Tuesday, July 22, 2014

Gold,AUD/USD

Gold has edged lower on Tuesday, as the spot price stands at $1306.09 per ounce in the European session. On the release front, it’s a busy day in the US, highlighted by Core CPI and Existing Home Sales, the first major events of the week from the US. The markets are bracing for another weak outing from Core CPI, while Existing Home Sales is  expected to improve sharply.
International trouble spots continue to grab the headlines, as nervous investors keep an eye on events Ukraine and the Middle East. Last week’s downing of a Malaysian Airlines jet, apparently by proRussian separatists, has seriously frayed relations between Europe and the US with Russia, which have already been strained since the latter annexed Crimea.

AUD/USD has posted gains on Tuesday, as the pair has pushed above the 0.94 line in the North American session. The Aussie has moved higher as US CPI posted a weak gain of 0.1% last month. Today’s other key release is Existing Home Sales, which will be released later in the day. In Australia, RBA Governor Glenn Stevens spoke at an event in Sydney. We’ll get a look at Australian CPI early on Wednesday.
US inflation numbers continue to struggle. Core CPI posted a paltry gain of 0.1%, shy of the estimate of 0.1%. The key index has looked in anemic in 2014, with its highest gain this year at just 0.3%. CPI gained 0.3% last month, matching the forecast. The markets are expecting better news on the housing front, as Existing Home Sales is expected to show strong gains in June.

Monday, July 21, 2014

EUR and GBP

The euro gained on the U.S. dollar and the yen held steady in a thinned-holiday Asian trading session overnight. But as tensions rise between Russia and the West, and the violence in the Gaza Strip becomes increasingly bloody, geopolitical events remain the focal point for investors and all asset classes.
The corporate earnings season is underway but even favorable U.S. earnings have been seemingly forgotten. Likewise, the aggressive search for safe haven trading strategies has temporarily fallen since the initial shocks of late last week. Markets and investors are seeking clear guidance from authorities before pursuing any aggressive strategies.
As we head stateside, currency technical levels remain in focus following last Friday’s tests for the EUR and GBP both outright and on the crosses. There has been no sustained breakout just yet, especially for the 18-member single unit, which tested and slightly breached the lower end of the trading range at the ‚¬1.3500 level at the end of last week. For many, with the pair having managed to hold above the pivotal January low of ‚¬1.3477, it will allow for more consolidation before the next onslaught with purpose.
Ongoing geopolitical events should leave the EUR vulnerable; especially ahead of a European Union foreign ministers meet scheduled for tomorrow to discuss sanctions against Russia. Market participants are required to follow both the Treasury and bund yields for clues. Currently, yield differentials are also hinting that the EUR could come under renewed fresh pressure with German 10-year yields probing fresh, historically low levels (bund 10′s +1.16%, U.S. 10′s +2.28%).

Friday, July 18, 2014

Forex News


Fresh US sanctions against Russia drag the ruble down to a six week low against the US dollar, but Morgan Stanley says the current pace of the selloff won't be sustained. Higher oil prices should benefit the ruble; Russia is a huge oil exporter, and lofty oil prices will lead to more money being converted into rubles to buy Russian oil. Russia's central bank also may step in to stabilize the ruble and cap its weakness. Morgan Stanley warns about potential spillover effects in the Polish zloty and Hungarian forint, which are down today against both the euro and dollar. USD/RUB at 34.93, up 1%.
The U.S. government because of what it views as Russia’s interference in Ukraine, imposed its most wide-ranging sanctions yet, on key players in the country’s economy, including Gazprombank and Rosneft Oil Co, and other major banks and energy and defense companies.
Putin said he needed to see the details of the sanctions to understand their full scope. But he added that he was sure the sanctions would damage the national interests of the United States in the long run.
How to use charts

Thursday, July 17, 2014

EUR/USD Daily

 EUR/USD   Daily
14::05 GMT - Range has not changed yet but prices are coming under     pressure again. Below today's low next focus is the Jun lows at       1.3502/10 and, if these fail, 1.3477 is next focus. Res. is still at 1.3540 and this needs to be cleared to take the pressure off the downside.N.I.
R5: 1.3647/50 * 9/10 Jul highs
R4: 1.3620/30  intraday level
R3: 1.3585/90  intraday level
R2: 1.3560  intraday level
R1: 1.3540  today high
S1: 1.3519  Wed low
S2: 1.3502/10 * Jun lows
S3: 1.3477 * Feb low
S4: 1.3452 * Aug 13 high
S5: 1.3417 * Jun 13 high

USD/JPY--USD/RUB

At a policy meeting this week, the Bank of Japan opted to hold course with its current monetary easing, and the minutes will be released later on Thursday. Any unexpected dissensions amongst policy makers in the minutes could have an impact on USD/JPY. Under current monetary policy, the money base has been increasing at an annual pace of 60-70 trillion yen. This has led to a severe weakening of the yen, so traders can expect the currency to remain below the 100 level, absent unexpectedly strong data out of Japan.

Fresh US sanctions against Russia drag the ruble down to a six-week low against the US dollar, but Morgan Stanley says the current pace of the selloff won't be sustained. Higher oil prices should benefit the ruble; Russia is a huge oil exporter, and lofty oil prices will lead to more money being converted into rubles to buy Russian oil. Russia's central bank also may step in to stabilize the ruble and cap its weakness. Morgan Stanley warns about potential spillover effects in the Polish zloty and Hungarian forint, which are down today against both the euro and dollar. USD/RUB at 34.93, up 1%.

Wednesday, July 16, 2014

USD/CAD

BMO Capital Markets says there's a mix of short- and medium-term foreign exchange players who are positioned roughly short-to-neutral on the Canadian dollar going into today's Bank of Canada policy statement at 10am. It suggests the broader consensus is for a more "dovish" tone in the statement and in the Bank's quarterly monetary policy report, which will be released at the same time. Firm warns, however, that this leaves room for USD/CAD to fall back to the low 1.0700s today if there is roughly no change in the tone at all. It would also leave the greenback vulnerable to further downside if Canadian CPI data for June on Friday is stronger than expected.

Thursday, July 10, 2014

EUR/USD

EUR/USD has edged lower on Thursday, as the pair trades in the mid-1.36 range in the European session. On the release front, French and Italian Industrial Production both posted sharp declines. Today’s highlight in the US is Unemployment Claims. Little change is expected from the previous release.
The Federal Reserve minutes did not shed much light on when the Fed plans to raise interest rates, but policymakers did agree to wind up the QE scheme by October. The asset purchase program flooded the economy with over $2 trillion, and the Fed has been steadily reducing the program since last December. Winding down QE will require several more tapers by the Fed, but that shouldn’t pose a problem, given the solid employment data the economy has been churning out. EUR/USD did not show much response to the low-key minutes, with the euro posting slight gains on Wednesday.