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For those forumers that wanna know what’s up: Forex Daily News

Discussion in 'Forex Daily News & Outlook' started by JavitoFX, Oct 22, 2009.

  1. JavitoFX

    JavitoFX New Member

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    Three noteworthy events defined yesterday’s FX markets; first off the BoE indicated a unanimous 9-0 vote had supported the decision not to expand QE at the most recent meeting, sending GBP soaring higher amongst the majors (GBPUSD has hit a high of 1.6637 so far). The statement elaborated that the MPC saw no compelling reason to change the bond plan for now, but added the November meeting would provide an opportunity to assess more fully.

    The second important driver of FX markets were earnings releases, notably Morgan Stanley and Wells Fargo who both trumped analyst forecasts, and sent equity markets surging higher. As usual, the positive gains in equity markets translated into an infectious sense of positive risk appetite which sent the USD spiralling lower to fresh lows (DXY as low as 74.94), and thus triggered the third key landmark, EURUSD finally breaking above the 1.5000 level. However far from being the explosive burst towards 1.5350 some bulls may have hoped for, EURUSD seemed to tread very tentatively in this new territory; it has thus far only pushed as high as 1.5046, and spent most of the remaining time consolidating in and around the 1.5000 level.
    Good trading :)
    http://www.ac-markets.com/forex-news/forex-alerts.aspx
     
  2. JavitoFX

    JavitoFX New Member

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    The light economic calendar today should keep FX markets range bound today. Asian equities were marginally stronger, after US equities ended weaker on Friday, despite broadly firm Q3 earnings reports and some better economic data. The sterling selling saw no respite in Asian session. The GBP was still the weakest among all currencies, as the lingering effect of the UK posting 3Q GDP figures, which shows that the UK is still in recession after posting negative GDP for the sixth straight quarter, is still present. I are still in the minority in expecting that the BoE will expand its asset purchasing programming roughly by £25bn at the November meeting. Should the MPC members choose this course of action, traders should expect a significantly weaker sterling.

    One of the highlight of this week will be the Norges Bank rate decision Wednesday. Markets expect the central bank to join the RBA in tightening rates. However, should the statement indicate gradual tightening over aggressive action, the market would be clearly disappointed. I believe any dip in the NOK is a good time to establish long positions.

    Later today, I get the Dallas Fed Manufacturing Activity reading, which is expected to print a -0.5% decline. If so, this would be the slowest rate of decline seen in 2 years.
    Happy trading :D
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  3. JavitoFX

    JavitoFX New Member

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    Risk appetite was slightly weaker in the Asian session, as equity markets failed to shake off a weak US consumer confidence figure. The USD strengthened as a consequence, with the commodity currencies losing the most ground. I believe the markets are starting to really take notice of the mounting disparity between relative economic performances. The falling momentum can be seen in the recent US economic data (Consumer Confidence reading disappointed at 47.7 versus consensus 53.5) but also UK, Japanese and Eurozone economic data have failed to impress. However, on the other side of the world EM Asia continues to chug along, punctuated by China's recent GDP figures. I believe this deferential will be an increasing part of FX pricing but currently risk appetite reigns supreme. Today, Australian CPI barely beat expectations coming in at +1.0% q/q (cons. 0.9%, prev. 0.5%) and +1.3% y/y (cons. 1.2%, prev. 1.5%). However, with roughly 100bp of tightening already priced for the next three RBA meetings combined with the heavy feel of risk correlated trades, the topside surprise was not enough, and AUD sold off (after a flash move higher).
    http://www.ac-markets.com/forex-news/forex-alerts.aspx
     
  4. JavitoFX

    JavitoFX New Member

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    Dark clouds (in the figurative sense, not Japanese candlestick) are clearly forming over risk appetite. Wall Street's severely underperformed yesterday and Asian equity markets are broadly lower, with our favorite risk barometer, the Shanghai composite, down -2.33%. The Baltic Dry index has closed lower in the last two days. Both the Norges Bank and RBNZ were significantly less hawkish than the markets had anticipated, prompting an unwinding of rate expectations. Economic data from the US, UK, Eurozone and Japan has failed to impress and actually points to a decline in the moment of recovery. But today, with the anniversary of the October 1929 share market crash in the back of trader’s minds, the day brings a critical US GDP figure. After the disappointing UK GDP figure last week (q/q -0.4% vs. 0.2% exp), a limp US growth figure will have the risk correlated trades feeling very vulnerable (however, a better figure will have participants pushing the entrenched recovery story). While Gold was the first to top out at $1070, it seems that traders are following crude prices direction. We believe this short term correction is the paired down of G4 growth expectations and should not turn into a complete risk appetite overthrow. However, in the near term the rapid climb in VIX to 27 and oil's 3% decline doesn’t bode well for the very crowded risk trade. In Japan, Industrial production for September printed ahead of expectations at +1.4% m/m (cons. 1.0%, prev. 1.6%) and -18.9% y/y (cons. -19.3%, prev. -19.0%) a 7th consecutive monthly increase.
    Good trading!!!
    http://www.ac-markets.com/forex-news/daily-snapshot.aspx
     
  5. JavitoFX

    JavitoFX New Member

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    The markets seem to be defying the SNB as we once again toy with the EURCHF 1.5090-1.5100 intervention zone. After dipping to 1.5083 on Friday we saw another suspected round of intervention, albeit less aggressive than that seen on 30 Sep. I remain in the pinnacle of the symmetrical triangle formation that has been in play for over a year, and of crucial importance to the continued SNB interest to weaken CHF will be the Swiss CPI due on Thursday. The market has clearly been at odds with the SNB thus far in terms of where they want CHF to trade, but if deflation continues to pose a threat I have no doubt the SNB will be resolute in maintaining their standpoint on EURCHF levels.
    Good trading!!!
    http://www.ac-markets.com/forex-news/daily-snapshot.aspx
     
  6. JavitoFX

    JavitoFX New Member

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    The USD has been slowly falling in the Asian session as risk appetite increases and equities rally. EURUSD traded higher to 1.4770 from 1.4660 while USDJPY climbed to 90.90 from 90.20. Risk correlated trades generally received a boost from Berkshire Hathaway agreeing to buy railroad Burlington Northern Santa Fe Corp and News Tuesday that the Reserve Bank of India bought 200 metric tons of gold from the IMF for $6.7bn . These events caused Wall Street to close slightly higher and gold to surge to $1084. Today in Australia, retail sales data surprised to the downside -0.2% vs. 0.5% exp. This data should provide a warning sign to AUD bulls, supporting the theory that the RBA will continue to move cautiously with its tightening, and slightly lowers the probability of a December rate hike (however there is lots of data between now & then).
    Good trading!!!
    http://www.ac-markets.com/forex-news/daily-snapshot.aspx
     
  7. JavitoFX

    JavitoFX New Member

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    The ECB meeting is expected to produce another unchanged rate decision, but the markets will be sensitive to any official references to currencies and EURUSD strength. Trichet’s press conference will be keenly eyed for mentions of this, especially in the Q&A session after the statement. Also today Swiss CPI will be released and consensus is looking for -0.7% y/y. The SNB's Jordan said inflation would be the main determinant for the SNB's exit from current policies. With inflation expected to remain in negative territory, the SNB will likely continue its FX intervention policy.
    Good trading!!!
    http://www.ac-markets.com/forex-news/daily-snapshot.aspx
     
  8. JavitoFX

    JavitoFX New Member

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    EURUSD key resistance lies at 1.5063 (26 Oct high), USDCHF eyes 1.0037 support ahead of a move to parity, and GBPUSD seems to have only weak and disparate resistance between current levels (1.6780) and threatening a return to 1.7000.
    Good trading!!!
    http://www.ac-markets.com/forex-news/daily-snapshot.aspx
     
  9. JavitoFX

    JavitoFX New Member

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    As the economy largely credited with driving the global recovery from recession, China’s consistent growth will encourage markets that the return to trend is well underway, and this has played out accordingly in FX markets this morning with widespread USD-selling in favour of higher yielding risk-assets.
    Good trading!!!
    http://www.ac-markets.com/forex-news/daily-snapshot.aspx
     

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