DAILY MARKET COMMENTARY
3 August 2011 – 8:00 GMT
Wednesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
Global risk aversion continued to rise during the Asia session after a day of further sovereign spread widening inside the Eurozone, and a poor session for US stocks. EURUSD traded 1.4162-1.4223 and USDJPY traded 77.01-77.40. The S&P 500 closed down -2.55%. AUDUSD remained under severe pressure due to declining risk appetite, and due to the rates market pricing in progressively deeper future cuts to the RBA's cash rate. US June consumer spending was reported at its lowest level since November 2010, confirming fears that domestic demand is currently not providing any meaningful support to the economy. It also added to nerves about US jobs data to come on Friday, as muted consumer confidence and business activity suggest little scope for a positive surprise. Elsewhere, the US Senate and President Obama signed off on the debt deal, which is aimed at raising the debt ceiling and cutting at least $2.1 trn from the budget deficit. However, this came as no surprise. Moody's affirmed the US long-term sovereign rating at Aaa in the wake of the deal on the debt ceiling, but lowered the outlook to negative. S&P has yet to give its verdict. ADP employment and the ISM non-manufacturing composite are due.
EUR
Italian authorities reportedly met on Tuesday to discuss the recent turmoil that has sent Italian long-term yields sharply higher, and concluded that the stress is mainly related to non-domestic factors, such as the critical situation in the Eurozone as a whole and in the US.
Eurozone PPI for June was unchanged at 0.0% m/m and +5.9% y/y.
JPY
Finance Minister Noda said the yen is overvalued and pledged to do his utmost to avoid further yen strength. BoJ Governor Shirakawa indirectly raised the prospect of further monetary easing - perhaps as soon as Friday's scheduled policy announcement. Shirakawa said the bank would take appropriate action after mulling the impact of the strong yen on the Japanese economy. Prime Minister Kan said he hopes the BoJ will support the economy in coordination with the government.
AUD
Although the AUD was already in an intraday downtrend largely due to declining risk appetite globally, a weaker-than-expected trade surplus and soft retail sales for June both added to the downward momentum.
GBP
UK construction PMI came in at 53.5, slightly higher than expectations for 53.1. The important indicator for the UK government will be the services indicator, due tomorrow.
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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Wednesday, August 03, 2011
Tuesday, August 02, 2011
2nd of August 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
2 August 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDJPY 76.25 key support.
EURUSD NEUTRAL A break above 1.4454 would trigger resumption of the bull trend and open 1.4536/78 resistance area. Support lies at 1.4134.
USDJPY BEARISH The pair has key support at 76.25, a move below this would expose 75.00, psychological level. Initial resistance is at 78.17.
GBPUSD BULLISH A rise through 1.6476 would open 1.6547, a key high. Support lies at 1.6211.
USDCHF BEARISH Support lies at 0.7681, the channel lower drawn off the Feb 11 high, ahead of 0.7541. Resistance is at 0.8070.
AUDUSD BULLISH Clearance of 1.1081 would expose 1.1198. Initial support lies at 1.0911.
USDCAD NEUTRAL Resistance is at 0.9636 while support lies at 0.9486.
EURCHF BEARISH A break of 1.1000 would favour extension of losses towards 1.0920/09 area. Resistance is at 1.1452.
EURGBP BEARISH A decline through 0.8705 would pave the way for losses towards 0.8657. Resistance is at 0.8806.
EURJPY BEARISH Initial support lies at 108.71 ahead of 106.61, the key low from March 17. Resistance is at 112.25.
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.
2 August 2011 – 8:00 GMT
Tuesday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
USDJPY 76.25 key support.
EURUSD NEUTRAL A break above 1.4454 would trigger resumption of the bull trend and open 1.4536/78 resistance area. Support lies at 1.4134.
USDJPY BEARISH The pair has key support at 76.25, a move below this would expose 75.00, psychological level. Initial resistance is at 78.17.
GBPUSD BULLISH A rise through 1.6476 would open 1.6547, a key high. Support lies at 1.6211.
USDCHF BEARISH Support lies at 0.7681, the channel lower drawn off the Feb 11 high, ahead of 0.7541. Resistance is at 0.8070.
AUDUSD BULLISH Clearance of 1.1081 would expose 1.1198. Initial support lies at 1.0911.
USDCAD NEUTRAL Resistance is at 0.9636 while support lies at 0.9486.
EURCHF BEARISH A break of 1.1000 would favour extension of losses towards 1.0920/09 area. Resistance is at 1.1452.
EURGBP BEARISH A decline through 0.8705 would pave the way for losses towards 0.8657. Resistance is at 0.8806.
EURJPY BEARISH Initial support lies at 108.71 ahead of 106.61, the key low from March 17. Resistance is at 112.25.
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.
2nd of August 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
2 August 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The US House of Representatives approved the bipartisan bill to raise the debt ceiling by a comfortable majority of 269-161. The currency reaction was extremely muted. EURUSD traded 1.4230-1.4283 and USDJPY 76.88-77.82. The Senate is due to vote on the same Bill at approximately 1600 GMT on Tuesday. Before the House vote, Moody's had already said that they were likely to affirm the US AAA debt rating if the debt ceiling is increased. However, the positive implications of the latest progress on the political front were offset by weaker macroeconomic data. At 50.9 (cons. 54.9, prev. 55.3) the ISM manufacturing PMI for July was considerably below market expectations. The new order component dropped to 49.2, into contraction territory. As a consequence of falling growth expectations, most global equity markets indices closed in the red. The S&P 500 ended 0.4% lower overnight and the Nikkei 225 is down 1.18% at the time of writing.
EUR
The manufacturing PMIs were released across parts of Europe and painted a mixed picture. While French and Italian numbers were stronger than the flash estimates, the Spanish PMI components were all down, with both domestic and export orders below 50. Our European economist notes that this points towards a further slowdown in Spanish industrial production.
JPY
Without citing sources, the Nikkei newspaper reported that the BoJ may take steps to ease monetary policy further at this week's meeting. It also claimed that the government is preparing for currency intervention.
Finance Minister Noda said he is watching FX markets especially closely today, and added he is communicating closely with the BoJ and with other countries on the yen's rise. He repeated that the yen is too strong and that moves have been one-sided.
AUD
The RBA kept the policy rate on hold and re-instated an implied near-term tightening bias, expressing 'concern' at the medium-term outlook for inflation. Nevertheless AUDUSD fell about 60 pips on the announcement. Our Australia economists stick to their view that the RBA is likely to hike rates again in October.
GBP
The UK manufacturing PMI was softer than consensus with the composite indicator at 49.1 and the new orders balance at 47.6. Cable fell on the release but soon reversed its losses.
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.
2 August 2011 – 8:00 GMT
Tuesday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
The US House of Representatives approved the bipartisan bill to raise the debt ceiling by a comfortable majority of 269-161. The currency reaction was extremely muted. EURUSD traded 1.4230-1.4283 and USDJPY 76.88-77.82. The Senate is due to vote on the same Bill at approximately 1600 GMT on Tuesday. Before the House vote, Moody's had already said that they were likely to affirm the US AAA debt rating if the debt ceiling is increased. However, the positive implications of the latest progress on the political front were offset by weaker macroeconomic data. At 50.9 (cons. 54.9, prev. 55.3) the ISM manufacturing PMI for July was considerably below market expectations. The new order component dropped to 49.2, into contraction territory. As a consequence of falling growth expectations, most global equity markets indices closed in the red. The S&P 500 ended 0.4% lower overnight and the Nikkei 225 is down 1.18% at the time of writing.
EUR
The manufacturing PMIs were released across parts of Europe and painted a mixed picture. While French and Italian numbers were stronger than the flash estimates, the Spanish PMI components were all down, with both domestic and export orders below 50. Our European economist notes that this points towards a further slowdown in Spanish industrial production.
JPY
Without citing sources, the Nikkei newspaper reported that the BoJ may take steps to ease monetary policy further at this week's meeting. It also claimed that the government is preparing for currency intervention.
Finance Minister Noda said he is watching FX markets especially closely today, and added he is communicating closely with the BoJ and with other countries on the yen's rise. He repeated that the yen is too strong and that moves have been one-sided.
AUD
The RBA kept the policy rate on hold and re-instated an implied near-term tightening bias, expressing 'concern' at the medium-term outlook for inflation. Nevertheless AUDUSD fell about 60 pips on the announcement. Our Australia economists stick to their view that the RBA is likely to hike rates again in October.
GBP
The UK manufacturing PMI was softer than consensus with the composite indicator at 49.1 and the new orders balance at 47.6. Cable fell on the release but soon reversed its losses.
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, August 01, 2011
1st of August 2011 - Technical Forex Market Overview
DAILY MARKET COMMENTARY
1 August 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
AUDUSD resistance 1.1081.
EURUSD BULLISH A break above 1.4536 would expose 1.4578, a key high. Near-term support lies at 1.4230.
USDJPY BEARISH Key support lies at 76.25, the key low, while resistance at 78.73 holds.
GBPUSD BULLISH Rise through 1.6496 would open 1.6547, a key high. Initial support lies at 1.6261.
USDCHF BEARISH The pair has support at 0.7693, the channel lower drawn off the Feb 11 high, ahead of 0.7541. Resistance is at 0.8070.
AUDUSD BULLISH Clearance of 1.1081 would expose 1.1198. Initial support lies at 1.0911.
USDCAD BEARISH Initial support is at 0.9486, a move below which would open the way towards 0.9458. Resistance is at 0.9590.
EURCHF BEARISH Near-term support lies at 1.1272 ahead of 1.0920. Resistance comes in at 1.1536.
EURGBP BEARISH Violation of 0.8705 would open the way towards 0.8657. Resistance is at 0.8806.
EURJPY BEARISH Key support lies at 109.58, a break of which would expose 108.53. Initial resistance is at 113.57.
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.
1 August 2011 – 8:00 GMT
Monday
_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
TECHNICAL DATA
AUDUSD resistance 1.1081.
EURUSD BULLISH A break above 1.4536 would expose 1.4578, a key high. Near-term support lies at 1.4230.
USDJPY BEARISH Key support lies at 76.25, the key low, while resistance at 78.73 holds.
GBPUSD BULLISH Rise through 1.6496 would open 1.6547, a key high. Initial support lies at 1.6261.
USDCHF BEARISH The pair has support at 0.7693, the channel lower drawn off the Feb 11 high, ahead of 0.7541. Resistance is at 0.8070.
AUDUSD BULLISH Clearance of 1.1081 would expose 1.1198. Initial support lies at 1.0911.
USDCAD BEARISH Initial support is at 0.9486, a move below which would open the way towards 0.9458. Resistance is at 0.9590.
EURCHF BEARISH Near-term support lies at 1.1272 ahead of 1.0920. Resistance comes in at 1.1536.
EURGBP BEARISH Violation of 0.8705 would open the way towards 0.8657. Resistance is at 0.8806.
EURJPY BEARISH Key support lies at 109.58, a break of which would expose 108.53. Initial resistance is at 113.57.
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.
1st of August 2011 - Fundamental Forex Market Overview
DAILY MARKET COMMENTARY
1 August 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
A deal has been agreed between President Obama and Congressional leaders to raise the debt ceiling by $0.9 trn immediately, and by as much as $2.4 trn by early next year. Fiscal spending cuts of up to $2.5 trn have also been agreed, although the detail is unclear given that a Congressional committee has been tasked with suggesting where those cuts are to be made. To become law, both the Senate and the House must still vote to approve the deal. Full votes are expected later today in Washington, although it must be stressed that acceptance is not a foregone conclusion. It is even conceivable that the debate drags on for a number of days. Despite the uncertainty surrounding the deal, both USDJPY and USDCHF found support overnight, although buying was somewhat cautious. EURUSD traded 1.4346-1.4410, and USDJPY 76.65-78.05. On Friday the S&P 500 fell -0.65%, although S&P futures are over 16 points ahead at the time of writing. US Q2 GDP growth came in well short of expectations at an annualised rate of only +1.3% (cons. +1.8%). Q1 growth was also revised down to a mere +0.4%, from a previous estimate of +1.9%. As a result, our US economics team have pushed back their call for the first Fed policy rate hike to "near the end of" 2012 (from Q1 2012..
EUR
Spanish Prime Minister Zapatero called a general election for November 20, and the euro initially reacted poorly. Apart from the political uncertainty this may bring, our European rates strategists note this may delay the full ratification of the EFSF's proposed new powers, announced at the July 21 EU summit.
Doubts have been raised in the press about whether the EFSF will be ready to provide Greece's sixth tranche of rescue funding which is due in September. All the previous tranches have been provided via a network of bilateral loans from donor countries, as the EFSF did not exist when Greece first needed to be rescued. However, since the July 21 summit, the stated ambition is to migrate responsibility for funding Greece to the EFSF. Somewhat alleviating concerns, a spokesman for the Eurogroup of Finance Ministers said that even if the EFSF cash cannot be mobilised in time for September, the existing system of bilateral loans which has funded Greece so far could be used again.
Newswires raised the possibility that Italy and Spain might choose not to contribute to Greece's sixth tranche if the bilateral system of loans is used again. Under the agreement reached in May 2010, a country may exercise its right not to participate if its own borrowing costs exceed the interest rate charged to Greece. We note that if the EFSF is ready in time, the problem goes away as countries would no longer need to raise cash directly to support Greece - rather that responsibility would fall on the EFSF, with Italy's and Spain's involvement limited to only guaranteeing the EFSF bonds issued. Spanish and Italian 10y yields closed slightly wider on the day at 6.04% and 5.85% respectively.
Eurozone July inflation was softer than expected at +2.5% y/y (cons. 2.7%). Nevertheless, hawkish rhetoric from ECB policymakers has been in plentiful supply over recent days, suggesting the bank remains alert to the risk of second-round inflationary pressures.
Moody's put Spain's Aa2 rating 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..
JPY
During the US session on Friday, Prime Minister Kan repeated comments made throughout the week by Finance Minister Noda. He said that recent FX moves are one-sided and that he would carefully watch FX moves closely. USDJPY briefly ticked about 10 pips higher, in the most pronounced reaction to rhetoric the market saw all week.
CHF
Swiss Economy Minister Schneider-Ammann said that the Swiss franc's rise is not temporary and it would not return to its former levels any time soon. He added that unemployment might climb because of the franc's strength.
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.
1 August 2011 – 8:00 GMT
Monday
____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________
FUNDAMENTAL ANALYSIS at 0800 GMT
USD
A deal has been agreed between President Obama and Congressional leaders to raise the debt ceiling by $0.9 trn immediately, and by as much as $2.4 trn by early next year. Fiscal spending cuts of up to $2.5 trn have also been agreed, although the detail is unclear given that a Congressional committee has been tasked with suggesting where those cuts are to be made. To become law, both the Senate and the House must still vote to approve the deal. Full votes are expected later today in Washington, although it must be stressed that acceptance is not a foregone conclusion. It is even conceivable that the debate drags on for a number of days. Despite the uncertainty surrounding the deal, both USDJPY and USDCHF found support overnight, although buying was somewhat cautious. EURUSD traded 1.4346-1.4410, and USDJPY 76.65-78.05. On Friday the S&P 500 fell -0.65%, although S&P futures are over 16 points ahead at the time of writing. US Q2 GDP growth came in well short of expectations at an annualised rate of only +1.3% (cons. +1.8%). Q1 growth was also revised down to a mere +0.4%, from a previous estimate of +1.9%. As a result, our US economics team have pushed back their call for the first Fed policy rate hike to "near the end of" 2012 (from Q1 2012..
EUR
Spanish Prime Minister Zapatero called a general election for November 20, and the euro initially reacted poorly. Apart from the political uncertainty this may bring, our European rates strategists note this may delay the full ratification of the EFSF's proposed new powers, announced at the July 21 EU summit.
Doubts have been raised in the press about whether the EFSF will be ready to provide Greece's sixth tranche of rescue funding which is due in September. All the previous tranches have been provided via a network of bilateral loans from donor countries, as the EFSF did not exist when Greece first needed to be rescued. However, since the July 21 summit, the stated ambition is to migrate responsibility for funding Greece to the EFSF. Somewhat alleviating concerns, a spokesman for the Eurogroup of Finance Ministers said that even if the EFSF cash cannot be mobilised in time for September, the existing system of bilateral loans which has funded Greece so far could be used again.
Newswires raised the possibility that Italy and Spain might choose not to contribute to Greece's sixth tranche if the bilateral system of loans is used again. Under the agreement reached in May 2010, a country may exercise its right not to participate if its own borrowing costs exceed the interest rate charged to Greece. We note that if the EFSF is ready in time, the problem goes away as countries would no longer need to raise cash directly to support Greece - rather that responsibility would fall on the EFSF, with Italy's and Spain's involvement limited to only guaranteeing the EFSF bonds issued. Spanish and Italian 10y yields closed slightly wider on the day at 6.04% and 5.85% respectively.
Eurozone July inflation was softer than expected at +2.5% y/y (cons. 2.7%). Nevertheless, hawkish rhetoric from ECB policymakers has been in plentiful supply over recent days, suggesting the bank remains alert to the risk of second-round inflationary pressures.
Moody's put Spain's Aa2 rating 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..
JPY
During the US session on Friday, Prime Minister Kan repeated comments made throughout the week by Finance Minister Noda. He said that recent FX moves are one-sided and that he would carefully watch FX moves closely. USDJPY briefly ticked about 10 pips higher, in the most pronounced reaction to rhetoric the market saw all week.
CHF
Swiss Economy Minister Schneider-Ammann said that the Swiss franc's rise is not temporary and it would not return to its former levels any time soon. He added that unemployment might climb because of the franc's strength.
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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