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EUR/AUD: technical picture EUR/AUD added about 500 pips in August rising from the record minimums around 1.1600 where in formed a double bottom. Westpac: The pair EUR/AUD will climb at least to 1.2330/50 in the coming weeks. Euro will likely be supported by “unwinding of EUR shorts as the ECB plans intervention in EZ bond markets”, while Aussie – weakened by “ongoing softness in China's data.” “A test of 1.25 would probably require the Fed to not deliver QE3.” The pair has approached resistance at $1.2145 (38.2% Fibo retracement from May maximums to August lows; February minimums). Further resistance lies at 1.2310/50 (50% retracement, 100-day MA) and 1.2480 (61.8% retracement, 200-day MA). Support lies at 1.2070, 1.2000, 1.1950 (50-day MA, 23.6% retracement). Corrections up to the latter are possible as EUR/AUD seems overbought after its advance and we see divergence at H4 MACD.   Chart. Daily EUR/AUD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

EUR/USD is supported by the ECB expectations EUR/USD has once again ascended close to $1.2600, but its advance was tempered by $1.2575. After it was announced that the ECB’s Mario Draghi won’t speak at Jackson Hole, the market’s mood brightened on the expectations that the details of the bond buying will be finally released soon. Photo: Reuters Nomura: “The only short-term option is to have the ECB buy the government debt of peripheral countries as longer-term answers to dysfunctional government bond market such as fiscal stimulus and a rule that addresses the issue of capital flight will probably take years to implement”. Sumitomo Mitsui: “We can apparently avert a situation where the debt crisis will trigger a collapse of the euro. Markets are expecting Spain to ask for a bailout, but it will spur the ECB to undertake a measure like the Securities Markets Program.” TD Securities: “There is a little more room for EUR gains from here, but significant resistance hovers just above, in the 1.2600 area. With a potential balance sheet expansion by the ECB as well as a rate cut, EUR should fundamentally be lower, and we think that should be the case at some point soon.” Westpac: “Investors will buy EURUSD on any 50-pip pull back. But be careful of excessive investor jitters: downside support levels to watch in EURUSD are $1.2450 and $1.2370-80, so if the common currency moves below those levels, stand aside”. Chart. H4 EUR/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

Key options expiring today Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (2 p.m. GMT). Here are the key options expiring today: EUR/USD: $1.2450, $1.2490, $1.2500, $1.2505, $1.2525, $1.2625; GBP/USD: $1.5650, $1.5730, $1.5750; USD/JPY: 78.15, 79.10, 79.15; AUD/USD: $1.0320, $1.0400, $1.0425, $1.0460; EUR/GBP 0.7900, 0.7975; AUD/JPY: 82.50. Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

August 29: forex news EUR/USD returned above $1.2500 yesterday and pushed the pair higher. Today its advance has stalled below $1.2575. Italy will offer 6-month bills today and as much as 7.5 billion euro ($9.4 billion) in bonds tomorrow. Italian Prime Minister Mario Monti meets with German Chancellor Angela Merkel in Berlin today. The ECB President Mario Draghi cancelled his attendance at this week’s Jackson Hole symposium citing his business with work. The markets interpreted this news as a sign that the ECB is preparing something big concerning the awaited bond buying plan. The ECB meets next Thursday, on September 6. Also note that the ECB reported a massive outflow of Spanish bank deposits, while Catalonia asked for 5 billion euro of aid from the Spanish central government. However, these reports didn’t disturb the markets. In US watch for the release of US Q2 GDP q/q (cons.: +1.7%; prev.: +1.5%) at 12:30 GMT, pending home sales m/m (cons.: +1.1%; prev.: -1.4%) at 14:00 GMT and Beige Book survey of economic conditions at 18:00 GMT. Mixed economic data released yesterday failed to clear up the picture of the potential QE3 timing, so all eyes will be on Ben Bernanke on Friday, though many analysts warn that the Chairman won’t make the things clearer. AUD was hurt as construction declined in Q2. NZD is still suffering from yesterday’s Fonterra report of reduced payouts to dairy farmers. USD/JPY was range bound inside 78.63/78.50. GBP/USD is flat above $1.5810. Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

EUR/GBP: technical comments EUR/GBP breached descending trend line resistance from March 28 around 0.7930. It seems that there are some buy limits above 0.7960/65 (August 6, 7 highs). Resistance for the pair lies at 0.8000 (100-day MA, psychological level). Analysts at Commerzbank say that the medium term outlook for EUR/GBP will remain bearish as long as it stays below 0.7963. At the same time, the pair will resume its downtrend only if it slips below Tuesday’s minimum at 0.7856. Analysts at RBS claim that increased support for euro zone sovereign bonds through some form of ECB purchases has provided some support for the EUR over the last week. However, it looks unlikely that the market will see any substantive developments ahead of the September ECB meeting. While, short term fair value for EUR/GBP is 0.8109, there is risk of some downside in the near term if Draghi disappoints on September 6. Chart. Daily EUR/GBP Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

RBC: bearish on NZD/CAD Analysts at RBC Capital Markets recommend selling NZD/CAD. The pair is declining for the third day after it recoiled down from the 50-day MA. On its way down New Zealand’s dollar has already breached 200-day MA at 0.8050 and 100-day MA at 0.8006. RBC explains their recommendation by the fact that New Zealand’s authorities are concerned about NZD strength. Continuing strength of the NZD is eroding any gains from the improvement in commodity prices. NZ commodity prices (in NZD terms) are at the lowest level since November 2009. Today NZ dairy giant Fonterra reduced its forecast payout for the 2012/13 season. This cut to farmers' incomes is worth ~0.2-0.3% of GDP and poses downside risk to RBNZ's GDP forecasts (from its June MPS). The Bank of Canada, on the other hand, is relatively calmer about CAD. Chart. Daily NZD/CAD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

MIG Bank: trading GBP/USD GBP/USD dipped to $1.5753 that is just above the 100-day MA earlier today before returning to the levels right under $1.5800. Sterling reached 3-month maximum at $1.5912 on August 23. Analysts at MIG Bank underline that British pound has breached its 2-month consolidation range to the upside. In their view, the pair’s recent uptrend will hold as long as it’s trading above $1.5708. The specialists recommend trying longs at $1.5810 targeting $1.5912/1.6190/1.6302. Chart. Daily GBP/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

Commerzbank: comments on EUR/USD Technical analysts at Commerzbank point out that EUR/USD is trading between $1.2597/1.2600 (78.6% of the move from June and 38.2% of the move this year) and $1.2478 (61.8% Fibonacci retracement). EUR/USD is now moving up to the upper border of this range. There’s the risk of a double top around $1.2600 as resistance may prove strong enough to stop the second attempt of the bulls to break higher. The specialists underline that the medium term downtrend will resume only after the pair breaches support of the short-term uptrend. As for further resistance, it lies at $1.2624/26 and $1.2672. Chart. H4 EUR/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

Scotiabank: brace for September turmoil Analysts at Scotiabank claim that relatively quite August will soon change into rather violent September. “September is littered with event risk,” underline the specialists saying that key events will likely sway both euro and US dollar at different times. The Fed’s Chairman will speak in Jackson Hole on Friday August 31; the ECB President Mario Draghi will give a speech on September 1, while China will release manufacturing PMI. Then there will be the ECB’s meeting on September 6, Germany’s top court decision on the constitutionality of providing aid to troubled euro zone countries and the September 13 Fed’s gathering when then central bank could announce QE3. Moreover, it’s not clear when or whether Spain will request sovereign bailout. In addition, though the while “commentaries following the meetings between Chancellor Merkel, President Hollande and Prime Minister Samaras appear to support the view that Greece will receive its next tranche of 31 billion euro, a negative report would push Grexit back into the headlines.” Image from chatswood.co.nz

IG: USD/JPY is rangebound this week Analysts at IG Markets Securities claim that USD/JPY has traded this month above a support level of about 78.15 yen and below 79.14 yen, the upper end of its daily Ichimoku Cloud. “Before the Fed event, the dollar doesn’t have enough power to break the range. You may have to wait until September to see moves to the upside or downside.” Chart. Daily USD/JPY Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

AUD/USD is under pressure AUD/USD hit 5-week minimum today at $1.0345 due to the worries about China’s economic slowdown. Shanghai Composite fell to 3 1/2-year minimums on Monday. Bank of Tokyo-Mitsubishi UFJ: “Given that the Aussie's fair value based on purchasing power parity is around $0.70, a level above $1.05 would be difficult to maintain. On the other hand, the Australian central bank is not as inclined to ease as the Fed and the ECB. There’s buying in the Aussie by central banks which want to increase the Aussie in their foreign reserves. So we do not expect it to fall below parity against the dollar.” Skandinaviska Enskilda Banken AB: “If AUD/USD goes below $1.0342, it may decline to $1.0170. Since Friday’s low point, a three wave upside correction has been completed and the market made a second attempt to extend the break lower.” Commerzbank: “There will be direct bearish bias while the pair trades below $1.0545 (last week’s high).” On the daily chart we see AUD/USD struggling between the support of the 50-day MA ($1.0345) and the 23.6% Fibo retracement of the advance from June minimums to August highs ($1.0370). Chart. Daily AUD/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

Key options expiring today Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (2 p.m. GMT). Here are the key options expiring today: EUR/USD: $1.2305, $1.2500 (large), $1.2505, $1.2550 (large); GBP/USD: $1.5750, $1.5775, $1.5780, $1.5800; USD/JPY: 79.00; AUD/USD: 1$.0375, $1.0400, $1.0450; EUR/JPY: 96.50, 97.35, 99.25 (large); AUD/JPY: 83.65. Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

August 28: forex news Demand for risk has decreased due to continued talk of China’s slowing economy, commodity price declines and low expectations coming out of Jackson Hole. Japan’s government downgraded its assessment of the national economy for the first time in 10 months. Moreover, investors expect sour data from Germany today. Australian new home sales fell by 5.6 % in July reminding that housing construction remains one of the weakest sectors of the economy. AUD/USD fell to $1.0350. NZD weakened versus the majority of its counterparts as the world’s largest dairy exporter Fonterra cut its forecast payout to farmer suppliers. USD/JPY slid to 78.50, closer to the lower border of its range. USD/CAD is consolidating right above 0.9900. EUR/USD is trading below $1.2500. In Europe watch for the release of German Gfk consumer sentiment at 06:00 GMT, Spanish final Q2 GDP at 07:00 GMT and EU M3 money supply at 08:00 GMT. Herman Van Rompuy, the president of the European Council, meets Spanish PM Rajoy at 11:00 GMT. Spain and Italy will try to sell short-term debt. Later today in the US watch for S&P/CS Composite-20 HPI at 13;00 GMT and CB Consumer Confidence at 14:00 GMT. Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

Jackson Hole may disappoint Dovish FOMC meeting minutes released last week did move the markets. However, many analysts doubt that the Fed’s Chairman will use his Jackson Hole speech to suggest QE3. JPMorgan Chase: “We don’t think Bernanke wants to make Jackson Hole into a policy-signaling event. That may be reserved for the FOMC meetings on September 12-13”. High Frequency Economics: “The Fed Chairman’s Jackson Hole address has traditionally been used more for laying out broad themes than for sending specific policy signals. Nor do we expect Mr. Bernanke to send a definitive signal this year.” Barclays: “It would be odd” for Bernanke to “take a strong position in advance of receiving the August jobs numbers a week later. We’re not looking for QE3 in September or beyond because we do expect stronger data in the second half of the year.” BNZ: “Some of the market impact of Bernanke’s speech has been nullified by last week’s dovish Fed minutes. The speech is expected to be used to map out the policy (easing) options facing the Fed. If this has the effect of hardening Fed easing expectations then the USD should continue to suffer.” Jackson Hole, Wyoming Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

AUD/USD: technical update AUD/USD is testing the levels below $1.0400 for the second trading day in a row. The uptrend channel within which Aussie traded since mid-June has been broken to the downside. If the pair declines below $1.0370 (23.6% Fibo retracement of the pair’s advance from June minimum to August maximum; today’s low), it may slide to $.0220 (38.3% retracement). Support levels for Aussie lie at $1.0340 (50-day MA), $1.0300 (200-day MA). Also watch if the pair closes below $1.0440 (former trend line support, July 19 maximum, August 21 minimum) or not. This level will play the role of the near-term resistance. In addition, there are more support/resistance levels to watch taking into account new declining channel since August 9. There’s more of the resistance at $1.0475 (April 27 maximum), $1.0500, $1.0535 and $1.0600. Westpac: Aussie’s affected by the declined iron ore prices and lower mining investment plans. However, the Fed QE3 hopes should limit losses to $1.0350/75. Chart. Daily AUD/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

Macroeconomic indicators The table below provides recent data on the main macroeconomic indicators and is an extremely valuable resource for any trader. Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

AUD/CAD: selling opportunity Analysts at Barclays Capital claim that although Canadian data have been rather weak so far due to external factors, domestic factors remain solid, so one may expect Canada’s modest economic growth for in the coming months. Among the positive factors the specialists mention pick-up in the US economy and the rebound in oil prices. “While disappointing retail sales and trade balance data suggest downside risks to our forecast, job growth and manufacturing shipments remained solid,” says Barclays. Barclays proposes buying loonie versus its Australian counterpart as Canada’s economic prospects seem brighter than those of Australia. Aussie will stay under the negative impact of soft Chinese HSBC PMI data. From the technical point of view we see that a close below the 100-day MA at 1.0290 and 1.0270 (50% retracement of the advance from May low to August highs) would make AUD/CAD vulnerable for a slide to 1.0200 and then to 1.0100. Chart. Daily AUD/CAD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

USD/JPY: technical update USD/JPY managed to rise from last week minimums around 78.30 and tested 78.80 (38.7% of the recent 130-pip decline, daily Kijun-sen). For now, this resistance remains unbroken. Today the market players seem uncertain: the greenback swayed up and down and is now once again close to the opening level around 78.70. The next resistance for the pair lies at 79.00 (psychological level, 50-day MA), 79.25 (200-day MA), 79.45 (100-day MA) and 79.65 (August 20 maximum). Support for US dollar lies at 78.60, 48.45 (today’s minimum, June 4 maximum), 78.30, 78.15, 78.00 and 77.90 (August 1 minimum). If the prices manage to break above 78.80/90, the bulls will likely test 79.25. Otherwise, USD/JPY will keep moving sideways above 78.00 as it did in the second half of July and in the first half of August. Chart. Daily USD/JPY

EUR/USD: range trading is expected this week EUR/USD is taking a pause after reaching last week the 7-week high at $1.2590. On the one hand, the single currency may find support ahead of Ben Bernanke’s speech in Jackson Hole on Friday, August 31. On the other hand, many analysts think it would be quite difficult for euro to overcome the recent maximum in the near term. Credit Agricole: “There's a lot of event risk, and I think this event risk will keep the euro capped. The currency will struggle to get above $1.26 this week.” Mizuho Securities: “We can see fundamentals deteriorating in the euro region. The euro is in a long-term downtrend.” Saxo Capital Markets: “We're having the same old issues coming out on the headlines about Greece. That's a capping point for the euro. This week EUR/USD is going to stay in range roughly between $1.2650 and $1.2400, not really breaking out of the highs that we saw last week.” Chart. H4 EUR/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

FX majors from top forecasters Here are the forecasts for EUR/USD, GBP/USD, USD/JPY, USD/CHF and EUR/JPY from top forecasters. Data were submitted on August 24. Source: FX Week Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

CFTC traders positioning data The latest Commitments of Traders (COT) report for week ended on August 21 was released on Friday, August 24, by the Commodity Futures Trading Commission (CFTC). Large currency speculators continued to decrease their overall USD long positions which declined during a week from $8.92 to $4.57 billion. The market’s sentiment for EUR improved after dipping the previous week. GBP positions switched from short to long ones. CAD longs rose a fourth consecutive week and surged to their best level since May 15. AUD long positions climbed to the highest level since April 12, 2011. NZD longs increased for an 11th straight week and continued to be at the highest level since the beginning of March. Take a look at the following table. It’s necessary to note that the figures cited above are always a week old at the time of their release. Never the less, CFTC data gives a good oversight into how the market is positioned and if/how these positions are being unwound. Although the CME speculators represent a small fraction of trading in the currency markets, their trades are widely seen as typical of hedge fund investors' currency movements. In the COT report all the market players are divided into three categories: hedgers (commercials), big speculators (non-commercials) and small traders (non-reportable positions). We analyze only non-commercial positions (mainly, these are banks and investment funds). Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

August 27: forex news After its descent from maximums around $1.2590 EUR/USD manage to hold above $1.2500. The pair passed Asian session flat above this level. Watch for German Ifo business climate at 08:00 GMT – the report may show that the indicator fell to a 2-year low (Cons.: 102.7; prev.: 103.3). German Finance Minister Wolfgang Schaeuble meets his French counterpart Pierre Moscovici today to discuss Greek budget targets. Today we’ll hear from the FOMC officials: Chicago FRB President Evans speaks at 10:00 GMT, while Cleveland FRB President Sandra Pianalto – at 16:15 GMT. France and Germany will sell short-term treasury bills. UK Markets are closed for the bank holiday. GBP/USD went down from last week’s maximum at $1.5912 to trade above $1.5800. The People’s Bank of China lowered yuan’s fixing by the most in 3 weeks and the government urged greater support for exporters. AUD/USD touched $1.0370 and then consolidated above 15 pips from this point. USD/JPY rose from last week’s lows in the 78.30 area, but remained below resistance at 78.80. Asian stocks show mixed results, with Nikkei +0.54% and Shanghai -0.84%, and all the rest in the middle. Gold reached today 4-month maximum of $1677. Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

USD/JPY: dollar may still recover USD/JPY has been declining since Monday. The pair recoiled down from the 100-day MA and the top of the daily Ichimoku Cloud and returned to the previous sideways range within which it was trading in the first half of August. On the downside US dollar is supported by the risk of Japan’s interventions, on the upside – limited by the MAs and the recent highs. USD may once again try to reach 80.00 yen, but we don’t this will happen last now. The final week of August will be highlighted with the expectations of more QE and this has to be a restraining factor for US currency. Next week watch for US preliminary Q2 GDP and pending home sales. Both indicators are expected to improve. Standard Chartered believe that Japanese CPI data due next week will likely intensify concerns about deflationary pressure. Analysts at Commerzbank stick to medium-term bullish view saying that USD/JPY will be targeting 80.00 as long as it trades above 77.90 (August minimum). Barclays sees see little downside risk from these levels, given Japanese policymakers' focus on the level of USD/JPY, while relative monetary policy and the risk of a sovereign downgrade suggest significant USD/JPY upside. Chart. Daily USD/JPY

MIG Bank: trading GBP/USD GBP/USD is experiencing a correction after a rally to 3-month maximum of $1.5912 (61.8% Fibo retracement from May decline). Analysts at MIG Bank are bullish on British currency. The specialists say that sterling is likely to retreat to previous high at $1.5800, but then it will resume growth as it managed to break to the upside its 2-month consolidation. The bank recommends placing buy limit at $1.5810 targeting 1.5912/1.6190/1.6302 at stopping at $1.5708. On a downside, support lies at $1.5785 (50% retracement), $1.5750 (50-day MA), $1.5715 (200-day MA), $1.5660 and $1.5620. Resistance for GBP/USD lies at $1.5930 (February 8, April 10 maximum), $1.6000 (March 27 maximum, psychological level). Chart. Daily GBP/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!

NZD: technical picture NZD/USD tested yesterday an important resistance of 0.8200 (2008 maximums, resistance line connecting 2011 and 2012 maximums). Yesterday’s daily candle looks very bearish. NZD has support at 0.8100 (late June maximums), 0.8040 (August minimums) and 0.8000 (around here daily MAs intersect). New Zealand released trade balance data: the nation’s trade surplus narrowed from 287M revised in June to 15M in July. Note, however, that with all the talk about potential easing from the major central banks, so it will very difficult for the bears to push the pair lower. Analysts at NAB say: “As speculation regarding further quantitative easing from the Fed is renewed we see the NZD/USD finding eventual support and backing. Despite the volatility associate with the currency and the upcoming events, over the medium term we see the NZD/USD supported by relative growth and interest rate differentials, and maintain a year-end target of 0.8200.” Commerzbank keeps insisting on the close coming downward reversal underlining that there’s resistance at 0.8223 (recent maximum) and 0.8260 (March resistance). Chart. Daily NZD/USD There’s the scope for some consolidation in the short term. The situation at H4 doesn’t look bad, kiwi isn’t overbought. Chart. H4 NZD/USD Have a profitable trade with FBS! If you have any questions to our analysts, you're welcome to ask or comments for this article!