Discussion points
Euro: EU strikes Deal on ESM, Spanish rescue - ECB to ease political pleased British pound: struggles to 61.8% Fib, BoE to lead more EQ US Dollar: weighed by risk-appetite, without profit to another K 90 Euro: EU strikes Deal on ESM, Spanish rescue - ECB to ease policy more
The Euro jumped to a maximum of 1.2692 that the European Union has agreed to recapitalized directly through the European stability mechanism commercial banks, while the group said he descended the ready status for the Spain: the Government seems to draw up to 100 EUR MSS. However, we have seen the German Chancellor Angela Merkel hold his ground as it continued to reject the Euro bonds and went to say this State for the Spain loan relaxation is unique - curb speculation that Italy can get a similar agreement if she need help.
Indeed, the move has helped alleviate the strains in the short term in the European financial system, but it seems that the Group made another attempt to buy more time that the agreement is to raise the fundamental Outlook for the region. Therefore, we might attend the single currency come under pressure next week as participants of the market see the Central Bank is taking additional steps to consolidate the sick economy, and we see the Council of Governors has its cycle of relaxation throughout the second half of the year as growth and inflation tapers off the coast. While 45 of 57 economists surveyed by Bloomberg News call for lower borrowing costs next week, the market players are pricing a chance to 37% for a 25bp rate cut according to Credit Switzerland night index swap, and the shift in the Outlook for the policy may reduce the appeal of the single currency as the Central Bank attempts to contain the risk of a prolonged recession. The ECB should continue to hit too consensual tone for monetary policy as the EURUSD excludes a high low around 1.2745, we should see the channel of downward trend of 2011 to continue to take shape and we see the pair to give in return for the relief rally.
Pound sterling: struggles of 61.8% Fib, BoE to lead more QE
The pound sterling pointe for a great night of 1.5697 in the rise in risk taking behaviour, but the sterling could come under pressure next week as participants of the market saw the Bank of England is taking additional steps to protect the debt crisis U.K. economy. According to a Bloomberg News study, 38 of 40 economists surveyed see the Central Bank, extend its program of purchasing assets beyond the target of 325 GBP, but we can see the majority of a stick to its current policy of the Committee in July as stickiness underlying price growth raises the threat of inflation. As the GBPUSD struggles to push above the tracing of Fibonacci 61.8% of 2009 low to high around 1.5690 - 1.5700, we can see the exchange rate consolidate before the rate decision, but the couple can retreat to 50.0% Fib about 1.5270 should the BoE take a very aggressive approach curb the decline in the risk for the region.
US dollar: weighed by risk-appetite, NFP is to increase another 90 K
The greenback gave in advance to leave earlier this month, with the Dow Jones index - FXCM U.S. Dollar (Ticker: USDOLLAR) a minimum of 10 048 and the marking reserve currency may heavy trade in trade in North America that FX traders increased their appetite for risk. However, as we expect to see US non-farm payroll increase another 90 K in June, the tepid recovery in the labour market may renew speculation for another program for the purchase of the assets on a large scale, but it seems that the FOMC move away from quantitative easing as the Committee extends "Operation Twist". In turn, we will maintain our appeal in the medium term for the USD, and we should see the continuous upward trend to take shape, as the Fed moderates its too consensual tone for monetary policy.
-Written by David Song, currency analyst
To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @ DavidJSong
To be added to the list of electronic distribution of David, send an e-mail with the subject line "Distribution list" to dsong@dailyfx.com.
The EUR/USD will resume the trend of 2011? Join us in the Forum
Related articles: weekly currency trade forecast
Future FX
Manager of purchase of Chicago (JUN)
U. of Michigan confidence (JUN F)
Euro: EU strikes Deal on ESM, Spanish rescue - ECB to ease political pleased British pound: struggles to 61.8% Fib, BoE to lead more EQ US Dollar: weighed by risk-appetite, without profit to another K 90 Euro: EU strikes Deal on ESM, Spanish rescue - ECB to ease policy more
The Euro jumped to a maximum of 1.2692 that the European Union has agreed to recapitalized directly through the European stability mechanism commercial banks, while the group said he descended the ready status for the Spain: the Government seems to draw up to 100 EUR MSS. However, we have seen the German Chancellor Angela Merkel hold his ground as it continued to reject the Euro bonds and went to say this State for the Spain loan relaxation is unique - curb speculation that Italy can get a similar agreement if she need help.
Indeed, the move has helped alleviate the strains in the short term in the European financial system, but it seems that the Group made another attempt to buy more time that the agreement is to raise the fundamental Outlook for the region. Therefore, we might attend the single currency come under pressure next week as participants of the market see the Central Bank is taking additional steps to consolidate the sick economy, and we see the Council of Governors has its cycle of relaxation throughout the second half of the year as growth and inflation tapers off the coast. While 45 of 57 economists surveyed by Bloomberg News call for lower borrowing costs next week, the market players are pricing a chance to 37% for a 25bp rate cut according to Credit Switzerland night index swap, and the shift in the Outlook for the policy may reduce the appeal of the single currency as the Central Bank attempts to contain the risk of a prolonged recession. The ECB should continue to hit too consensual tone for monetary policy as the EURUSD excludes a high low around 1.2745, we should see the channel of downward trend of 2011 to continue to take shape and we see the pair to give in return for the relief rally.
Pound sterling: struggles of 61.8% Fib, BoE to lead more QE
The pound sterling pointe for a great night of 1.5697 in the rise in risk taking behaviour, but the sterling could come under pressure next week as participants of the market saw the Bank of England is taking additional steps to protect the debt crisis U.K. economy. According to a Bloomberg News study, 38 of 40 economists surveyed see the Central Bank, extend its program of purchasing assets beyond the target of 325 GBP, but we can see the majority of a stick to its current policy of the Committee in July as stickiness underlying price growth raises the threat of inflation. As the GBPUSD struggles to push above the tracing of Fibonacci 61.8% of 2009 low to high around 1.5690 - 1.5700, we can see the exchange rate consolidate before the rate decision, but the couple can retreat to 50.0% Fib about 1.5270 should the BoE take a very aggressive approach curb the decline in the risk for the region.
US dollar: weighed by risk-appetite, NFP is to increase another 90 K
The greenback gave in advance to leave earlier this month, with the Dow Jones index - FXCM U.S. Dollar (Ticker: USDOLLAR) a minimum of 10 048 and the marking reserve currency may heavy trade in trade in North America that FX traders increased their appetite for risk. However, as we expect to see US non-farm payroll increase another 90 K in June, the tepid recovery in the labour market may renew speculation for another program for the purchase of the assets on a large scale, but it seems that the FOMC move away from quantitative easing as the Committee extends "Operation Twist". In turn, we will maintain our appeal in the medium term for the USD, and we should see the continuous upward trend to take shape, as the Fed moderates its too consensual tone for monetary policy.
-Written by David Song, currency analyst
To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @ DavidJSong
To be added to the list of electronic distribution of David, send an e-mail with the subject line "Distribution list" to dsong@dailyfx.com.
The EUR/USD will resume the trend of 2011? Join us in the Forum
Related articles: weekly currency trade forecast
Future FX
Manager of purchase of Chicago (JUN)
U. of Michigan confidence (JUN F)
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