at 1.0943.
USDCAD BEARISH Initial support lies at 0.9407, a break below which would expose 0.9385. Near-term resistance is at 0.9531.
EURCHF BEARISH Momentum is negative; focus is on 1.1374 where a break would open 1.1288. Initial resistance is at 1.1663.
EURGBP BEARISH Break of 0.8705 would confirm the bear trend opening 0.8657 next. Resistance is at 0.8848.
EURJPY BEARISH While resistance at 113.66 remain intact, expect a decline towards 111.46 ahead of 110.66.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURCHF support 1.1374
EURUSD BULLISH Key resistance is at 1.4578; a break above this would open up 1.4697. Initial support lies at 1.4269.
USDJPY BEARISH A move below 77.41 would expose 76.25, a key low. Resistance is at 78.70.
GBPUSD BULLISH Clearance of 1.6442 would open 1.6496. Support lies at 1.6262.
USDCHF BEARISH Watch for a clear break of 0.8000, psychological level, to extend weakness towards 0.7927. Resistance is at 0.8178.
AUDUSD BULLISH The pair extends gains; resistance is at 1.1081, a clearance of which would pave the way towards 1.1198. Initial support lies at 1.0943.
USDCAD BEARISH Initial support lies at 0.9407, a break below which would expose 0.9385. Near-term resistance is at 0.9531.
EURCHF BEARISH Momentum is negative; focus is on 1.1374 where a break would open 1.1288. Initial resistance is at 1.1663.
EURGBP BEARISH Break of 0.8705 would confirm the bear trend opening 0.8657 next. Resistance is at 0.8848.
EURJPY BEARISH While resistance at 113.66 remain intact, expect a decline towards 111.46 ahead of 110.66.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
28 July 2011 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The RBNZ kept the OCR steady at 2.5%, but pointed to the need for a near-term rate hike. Other than that, there was very little fresh news during the Asia session. The White House and Congress remain deadlocked in talks over the debt ceiling, and there does not appear to be any clear consensus on which deal, if any, has the best chance of being passed before August 2. The plan offered by Speaker Boehner appears to be falling out of favour as the President has suggested it would be vetoed, while the Congressional Budget Office warned that savings would not be as high as claimed. The White House noted that Congress is still expected to act decisively and a message must be sent to the world that "the US pays on time". Investors are becoming more nervous, with equities leading the way - the S&P was down 2% and Asian equities have followed suit. On the data front, the Fed's Beige Book showed the US economy slowed in 8 out of the 12 regions. EURUSD traded 1.4330-1.4377 and USDJPY traded 77.73-78.15.
EUR
The ECB's Provopoulos said that Greece should aim to exceed its budget goals as exceeding targets would help win market trust. He also said that monetary policy is 'still very accommodative'.
ECB President Trichet said that speculating on a Greek default would be 'a sure-fire way of losing money given the decisions taken last Thursday.' However, he then toned down his comments and said that what was critical was for Greece to implement all that it had agreed to, to rebalance its economy.
Unnamed Reuters sources said that the EFSF is likely to conduct the Greek buybacks itself, rather than Greece. It appears buybacks will focus on bonds trading at less than 65% and the buyback won't be limited to the EUR20 bn figure indicated at the leaders' summit. We believe this is important in light of Greek PM Papandreou's comments earlier - that the loans are indeed the first stages of common issuance.
German preliminary CPI for July increased to +2.4% y/y, in line with consensus. Inflation expectations and short-term rates have eased over the last few weeks, indicating that price pressures are not a big issue for the market anymore. The wider Eurozone CPI figure is due for release on Friday.
German Finance Minister Schaeuble said the government rejects a 'carte blanche' for secondary bond market purchases by EFSF/ESM and added that it would be wrong to think that the Eurozone crisis could be permanently solved by a one-off summit. This suggests that further policy announcements may be likely and implementation risks are significant..
JPY
Reuters reported that Economy Minister Yosano had said at a meeting with the governor of a Japanese prefecture that FX intervention of the order of JPY1-2 trn would be quite difficult. He also reportedly said that FX intervention would be unlikely before Aug 2. We note that on Sept. 15, the BoJ sold Y2.1 trn worth of yen, and on March 18 they sold just under Y0.7 trn.
GBP
MPC member David Miles offered no real change in tone, suggesting that the UK economy could fall back into recession, although this is not the base case. He also said that inflation is likely to remain above target through 2011 and much of 2012, but action now risks undesirable output volatility.
NZD
The RBNZ kept the policy rate unchanged at 2.5%. Governor Bollard did point to the possibility of an early hike though, noting there was "little need" for the previous "insurance" cut of 50bp "to remain in place much longer". Looking even further ahead, he said the strong NZD would reduce the need for additional hikes.
In response to the overnight policy statement, our New Zealand economist brought forward his RBNZ hike call - he now thinks RBNZ to hike by 50bp in Dec. 2011 (previously March 2012).
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 July 2011 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The RBNZ kept the OCR steady at 2.5%, but pointed to the need for a near-term rate hike. Other than that, there was very little fresh news during the Asia session. The White House and Congress remain deadlocked in talks over the debt ceiling, and there does not appear to be any clear consensus on which deal, if any, has the best chance of being passed before August 2. The plan offered by Speaker Boehner appears to be falling out of favour as the President has suggested it would be vetoed, while the Congressional Budget Office warned that savings would not be as high as claimed. The White House noted that Congress is still expected to act decisively and a message must be sent to the world that "the US pays on time". Investors are becoming more nervous, with equities leading the way - the S&P was down 2% and Asian equities have followed suit. On the data front, the Fed's Beige Book showed the US economy slowed in 8 out of the 12 regions. EURUSD traded 1.4330-1.4377 and USDJPY traded 77.73-78.15.
EUR
The ECB's Provopoulos said that Greece should aim to exceed its budget goals as exceeding targets would help win market trust. He also said that monetary policy is 'still very accommodative'.
ECB President Trichet said that speculating on a Greek default would be 'a sure-fire way of losing money given the decisions taken last Thursday.' However, he then toned down his comments and said that what was critical was for Greece to implement all that it had agreed to, to rebalance its economy.
Unnamed Reuters sources said that the EFSF is likely to conduct the Greek buybacks itself, rather than Greece. It appears buybacks will focus on bonds trading at less than 65% and the buyback won't be limited to the EUR20 bn figure indicated at the leaders' summit. We believe this is important in light of Greek PM Papandreou's comments earlier - that the loans are indeed the first stages of common issuance.
German preliminary CPI for July increased to +2.4% y/y, in line with consensus. Inflation expectations and short-term rates have eased over the last few weeks, indicating that price pressures are not a big issue for the market anymore. The wider Eurozone CPI figure is due for release on Friday.
German Finance Minister Schaeuble said the government rejects a 'carte blanche' for secondary bond market purchases by EFSF/ESM and added that it would be wrong to think that the Eurozone crisis could be permanently solved by a one-off summit. This suggests that further policy announcements may be likely and implementation risks are significant..
JPY
Reuters reported that Economy Minister Yosano had said at a meeting with the governor of a Japanese prefecture that FX intervention of the order of JPY1-2 trn would be quite difficult. He also reportedly said that FX intervention would be unlikely before Aug 2. We note that on Sept. 15, the BoJ sold Y2.1 trn worth of yen, and on March 18 they sold just under Y0.7 trn.
GBP
MPC member David Miles offered no real change in tone, suggesting that the UK economy could fall back into recession, although this is not the base case. He also said that inflation is likely to remain above target through 2011 and much of 2012, but action now risks undesirable output volatility.
NZD
The RBNZ kept the policy rate unchanged at 2.5%. Governor Bollard did point to the possibility of an early hike though, noting there was "little need" for the previous "insurance" cut of 50bp "to remain in place much longer". Looking even further ahead, he said the strong NZD would reduce the need for additional hikes.
In response to the overnight policy statement, our New Zealand economist brought forward his RBNZ hike call - he now thinks RBNZ to hike by 50bp in Dec. 2011 (previously March 2012).
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, July 27, 2011
27th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
27 July 2011 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
AUDUSD clears 1.1012
EURUSD BULLISH While support lies at 1.4324, a break above 1.4578 would signal extension of gains towards 1.4697.
USDJPY BEARISH Momentum is negative; scope for further weakness towards 77.41 ahead of 76.25, a key low. Resistance is at 78.70.
GBPUSD BULLISH A clearance of 1.6473 would open 1.6547. Initial support lies at 1.6262.
USDCHF BEARISH Watch for a clear break of 0.8000, psychological level, to extend weakness towards 0.7927. Resistance is at 0.8178.
AUDUSD BULLISH Rise through 1.1012 has paved the way towards 1.1198. Support lies at 1.0944.
USDCAD BEARISH Initial support lies at 0.9385 ahead of 0.9252. Near-term resistance is at 0.9531.
EURCHF BEARISH Violation of 1.1496 would expose 1.1374. Initial resistance is at 1.1781.
EURGBP NEUTRAL Near-term directional triggers are at 0.8895 and 0.8798.
EURJPY BEARISH While resistance at 113.66 remain intact, expect a decline towards 112.04 ahead of 111.46.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
AUDUSD clears 1.1012
EURUSD BULLISH While support lies at 1.4324, a break above 1.4578 would signal extension of gains towards 1.4697.
USDJPY BEARISH Momentum is negative; scope for further weakness towards 77.41 ahead of 76.25, a key low. Resistance is at 78.70.
GBPUSD BULLISH A clearance of 1.6473 would open 1.6547. Initial support lies at 1.6262.
USDCHF BEARISH Watch for a clear break of 0.8000, psychological level, to extend weakness towards 0.7927. Resistance is at 0.8178.
AUDUSD BULLISH Rise through 1.1012 has paved the way towards 1.1198. Support lies at 1.0944.
USDCAD BEARISH Initial support lies at 0.9385 ahead of 0.9252. Near-term resistance is at 0.9531.
EURCHF BEARISH Violation of 1.1496 would expose 1.1374. Initial resistance is at 1.1781.
EURGBP NEUTRAL Near-term directional triggers are at 0.8895 and 0.8798.
EURJPY BEARISH While resistance at 113.66 remain intact, expect a decline towards 112.04 ahead of 111.46.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
27 July 2011 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The US dollar lost more ground to the AUD during the Asia session after Australian Q2 CPI came in well ahead of expectations. As for the US debt ceiling impasse, the rhetoric emanating from Washington suggests that there is still some distance to cover for both sides to reach an agreement, though the market appears inured to the fact that any deal reached at this stage would probably be insufficient to ward off revisiting the issue in a few quarters' time, if not sooner. White House Chief of Staff Daley said he is confident Congress will work to prevent a default but offered no details on how talks are progressing. On the data front, consumer confidence rebounded but housing figures were soft. EURUSD traded 1.4492-1.4536, and USDJPY 77.70-78.09.
EUR
Moody's downgraded Cyprus two notches to Baa1 citing fiscal problems, the political climate, and exposure of the banking system to Greece.
ECB Governing Council member Lipstok noted that interest rates were still very low even after the recent increase.
Eurozone M3 figures are due on Wednesday, along with CPI figures out of Germany.
JPY
Reuters reported that 'sources' suggest Japanese policymakers are considering solo FX intervention as an increasingly viable near-term option. Solo action would indeed be their only option as multilateral G7 intervention would not be viable this time around. They are likely to wait for events to unfold in the US first however, as policymakers might do the work for them.
Finance Minister Noda repeated his recent warnings that yen moves have been "one-sided" and that he is watching FX moves closely..
GBP
UK GDP growth was in line with consensus at +0.2% q/q. Sterling found some support though as the ONS reported that special factors dragged growth by around 0.5ppt. Without these, growth would have been a much more respectable 0.7%. Our UK economist notes that 0.5ppt was probably bigger than many might have expected. However, 0.2% is weak and as such, talks of QE2 will re-emerge, but in our view, with consumer price inflation yet to peak, the MPC is very unlikely to start another round of QE for fear of dislodging expectations.
BoE's Weale said in a German newspaper that the BoE forecasts show risk of double-dip recession in UK, perhaps in winter. However, the hawkish Weale repeated his calls for rate hikes, saying that inflation levels remain high.
AUD
AUDUSD reached new post-flotation highs after an above consensus Q2 CPI report. CPI rose +0.9% q/q (cons. +0.7%) and +3.6% y/y (cons. 3.4%).
NZD
New Zealand Finance Minister Bill English said the NZD was strong because the market was starting to see it as a safe-haven currency. We believe the low liquidity of the NZD suggests this status is hard to justify for now and NZD strength is more a consequence of US dollar weakness. He also warned that the combination of a stronger NZ dollar and lower commodity prices would be negative for the country.
CHF
The KoF leading indicator is due on Wednesday, the market is looking for a decline to 2.11 from 2.23, though these are still relatively elevated levels. Lack of deflation risk means the SNB is unlikely to take action despite the strength of the currency.
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 July 2011 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The US dollar lost more ground to the AUD during the Asia session after Australian Q2 CPI came in well ahead of expectations. As for the US debt ceiling impasse, the rhetoric emanating from Washington suggests that there is still some distance to cover for both sides to reach an agreement, though the market appears inured to the fact that any deal reached at this stage would probably be insufficient to ward off revisiting the issue in a few quarters' time, if not sooner. White House Chief of Staff Daley said he is confident Congress will work to prevent a default but offered no details on how talks are progressing. On the data front, consumer confidence rebounded but housing figures were soft. EURUSD traded 1.4492-1.4536, and USDJPY 77.70-78.09.
EUR
Moody's downgraded Cyprus two notches to Baa1 citing fiscal problems, the political climate, and exposure of the banking system to Greece.
ECB Governing Council member Lipstok noted that interest rates were still very low even after the recent increase.
Eurozone M3 figures are due on Wednesday, along with CPI figures out of Germany.
JPY
Reuters reported that 'sources' suggest Japanese policymakers are considering solo FX intervention as an increasingly viable near-term option. Solo action would indeed be their only option as multilateral G7 intervention would not be viable this time around. They are likely to wait for events to unfold in the US first however, as policymakers might do the work for them.
Finance Minister Noda repeated his recent warnings that yen moves have been "one-sided" and that he is watching FX moves closely..
GBP
UK GDP growth was in line with consensus at +0.2% q/q. Sterling found some support though as the ONS reported that special factors dragged growth by around 0.5ppt. Without these, growth would have been a much more respectable 0.7%. Our UK economist notes that 0.5ppt was probably bigger than many might have expected. However, 0.2% is weak and as such, talks of QE2 will re-emerge, but in our view, with consumer price inflation yet to peak, the MPC is very unlikely to start another round of QE for fear of dislodging expectations.
BoE's Weale said in a German newspaper that the BoE forecasts show risk of double-dip recession in UK, perhaps in winter. However, the hawkish Weale repeated his calls for rate hikes, saying that inflation levels remain high.
AUD
AUDUSD reached new post-flotation highs after an above consensus Q2 CPI report. CPI rose +0.9% q/q (cons. +0.7%) and +3.6% y/y (cons. 3.4%).
NZD
New Zealand Finance Minister Bill English said the NZD was strong because the market was starting to see it as a safe-haven currency. We believe the low liquidity of the NZD suggests this status is hard to justify for now and NZD strength is more a consequence of US dollar weakness. He also warned that the combination of a stronger NZ dollar and lower commodity prices would be negative for the country.
CHF
The KoF leading indicator is due on Wednesday, the market is looking for a decline to 2.11 from 2.23, though these are still relatively elevated levels. Lack of deflation risk means the SNB is unlikely to take action despite the strength of the currency.
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, July 26, 2011
26th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
26 July 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
AUDUSD clears 1.0889
EURUSD BULLISH While support lies at 1.4324, watch for a move above 1.4578 to confirm the bull trend and extend gains towards 1.4697.
USDJPY BEARISH Momentum is negative; a decline through 77.41 would open 76.25, a key low. Resistance is at 79.32.
GBPUSD BULLISH Clearance of 1.6366 would open the way towards 1.6442. Initial support lies at 1.6262.
USDCHF BEARISH Pressure on 0.8000 psychological level; a break here would open 0.7790. Resistance is at 0.8178.
AUDUSD BULLISH Rise through 1.0889 has opened 1.0953 ahead of 1.1012, key high from May 2. Support lies at 1.0796.
USDCAD BEARISH The pair has initial support at 0.9423, a move below which would expose 0.9385. Near-term resistance is at 0.9531.
EURCHF BEARISH Support lies at 1.1496 ahead of 1.1374. Resistance is at 1.1781.
EURGBP NEUTRAL A move above 0.8895 would trigger a bull trend. Support lies at 0.8798.
EURJPY BEARISH A decline through 111.46 would expose 110.66. Resistance is at 113.66.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
AUDUSD clears 1.0889
EURUSD BULLISH While support lies at 1.4324, watch for a move above 1.4578 to confirm the bull trend and extend gains towards 1.4697.
USDJPY BEARISH Momentum is negative; a decline through 77.41 would open 76.25, a key low. Resistance is at 79.32.
GBPUSD BULLISH Clearance of 1.6366 would open the way towards 1.6442. Initial support lies at 1.6262.
USDCHF BEARISH Pressure on 0.8000 psychological level; a break here would open 0.7790. Resistance is at 0.8178.
AUDUSD BULLISH Rise through 1.0889 has opened 1.0953 ahead of 1.1012, key high from May 2. Support lies at 1.0796.
USDCAD BEARISH The pair has initial support at 0.9423, a move below which would expose 0.9385. Near-term resistance is at 0.9531.
EURCHF BEARISH Support lies at 1.1496 ahead of 1.1374. Resistance is at 1.1781.
EURGBP NEUTRAL A move above 0.8895 would trigger a bull trend. Support lies at 0.8798.
EURJPY BEARISH A decline through 111.46 would expose 110.66. Resistance is at 113.66.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
26 July 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
A pair of speeches by US President Obama and House Speaker Boehner showed that there has been no significant convergence of opinion between both camps in the debt ceiling debate. This jolted FX investors into concluding that the risk of a US downgrade and possible default was larger than first supposed, and the dollar sold off across the board. EURUSD traded 1.4358-1.4501 and USDJPY 77.90-78.70. USDCHF made new lows; NZDUSD made new highs. We remain optimistic that a deal will be done but it will probably fall short of what the market is looking for and may not appease the ratings agencies. We expect negotiations to continue into the 11th hour which may suggest further volatility in the coming days, but investors should note that this may not result in dollar sales across the board as deleveraging-based risk reduction tends to cause dollar funding demand to rise. Ahead on Tuesday, Q2 GDP is due in the UK. In the US, consumer confidence and the Case-Shiller HPI are due.
EUR
On a visit to Washington D.C., Greek Finance Minister Venizelos noted that Greece has 'regained its credibility' and said the country needed national unity and a less expensive state. He said there would be success in 'rebuilding the country'.
ECB's Costa says an economic government needs to be created for the Eurozone. The ECB has offered several hints over recent weeks that it favours a fiscal union, with President Trichet noting on several occasions that it is the best scenario for the Eurozone.
Data are limited on Tuesday but the GfK Consumer Confidence Survey will be out and the market is looking for another dip to 5.6 from 5.7. CPI figures throughout Europe will be released this week and any surprises to the downside will throw the ECB's tightening prospects into question.
JPY
Finance Minister Noda repeated his recent warnings that yen moves have been "one-sided" and that he is watching FX moves closely.
GBP
UK Q2 GDP is due and we are looking for a +0.1% quarterly gain, below the +0.2% expected by the consensus. Any downside surprise would rekindle QE fears, which has been widely discussed among policymakers of late given the downturn in general growth expectations in the UK.
BBA home loans in June were just ahead of expectations at 31,747, compared with forecasts for 31,000 and an upwardly revised 30,803 in May. However, mortgage lending numbers were down 6% y/y.
AUD
RBA Governor Stevens did not refer to monetary policy during his overnight speech but did point to the advantages of a strong AUD. Wednesday's Q2 CPI release will be a focus for AUD investors.
NZD
The NZD fell after New Zealand's trade balance for June came in weaker than expected as exports declined significantly. But NZDUSD ultimately made a full recovery against a backdrop of general dollar weakness.
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 July 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
A pair of speeches by US President Obama and House Speaker Boehner showed that there has been no significant convergence of opinion between both camps in the debt ceiling debate. This jolted FX investors into concluding that the risk of a US downgrade and possible default was larger than first supposed, and the dollar sold off across the board. EURUSD traded 1.4358-1.4501 and USDJPY 77.90-78.70. USDCHF made new lows; NZDUSD made new highs. We remain optimistic that a deal will be done but it will probably fall short of what the market is looking for and may not appease the ratings agencies. We expect negotiations to continue into the 11th hour which may suggest further volatility in the coming days, but investors should note that this may not result in dollar sales across the board as deleveraging-based risk reduction tends to cause dollar funding demand to rise. Ahead on Tuesday, Q2 GDP is due in the UK. In the US, consumer confidence and the Case-Shiller HPI are due.
EUR
On a visit to Washington D.C., Greek Finance Minister Venizelos noted that Greece has 'regained its credibility' and said the country needed national unity and a less expensive state. He said there would be success in 'rebuilding the country'.
ECB's Costa says an economic government needs to be created for the Eurozone. The ECB has offered several hints over recent weeks that it favours a fiscal union, with President Trichet noting on several occasions that it is the best scenario for the Eurozone.
Data are limited on Tuesday but the GfK Consumer Confidence Survey will be out and the market is looking for another dip to 5.6 from 5.7. CPI figures throughout Europe will be released this week and any surprises to the downside will throw the ECB's tightening prospects into question.
JPY
Finance Minister Noda repeated his recent warnings that yen moves have been "one-sided" and that he is watching FX moves closely.
GBP
UK Q2 GDP is due and we are looking for a +0.1% quarterly gain, below the +0.2% expected by the consensus. Any downside surprise would rekindle QE fears, which has been widely discussed among policymakers of late given the downturn in general growth expectations in the UK.
BBA home loans in June were just ahead of expectations at 31,747, compared with forecasts for 31,000 and an upwardly revised 30,803 in May. However, mortgage lending numbers were down 6% y/y.
AUD
RBA Governor Stevens did not refer to monetary policy during his overnight speech but did point to the advantages of a strong AUD. Wednesday's Q2 CPI release will be a focus for AUD investors.
NZD
The NZD fell after New Zealand's trade balance for June came in weaker than expected as exports declined significantly. But NZDUSD ultimately made a full recovery against a backdrop of general dollar weakness.
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, July 25, 2011
25th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
25 July 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD watch 1.4578 resistance.
EURUSD NEUTRAL A move above 1.4578 would trigger a bull trend, while support lies at 1.4134.
USDJPY BEARISH Initial support lies at 77.41, a move below which would open 76.25, a key low. Resistance is at 79.32.
GBPUSD BULLISH Clearance of 1.6366 would expose 1.6442. Near-term support lies at 1.6121.
USDCHF BEARISH Key support lies at 0.8033, a fall below which would open 0.8000, the psychological level. Resistance is at 0.8278.
AUDUSD BULLISH A move above 1.0889 would open the way towards 1.0953. Support is at 1.0694.
USDCAD BEARISH The pair has support at 0.9423 ahead of 0.9385. Resistance is at 0.9610.
EURCHF BEARISH Recovery found resistance at 1.1888. Focus is back on the downside with initial support at 1.1572 ahead of 1.1496.
EURGBP BEARISH Support is at 0.8757, a break of which would open 0.8705, a key low. Resistance holds at 0.8895.
EURJPY BEARISH While resistance at 113.66 holds, watch for a decline through 111.46 to expose 110.66.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
25 July 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD watch 1.4578 resistance.
EURUSD NEUTRAL A move above 1.4578 would trigger a bull trend, while support lies at 1.4134.
USDJPY BEARISH Initial support lies at 77.41, a move below which would open 76.25, a key low. Resistance is at 79.32.
GBPUSD BULLISH Clearance of 1.6366 would expose 1.6442. Near-term support lies at 1.6121.
USDCHF BEARISH Key support lies at 0.8033, a fall below which would open 0.8000, the psychological level. Resistance is at 0.8278.
AUDUSD BULLISH A move above 1.0889 would open the way towards 1.0953. Support is at 1.0694.
USDCAD BEARISH The pair has support at 0.9423 ahead of 0.9385. Resistance is at 0.9610.
EURCHF BEARISH Recovery found resistance at 1.1888. Focus is back on the downside with initial support at 1.1572 ahead of 1.1496.
EURGBP BEARISH Support is at 0.8757, a break of which would open 0.8705, a key low. Resistance holds at 0.8895.
EURJPY BEARISH While resistance at 113.66 holds, watch for a decline through 111.46 to expose 110.66.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
25th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
25 July 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The euro initially weakened after Moody's cut Greece's sovereign rating by three notches to Ca, taking it one notch above the lowest possible rating. FX markets had earlier made a volatile start to the week in Asia after the latest round of negotiations on raising the US debt ceiling broke up acrimoniously and, crucially, without agreement over the weekend. EURUSD traded 1.4343-1.4417 and USDJPY 78.12-78.56. Gold hit a new record high at $1624.07/oz. Although we recognise that investor concern is slowly rising, we feel the market is still willing to give the US the benefit of the doubt for now. Nevertheless, as August 2 approaches, FX markets are likely to become increasingly volatile if no compromise is in sight. USDJPY and USDCHF in particular are likely to feel increasingly heavy, while risk pairs such as AUDUSD and NZDUSD may come under significant downward pressure - especially if equity markets weaken in tandem. US Treasury Secretary Geithner met with Fed Chairman Bernanke and New York Fed President Dudley on Friday to discuss the economic implications of a failure to raise the debt ceiling in a timely manner.
EUR
Moody's cut Greece's sovereign rating by three notches to Ca on Monday, taking it to one notch above the lowest possible rating. This is not yet a selective default, although the agency noted that under the terms announced on Thursday, "the probability of a distressed exchange, and hence a default, on Greek government bonds is virtually 100%."
Bundesbank President Weidmann gave a balanced assessment of the decisions taken at Thursday's EU summit, noting that "acute tensions in financial markets" might now be reduced. However, he also observed that "substantial additional risks were shifted to assisting countries and their taxpayers", which "weakens the foundation for a currency union based on fiscal self-responsibility".
On Friday there was further substantial tightening of Greek, Portuguese, and Irish sovereign bond spreads. However, Spanish and Italian 10y bond yields actually ended the day slightly wider, suggesting concern over contagion risk remains elevated. European politicians do not appear to be in any hurry to enact the proposals made on Thursday. Germany's Chancellor Merkel suggested she would not attempt to win support from the German parliament for Thursday's summit decisions until after the summer recess.
Fitch announced that Greece's sovereign rating would be cut to 'restricted default', but implied that this would not happen until private sector participation levels were known. Furthermore, Fitch's expectation is that this rating would only apply for "a few days", and would then be raised to "single B" or "CCC" as soon as new bonds are issued to replace the old. We note that the 'restricted default' term used by Fitch is equivalent to the 'selective default' rating used by Moody's and S&P.
Bank of Portugal Governor Costa ruled out the possibility of Portugal having its rating cut to selective default, dismissing the idea as "out of the question".
Fitch also announced that proposals to extend the powers of the EFSF, announced at Thursday's EU summit, would not imperil the EFSF's triple-A rating given that it is backed by guarantees.
ECB President Trichet again laid out his vision for institutional and governance reform within the Eurozone. He said in the future "it should be possible to impose measures on a country that does not implement the agreed adjustments". Looking even further ahead, he said that "a new type of confederation" could be created involving a "European finance ministry with its own responsibilities". Trichet added that the euro is not in the midst of a "currency crisis" because it is stable and keeps its value extremely well.
The German Ifo business climate survey for July came in slightly weaker than expected at 112.9 (cons. 113.8). According to the report, conditions in Germany worsened, mainly on significantly weakening export expectations..
JPY
Finance Minister Noda said that the government "will take resolute actions when necessary" to help counter the yen's strength. He added that he needs to watch FX moves closely, as was the case during the joint G7 intervention in March. This is arguably the strongest warning issued since then, and illustrates that intervention risk is now extremely high.
AUD
PPI for Q2 came in exactly in line with consensus at +0.8% q/q, and +3.4% y/y. As signalled in the recent RBA minutes, Wednesday's CPI print will be a key driver of monetary policy. Our Australian economists maintain their above-consensus +0.9% q/q forecast, and stick to their view that the next hike is due in October.
RBA Assistant Governor Edey said that domestic Australian banks have limited exposure to the sovereign debt of countries regarded as most at risk..
CAD
June inflation was much weaker than expected, with the headline rate coming in at only +3.1% y/y (cons. 3.6%). The core figure also dropped to +1.3% y/y (prev. 1.9%), seriously dampening market expectations for an early hike from the Bank of Canada.
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.
25 July 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The euro initially weakened after Moody's cut Greece's sovereign rating by three notches to Ca, taking it one notch above the lowest possible rating. FX markets had earlier made a volatile start to the week in Asia after the latest round of negotiations on raising the US debt ceiling broke up acrimoniously and, crucially, without agreement over the weekend. EURUSD traded 1.4343-1.4417 and USDJPY 78.12-78.56. Gold hit a new record high at $1624.07/oz. Although we recognise that investor concern is slowly rising, we feel the market is still willing to give the US the benefit of the doubt for now. Nevertheless, as August 2 approaches, FX markets are likely to become increasingly volatile if no compromise is in sight. USDJPY and USDCHF in particular are likely to feel increasingly heavy, while risk pairs such as AUDUSD and NZDUSD may come under significant downward pressure - especially if equity markets weaken in tandem. US Treasury Secretary Geithner met with Fed Chairman Bernanke and New York Fed President Dudley on Friday to discuss the economic implications of a failure to raise the debt ceiling in a timely manner.
EUR
Moody's cut Greece's sovereign rating by three notches to Ca on Monday, taking it to one notch above the lowest possible rating. This is not yet a selective default, although the agency noted that under the terms announced on Thursday, "the probability of a distressed exchange, and hence a default, on Greek government bonds is virtually 100%."
Bundesbank President Weidmann gave a balanced assessment of the decisions taken at Thursday's EU summit, noting that "acute tensions in financial markets" might now be reduced. However, he also observed that "substantial additional risks were shifted to assisting countries and their taxpayers", which "weakens the foundation for a currency union based on fiscal self-responsibility".
On Friday there was further substantial tightening of Greek, Portuguese, and Irish sovereign bond spreads. However, Spanish and Italian 10y bond yields actually ended the day slightly wider, suggesting concern over contagion risk remains elevated. European politicians do not appear to be in any hurry to enact the proposals made on Thursday. Germany's Chancellor Merkel suggested she would not attempt to win support from the German parliament for Thursday's summit decisions until after the summer recess.
Fitch announced that Greece's sovereign rating would be cut to 'restricted default', but implied that this would not happen until private sector participation levels were known. Furthermore, Fitch's expectation is that this rating would only apply for "a few days", and would then be raised to "single B" or "CCC" as soon as new bonds are issued to replace the old. We note that the 'restricted default' term used by Fitch is equivalent to the 'selective default' rating used by Moody's and S&P.
Bank of Portugal Governor Costa ruled out the possibility of Portugal having its rating cut to selective default, dismissing the idea as "out of the question".
Fitch also announced that proposals to extend the powers of the EFSF, announced at Thursday's EU summit, would not imperil the EFSF's triple-A rating given that it is backed by guarantees.
ECB President Trichet again laid out his vision for institutional and governance reform within the Eurozone. He said in the future "it should be possible to impose measures on a country that does not implement the agreed adjustments". Looking even further ahead, he said that "a new type of confederation" could be created involving a "European finance ministry with its own responsibilities". Trichet added that the euro is not in the midst of a "currency crisis" because it is stable and keeps its value extremely well.
The German Ifo business climate survey for July came in slightly weaker than expected at 112.9 (cons. 113.8). According to the report, conditions in Germany worsened, mainly on significantly weakening export expectations..
JPY
Finance Minister Noda said that the government "will take resolute actions when necessary" to help counter the yen's strength. He added that he needs to watch FX moves closely, as was the case during the joint G7 intervention in March. This is arguably the strongest warning issued since then, and illustrates that intervention risk is now extremely high.
AUD
PPI for Q2 came in exactly in line with consensus at +0.8% q/q, and +3.4% y/y. As signalled in the recent RBA minutes, Wednesday's CPI print will be a key driver of monetary policy. Our Australian economists maintain their above-consensus +0.9% q/q forecast, and stick to their view that the next hike is due in October.
RBA Assistant Governor Edey said that domestic Australian banks have limited exposure to the sovereign debt of countries regarded as most at risk..
CAD
June inflation was much weaker than expected, with the headline rate coming in at only +3.1% y/y (cons. 3.6%). The core figure also dropped to +1.3% y/y (prev. 1.9%), seriously dampening market expectations for an early hike from the Bank of Canada.
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, July 20, 2011
20th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
20 July 2011 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURCHF 1.1752 resistance.
EURUSD BEARISH Focus on initial support at 1.4069, a break which would expose 1.4014 ahead of 1.3951. Resistance holds at 1.4295.
USDJPY BEARISH Decline through 78.82 would extend weakness towards 78.44 ahead of 76.25, a key low. Resistance is at 79.61.
GBPUSD NEUTRAL Key upside trigger is at 1.6194, a break above which would develop bullish conditions. Initial support lies at 1.6006.
USDCHF BEARISH As long as resistance at 0.8398 holds, bearish trend remains intact. Look for a break below 0.8152 to expose 0.8033.
AUDUSD BULLISH Break above 1.0802 is required to confirm the bull trend and target 1.0889 next. Support lies at 1.0598.
USDCAD BEARISH Sharp sell-off through 0.9513 has paved the way for losses towards 0.9446 ahead of 0.9400. Resistance is at 0.9602.
EURCHF BEARISH Initial support is at 1.1515, a move below which would reinforce the bearish conditions and expose 1.1374. Resistance is at 1.1752.
EURGBP BEARISH Support lies at 0.8705, a break of which would expose 0.8657. Resistance is at 0.8847.
EURJPY BEARISH Violation of 111.18 would signal further downside move towards 110.66 ahead of 109.58. Resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURCHF 1.1752 resistance.
EURUSD BEARISH Focus on initial support at 1.4069, a break which would expose 1.4014 ahead of 1.3951. Resistance holds at 1.4295.
USDJPY BEARISH Decline through 78.82 would extend weakness towards 78.44 ahead of 76.25, a key low. Resistance is at 79.61.
GBPUSD NEUTRAL Key upside trigger is at 1.6194, a break above which would develop bullish conditions. Initial support lies at 1.6006.
USDCHF BEARISH As long as resistance at 0.8398 holds, bearish trend remains intact. Look for a break below 0.8152 to expose 0.8033.
AUDUSD BULLISH Break above 1.0802 is required to confirm the bull trend and target 1.0889 next. Support lies at 1.0598.
USDCAD BEARISH Sharp sell-off through 0.9513 has paved the way for losses towards 0.9446 ahead of 0.9400. Resistance is at 0.9602.
EURCHF BEARISH Initial support is at 1.1515, a move below which would reinforce the bearish conditions and expose 1.1374. Resistance is at 1.1752.
EURGBP BEARISH Support lies at 0.8705, a break of which would expose 0.8657. Resistance is at 0.8847.
EURJPY BEARISH Violation of 111.18 would signal further downside move towards 110.66 ahead of 109.58. Resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
20 July 2011 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The dollar recovered some ground against the Swiss franc and the yen on a combination of healthy US data, better corporate earnings and potential progress on the debt ceiling. President Obama warmed to the "Gang of Six" deficit reduction plan and senior lawmakers in the Senate intimated that the measure could pass with relative ease. However, the House is a much tougher proposition and it remains to be seen whether comprehensive legislation can be passed and signed into law before the Aug. 2 deadline. In another sign of the potential consequences of failure to achieve a deal, Moody's warned that five states could also lose their AAA rating due to their reliance on federal revenue. In the Eurozone, Reuters reported that French President Sarkozy would meet with German Chancellor Merkel ahead of the Thursday EU Summit. On the data front, US housing starts and building permits surprised to the upside. EURUSD traded 1.4109-1.4182 and USDJPY 78.89-79.32.
EUR
A Eurozone policy options paper suggested that European officials are looking at three broad options for the private sector role in Greek debt. The first is bond buybacks and credit enhancements (which the ratings agencies would likely see as a selective default). The second is based on the French plan proposed last month and the third plan involves a financial sector tax, lower rates and longer maturities on Greek EFSF loans. We haven't heard a great deal about the third option, but it is believed that this is the least likely of the three so far.
Greek PM Papandreou said the EU summit can be "make or break" for the region. He said that there are systemic issues in the EUR which must be dealt with, and that Greece has done and will do all it must do. He again called for joint Eurobonds, but several German lawmakers were also on the wires expressing firm opposition to any such move.
German Chancellor Merkel said Europe's fiscal crisis could not be solved in one go, and cautioned against expectations of a major deal at this week's summit, saying 'there won't be one spectacular step'. There remains a lot of confusion regarding Thursday's agenda, with Irish PM Enda Kenny noting it had not been decided.
French President Sarkozy's staff confirmed that both he and Merkel are due to meet today to prepare for Thursday's summit.
JPY
Finance Minister Noda again expressed his dissatisfaction with where the yen is trading. He said current levels do not reflect Japan's economic fundamentals, and yen strength is being driven by worries about European and US sovereign debt. He warned that the government will take decisive steps on FX if necessary, and that there has been no change in the government's policy of intervening when FX rates move excessively or in a disorderly fashion. These comments qualify as a rhetorical escalation in our view, although there was no FX reaction.
GBP
The BoE minutes to the July policy meeting are due on Wednesday. We continue to expect a 7-2 vote on a rate hike, but an 8-1 vote on new asset purchases. A new vote in favour of the latter, or further shift in the direction of the MPC towards more easing will hurt sterling.
CAD
The Bank of Canada kept policy rates on hold. The only notable change in language was its signalling that stimulus is "to be withdrawn" rather than "eventually withdrawn", which all but confirms the bank is in full normalisation mode. This is probably a nod to the elevated inflation pressures seen of late, but the BoC acknowledges that significant risks lie ahead. The BoC warned that persistent CAD strength is harming exports. The BoC's MPR is due on Wednesday.
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 July 2011 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The dollar recovered some ground against the Swiss franc and the yen on a combination of healthy US data, better corporate earnings and potential progress on the debt ceiling. President Obama warmed to the "Gang of Six" deficit reduction plan and senior lawmakers in the Senate intimated that the measure could pass with relative ease. However, the House is a much tougher proposition and it remains to be seen whether comprehensive legislation can be passed and signed into law before the Aug. 2 deadline. In another sign of the potential consequences of failure to achieve a deal, Moody's warned that five states could also lose their AAA rating due to their reliance on federal revenue. In the Eurozone, Reuters reported that French President Sarkozy would meet with German Chancellor Merkel ahead of the Thursday EU Summit. On the data front, US housing starts and building permits surprised to the upside. EURUSD traded 1.4109-1.4182 and USDJPY 78.89-79.32.
EUR
A Eurozone policy options paper suggested that European officials are looking at three broad options for the private sector role in Greek debt. The first is bond buybacks and credit enhancements (which the ratings agencies would likely see as a selective default). The second is based on the French plan proposed last month and the third plan involves a financial sector tax, lower rates and longer maturities on Greek EFSF loans. We haven't heard a great deal about the third option, but it is believed that this is the least likely of the three so far.
Greek PM Papandreou said the EU summit can be "make or break" for the region. He said that there are systemic issues in the EUR which must be dealt with, and that Greece has done and will do all it must do. He again called for joint Eurobonds, but several German lawmakers were also on the wires expressing firm opposition to any such move.
German Chancellor Merkel said Europe's fiscal crisis could not be solved in one go, and cautioned against expectations of a major deal at this week's summit, saying 'there won't be one spectacular step'. There remains a lot of confusion regarding Thursday's agenda, with Irish PM Enda Kenny noting it had not been decided.
French President Sarkozy's staff confirmed that both he and Merkel are due to meet today to prepare for Thursday's summit.
JPY
Finance Minister Noda again expressed his dissatisfaction with where the yen is trading. He said current levels do not reflect Japan's economic fundamentals, and yen strength is being driven by worries about European and US sovereign debt. He warned that the government will take decisive steps on FX if necessary, and that there has been no change in the government's policy of intervening when FX rates move excessively or in a disorderly fashion. These comments qualify as a rhetorical escalation in our view, although there was no FX reaction.
GBP
The BoE minutes to the July policy meeting are due on Wednesday. We continue to expect a 7-2 vote on a rate hike, but an 8-1 vote on new asset purchases. A new vote in favour of the latter, or further shift in the direction of the MPC towards more easing will hurt sterling.
CAD
The Bank of Canada kept policy rates on hold. The only notable change in language was its signalling that stimulus is "to be withdrawn" rather than "eventually withdrawn", which all but confirms the bank is in full normalisation mode. This is probably a nod to the elevated inflation pressures seen of late, but the BoC acknowledges that significant risks lie ahead. The BoC warned that persistent CAD strength is harming exports. The BoC's MPR is due on Wednesday.
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, July 19, 2011
19th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
19 July 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDCAD 0.9669 resistance
EURUSD BEARISH Break below initial support at 1.4014 would pave the way for losses towards 1.3951 ahead of 1.3837, while resistance at 1.4295 holds.
USDJPY BEARISH Violation of initial support at 78.44 Fibonacci level would open 76.25, a key low. Resistance is at 79.61.
GBPUSD NEUTRAL Resistance is at 1.6194, while a decline through 1.5987 would resume the bear trend and expose 1.5939.
USDCHF BEARISH Watch for a break below 0.8033 to signal weakness towards 0.7800, a channel lower drawn off Feb 11 high. Resistance is at 0.8276, a previous low.
AUDUSD NEUTRAL Resistance is at 1.0746, while support lies at 1.0526.
USDCAD BEARISH While resistance at 0.9669 holds; focus on initial support at 0.9513, a key low ahead of 0.9446.
EURCHF BEARISH Decline through 1.1342 would open the way to 1.1106. Initial resistance is at 1.1650.
EURGBP BEARISH Initial support lies at 0.8705, a break of which would expose 0.8657. Resistance is at 0.8847.
EURJPY BEARISH Breach of 110.66 would signal further downside move towards 109.58 ahead of 107.99. Resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDCAD 0.9669 resistance
EURUSD BEARISH Break below initial support at 1.4014 would pave the way for losses towards 1.3951 ahead of 1.3837, while resistance at 1.4295 holds.
USDJPY BEARISH Violation of initial support at 78.44 Fibonacci level would open 76.25, a key low. Resistance is at 79.61.
GBPUSD NEUTRAL Resistance is at 1.6194, while a decline through 1.5987 would resume the bear trend and expose 1.5939.
USDCHF BEARISH Watch for a break below 0.8033 to signal weakness towards 0.7800, a channel lower drawn off Feb 11 high. Resistance is at 0.8276, a previous low.
AUDUSD NEUTRAL Resistance is at 1.0746, while support lies at 1.0526.
USDCAD BEARISH While resistance at 0.9669 holds; focus on initial support at 0.9513, a key low ahead of 0.9446.
EURCHF BEARISH Decline through 1.1342 would open the way to 1.1106. Initial resistance is at 1.1650.
EURGBP BEARISH Initial support lies at 0.8705, a break of which would expose 0.8657. Resistance is at 0.8847.
EURJPY BEARISH Breach of 110.66 would signal further downside move towards 109.58 ahead of 107.99. Resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
19 July 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The market remains in a state of suspended animation given the relative lack of news, the dearth of economic data releases, and the uncertainty around what may emerge from Thursday's EU summit. Nevertheless there is a palpable sense of foreboding as Spanish and Italian yields continue to climb. The euro staged a modest recovery during the US session, but this is unlikely to last. After all, the upswing only got underway when European sovereign bond markets closed for the evening, which put a temporary stop to the flow of euro negative headlines on the plight of Eurozone sovereign bond markets. In Asia, the minutes of the RBA's July 5 policy meeting show that the bank has shifted decisively to a neutral policy stance. EURUSD traded in a range of 1.4084-1.4136 and USDJPY 78.97-79.15. Gold traded up to a new record high, briefly touching $1607.45/oz. The S&P 500 fell 0.8%. European equities earlier closed about 2% lower, after Eurozone-negative press reports impacted sentiment. US housing data is due and our US economists are broadly in line with consensus.
EUR
Greek Finance Minister Venizelos said that Greece has not yet accepted that a 'selective default' rating is inevitable. He said that if the ECB is no longer in a position to support Greek banks, liquidity could be made available via the EFSF or via the wider system of national central banks. This suggests that the possibility is being explored of using an emergency liquidity facility operated by the Greek central bank to help fund Greek banks if the ECB finds itself unable to do so.
ECB Governing Council member Nowotny said a Greek default would have very grave consequences. He added that a range of options still has to be studied, and that some of these proposals are intended to manage the aftermath of a short-term selective default rating.
ECB Executive Board member Bini-Smaghi repeated the ECB's opposition to imposing actual losses on private sector bondholders, arguing that doing so could cost taxpayers even more. He said that, given the Greek banks "would collapse" in this case, the EU would have to bail out both the Greek economy and the Greek banks which would be "a much more expensive proposition".
ECB President Trichet indicated there has been no softening of the ECB's position on Greece. He repeated that any solution for Greece has to avoid both a credit event and a selective default, and that it is the responsibility of governments to come up with a solution. He said he does not expect the debt crisis to cause another recession.
The ECB did not settle any bond purchases under the Securities Markets Program last week. Allowing for settlement lead times, this implies that the ECB had conducted no purchases as of the European close on Tuesday. The program has now been dormant for 16 weeks, but could be restarted without warning.
A German government spokesman said that Germany seeks to send a clear signal to markets at the EU summit planned for Thursday.
AUD
The minutes of the July 5 policy meeting show that the RBA has shifted decisively to a neutral policy stance, noting that "the flow of recent information suggested both that there was more time to assess the likely strength of inflationary pressures in Australia and that it would be prudent to use that time". The upcoming inflation report on July 27 is likely to be a key determinant of near-term policy.
CAD
Our analysts are in line with consensus, and expects the base rate to be kept unchanged at today's policy meeting. As far as the policy statement is concerned, we would not be surprised to see mildly hawkish overtones seep into the text, given that CPI in May showed a significant increase.
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 July 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The market remains in a state of suspended animation given the relative lack of news, the dearth of economic data releases, and the uncertainty around what may emerge from Thursday's EU summit. Nevertheless there is a palpable sense of foreboding as Spanish and Italian yields continue to climb. The euro staged a modest recovery during the US session, but this is unlikely to last. After all, the upswing only got underway when European sovereign bond markets closed for the evening, which put a temporary stop to the flow of euro negative headlines on the plight of Eurozone sovereign bond markets. In Asia, the minutes of the RBA's July 5 policy meeting show that the bank has shifted decisively to a neutral policy stance. EURUSD traded in a range of 1.4084-1.4136 and USDJPY 78.97-79.15. Gold traded up to a new record high, briefly touching $1607.45/oz. The S&P 500 fell 0.8%. European equities earlier closed about 2% lower, after Eurozone-negative press reports impacted sentiment. US housing data is due and our US economists are broadly in line with consensus.
EUR
Greek Finance Minister Venizelos said that Greece has not yet accepted that a 'selective default' rating is inevitable. He said that if the ECB is no longer in a position to support Greek banks, liquidity could be made available via the EFSF or via the wider system of national central banks. This suggests that the possibility is being explored of using an emergency liquidity facility operated by the Greek central bank to help fund Greek banks if the ECB finds itself unable to do so.
ECB Governing Council member Nowotny said a Greek default would have very grave consequences. He added that a range of options still has to be studied, and that some of these proposals are intended to manage the aftermath of a short-term selective default rating.
ECB Executive Board member Bini-Smaghi repeated the ECB's opposition to imposing actual losses on private sector bondholders, arguing that doing so could cost taxpayers even more. He said that, given the Greek banks "would collapse" in this case, the EU would have to bail out both the Greek economy and the Greek banks which would be "a much more expensive proposition".
ECB President Trichet indicated there has been no softening of the ECB's position on Greece. He repeated that any solution for Greece has to avoid both a credit event and a selective default, and that it is the responsibility of governments to come up with a solution. He said he does not expect the debt crisis to cause another recession.
The ECB did not settle any bond purchases under the Securities Markets Program last week. Allowing for settlement lead times, this implies that the ECB had conducted no purchases as of the European close on Tuesday. The program has now been dormant for 16 weeks, but could be restarted without warning.
A German government spokesman said that Germany seeks to send a clear signal to markets at the EU summit planned for Thursday.
AUD
The minutes of the July 5 policy meeting show that the RBA has shifted decisively to a neutral policy stance, noting that "the flow of recent information suggested both that there was more time to assess the likely strength of inflationary pressures in Australia and that it would be prudent to use that time". The upcoming inflation report on July 27 is likely to be a key determinant of near-term policy.
CAD
Our analysts are in line with consensus, and expects the base rate to be kept unchanged at today's policy meeting. As far as the policy statement is concerned, we would not be surprised to see mildly hawkish overtones seep into the text, given that CPI in May showed a significant increase.
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, July 18, 2011
18th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
18 July 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDCAD 0.9513 support
EURUSD BEARISH Focus is on initial support at 1.3951, a break of which would favor extension of bear trend and open 1.3837. Initial resistance is at 1.4200.
USDJPY BEARISH The pair targets support at 78.44 Fibonacci level; a break of which would open 76.25, a key low. Resistance is at 79.61.
GBPUSD NEUTRAL Initial resistance is at 1.6254, while support lies at 1.5906.
USDCHF BEARISH Sharp sell-off through 0.8083 has paved the way for losses towards 0.8016 ahead of 0.7836. Resistance is at 0.8276, a
previous low.
AUDUSD NEUTRAL Near-term directional triggers are at 1.0746 and 1.0526.
USDCAD BEARISH Key support lies at 0.9513, a clearance of which would expose 0.9446. Near-term resistance is at 0.9624.
EURCHF BEARISH Decline through 1.1458 has signalled further weakness towards 1.1374 ahead of 1.1056. Resistance is at 1.1650.
EURGBP BEARISH Potential for further downside towards 0.8722, a key low from June 16; next support comes in at 0.8657. Initial resistance is at 0.8847.
EURJPY BEARISH Focus is on initial support at 109.58, a break of which would expose 107.99. Resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
18 July 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDCAD 0.9513 support
EURUSD BEARISH Focus is on initial support at 1.3951, a break of which would favor extension of bear trend and open 1.3837. Initial resistance is at 1.4200.
USDJPY BEARISH The pair targets support at 78.44 Fibonacci level; a break of which would open 76.25, a key low. Resistance is at 79.61.
GBPUSD NEUTRAL Initial resistance is at 1.6254, while support lies at 1.5906.
USDCHF BEARISH Sharp sell-off through 0.8083 has paved the way for losses towards 0.8016 ahead of 0.7836. Resistance is at 0.8276, a
previous low.
AUDUSD NEUTRAL Near-term directional triggers are at 1.0746 and 1.0526.
USDCAD BEARISH Key support lies at 0.9513, a clearance of which would expose 0.9446. Near-term resistance is at 0.9624.
EURCHF BEARISH Decline through 1.1458 has signalled further weakness towards 1.1374 ahead of 1.1056. Resistance is at 1.1650.
EURGBP BEARISH Potential for further downside towards 0.8722, a key low from June 16; next support comes in at 0.8657. Initial resistance is at 0.8847.
EURJPY BEARISH Focus is on initial support at 109.58, a break of which would expose 107.99. Resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
18th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
18 July 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
EURUSD dropped 80 pips during the Asia session following a barrage of euro-negative newspaper commentary. Some articles expressed concern about European bank exposure to troubled sovereigns, but the majority were of a more general nature, criticising the response of European authorities to date, and raising doubts about the euro's very survival. EURUSD traded in a range of 1.4052-1.4168 and USDJPY 78.96-79.30. EURCHF and USDCHF made new record lows. The stress test results themselves passed largely without incident on Friday, although European markets were closed at the time, raising the risk of a delayed reaction as Europe walks in on Monday. Only 8 of the 90 banks were deemed to have failed, and a capital shortfall of only €2.5 bn was identified. Although European equities closed in the red, the S&P 500 managed to climb +0.56%. As expected, US core CPI rose to +1.6% y/y (prev. 1.5%), which reinforces the view of our US economists that further QE is unlikely. University of Michigan consumer sentiment fell sharply to 63.8 (cons. 72.2). Our economists believe the deterioration is at least partly due to the debt ceiling impasse and, consequently, a resolution would go a long way toward improving confidence.
EUR
A date has finally been set for the upcoming EU summit, putting an end to days of speculation about whether it would be held at all. It is due to take place on Thursday July 21. The two items on the agenda are "the financial stability of the Euro area as a whole and the future financing of the Greek programme". Germany's Chancellor Merkel said she will only travel to the summit if an agreement on Greece is to be reached. Merkel added she is "not working towards" a solution that involves a restructuring of Greek debt.
European bank stress test results were released at 1600 GMT on Friday. Eight of the 90 banks tested were deemed to have failed the tests although the total capital shortfall was found to be only ?2.5 bn. By contrast, our bank analysts think the European banking system needs somewhere in the region of ?150 bn in additional capital before it can be considered to be adequately capitalised. Five Spanish banks, two Greek banks and one Austrian bank did not pass. The European Banking Authority which carried out the tests said that of all the Greek sovereign debt held by banks, 67% of it is held by Greek banks, while German and French banks hold 9% and 8% respectively.
Both houses of the Italian parliament have now approved a ?48 bn package of austerity measures, after a final vote on Friday evening. Earlier on Friday, sovereign debt markets continued to show signs of strain with Spanish and Italian yields rising still further.
Bundesbank President Weidmann said that a haircut on Greek debt "will not really improve anything" while the public finances continue to show "high deficits".
EU Commissioner Rehn again called for the lowering of interest rates Ireland pays on rescue funds, as well as an extension of loan maturities.
Reuters cited a French government source as saying that Germany and Italy are likely to oppose a second IEA oil stock release later this week. Any release of further oil reserves beyond the 60m barrels originally planned would likely be euro-negative as the market would anticipate a further decline in Eurozone inflationary pressures.
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.
18 July 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
EURUSD dropped 80 pips during the Asia session following a barrage of euro-negative newspaper commentary. Some articles expressed concern about European bank exposure to troubled sovereigns, but the majority were of a more general nature, criticising the response of European authorities to date, and raising doubts about the euro's very survival. EURUSD traded in a range of 1.4052-1.4168 and USDJPY 78.96-79.30. EURCHF and USDCHF made new record lows. The stress test results themselves passed largely without incident on Friday, although European markets were closed at the time, raising the risk of a delayed reaction as Europe walks in on Monday. Only 8 of the 90 banks were deemed to have failed, and a capital shortfall of only €2.5 bn was identified. Although European equities closed in the red, the S&P 500 managed to climb +0.56%. As expected, US core CPI rose to +1.6% y/y (prev. 1.5%), which reinforces the view of our US economists that further QE is unlikely. University of Michigan consumer sentiment fell sharply to 63.8 (cons. 72.2). Our economists believe the deterioration is at least partly due to the debt ceiling impasse and, consequently, a resolution would go a long way toward improving confidence.
EUR
A date has finally been set for the upcoming EU summit, putting an end to days of speculation about whether it would be held at all. It is due to take place on Thursday July 21. The two items on the agenda are "the financial stability of the Euro area as a whole and the future financing of the Greek programme". Germany's Chancellor Merkel said she will only travel to the summit if an agreement on Greece is to be reached. Merkel added she is "not working towards" a solution that involves a restructuring of Greek debt.
European bank stress test results were released at 1600 GMT on Friday. Eight of the 90 banks tested were deemed to have failed the tests although the total capital shortfall was found to be only ?2.5 bn. By contrast, our bank analysts think the European banking system needs somewhere in the region of ?150 bn in additional capital before it can be considered to be adequately capitalised. Five Spanish banks, two Greek banks and one Austrian bank did not pass. The European Banking Authority which carried out the tests said that of all the Greek sovereign debt held by banks, 67% of it is held by Greek banks, while German and French banks hold 9% and 8% respectively.
Both houses of the Italian parliament have now approved a ?48 bn package of austerity measures, after a final vote on Friday evening. Earlier on Friday, sovereign debt markets continued to show signs of strain with Spanish and Italian yields rising still further.
Bundesbank President Weidmann said that a haircut on Greek debt "will not really improve anything" while the public finances continue to show "high deficits".
EU Commissioner Rehn again called for the lowering of interest rates Ireland pays on rescue funds, as well as an extension of loan maturities.
Reuters cited a French government source as saying that Germany and Italy are likely to oppose a second IEA oil stock release later this week. Any release of further oil reserves beyond the 60m barrels originally planned would likely be euro-negative as the market would anticipate a further decline in Eurozone inflationary pressures.
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, July 15, 2011
15th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
15 July 2011 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
GBPUSD 1.6254 resistance
EURUSD BEARISH Initial resistance is at 1.4295, while this remains intact; watch for a break below 1.3951 to open the way towards 1.3837.
USDJPY BEARISH Support lies at 78.44 Fibonacci level; a break here would open 76.25 key low. Resistance is at 80.38.
GBPUSD NEUTRAL Key resistance lies at 1.6254, while support lies at 1.5906.
USDCHF BEARISH Scope for weakness towards 0.8016 and 0.7836. Resistance is at 0.8276, a previous low.
AUDUSD BULLISH Break of 1.0802 is needed to reinforce the bullish conditions and target 1.0889 next. Initial support lies at 1.0580.
USDCAD BEARISH Decline through 0.9549 would pave the way for losses towards 0.9513, a key low. Near-term resistance is at 0.9669.
EURCHF BEARISH Focus is on 1.1495, a move below which would expose 1.1458. Resistance is at 1.1752.
EURGBP BEARISH Violation of 0.8760 has signalled potential for further downside towards 0.8749 ahead of 0.8722. Initial resistance is at 0.8877.
EURJPY BEARISH While resistance at 112.95 holds, expect losses towards 109.58 ahead of 107.99.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
GBPUSD 1.6254 resistance
EURUSD BEARISH Initial resistance is at 1.4295, while this remains intact; watch for a break below 1.3951 to open the way towards 1.3837.
USDJPY BEARISH Support lies at 78.44 Fibonacci level; a break here would open 76.25 key low. Resistance is at 80.38.
GBPUSD NEUTRAL Key resistance lies at 1.6254, while support lies at 1.5906.
USDCHF BEARISH Scope for weakness towards 0.8016 and 0.7836. Resistance is at 0.8276, a previous low.
AUDUSD BULLISH Break of 1.0802 is needed to reinforce the bullish conditions and target 1.0889 next. Initial support lies at 1.0580.
USDCAD BEARISH Decline through 0.9549 would pave the way for losses towards 0.9513, a key low. Near-term resistance is at 0.9669.
EURCHF BEARISH Focus is on 1.1495, a move below which would expose 1.1458. Resistance is at 1.1752.
EURGBP BEARISH Violation of 0.8760 has signalled potential for further downside towards 0.8749 ahead of 0.8722. Initial resistance is at 0.8877.
EURJPY BEARISH While resistance at 112.95 holds, expect losses towards 109.58 ahead of 107.99.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
15 July 2011 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
S&P put the US rating on negative watch "owing to the dynamics of the political debate on the debt ceiling'. The agency said there is "at least a one-in-two likelihood that we could lower the long-term rating on the U.S. within the next 90 days". At Fed Chairman Bernanke's second day of testimony he floated contingency plans around the debt ceiling issue, such as the Fed itself buying up defaulted securities, though he added that any such decision would need to be taken by the FOMC as a whole and he expressed doubts over its efficacy on preventing prohibitive gains in yields. Meanwhile, the White House reported that $1.5 trn in cuts were agreed upon and an additional $200 bn could be found, though we believe these figures are insufficient to avoid another vote next year.
On the data side, core retail sales were better than expected despite a soft headline print, and CPI numbers are due on Friday. EURUSD traded in a range of 1.4116-1.4200 and USDJPY 78.89-79.25.
EUR
Germany's Finance Minister Schaeuble said that the Greek crisis is now endangering the euro as a whole.
The Austrian finance minister said he wants to avoid a haircut for Greece, as this would have a negative effect on taxpayers. He added that the Greek plan could be a debt rollover, bond swap or "insurance model", or a mix of all three. He is also against increasing EU safety net 'again and again'.
It appears that there will be no special EU session on Friday, which should clear the way for markets to focus on the banking stress tests. German Chancellor Merkel noted that a summit would be welcome, but the pre-condition would be an agreement on the Greek program. Similar comments were echoed by the Dutch.
The Italian Senate approved austerity measures and the lower house will vote on it tomorrow. The government has a slimmer majority in this chamber so there is still some prospect of event risk if the measures do not pass.
The European Stress Test results are due. National releases come out at 16:00 GMT and individual releases will be available from banks almost immediately after. In other data, the Eurozone trade balance is due..
JPY
Finance Minister Noda repeated that yen moves have been one-sided, but he did not comment on whether he was poised to intervene in FX markets.
Japan chief cabinet secretary Edano says Japan is watching the foreign exchange markets with tension, but has no comment on potential yen intervention. This largely echoes what the Finance Minister Noda said yesterday.
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 July 2011 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
S&P put the US rating on negative watch "owing to the dynamics of the political debate on the debt ceiling'. The agency said there is "at least a one-in-two likelihood that we could lower the long-term rating on the U.S. within the next 90 days". At Fed Chairman Bernanke's second day of testimony he floated contingency plans around the debt ceiling issue, such as the Fed itself buying up defaulted securities, though he added that any such decision would need to be taken by the FOMC as a whole and he expressed doubts over its efficacy on preventing prohibitive gains in yields. Meanwhile, the White House reported that $1.5 trn in cuts were agreed upon and an additional $200 bn could be found, though we believe these figures are insufficient to avoid another vote next year.
On the data side, core retail sales were better than expected despite a soft headline print, and CPI numbers are due on Friday. EURUSD traded in a range of 1.4116-1.4200 and USDJPY 78.89-79.25.
EUR
Germany's Finance Minister Schaeuble said that the Greek crisis is now endangering the euro as a whole.
The Austrian finance minister said he wants to avoid a haircut for Greece, as this would have a negative effect on taxpayers. He added that the Greek plan could be a debt rollover, bond swap or "insurance model", or a mix of all three. He is also against increasing EU safety net 'again and again'.
It appears that there will be no special EU session on Friday, which should clear the way for markets to focus on the banking stress tests. German Chancellor Merkel noted that a summit would be welcome, but the pre-condition would be an agreement on the Greek program. Similar comments were echoed by the Dutch.
The Italian Senate approved austerity measures and the lower house will vote on it tomorrow. The government has a slimmer majority in this chamber so there is still some prospect of event risk if the measures do not pass.
The European Stress Test results are due. National releases come out at 16:00 GMT and individual releases will be available from banks almost immediately after. In other data, the Eurozone trade balance is due..
JPY
Finance Minister Noda repeated that yen moves have been one-sided, but he did not comment on whether he was poised to intervene in FX markets.
Japan chief cabinet secretary Edano says Japan is watching the foreign exchange markets with tension, but has no comment on potential yen intervention. This largely echoes what the Finance Minister Noda said yesterday.
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, July 14, 2011
14th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
14 July 2011 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDJPY pressures 78.44 support
EURUSD BEARISH Break of 1.3951 would open 1.3837 key low. Resistance is at 1.4342 Fibonacci level.
USDJPY BEARISH Pressure on 78.44 Fibonacci support; a break here would open 76.25 key low. Near-term resistance is at 79.57 previous low.
GBPUSD BEARISH The pair bounced back through 1.6141 to expose 1.6263. Overall outlook is negative and we expect weakness towards 1.5906 and 1.5781.
USDCHF BEARISH Bear trend continues; decline through 0.8165 has triggered further weakness towards 0.8000 psychological level. Resistance is at 0.8276 previous low.
AUDUSD BULLISH Break of 1.0790 has exposed 1.0889, while support lies at 1.0580,
USDCAD BEARISH Violation of 0.9566 has exposed 0.9513, a key level. Resistance is at 0.9669.
EURCHF BEARISH The cross continues to weaken. Support is at 1.1458, where a break would open up the way for eventual move towards parity. Resistance is at 1.1752.
EURGBP BEARISH Clearance of 0.8749 would expose 0.8722. Initial resistance is at 0.8906.
EURJPY BEARISH Support lies at 109.58, a move below the level would open 107.99 and 106.61 next. Near-term resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDJPY pressures 78.44 support
EURUSD BEARISH Break of 1.3951 would open 1.3837 key low. Resistance is at 1.4342 Fibonacci level.
USDJPY BEARISH Pressure on 78.44 Fibonacci support; a break here would open 76.25 key low. Near-term resistance is at 79.57 previous low.
GBPUSD BEARISH The pair bounced back through 1.6141 to expose 1.6263. Overall outlook is negative and we expect weakness towards 1.5906 and 1.5781.
USDCHF BEARISH Bear trend continues; decline through 0.8165 has triggered further weakness towards 0.8000 psychological level. Resistance is at 0.8276 previous low.
AUDUSD BULLISH Break of 1.0790 has exposed 1.0889, while support lies at 1.0580,
USDCAD BEARISH Violation of 0.9566 has exposed 0.9513, a key level. Resistance is at 0.9669.
EURCHF BEARISH The cross continues to weaken. Support is at 1.1458, where a break would open up the way for eventual move towards parity. Resistance is at 1.1752.
EURGBP BEARISH Clearance of 0.8749 would expose 0.8722. Initial resistance is at 0.8906.
EURJPY BEARISH Support lies at 109.58, a move below the level would open 107.99 and 106.61 next. Near-term resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
14 July 2011 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The dollar was dealt a double blow over the past 12 hours. Moody's put the US sovereign rating on review for a possible downgrade, citing a lack of progress in negotiations on raising the debt ceiling. The dollar sold off in response, and losses were especially pronounced against the JPY and CHF. Earlier, Fed Chairman Bernanke's testimony to Congress set a relatively dovish tone and comments suggesting that the option for further stimulus remains open stoked fears of another round of QE. Bernanke's speech largely repeated themes from his June 22 comments but the Fed is clearly keeping an open stance on policy until a significant trend in data emerges. The euro shook off uncertainty over the timing of a potential emergency meeting in the Eurozone and a Fitch downgrade of Greece. EURUSD traded 1.4131-1.4282. USDJPY traded 78.47-79.61. Eurozone core CPI and US jobless claims are due.
EUR
Separate Eurozone authorities continue to dispute whether an emergency session will take place on Friday to address the region's debt crisis. The German Chancellor's office said no plans were being made at this time, though other sources noted that a meeting had been confirmed.
Fitch cut Greece's rating to CCC, and removed it from ratings watch negative. The agency said the move owes to the "absence of a new, fully-funded and credible EU-IMF economic program" and said a "rating default event" could arise from private sector involvement in Greece.
Eurozone industrial production for May grew at +4.0% y/y (cons. +4.8% y/y).
The Italian centre-left opposition called for approval of government austerity measures in the Senate by Thursday and by the lower house by Sunday. The Italian Economy Minister said the package will be approved and reinforced by Friday.
GBP
UK employment data was mixed. The claimant count for June came in at 24.5k, well above market expectations of 15.0, although the ILO measure showed that the labour market is still expanding. Sterling fell on the release and we look for further moves downward as the BoE doves maintain control of the BoE.
UK Chancellor George Osborne called upon Eurozone governments to act decisively on current risks, and warned that the UK was not immune to any financial storm led by the Eurozone..
JPY
Finance Minister Noda said recent moves in USDJPY have been one-sided, and that he does not want the current yen rise to persist. After first falling to a low of 78.45, USDJPY suddenly jumped to a high of 79.62 in Asia. There was no official confirmation of any intervention activity.
CHF
SNB's Jordan was on the wires yesterday, saying he was "very worried about current developments" in Europe and was "watching" EURCHF. He said that pegging EURCHF "would mean loss in sovereignty" however and the SNB was "neither powerless nor unable to act", suggesting that intervention was not completely off the table but remains dependent on CPI.
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 July 2011 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The dollar was dealt a double blow over the past 12 hours. Moody's put the US sovereign rating on review for a possible downgrade, citing a lack of progress in negotiations on raising the debt ceiling. The dollar sold off in response, and losses were especially pronounced against the JPY and CHF. Earlier, Fed Chairman Bernanke's testimony to Congress set a relatively dovish tone and comments suggesting that the option for further stimulus remains open stoked fears of another round of QE. Bernanke's speech largely repeated themes from his June 22 comments but the Fed is clearly keeping an open stance on policy until a significant trend in data emerges. The euro shook off uncertainty over the timing of a potential emergency meeting in the Eurozone and a Fitch downgrade of Greece. EURUSD traded 1.4131-1.4282. USDJPY traded 78.47-79.61. Eurozone core CPI and US jobless claims are due.
EUR
Separate Eurozone authorities continue to dispute whether an emergency session will take place on Friday to address the region's debt crisis. The German Chancellor's office said no plans were being made at this time, though other sources noted that a meeting had been confirmed.
Fitch cut Greece's rating to CCC, and removed it from ratings watch negative. The agency said the move owes to the "absence of a new, fully-funded and credible EU-IMF economic program" and said a "rating default event" could arise from private sector involvement in Greece.
Eurozone industrial production for May grew at +4.0% y/y (cons. +4.8% y/y).
The Italian centre-left opposition called for approval of government austerity measures in the Senate by Thursday and by the lower house by Sunday. The Italian Economy Minister said the package will be approved and reinforced by Friday.
GBP
UK employment data was mixed. The claimant count for June came in at 24.5k, well above market expectations of 15.0, although the ILO measure showed that the labour market is still expanding. Sterling fell on the release and we look for further moves downward as the BoE doves maintain control of the BoE.
UK Chancellor George Osborne called upon Eurozone governments to act decisively on current risks, and warned that the UK was not immune to any financial storm led by the Eurozone..
JPY
Finance Minister Noda said recent moves in USDJPY have been one-sided, and that he does not want the current yen rise to persist. After first falling to a low of 78.45, USDJPY suddenly jumped to a high of 79.62 in Asia. There was no official confirmation of any intervention activity.
CHF
SNB's Jordan was on the wires yesterday, saying he was "very worried about current developments" in Europe and was "watching" EURCHF. He said that pegging EURCHF "would mean loss in sovereignty" however and the SNB was "neither powerless nor unable to act", suggesting that intervention was not completely off the table but remains dependent on CPI.
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, July 13, 2011
13th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
13 July 2011 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDJPY 78.44 support
EURUSD BEARISH A break below 1.3837 would open 1.3752 and 1.3659. Resistance holds at 1.4295 for now.
USDJPY BEARISH The pair found support ahead of 78.44 Fibonacci level. A break here would open 76.25 key low. Near-term resistance is at 80.38.
GBPUSD BEARISH Focus is on 1.5752, a break below which would expose 1.5676. Resistance is at 1.6056.
USDCHF BEARISH Key support is at 0.8276, a move below the level would open 0.8165. Resistance is at 0.8551.
AUDUSD NEUTRAL 1.0790 and 1.0391 mark the near-term directional triggers.
USDCAD BEARISH Initial support is at 0.9566 ahead of 0.9513. Resistance is at 0.9779, yesterday's high.
EURCHF BEARISH Initial support is at 1.1500, a decline through which would expose 1.1458. Resistance is at 1.1806.
EURGBP BEARISH Sell-off targets 0.8722; a break here is required to confirm the bear trend and expose 0.8667. Resistance is at 0.8839.
EURJPY BEARISH Currently holds support at 109.58; a move below the level would open 107.99 and 106.61 next. Near-term resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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 July 2011 – 8:00 GMT
Wednesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDJPY 78.44 support
EURUSD BEARISH A break below 1.3837 would open 1.3752 and 1.3659. Resistance holds at 1.4295 for now.
USDJPY BEARISH The pair found support ahead of 78.44 Fibonacci level. A break here would open 76.25 key low. Near-term resistance is at 80.38.
GBPUSD BEARISH Focus is on 1.5752, a break below which would expose 1.5676. Resistance is at 1.6056.
USDCHF BEARISH Key support is at 0.8276, a move below the level would open 0.8165. Resistance is at 0.8551.
AUDUSD NEUTRAL 1.0790 and 1.0391 mark the near-term directional triggers.
USDCAD BEARISH Initial support is at 0.9566 ahead of 0.9513. Resistance is at 0.9779, yesterday's high.
EURCHF BEARISH Initial support is at 1.1500, a decline through which would expose 1.1458. Resistance is at 1.1806.
EURGBP BEARISH Sell-off targets 0.8722; a break here is required to confirm the bear trend and expose 0.8667. Resistance is at 0.8839.
EURJPY BEARISH Currently holds support at 109.58; a move below the level would open 107.99 and 106.61 next. Near-term resistance is at 112.95.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
13th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
13 July 2011 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
Risk appetite held steady during the Asia session, helped in part by stronger than expected Chinese economic data. EURUSD traded 1.3951-1.4054 and USDJPY traded 78.50-79.58. However, in another sign that the currency union's woes are only beginning, Moody's has downgraded Ireland to Ba1, or junk status, citing concerns that there could be further pressure on the sovereign from a disorderly default, or if the Irish government were unable to meet its targeted fiscal consolidation goals. Given that the ECB had waived collateral rules for Irish debt in Q1, the impact was not as significant as that on Portugal, but we expect headlines to remain negative for the euro in general. There is particular concern over whether the European Union is in fact going to meet later this week to discuss the crisis as different sources continue to contradict each other.
In the US, the FOMC minutes from the June meeting were released with limited fanfare. The Fed cited concerns over the debt ceiling and Eurozone problems as risks to the US economy, but there was less consensus on domestic growth. Some FOMC members warned that further stimulus may be warranted should conditions deteriorate further, giving hope to the handful of investors still on the lookout for QE3, but we still note that the bar for fresh action is prohibitively high at this stage. Fed Chairman Bernanke is set to deliver his semi-annual testimony on policy on Wednesday.
EUR
Moody's downgraded Ireland by one notch to Ba1, "junk" status, citing fears that the government would not be able to meet its fiscal consolidation targets and further assistance may be needed. Disruption from Greece and other sources have also been cited as potential pressure points. This met with a rebuke from Irish and Eurozone authorities, both of whom stressed that Ireland is on track within its current program and the move was not justified.
The Italian centre-left opposition called for approval of government austerity measures in the Senate by Thursday, and by the lower house by Sunday.
Belgium PM Leterme says Belgium's 2011 budget deficit is to be 3.3% of GDP instead of 3.6% of GDP. This was a reassuring figure after the OECD also warned that Belgium's fiscal path risked becoming unsustainable.
Separate Eurozone authorities continue to dispute whether an emergency session would be called on Friday. The German Chancellor's office said no plans were being made at this time, though other sources noted that a meeting had been confirmed.
Eurozone industrial production is due on Wednesday; the market is looking for a 4.8% y/y gain (0.4% m/m).
GBP
UK CPI came in softer than expectations at 4.2% y/y. The surprise decline was driven by weaker consumer sales as the UK retail sector feels the fiscal austerity squeeze. Sterling remains under pressure as the focus for the BoE switches towards growth prospects and potential spillover of Eurozone problems.
UK Chancellor George Osborne called upon Eurozone governments to act decisively on current risks, and warned that the UK was not immune to any financial storm led by the Eurozone.
On Wednesday labour market data will be the key focus. The claimant count rate is expected to show a rise to 4.7% as jobless claims continue to rise (cons. 15k). The ILO unemployment rate is expected to remain unchanged at 7.7%.
JPY
Finance Minister Noda described the overnight move in USDJPY as a little one-sided, but did not indicate that FX intervention is imminent.
CAD
Canada's merchandise trade deficit shrunk slightly to $0.8 bn in May (consensus -$0.9 bn, UBSe -$0.5 bn) from -$0.9 bn in April. Our analysts note the export gain was largely due to higher volumes in machinery and equipment, while imports advanced as well.
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 July 2011 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
Risk appetite held steady during the Asia session, helped in part by stronger than expected Chinese economic data. EURUSD traded 1.3951-1.4054 and USDJPY traded 78.50-79.58. However, in another sign that the currency union's woes are only beginning, Moody's has downgraded Ireland to Ba1, or junk status, citing concerns that there could be further pressure on the sovereign from a disorderly default, or if the Irish government were unable to meet its targeted fiscal consolidation goals. Given that the ECB had waived collateral rules for Irish debt in Q1, the impact was not as significant as that on Portugal, but we expect headlines to remain negative for the euro in general. There is particular concern over whether the European Union is in fact going to meet later this week to discuss the crisis as different sources continue to contradict each other.
In the US, the FOMC minutes from the June meeting were released with limited fanfare. The Fed cited concerns over the debt ceiling and Eurozone problems as risks to the US economy, but there was less consensus on domestic growth. Some FOMC members warned that further stimulus may be warranted should conditions deteriorate further, giving hope to the handful of investors still on the lookout for QE3, but we still note that the bar for fresh action is prohibitively high at this stage. Fed Chairman Bernanke is set to deliver his semi-annual testimony on policy on Wednesday.
EUR
Moody's downgraded Ireland by one notch to Ba1, "junk" status, citing fears that the government would not be able to meet its fiscal consolidation targets and further assistance may be needed. Disruption from Greece and other sources have also been cited as potential pressure points. This met with a rebuke from Irish and Eurozone authorities, both of whom stressed that Ireland is on track within its current program and the move was not justified.
The Italian centre-left opposition called for approval of government austerity measures in the Senate by Thursday, and by the lower house by Sunday.
Belgium PM Leterme says Belgium's 2011 budget deficit is to be 3.3% of GDP instead of 3.6% of GDP. This was a reassuring figure after the OECD also warned that Belgium's fiscal path risked becoming unsustainable.
Separate Eurozone authorities continue to dispute whether an emergency session would be called on Friday. The German Chancellor's office said no plans were being made at this time, though other sources noted that a meeting had been confirmed.
Eurozone industrial production is due on Wednesday; the market is looking for a 4.8% y/y gain (0.4% m/m).
GBP
UK CPI came in softer than expectations at 4.2% y/y. The surprise decline was driven by weaker consumer sales as the UK retail sector feels the fiscal austerity squeeze. Sterling remains under pressure as the focus for the BoE switches towards growth prospects and potential spillover of Eurozone problems.
UK Chancellor George Osborne called upon Eurozone governments to act decisively on current risks, and warned that the UK was not immune to any financial storm led by the Eurozone.
On Wednesday labour market data will be the key focus. The claimant count rate is expected to show a rise to 4.7% as jobless claims continue to rise (cons. 15k). The ILO unemployment rate is expected to remain unchanged at 7.7%.
JPY
Finance Minister Noda described the overnight move in USDJPY as a little one-sided, but did not indicate that FX intervention is imminent.
CAD
Canada's merchandise trade deficit shrunk slightly to $0.8 bn in May (consensus -$0.9 bn, UBSe -$0.5 bn) from -$0.9 bn in April. Our analysts note the export gain was largely due to higher volumes in machinery and equipment, while imports advanced as well.
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, July 12, 2011
12th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
12 July 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD breaks 1.3970
EURUSD BEARISH Decline through 1.3970 has confirmed the bearish conditions and exposed support at 1.3903 ahead of 1.3855. Near-term resistance is at 1.4298.
USDJPY BEARISH Break below 80.27 has opened the way towards 79.70 and 79.57. Initial resistance is at 80.83.
GBPUSD BEARISH Clearance of 1.5881 has put focus on 1.5822 ahead of 1.5752. Resistance is at 1.6056.
USDCHF BEARISH Key support is at 0.8276, a move below the level would open 0.8165. Resistance is at 0.8551.
AUDUSD NEUTRAL Pull back through 1.0591 has exposed support at 1.0520. Key resistance is at 1.0790.
USDCAD BEARISH Initial support is at 0.9600, a break of which would expose 0.9556. A recovery through 0.9740 would offset the losses and open 0.9780.
EURCHF BEARISH Scope for further weakness towards 1.1600 and 1.1458. Resistance is at 1.1984.
EURGBP NEUTRAL Downside trigger is at 0.8722, while resistance is at 0.8906.
EURJPY BEARISH Sell-off through 112.00 has paved the way for weakness towards 110.54 ahead of 110.00. Resistance is at 113.42.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
12 July 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURUSD breaks 1.3970
EURUSD BEARISH Decline through 1.3970 has confirmed the bearish conditions and exposed support at 1.3903 ahead of 1.3855. Near-term resistance is at 1.4298.
USDJPY BEARISH Break below 80.27 has opened the way towards 79.70 and 79.57. Initial resistance is at 80.83.
GBPUSD BEARISH Clearance of 1.5881 has put focus on 1.5822 ahead of 1.5752. Resistance is at 1.6056.
USDCHF BEARISH Key support is at 0.8276, a move below the level would open 0.8165. Resistance is at 0.8551.
AUDUSD NEUTRAL Pull back through 1.0591 has exposed support at 1.0520. Key resistance is at 1.0790.
USDCAD BEARISH Initial support is at 0.9600, a break of which would expose 0.9556. A recovery through 0.9740 would offset the losses and open 0.9780.
EURCHF BEARISH Scope for further weakness towards 1.1600 and 1.1458. Resistance is at 1.1984.
EURGBP NEUTRAL Downside trigger is at 0.8722, while resistance is at 0.8906.
EURJPY BEARISH Sell-off through 112.00 has paved the way for weakness towards 110.54 ahead of 110.00. Resistance is at 113.42.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
12th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
12 July 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The euro continued to sell off during the Asia session as Monday's meeting of Eurozone finance ministers failed to produce any concrete proposals to address the latest bout of market nervousness. EURUSD traded 1.3932-1.4062 and USDJPY 80.06-80.38. Italy's debt auctions on Thursday are likely to be the next major risk event for the euro, and are already fast becoming the focus of market attention. Yesterday, Spanish 10y yields climbed above 6% for the first time since the launch of the euro. Italian 10y yields pushed 42 bp higher on the day, while German bunds saw safe haven demand. EURCHF made new record lows overnight, dipping below 1.1700 again. European stocks fell sharply, and the S&P 500 followed closing -1.81% lower. FOMC minutes are due, but events inside the Eurozone are likely to remain the principal driver of EURUSD for the foreseeable future.
EUR
No new policy initiatives were announced at Monday's meeting of Eurozone finance ministers despite yesterday's broad-based selloff in euro-denominated assets. The post-meeting statement made no direct reference to Italy or Spain. Given these countries are the source of the latest bout of market nervousness, this omission is unlikely to soothe market concerns. Although Eurogroup Chairman Juncker did say he was aware that Italy is currently the focus of market attention, he conceded the meeting did not discuss developments in Italy in specific detail.
Ministers said they "stand ready to adopt further measures" to improve the Eurozone's capacity "to resist contagion risk". But the details were disappointingly vague. The possibility of "enhancing the flexibility and the scope of the EFSF" was mentioned, but proposals on this have yet to be even presented to ministers. Some progress on this is expected "shortly", but no specific timeframe was mentioned.
The most interesting development was that ministers have dropped their ambition to find a solution that avoids a 'selective default' rating for Greece. This is likely a tacit admission that a default rating will be almost impossible to avoid. That in itself is a worrying development for the euro given the uncertainties around how the ECB and national regulators may react.
ECB Executive Board member Bini-Smaghi said that inflation expectations in the Eurozone are stable for now. On the sovereign debt issue, he stuck to his previous view claiming that allowing a country to default would be "madness'. He described the correlation between sovereign risk and banking sector risk as 'explosive', but insisted that Italy will never default because it is a rich country and is clearly able to repay its debt. However, he recommended that Italian banks should accelerate their plans to raise capital.
German Chancellor Merkel said that Italy must send an urgent signal about its commitment to fiscal reform.
German Finance Minister Schaeuble said that speculation about doubling the size of Europe's rescue facility has no basis in fact.
The PBoC's Deputy Governor said that he has confidence in the euro, and that Europe will remain a primary investment target for China. He added he is prepared to explore cooperation with the EU, although did not elaborate.
EU Financial Services Commissioner Barnier said he would ask the G20 to consider global rules on ratings agencies.
JPY
The BoJ kept the policy rate unchanged, and made no adjustments to any of its unconventional policy measures.
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.
12 July 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The euro continued to sell off during the Asia session as Monday's meeting of Eurozone finance ministers failed to produce any concrete proposals to address the latest bout of market nervousness. EURUSD traded 1.3932-1.4062 and USDJPY 80.06-80.38. Italy's debt auctions on Thursday are likely to be the next major risk event for the euro, and are already fast becoming the focus of market attention. Yesterday, Spanish 10y yields climbed above 6% for the first time since the launch of the euro. Italian 10y yields pushed 42 bp higher on the day, while German bunds saw safe haven demand. EURCHF made new record lows overnight, dipping below 1.1700 again. European stocks fell sharply, and the S&P 500 followed closing -1.81% lower. FOMC minutes are due, but events inside the Eurozone are likely to remain the principal driver of EURUSD for the foreseeable future.
EUR
No new policy initiatives were announced at Monday's meeting of Eurozone finance ministers despite yesterday's broad-based selloff in euro-denominated assets. The post-meeting statement made no direct reference to Italy or Spain. Given these countries are the source of the latest bout of market nervousness, this omission is unlikely to soothe market concerns. Although Eurogroup Chairman Juncker did say he was aware that Italy is currently the focus of market attention, he conceded the meeting did not discuss developments in Italy in specific detail.
Ministers said they "stand ready to adopt further measures" to improve the Eurozone's capacity "to resist contagion risk". But the details were disappointingly vague. The possibility of "enhancing the flexibility and the scope of the EFSF" was mentioned, but proposals on this have yet to be even presented to ministers. Some progress on this is expected "shortly", but no specific timeframe was mentioned.
The most interesting development was that ministers have dropped their ambition to find a solution that avoids a 'selective default' rating for Greece. This is likely a tacit admission that a default rating will be almost impossible to avoid. That in itself is a worrying development for the euro given the uncertainties around how the ECB and national regulators may react.
ECB Executive Board member Bini-Smaghi said that inflation expectations in the Eurozone are stable for now. On the sovereign debt issue, he stuck to his previous view claiming that allowing a country to default would be "madness'. He described the correlation between sovereign risk and banking sector risk as 'explosive', but insisted that Italy will never default because it is a rich country and is clearly able to repay its debt. However, he recommended that Italian banks should accelerate their plans to raise capital.
German Chancellor Merkel said that Italy must send an urgent signal about its commitment to fiscal reform.
German Finance Minister Schaeuble said that speculation about doubling the size of Europe's rescue facility has no basis in fact.
The PBoC's Deputy Governor said that he has confidence in the euro, and that Europe will remain a primary investment target for China. He added he is prepared to explore cooperation with the EU, although did not elaborate.
EU Financial Services Commissioner Barnier said he would ask the G20 to consider global rules on ratings agencies.
JPY
The BoJ kept the policy rate unchanged, and made no adjustments to any of its unconventional policy measures.
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, July 11, 2011
11th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
11 July 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURCHF 1.1806 key support
EURUSD BEARISH Focus is on 1.4103, a break below which would expose 1.4074. Resistance is at 1.4375.
USDJPY BULLISH Initial resistance is at 81.77, a break of which would expose 82.23. Near-term support lies at 80.27.
GBPUSD BEARISH While resistance at 1.6141 holds, watch for a break below 1.5911 to expose 1.5881, Fibonacci level.
USDCHF BEARISH Momentum is negative; a break of initial support at 0.8306 would open 0.8276, a key low. Key resistance is at 0.8551.
AUDUSD BULLISH Focus on initial resistance at 1.0790, a move above which would open the way towards 1.0889. Initial support lies at 1.0655.
USDCAD BEARISH Initial support lies at 0.9556, a break here would open 0.9513. Resistance is at 0.9705.
EURCHF BEARISH Sharp sell-off through 1.1934 has paved the way for further downside towards 1.1806. Resistance is at 1.2172.
EURGBP NEUTRAL Resistance is at 0.9001, while initial support lies at 0.8826 ahead of 0.8807.
EURJPY BEARISH Decline through 114.50 has opened the way to 113.78 and 113.42. Initial resistance is at 116.81.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
11 July 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURCHF 1.1806 key support
EURUSD BEARISH Focus is on 1.4103, a break below which would expose 1.4074. Resistance is at 1.4375.
USDJPY BULLISH Initial resistance is at 81.77, a break of which would expose 82.23. Near-term support lies at 80.27.
GBPUSD BEARISH While resistance at 1.6141 holds, watch for a break below 1.5911 to expose 1.5881, Fibonacci level.
USDCHF BEARISH Momentum is negative; a break of initial support at 0.8306 would open 0.8276, a key low. Key resistance is at 0.8551.
AUDUSD BULLISH Focus on initial resistance at 1.0790, a move above which would open the way towards 1.0889. Initial support lies at 1.0655.
USDCAD BEARISH Initial support lies at 0.9556, a break here would open 0.9513. Resistance is at 0.9705.
EURCHF BEARISH Sharp sell-off through 1.1934 has paved the way for further downside towards 1.1806. Resistance is at 1.2172.
EURGBP NEUTRAL Resistance is at 0.9001, while initial support lies at 0.8826 ahead of 0.8807.
EURJPY BEARISH Decline through 114.50 has opened the way to 113.78 and 113.42. Initial resistance is at 116.81.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
11th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
11 July 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The dollar enjoyed a broad-based though somewhat cautious advance during the Asia session. The euro came under further selling pressure after several vague newspaper articles suggested that opposition to an eventual Greek default may be starting to melt away among European officials. EURUSD traded 1.4181-1.4297. USDJPY traded 80.51-81.78. On Friday, non-farm payrolls only managed to climb by +18k (cons. +105k), while private payrolls rose only +57k (cons. +132k). The unemployment rate unexpectedly ticked higher again to 9.2% (cons. 9.1%). In response, the dollar fell sharply against the JPY and the CHF as US 10y yields dropped 15bp. US President Obama said the payrolls data shows "we still have a long way to go". US Treasury Secretary Geithner said he expects to see yields push higher as the Aug. 2 deadline approaches for changes to the debt ceiling. Our rates strategists agree, and we believe that if the move up in yields is gradual and orderly, USDJPY and USDCHF should receive some support, at least in the early stages of the move.
EUR
Eurozone finance ministers are due to hold their regular monthly meeting today, beginning at 1245 GMT. However Reuters, citing unnamed sources, reports that an additional emergency meeting will take place beforehand. A small number of key decision makers are expected to attend, including EU Council President Von Rompuy, ECB President Trichet, Eurogroup Chairman Juncker, European Commission President Barroso and EU Commissioner for Economic and Monetary Affairs Rehn.
ECB Executive Board member Bini-Smaghi said that the crisis has shown that the euro is an incomplete construct. The comment appears to contradict the claim - popular among EU politicians and policymakers - that this crisis is not a crisis of the euro but rather a debt crisis in a number of Eurozone countries.
Bini-Smaghi said that longer-term solutions are needed to bolster the euro, even if Treaty changes may be needed to achieve them. He suggested that Eurozone countries could eventually transfer their debt issuance functions to a supra-national agency. He added that he favours a change in EFSF rules so that the release of funds will no longer need unanimous approval. We note that this would, in principle, make it easier for cash to be delivered to fiscally-challenged member states in future and would likely be seen as euro-positive.
Italian sovereign bonds and equities fell quite sharply on Friday - with the markets regulator saying that the selling was likely due to an over-reaction to rising levels of uncertainty. Italian Prime Minister Berlusconi said he had a "long and cordial" meeting with Economy Minister Tremonti, somewhat alleviating market concerns that a rift had developed between them. Berlusconi added that Italy aims to balance the budget by 2014. Reuters reports that German newspaper Die Welt will claim on Monday that the ECB favours a doubling of the EFSF's size to ?1.5 trn so as to cope with a possible escalation of the situation in Italy.
German President Wulff said that it could take another "10 to 15 years" to solve Greece's fiscal problems - a "lot more time&than...Europe is currently willing to acknowledge".
The IMF's Executive Board approved the release of ?3.2 bn to Greece as part of the fifth quarterly tranche (the EU has already approved its own contribution of ?8.7 bn). The decision was widely expected given the Greek parliament's approval of the latest round of austerity measures. IMF Managing Director Lagarde, referring to Greece, warned that "a durable fiscal adjustment is needed, lest the deficit get entrenched at an unsustainably high level".
Barroso said that a consensus is now building on how to regulate ratings agencies, but that the European Commission has no plans to create a new ratings agency.
JPY
Finance Minister Noda said that recent yen rises are not "excessive" but that Japan will intervene decisively if yen moves become as sharp as they were in March. Noda went on to say that Japan's intervention policy would not change under a new prime minister as FX policy is decided by the finance minister and not the prime minister.
The BoJ is scheduled to begin a two-day policy meeting today. We do not expect any shifts in policy to be announced on Tuesday.
AUD
Weekend data showed that China's CPI was firmer than expected in June, rising to +6.4% y/y (cons. 6.2%, prev. 5.5%). Ordinarily, CPI strength of this magnitude would hurt the AUD on fears of imminent policy tightening. However, the PBoC hiked the policy rate last week pre-emptively, so the AUD has taken the weekend news in its stride. China's June trade data showed a slowdown in overall import growth, to +19.3% y/y (cons. 25.3%, prev. 28.4%).
CAD
Canadian jobs numbers were robust with net change in employment coming in at 28.4k, mostly driven by part-time employment which accounted for about two-thirds of the rise. The unemployment rate was flat at 7.4%, in line with expectations.
USDCAD climbed almost 80 pips immediately after the weak US payrolls numbers were released, but surrendered half of its gains before the close.
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.
11 July 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The dollar enjoyed a broad-based though somewhat cautious advance during the Asia session. The euro came under further selling pressure after several vague newspaper articles suggested that opposition to an eventual Greek default may be starting to melt away among European officials. EURUSD traded 1.4181-1.4297. USDJPY traded 80.51-81.78. On Friday, non-farm payrolls only managed to climb by +18k (cons. +105k), while private payrolls rose only +57k (cons. +132k). The unemployment rate unexpectedly ticked higher again to 9.2% (cons. 9.1%). In response, the dollar fell sharply against the JPY and the CHF as US 10y yields dropped 15bp. US President Obama said the payrolls data shows "we still have a long way to go". US Treasury Secretary Geithner said he expects to see yields push higher as the Aug. 2 deadline approaches for changes to the debt ceiling. Our rates strategists agree, and we believe that if the move up in yields is gradual and orderly, USDJPY and USDCHF should receive some support, at least in the early stages of the move.
EUR
Eurozone finance ministers are due to hold their regular monthly meeting today, beginning at 1245 GMT. However Reuters, citing unnamed sources, reports that an additional emergency meeting will take place beforehand. A small number of key decision makers are expected to attend, including EU Council President Von Rompuy, ECB President Trichet, Eurogroup Chairman Juncker, European Commission President Barroso and EU Commissioner for Economic and Monetary Affairs Rehn.
ECB Executive Board member Bini-Smaghi said that the crisis has shown that the euro is an incomplete construct. The comment appears to contradict the claim - popular among EU politicians and policymakers - that this crisis is not a crisis of the euro but rather a debt crisis in a number of Eurozone countries.
Bini-Smaghi said that longer-term solutions are needed to bolster the euro, even if Treaty changes may be needed to achieve them. He suggested that Eurozone countries could eventually transfer their debt issuance functions to a supra-national agency. He added that he favours a change in EFSF rules so that the release of funds will no longer need unanimous approval. We note that this would, in principle, make it easier for cash to be delivered to fiscally-challenged member states in future and would likely be seen as euro-positive.
Italian sovereign bonds and equities fell quite sharply on Friday - with the markets regulator saying that the selling was likely due to an over-reaction to rising levels of uncertainty. Italian Prime Minister Berlusconi said he had a "long and cordial" meeting with Economy Minister Tremonti, somewhat alleviating market concerns that a rift had developed between them. Berlusconi added that Italy aims to balance the budget by 2014. Reuters reports that German newspaper Die Welt will claim on Monday that the ECB favours a doubling of the EFSF's size to ?1.5 trn so as to cope with a possible escalation of the situation in Italy.
German President Wulff said that it could take another "10 to 15 years" to solve Greece's fiscal problems - a "lot more time&than...Europe is currently willing to acknowledge".
The IMF's Executive Board approved the release of ?3.2 bn to Greece as part of the fifth quarterly tranche (the EU has already approved its own contribution of ?8.7 bn). The decision was widely expected given the Greek parliament's approval of the latest round of austerity measures. IMF Managing Director Lagarde, referring to Greece, warned that "a durable fiscal adjustment is needed, lest the deficit get entrenched at an unsustainably high level".
Barroso said that a consensus is now building on how to regulate ratings agencies, but that the European Commission has no plans to create a new ratings agency.
JPY
Finance Minister Noda said that recent yen rises are not "excessive" but that Japan will intervene decisively if yen moves become as sharp as they were in March. Noda went on to say that Japan's intervention policy would not change under a new prime minister as FX policy is decided by the finance minister and not the prime minister.
The BoJ is scheduled to begin a two-day policy meeting today. We do not expect any shifts in policy to be announced on Tuesday.
AUD
Weekend data showed that China's CPI was firmer than expected in June, rising to +6.4% y/y (cons. 6.2%, prev. 5.5%). Ordinarily, CPI strength of this magnitude would hurt the AUD on fears of imminent policy tightening. However, the PBoC hiked the policy rate last week pre-emptively, so the AUD has taken the weekend news in its stride. China's June trade data showed a slowdown in overall import growth, to +19.3% y/y (cons. 25.3%, prev. 28.4%).
CAD
Canadian jobs numbers were robust with net change in employment coming in at 28.4k, mostly driven by part-time employment which accounted for about two-thirds of the rise. The unemployment rate was flat at 7.4%, in line with expectations.
USDCAD climbed almost 80 pips immediately after the weak US payrolls numbers were released, but surrendered half of its gains before the close.
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, July 08, 2011
8th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
8 July 2011 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURGBP 89.03 Support.
EURUSD NEUTRAL The near-term directional triggers are at 1.4467 and 1.4215.
USDJPY BULLISH Focus on initial resistance at 81.77, a break here would open 82.23, a key high. Support lies at 80.71.
GBPUSD BEARISH Momentum is negative; a move below 1.5911 would pave the way for losses towards 1.5881, Fibonacci level. Near-term resistance is at 1.6091.
USDCHF NEUTRAL A recovery through 0.8551 would develop bullish conditions, while support lies at 0.8364.
AUDUSD BULLISH Clearance of initial resistance at 1.0790 would open the way towards 1.0889. Initial support lies at 1.0655.
USDCAD BEARISH The break of initial support at 0.9556 would signal further weakness towards 0.9513. Resistance is at 0.9667.
EURCHF NEUTRAL Resistance is at 1.2201, while downside trigger lies at 1.1934.
EURGBP BULLISH The cross bounced back to put focus on resistance 0.9018, a push above which would open 0.9049. Support lies at 0.8903.
EURJPY BULLISH Break of resistance at 117.05 would expose 117.90. Initial support lies at 115.53.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
8 July 2011 – 8:00 GMT
Friday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURGBP 89.03 Support.
EURUSD NEUTRAL The near-term directional triggers are at 1.4467 and 1.4215.
USDJPY BULLISH Focus on initial resistance at 81.77, a break here would open 82.23, a key high. Support lies at 80.71.
GBPUSD BEARISH Momentum is negative; a move below 1.5911 would pave the way for losses towards 1.5881, Fibonacci level. Near-term resistance is at 1.6091.
USDCHF NEUTRAL A recovery through 0.8551 would develop bullish conditions, while support lies at 0.8364.
AUDUSD BULLISH Clearance of initial resistance at 1.0790 would open the way towards 1.0889. Initial support lies at 1.0655.
USDCAD BEARISH The break of initial support at 0.9556 would signal further weakness towards 0.9513. Resistance is at 0.9667.
EURCHF NEUTRAL Resistance is at 1.2201, while downside trigger lies at 1.1934.
EURGBP BULLISH The cross bounced back to put focus on resistance 0.9018, a push above which would open 0.9049. Support lies at 0.8903.
EURJPY BULLISH Break of resistance at 117.05 would expose 117.90. Initial support lies at 115.53.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
8th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
8 July 2011 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
Attention shifts to payrolls today as the market seeks to end the week consolidating the gains made in risk. A robust ADP payrolls report has boosted hopes of a good number today (UBSe +135k, cons. 100k) and sentiment is invariably better on the economy compared to just over a weak ago, when soft regional PMI prints out of the US prompted fears that the soft patch was entrenching. Consensus expectations for the headline payrolls number has risen by around 20k since, though even with a good print the Fed will remain underwhelmed. In other news, yesterday the euro caught a bid after the ECB unexpectedly tweaked its collateral rules to favour Portuguese sovereign bonds. Consequently, these bonds will still be considered eligible collateral at ECB tenders even if the sovereign rating is eventually cut to "junk" status by all three ratings agencies. Previously, only Greek and Irish sovereign debt had enjoyed this privilege. Before Thursday's decision, there had been a hypothetical risk that Portuguese banks might soon be unable to access ECB cash, leading to a potential funding crisis - but the ECB's action now effectively removes this risk in the near term. EURUSD traded in a range of 1.4335-1.4368 and USDJPY 81.22-81.31.
EUR
The ECB hiked interest rates for the second time in the current cycle, pushing the refi rate 25 bp higher to 1.50%. This was widely expected, so the euro climbed just 10 pips in the immediate aftermath of the announcement, only to surrender these gains moments later. At the subsequent press conference, ECB President Trichet maintained his hawkish tightening bias, noting that the risks to inflation remain on the upside and that he is monitoring these risks "very closely". Trichet also repeated the ECB's opposition to any rollover of Greek debt that would result in either a credit event, or a selective default rating.
EU President Van Rompuy again said the EUR is not facing a crisis, and the currency is stable and strong.
German industrial production was very strong at 7.6%y/y, and 1.2%m/m. This is consistent with the firm factory orders releases sent this weak, though doubts remain over the sustainability of the figures.
German trade surplus in May was stronger than expected at EUR12.8bln, helped by a 19.9% jump in exports. However the current account was softer compared to April at EUR6.9bln.
GBP
The Bank of England held the base rate steady at 0.50% and kept its asset purchase target unchanged. No statement was released, and investors will now look to the minutes for further details - sterling is likely to be hurt on any evidence of a shift in opinion towards more Gilt purchases. We continue to see GBP trading heavy in the medium term.
CHF
Swiss Unemployment was in line with expectations at 2.8% in June, data remains robust in the country though the SNB remains in a difficult position to move forward with policy, even though the ECB has now pushed the rate gap to 125bp.
Swiss CPI for June came in below consensus with consumer prices increasing +0.6% y/y and -0.2% m/m. We remain positive on EURCHF in the medium term as last week's weaker than expected manufacturing PMI suggests Swiss exports may be starting to feel the effects from their strong currency, but in the short term Moody's recent downgrade Portugal, and other associated periphery risks are weighing on EURCHF.
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.
8 July 2011 – 8:00 GMT
Friday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
Attention shifts to payrolls today as the market seeks to end the week consolidating the gains made in risk. A robust ADP payrolls report has boosted hopes of a good number today (UBSe +135k, cons. 100k) and sentiment is invariably better on the economy compared to just over a weak ago, when soft regional PMI prints out of the US prompted fears that the soft patch was entrenching. Consensus expectations for the headline payrolls number has risen by around 20k since, though even with a good print the Fed will remain underwhelmed. In other news, yesterday the euro caught a bid after the ECB unexpectedly tweaked its collateral rules to favour Portuguese sovereign bonds. Consequently, these bonds will still be considered eligible collateral at ECB tenders even if the sovereign rating is eventually cut to "junk" status by all three ratings agencies. Previously, only Greek and Irish sovereign debt had enjoyed this privilege. Before Thursday's decision, there had been a hypothetical risk that Portuguese banks might soon be unable to access ECB cash, leading to a potential funding crisis - but the ECB's action now effectively removes this risk in the near term. EURUSD traded in a range of 1.4335-1.4368 and USDJPY 81.22-81.31.
EUR
The ECB hiked interest rates for the second time in the current cycle, pushing the refi rate 25 bp higher to 1.50%. This was widely expected, so the euro climbed just 10 pips in the immediate aftermath of the announcement, only to surrender these gains moments later. At the subsequent press conference, ECB President Trichet maintained his hawkish tightening bias, noting that the risks to inflation remain on the upside and that he is monitoring these risks "very closely". Trichet also repeated the ECB's opposition to any rollover of Greek debt that would result in either a credit event, or a selective default rating.
EU President Van Rompuy again said the EUR is not facing a crisis, and the currency is stable and strong.
German industrial production was very strong at 7.6%y/y, and 1.2%m/m. This is consistent with the firm factory orders releases sent this weak, though doubts remain over the sustainability of the figures.
German trade surplus in May was stronger than expected at EUR12.8bln, helped by a 19.9% jump in exports. However the current account was softer compared to April at EUR6.9bln.
GBP
The Bank of England held the base rate steady at 0.50% and kept its asset purchase target unchanged. No statement was released, and investors will now look to the minutes for further details - sterling is likely to be hurt on any evidence of a shift in opinion towards more Gilt purchases. We continue to see GBP trading heavy in the medium term.
CHF
Swiss Unemployment was in line with expectations at 2.8% in June, data remains robust in the country though the SNB remains in a difficult position to move forward with policy, even though the ECB has now pushed the rate gap to 125bp.
Swiss CPI for June came in below consensus with consumer prices increasing +0.6% y/y and -0.2% m/m. We remain positive on EURCHF in the medium term as last week's weaker than expected manufacturing PMI suggests Swiss exports may be starting to feel the effects from their strong currency, but in the short term Moody's recent downgrade Portugal, and other associated periphery risks are weighing on EURCHF.
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, July 07, 2011
7th of July 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
7 July 2011 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURJPY focus on 117.90.
EURUSD BULLISH While support at 1.4333 holds, focus on initial resistance at 1.4578; a break here would expose 1.4653 and 1.4697, the key high from June 7.
USDJPY BULLISH A move above 81.27 would open up the way towards 81.77 and 82.23. Support lies at 80.27.
GBPUSD BEARISH Decline through 1.5970 would favor extension of losses towards 1.5911. Resistance is at 1.6154.
USDCHF NEUTRAL Key resistance is at 0.8551, while support lies at 0.8306 ahead of 0.8276, the key low.
AUDUSD BULLISH Clearance of 1.0790 would signal scope for further gains towards 1.0889. Initial support lies at 1.0520.
USDCAD BEARISH A push through 0.9580 would expose key support at 0.9513. Resistance is at 0.9705.
EURCHF NEUTRAL Sharp fall below 1.2186 has turned the model to neutral; resistance is at 1.2346 and support lies at 1.2030.
EURGBP BULLISH As long as 0.8903 holds, expect a recovery towards 0.9049 and 0.9095, the Fibonacci resistance.
EURJPY BULLISH Focus is on 117.90 break of which would be an important bullish development to expose 118.38 next. Support holds at 115.91.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
7 July 2011 – 8:00 GMT
Thursday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
EURJPY focus on 117.90.
EURUSD BULLISH While support at 1.4333 holds, focus on initial resistance at 1.4578; a break here would expose 1.4653 and 1.4697, the key high from June 7.
USDJPY BULLISH A move above 81.27 would open up the way towards 81.77 and 82.23. Support lies at 80.27.
GBPUSD BEARISH Decline through 1.5970 would favor extension of losses towards 1.5911. Resistance is at 1.6154.
USDCHF NEUTRAL Key resistance is at 0.8551, while support lies at 0.8306 ahead of 0.8276, the key low.
AUDUSD BULLISH Clearance of 1.0790 would signal scope for further gains towards 1.0889. Initial support lies at 1.0520.
USDCAD BEARISH A push through 0.9580 would expose key support at 0.9513. Resistance is at 0.9705.
EURCHF NEUTRAL Sharp fall below 1.2186 has turned the model to neutral; resistance is at 1.2346 and support lies at 1.2030.
EURGBP BULLISH As long as 0.8903 holds, expect a recovery towards 0.9049 and 0.9095, the Fibonacci resistance.
EURJPY BULLISH Focus is on 117.90 break of which would be an important bullish development to expose 118.38 next. Support holds at 115.91.
SCHEDULE
Please visit Fibosignals.com’s Economic Calendar for a schedule of market news and events.
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.
7th of July 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
7 July 2011 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The ECB decision today will be the main focus as investors assess whether the central bank can maintain a relatively hawkish stance in light of growing data and event risk. Despite heavy volatility in European credit markets, sentiment finally stabilised during the US session once the market had fully digested yesterday's news of Portugal's ratings downgrade. Surveying the damage since the announcement we see that the euro fell 200 pips, Portuguese 10y yields widened about 180 bp, and other European sovereigns such as Ireland, Spain, and Italy also came under some pressure. European equities only fell moderately however, and the S&P 500 has since managed to stay just inside positive territory at +0.1% on the day. The European authorities have denounced credit ratings agencies over their action, leading to fears of renewed policy risk. In Australia overnight, jobs figures came in slightly better than expected at +23k (cons. 15k), somewhat offsetting the negative impact of a Chinese hike yesterday but the outlook remains less rosy at this stage. Ahead today, the BoE decision is also out EURUSD traded 1.4312 -1.4347, USDJPY 80.80-81.01.
EUR
The European commission 'regretted' Moody's decision to cut Portugal's rating, and EU Commission President Barroso said that the move was based on hypothetical scenarios.
It was a light data day but German factory orders surprised to the upside, registering a 1.8%m/m gain vs. expectations for a 0.5% decline. German industrial production is due, along with the ECB rate decision. Our European economists expect another 25 bp hike from the ECB today.
Apart from the ECB decision, In Switzerland, CPI is due today, we also have industrial production data out of Germany and Norway.
GBP
The Bank of England will decide on rates today and the asset purchase program. We expect no action on either policy measure.
CAD
Canadian IVEY PMI is out today and the market is looking for a decline to 62.0 - though still a robust reading. We remain favourable on CAD on the crosses.
AUD
The Australian jobs report came in slightly better than expected at +23k. The unemployment rate was steady at 4.9% - which our economists believe is crucial at this stage. Even though the rate of growth is flat, there is no reason for markets to be overly dovish yet.
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.
7 July 2011 – 8:00 GMT
Thursday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The ECB decision today will be the main focus as investors assess whether the central bank can maintain a relatively hawkish stance in light of growing data and event risk. Despite heavy volatility in European credit markets, sentiment finally stabilised during the US session once the market had fully digested yesterday's news of Portugal's ratings downgrade. Surveying the damage since the announcement we see that the euro fell 200 pips, Portuguese 10y yields widened about 180 bp, and other European sovereigns such as Ireland, Spain, and Italy also came under some pressure. European equities only fell moderately however, and the S&P 500 has since managed to stay just inside positive territory at +0.1% on the day. The European authorities have denounced credit ratings agencies over their action, leading to fears of renewed policy risk. In Australia overnight, jobs figures came in slightly better than expected at +23k (cons. 15k), somewhat offsetting the negative impact of a Chinese hike yesterday but the outlook remains less rosy at this stage. Ahead today, the BoE decision is also out EURUSD traded 1.4312 -1.4347, USDJPY 80.80-81.01.
EUR
The European commission 'regretted' Moody's decision to cut Portugal's rating, and EU Commission President Barroso said that the move was based on hypothetical scenarios.
It was a light data day but German factory orders surprised to the upside, registering a 1.8%m/m gain vs. expectations for a 0.5% decline. German industrial production is due, along with the ECB rate decision. Our European economists expect another 25 bp hike from the ECB today.
Apart from the ECB decision, In Switzerland, CPI is due today, we also have industrial production data out of Germany and Norway.
GBP
The Bank of England will decide on rates today and the asset purchase program. We expect no action on either policy measure.
CAD
Canadian IVEY PMI is out today and the market is looking for a decline to 62.0 - though still a robust reading. We remain favourable on CAD on the crosses.
AUD
The Australian jobs report came in slightly better than expected at +23k. The unemployment rate was steady at 4.9% - which our economists believe is crucial at this stage. Even though the rate of growth is flat, there is no reason for markets to be overly dovish yet.
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.