AUD/USDGraphic review: Aussie returns some of the EU gains

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Adrian Robles, 7 July 2012 00: 35 GMT prepared from Adrian Robles, EST 2 hr MarketScope chart

This week rode the AUDUSD on the market-wide optimism triggered by the Summit and by the prospect of a co-ordinated stimulus effort managed by the European Central Bank. The ECB crushed this hope on Thursday at the press conference, which ended the rally in the AUDUSD.

The AUDUSD began a reading over 50 led an expansion in manufacturing the week on a short bit, after China Manufacturing PMI surpass expectations to coverage. A survey by Bloomberg called for a contraction in the Chinese manufacturing which would have implied Australian raw materials less demand. The few Poppedon Tuesday, when may extended the building approvals by 27.3 per cent from April, brings growth in building approvals in the last 12 months by 9.3 percent. The extension in the Mai building permits was the fact that investors optimistic were bp rate in the Australian economy ahead of the 25, which highlights cut in June. The couple over the closure of two hours ended in further, but lower, after the Reserve Bank of Australia to keep cash rate (OCR) to 3.5 per cent. The couple moved a few points after the announcement, because market participants, where the accommodation already in the RBA would keep prices, cash prices.

On Thursday, the the AUDUSD almost fell 100 points after the European Central Bank the OCR on an all time cut by 0.75% lower, but offered no stimulus efforts. After the press conference flocked back to the safe haven currency is, rejects the USD to carry in the AUDUSD. The downward trend continued Friday after the June she published United States the employment data AUSUSD fall 100 points to settle at 1.0190 (at the time of writing). The FXCM US dollar index (ticker: USDollar) rallied after found that unemployment does not increase. The jump in the U.S. dollar the result of danger can be negative investors, a sideline position independent of employment data have been.

At the end of this week has again about 30 percent of the profits that were made during the two days of the EU Summit of AUDUSD and the Aussie can give more of the EU Summit WINS $, is another retreat in risk appetite.

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7 July 2012 00: 35 GMT

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NZD Struggles to Hold Gains as Risk Rally Quickly Falters- CAD Lags

11 June 2012 16: 14 GMT Daily winners and losers

The New Zealand dollar is stronger against the European front softer dollar with and advance of 0.47% on the session. While news of a rescue of 100 billion euros for the banking system of the Spain retained larger flow risk appetite in the interim, the rally is likely to fade quickly as the nation now faces 36 billion euros in bonds this year, an amount which is expected to rise as the prospects of growth and unemployment continue to deteriorate.
Although the initial thrust of currencies of Asia Sunday open risk substantially faded, the NZD/USD is remained rather well supported with the pair now hold just below daily resistance allows Fibonacci 38.2% of may decline to 7754 after briefly as high as 7785 climb. Daily support is 23.6% to 7640 allows and is supported by the support trendline dating from March 2011. Locate the advances remain limited in the interval with only a break superstructure RSI above the mark of 60 opening the door to the progress of the superstructure more later in the kiwi.
The graph of the scalp shows NZD/USD, acting in a well-defined ascending channel formation dating back to June 1 with the pair of soft 7725 currently testing support. Look at yield level should rally today risk coming under further pressure with subsequent support target in the eyes to the 7675, Fibonacci 23.6% to 7640 allows and 76-handle. Preliminary resistance lies with 38.2% to 7754 allows and is supported by the figure of 78 and 50% to 7845 allows. Yet again, look for the pair to come under pressure later in the session, as the markets continue to pare early gains.
Indicators of levels

Level/Indicator	Level
200-Day SMA	0.7963
100-Day SMA	0.8077
50-Day SMA	0.7897
2012 NZD LOW	0.7454

The Canadian dollar is low performer against the greenback in 11 hours of the morning in New York with a decrease of 0.08% to the session. The losses are on the back of a large reversal of trends risk early in the session as stocks is negative and the euphoria of a Spanish rescue fades quickly. The USD/CAD has rebounded sharply to wide daily tracing of 38.2% Fibonacci support may advance to the handful of 1.02 before meeting the daily resistance allows 23.6% to 1.0293. Note that a RSI break below the 50 offers another declaration of conviction on a more important correction in the Loon with subsequent daily support 50% 1.0123 allows.

The graph of the scalp shows the USD/CAD, doing running allows 23.65 to 1.0293 after have rebounded sharply from 1.02-handle in trade during the night. Levels of future resistance of soft superstructure are eyed 1.0320, 1.0360, 1.0390 and 1.0425. A violation over June to 1.0445 attenuates pressure already down with such a scenario, considering targets in November over 1.05 upper. Mild interim support is based in 1.0270, supported by 1.0235 and allows 38.2% to the figure of 1.02. A break under the mark risk of losses of dollar with such a scenario targeting allows 50% 1.0123 and 1.0155. We remain neutral on the Loon at these levels until a superstructure near back over January to 1.0320.
Indicators of levels

-$ NZ Dollar des Gains sur les perspectives de croissance de la Chine, le sommet du G8 tient Euro faible

21 May 2012 16: 33 GMT  Fundamental Headlines
-Copper Up purpose Greek Contagion Fears Weigh - Reuters
-Asia Stocks Rise After China first Says Growth is Focus - Bloomberg
-Treasury Prices Fall as G8 Leaders Back Greece in Euro Zone - Reuters
-Gold Steadies As Softer Euro Curbs Rebound - Reuters
-Fed's Lockhart Says Circumstances Not Ripe for QE3 - Reuters
European Session Summary
The US Dollar (ticker: USDOLLAR) traded lower against the Australian Dollar and other high-risk counterparts on a modest improvement in financial market sentiment, but overall momentum left it poised for modest gains against the Euro and British Pound. It was a quiet start to the trading week as highly-anticipated events over the weekend failed to produce material breakthroughs or shifts in financial market sentiment.
The biggest event risk on the weekend was a highly-anticipated summit of G8 leaders. Disappointingly little action or new rhetoric nonetheless meant that Chinese Premier Wen Jiabao's pledges to focus more on bolstering Chinese economic growth took the spotlight. Jiabao indicated that policies may be loosened further as inflation moderates. As a result, commodity and risk-correlated assets such as the Australian dollar, NZ dollar and Canadian dollar strengthened against the greenback. Prices of growth-dependent commodities like copper and crude oil similarly gilts higher on stronger Chinese growth prospects.
Yet gains in broader markets were muted as Greek contagion fears continued to weigh on the global economic outlook. G8 leaders vowed to take steps to combat financial turmoil and revive a global economy threatened by Europe's continuing debt crisis. But they were unable to offer a solution to Greece's debt woes ahead of elections to be held on June 17.
Looking ahead, the top market event to watch out for will be the UK report for April on its Consumer Price Index (CPI), due for release at 08: 30 GMT on Tuesday morning (04: 30 EDT). Consumer prices in the UK are expected to have risen 0.6 percent in April from a month ago, while core inflation is expected to have fallen to 2.0 percent on an annual basis from 2.5 percent in March. Should core inflation fall in line with gold more than projected, we may see calls for further quantitative easing by the Bank of England which is likely to weaken the pound.
Taking a look at credit, pressure is back on the shorter-end of the curve, with yields on Spanish 2-year notes climbing to 4.210 percent. On the longer end, Greek 10-year notes led rising yields, increasing 15 6-basis points to a 29.299 percent yield.
NZDUSD 5 - min Chart: May 21, 2012

Charts Created using Marketscope - Prepared by Tzu - Wen Chen
The New Zealand Dollar is the top performer, rallying by 0.55 percent against the US dollar, which is among the weaker currencies on the day. The Australian and Canadian dollars were also higher against the greenback, gaining 0.12 percent and 0.05, respectively. The Japanese Yen trails all of its major currency counterparts, with the USDJPY declining by 0.38 percent.

$ Dollar Gains on Spain Rating Cut, US GDP Report on Tap Ahead

27 April 2012 07:09 GMT  Talking Points Dollar, Yen Gain on Haven Demand as S&P Cuts Spain’s Credit Rating US GDP Report May Force FX Markets to Rethink Likelihood of QE3 Italian Bond Yields on Returning Credit Stress Ahead of Debt Auction The US Dollar (ticker: USDollar) and Japanese Yen outperformed in overnight as Asian stocks declined, boosting demand for the go-to safe haven currencies, after Standard & Poor’s cut Spain’s sovereign credit rating and assigned it a negative outlook, saying a recession will undermine the government’s ability to reduce the budget deficit. Eurozone crisis fears overshadowed would-be downward pressure on the Yen after the Bank of Japan expanded its stimulus efforts by a cumulative ¥10 trillion yen, broadly in line with market expectations.
Futures tracking key European stock indexes and the S&P 500 are sharply lower, hinting the risk-averse is set to carry forward into Wall Street trade. On the data calendar, the focus is first-quarter US Gross Domestic Product figures, where expectations point to a 2.5 percent annualized quarterly increase after a 3 percent rise in the three months through December.
The result is likely to be interpreted in the context of this week’s FOMC policy meeting, with a better-than-expected outcome carrying the possibility of reminding traders that Ben Bernanke’s commentary was hardly as supportive of QE3 as traders’ initial reaction suggested. Alternatively, a disappointing print will further fuel stimulus bets and may renewed downward pressure on the greenback.
Elsewhere, an Italian bond auction will be interesting to watch as Eurozone debt crisis fears heat up anew. Rome is scheduled to sell a tranche of 2016-2022 debt, with investors keeping a close eye on average yield levels to gauge the severity of returning funding stress. The spread between yields on benchmark German 10-year bonds and Italian equivalents rose 14bps ahead of the sale, tapping a three-month high at 410bps.
Asia Session: What Happened
Markit/JMMA Manufacturing PMI (APR)
Overall Household Spending (YoY) (MAR)
National CPI Ex-Fresh Food (YoY) (MAR)
National CPI Ex Food, Energy (YoY) (MAR)
Tokyo CPI Ex-Fresh Food (YoY) (APR)
Tokyo CPI Ex Food, Energy (YoY) (APR)
Industrial Production (MoM) (MAR P)
Industrial Production (YoY) (MAR P)
Industrial Profits YTD (YoY) (MAR)
MNI Business Confidence Survey (APR)
Vehicle Production (YoY) (MAR)
Construction Orders (YoY) (MAR)
Annualized Housing Starts (MAR)
Euro Session: What to Expect
German GfK Consumer Confidence Survey (MAY)
German Import Price Index (MoM) (MAR)
German Import Price Index (YoY) (MAR)
French Producer Prices (MoM) (MAR)
French Producer Prices (YoY) (MAR)
French Consumer Spending (MoM) (MAR)
French Consumer Spending (YoY) (MAR)
KOF Swiss Leading Indicator (APR)
Critical Levels

[[ British Pound Looks to Q1 GDP Report to Support Continued Gains ]]

Fundamental Forecast for British Pound: Bullish

• Sterling Gains as CPI Posts First Gain in Six Months
• UK Unemployment Rate Unexpectedly Fell in March
• BOE Minutes Reveal Posen Abandoned Call for QE
• British Pound Surges on Strong Retail Sales Report

The British Pound stands apart from most of its major counterparts, with prices primarily responsive to domestic monetary policy expectations rather than the broad-based sense trends that dominate much of the FX space. Indeed, GBPUSD now shows a tremendous correlation with 2-year UK bond yields, which implicitly reflect traders' outlook for the near-to medium-term path of borrowing costs.

In the week ahead, this puts the focus on the first - quarter set of GDP figures. Expectations call for output to rise 0.1 percent in the three months through March after shrinking in the fourth quarter, avoiding the onset of a technical recession. The probability of such an outcome has been enhanced by an equivalent reading on a closely-watched private sector estimate from NIESR, a London-based consultancy. Validation of a return to growth is likely to offer further support to front end UK bond yields, reinforcing Sterling's recent gains and offering scope for a continued advance. Needless to say, a downside surprise would go a long way toward deflating the currency's momentum.

With that in mind, it is important to note that the Pound's recent advance against the majors has likely produced the need for a corrective pullback or at least a period of digestion. With that GDP report not due until mid-week, that means the UK unit initially may find itself lacking for firm upside momentum. Indeed, a period of corrective weakness driven by near-term profit-taking appears reasonable. -IS

$$$ US Earnings Next Week Could Benefit Risk-Based Currencies

14 April 2012 02:54 GMT  US Earnings Releases (April 16-20, 2012)

International Business Machines

Source: Bloomberg

Blue shading denotes TARP funds recipient

Among the major market themes for the coming week will be the continuation of the US first-quarter earnings season. Currently, the market consensus continues to point to a slowdown in earnings growth or even a drop in net income for some firms. Indeed, earnings have already recovered at a very rapid clip since the financial crisis, suggesting reduced scope for additional growth. 

 

 Chart generated using data from Bloomberg

The more modest consensus estimates, however, open the possibility for some positive surprises. This could help lift risk appetite in the forex markets, which had been shaken over past weeks by disappointments on the macroeconomic data front.

The key highlights for next week will be earnings from the major TARP recipient banks – with Citigroup reporting on Monday, Goldman Sachs on Tuesday, Bank of America and Morgan Stanley on Thursday. Several of these banks could follow in the footsteps of JP Morgan and Wells Fargo, which both beat estimates on Friday amid a more benign environment for the financial sector. With improved sentiment in the capital markets during the first quarter, higher trading volumes, and a mortgage market benefiting from near all-time interest rates, the banks could report robust results.

Healthy reports from these banks could inject renewed confidence in the US economy, which had suffered from a weak March non-farm payrolls report and an uptick in new jobless claims this week. By fueling bullish sentiment during the week, the earnings could spark short-term rallies in the higher-yielding, risk-correlated currencies. Robust bank earnings on the back of strong lending activity, however, could also imply broad credit availability, weakening the case for a QE3. At a time when the Fed has been sending mixed signals about prospects for further easing, dampened expectations for more loosening could also be supportive of the US Dollar.

Aside from the TARP banks, we will see earnings from several bellwethers of global economic activity, business investment, and consumer sentiment. These include Johnson and Johnson on the consumer side, industrial giants GE and Ingersoll-Rand, and technology flagships Intel, IBM, and Microsoft. As with much of the US corporate landscape, earnings estimates for several of these firms have been pegged at more modest levels; as a result, there is scope for upside surprise. Should several of these earnings truly exceed expectations, markets could react as they did following Alcoa’s surprise profit - a pickup in risk appetite. Following disappointing Chinese GDP figures on Friday, a recovery in sentiment could bring about a meaningful temporary rebound in the higher-yielding currency pairs. Traders should remain alert, however, to developments surrounding the Eurozone and China, which may cut short any earnings-related bounce.

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14 April 2012 02:54 GMT