OctaFX.Com - Financial News and Analysis

[OctaFX_Farid]

S&P futures fall below 1900, hit a fresh 10-week low

FXStreet (Mumbai) - The S&P futures have declined below 1900 levels to hit a fresh ten week low of 1889. The S&P futures were seen trading at the current levels during the first week of August.

The S&P futures are now trading 0.14% lower at 1891, after having hit a low of 1889. Meanwhile, the DJIA has shed 0.26% to trade at 16501.50, while the NASDAQ futures are trading 0.44% lower at 3837.70.

The concerns of global economic slowdown have dragged down the S&P from a high of 2014.50 hit in mid-September. Since then prices have been on a declining trend, as investors priced-in a possibility of an early interest rate hike in the US amid global economic slowdown.

S&P futures Technical levels

The S&P futures have an immediate support around 1880 levels, below which prices can fall to 1844 levels. On the upside, the day’s high of 1905.95 should act as a strong resistance level.

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Oct 13, 2014

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[OctaFX_Farid]

CBOE VIX hits a 21-month high

FXStreet (Mumbai) - The Chicago Board Options Exchange(CBOE) Volatility Index (VIX) has hit a 21-month high of 22.30 today as the S&P futures and the DJIA fell by 0.22% and 0.24% respectively.

The CBOE VIX is trading 4.99% higher at 22.30 at the time of writing. The Index bottomed out in June when the index had hit a low of 10.32. Since then, the volatility has been on the rise as the investors price-in the direction of the Federal Reserve (Fed) policy amid weakening global growth. The geopolitical tensions also had a role to play in pushing the VIX higher.

Moreover, the VIX has given a breakout above key resistance levels, which may be a warning of further slide in the equity markets.

VIX Technical levels

The VIX has an immediate resistance of 23.23 (Dec 2012 high), above which it can rise to 25.00 levels. On the downside, 21.48 and 18.00 levels should act as the strong support levels.

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Oct 13, 2014

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[OctaFX_Farid]

European equities fall as the DJIA weakens

FXStreet (Mumbai) - The weakness in the US Equity markets has pulled down the European equity markets, which were trading about a half a percent up ahead of the US Open.

The DJIA is trading 0.16% lower at 16517.50, down from a high of 16595.50, while the S&P futures are trading flat at 1895.15, down from a high of 1905. Consequently , the Dax has erased gains to trade just 0.18% up at 8810 levels. Meanwhile, the FTSE is trading 0.44% up at 6367.90.

The Equity markets in the US are swinging from gains to losses as the markets lack a fundamental trigger today. The US treasury markets are closed, hence no fresh cues are coming-in from the treasury yields. Consequently, the US Dollar Index and the Gold prices are trading lackluster.

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Oct 13, 2014

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[OctaFX_Farid]

EUR/USD keeps the narrow range

FXStreet (Edinburgh) - The shared currency is looking to extend its consolidation pattern, with EUR/USD meandering between 1.2680 and 1.2700.

EUR/USD unmotivated below 1.2700

Spot remains unable to break above the 1.2700 handle so far. In the meantime, dullness seems to be taking over markets following the lack of catalysts and leaving spot without the necessary spark to march beyond the 1.2700 mark. According to strategists at Westpac, “The sharp move in yields spreads against EUR/USD has arguably run its course and EUR/USD has bottomed, albeit only for the time being in both cases… EUR/USD may well trade back toward 1.2900 before upside is exhausted”.

EUR/USD levels to watch

At the moment the pair is up 0.41% at 1.2682 with the next resistance at 1.2698 (high Oct.13) ahead of 1.2716 (high Oct.10) and then 1.2743 (21-d MA). On the flip side, a breakdown of 1.2638 (200-h MA) would expose 1.2605 (low Oct.10) and finally 1.2583 (low Oct.7).

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Oct 13, 2014

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[OctaFX_Farid]

AUD/USD pressing on to the downside

FXStreet (Barcelona) - AUD/USD is trading at 0.8757, up 0.82% on the day, having posted a daily high at 0.8789 and low at 0.8652.

AUD/USD ran into supply at 0.8780 resistance and has been levelled at the support of the final session of last weeks business here but weigh quite heavily currently. Emmanuel Ng, FX Strategist at OCBC Bank said however that they would expect the AUD to derive some comfort following the latest September China trade numbers, with both exports and imports coming in stronger than expected. “While the PBOC’s assurances that the risk of a heard landing is very small may temper near term downside for the pair, note that on the CFTC front, net leveraged AUD positioning flipped to a net short balance for the first time since late March 2014”.

AUD/USD noteworthy levels

Current price is 0.8757, with resistance ahead at 0.8763 (Hourly 200 SMA), 0.8781 (Hourly 100 SMA) and 0.8826 (Daily Classic R2). Next support to the downside can be found at 0.8756 (Daily Classic R1), 0.8746 (Weekly Classic PP), 0.8742 (Hourly 20 EMA), 0.8718 (Daily Classic PP) and 0.8686.

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Oct 13, 2014

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[OctaFX_Farid]

Fed QE might be needed again - Deutsche Bank

FXStreet (Łódź) - Jim Reid, Head of Global Fundamental Credit Strategy at Deutsche Bank argues that another QE program from the Fed is possible, probably during the next US recession.

Key quotes

"The rationale being that the terminal Fed funds rate will probably not be able to get high enough this cycle for conventional policy alone to be enough by the time we get to the next recession."

"By this time the ECB may be fully into QE and the BoJ may have done more, so without Fed QE the dollar might also be becoming too strong for comfort. However after the events of the last few weeks could the Fed actually re-start purchases before a recession?"

"Well Fed Williams made some interesting comments yesterday, albeit ones that were caveated. He was quoted as saying that 'If we really get a sustained, disinflationary forecast ... then I think moving back to additional asset purchases in a situation like that should be something we should seriously consider'."

"However he did say it would take a big shift in the U.S. economic outlook for the Fed to restart its bond buying and that he still felt it would likely be appropriate to begin lifting rates from zero in the middle of next year."

"So a fairly big bid-offer on how Fed policy might evolve over the next 12 month but another small sign from the Fed that there is some recent anxiousness about global growth and inflation."

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Oct 15, 2014

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[OctaFX_Farid]

SEB: GBP/USD near-term below 1.60 - eFXnews

FXStreet (Łódź) - The eFXnews team comment that SEB see GBP/USD remaining below the 1.60 level in the nearest future, following another strong decline on Tuesday.

Key quotes

"Short-term conditions may be stretched, but few cares and the medium-term mid-Oct'13 reaction low of 1.5854 is fully in sight (below which 1.5785/75 & 1.5753 would come into play)."

"A prior near-term low & yesterday's mid-body point provides local resistance around 1.60."

"Current intraday stretches are located at 1.5854 & 1.6005."

'This content has been provided under specific arrangement with eFXnews.'

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Oct 15, 2014

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[OctaFX_Farid]

EUR/USD unable to move away from 1.5900 - FXStreet

FXStreet (Łódź) - FXStreet Chief Analyst Valeria Bednarik observes that GBP/USD managed to rise from its daily low of 1.5876, but continues trading close to the 1.5900 level.

Key quotes

"The UK employment report was nothing really outstanding, but at the end, data pointed out for some steady growth in the sector, maybe not enough to trigger a strong come back, but at least to halt the bleeding."

"Technically, the 4 hours chart maintains the bearish pressure as per 20 SMA heading strongly south well above current price and indicators hovering around oversold levels."

"The immediate resistance comes at 1.5950, former monthly low, and only a clear recovery above it will favor some further advances up to 1.6000 price zone."

"To the downside, a downward acceleration through 1.5890 should trigger a new round of selling towards fresh lows at the 1.5850/60 price zone."

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Oct 15, 2014

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[OctaFX_Farid]

CAC declines from a technical resistance

FXStreet (Mumbai) - The French equity index declined after having failed to sustain above the 5-day moving average level of 4088.

The Cac is trading 0.70% lower at 4059.80, in line with its European peers. The index had briefly rose above 4088 levels, to hit a high of 4096. However, the index faced rejection at the 5-day average level post which prices slumped to a day’s low of 4041.30.

The Index details indicate that the fall has been led by Oil and Gas stocks which have declined by 0.5%. Utlities, Automobile and Banking stocks have shed 1%, 0.85%, and 0.77% respectively. Lending some support to the index are the food producers which are up by 2.98%.

Cac Technical levels

The Cac has an immediate resistance of 4088-4096 levels, above which the index can re-test 4109 levels (Aug 8 lows). On the flip side, the Cac can re-test 4012 levels if the day’s low of 4041 is taken out.

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Oct 15, 2014

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[OctaFX_Farid]

US: Retail Sales (Sep) dropped 0.3%

FXStreet (Edinburgh) - The Commerce Department has informed that US retail sales have contracted 0.3% MoM during September. Ex autos, sales have also dropped 0.2%. Both prints missed estimates at -0.1% and 0.3%, respectively...

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Oct 15, 2014

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[OctaFX_Farid]

USD/JPY finds support at 105.50

FXStreet (Córdoba) - USD/JPY fell sharply throughout the European session and slid back below 106.00 as the yen remains in demand across the board, with EUR/JPY having scored a fresh 2014 low.

USD/JPY retreated from a daily high of 106.32 and stretched to a low of 105.50 before finding support and recovering slightly. At time of writing, the pair is trading at 105.85, still 0.13% below its opening price.

Next on tap, US will release last week’s initial jobless claims and September’s industrial output.

USD/JPY technical levels

As for technical levels, USD/JPY could find next supports at 105.20 (Oct 15 low), 105.00 (psychological level) and 104.87 (Sept 8 low). On the flip side, resistances are seen at 106.32 (intraday high), 106.97/107.00 (100-hour SMA/psychological level) and 107.48 (Oct 15 high).

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Oct 16, 2014

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[OctaFX_Farid]

US Equity futures down 1%, point to a weak opening

FXStreet (Mumbai) - The US Equity futures are trading weak, tracking the fall in the European and the Asian equity markets.

The DJIA December futures are trading 1.065 lower at 15,838 levels. Meanwhile the S&P December futures and the Nasdaq December futures have lost 1.20% and 1.23% respectively. The fall in the equity markets may continue ahead as the S&P 500 Volatility Index (VIX) October future contract is trading 7.11% higher at 25.685 levels.

The US Equity futures did recover some losses after the official data in the US showed Initial jobless claims for the week ended Oct 11 fell to their lowest level in 14 years. However, the underlying tone appears bearish as indicated by the rising VIX futures.

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Oct 16, 2014

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[OctaFX_Farid]

Fed's Lockhart: Situation on labor market not stable yet

FXStreet (Łódź) - Speaking in New Jersey on Thursday Atlanta Fed President Dennis Lockhart didn't touch upon monetary policy but concentrated on the situation on the US labor market, which in his opinion is still far from normal.

He suggested that with the strengthening of the economy the use of part-time workers should be declining, although the preference for such workers will remain.

Lockhart also pointed to the need of workers adapting to the technological developments on the labor market and the progressive automation.

“If you accept as reality the persistence and growth of automation, robotics, production algorithms and digitization in general, I don’t think it’s difficult to imagine what jobs will increasingly require as hard skills and, consequently, what strategic workforce development will entail,” he said.

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Oct 16, 2014

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[OctaFX_Farid]

India Bank Loan Growth climbed from previous 9.7% to 11%

Read more in Forex News

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Oct 17, 2014

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[OctaFX_Farid]

Canada: CPI (Sep) rose 2.0% YoY

FXStreet (Edinburgh) -Headline consumer prices in Canada rose at an annual pace of 2.0% during September, in line with expectations. On a monthly basis prices gained 0.1%, matching forecasts. Core prices, gauged by the Bank of Canada, rose 2.1% over the last twelve months and 0.2% inter-month.

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Oct 17, 2014

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[OctaFX_Farid]

Fed's Yellen: Economic inequality continues widening in the US

FXStreet (Łódź) - Speaking at the Boston Fed economic conference on Inequality of Economic Opportunity president Janet Yellen doesn't comment on monetary policy in her prepared remarks.

• She expresses her grave concern about the extent and growth of income inequality in the US and asks whether this is compatible with American values

The widening of inequality, which halted during the recession has resumed in recovery.

• U.S. is one of the few advanced economies that does not fund public education through national taxes.

• Economic mobility is lower in the US than in most advanced economies.

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Oct 17, 2014

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[OctaFX_Farid]

AUD/USD hit fresh highs above 0.8800

FXStreet (Córdoba) - AUD/USD rose to 0.8811 and printed a fresh daily highs, slightly below yesterday’s strongest levels. Reports mentioned that the central bank of China was going to inject up to 200 billion yuan into banks. The aussie rose across the board afterwards but then pulled back.

Currently trades at 0.8791, almost 50 pips above the level it closed yesterday, supported by risk appetite as stocks rise sharply in Europe and Wall Street futures point to a strong opening.

AUD/USD rangebound

The pair had volatile days but remains inside last week range. To the downside, the area above 0.8650 capped the decline while to the upside price peaked at 0.8863, below 0.8898, where last week highs lie.

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Oct 17, 2014

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[OctaFX_Farid]

US Equity futures point to a strong opening

FXStreet (Mumbai) - The US Equity futures have gained strength tracking the gains in the European equity markets.

The DJIA December futures are trading 1.01%h higher at 16, 176, while the S&P December futures are trading 1.20% higher at 1872.95. Meanwhile, the ten-year treasury yield in the US is trading steady around 2.19%.

Moreover, the US index futures have strengthened on speculation that the Federal Reserve may support economic growth with more stimulus, while Morgan Stanley and General Electric Co. reported better-than-estimated profits.

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Oct 17, 2014

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[OctaFX_Farid]

DJIA likely to end down for the fourth consecutive week

FXStreet (Mumbai) - The US Equity markets are trading strong today, despite which the DJIA is likely to end lower for a fourth consecutive week.

The index is currently trading 156 points up at 16,273, having recovered from a low of 15,853 hit yesterday. However, the index will have to rise 243 points more in order to avoid a negative weekly closing. The Equity markets rallied since yesterday on hopes that the Federal Reserve (Fed) may extend its bond buying program beyond the schedule in order to support the economy.

The Index details reveal a strong performance from bank stocks. JP Morgan and Goldman Sachs are trading higher by 1.26% and 2.36% respectively. Meanwhile, General electric is the biggest gainer so far, up 3.4%. Except Walmart and Coca cola, which are down by 0.80% and 0.51%, respectively, all other stocks are trading in the green.

Moreover, the DJIA is likely to finish the week lower since the markets lack fresh triggers going into the weekend. The dovish talk from the Fed official Bullard and a strong factory output data released yesterday has been priced-in by the markets. So far, the housing data released today has not created much of an impact on the financial markets.

DJIA Technical levels

The index has an immediate resistance of 16,333 levels. A weekly close above the same may see the index rising to 16,500 levels next week. On the other hand, prices may fall back to 16,000 levels if the index fails to rise above 16,333 levels.

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Oct 17, 2014

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[OctaFX_Farid]

Banks start to charge customers for deposits in euro - Investec

FXStreet (Łódź) - Jonathan Pryor, Corporate Treasury Analyst at Investec observes that following ECB's introduction of negative deposit rates some large global banks have begun to charge their clients for holding cash in euros.

Key Quotes

"This is the first glimpse of the trickledown effect of the ECB's recent move to negative deposit rates (negative deposit rates mean banks are paying to park their money with the ECB)."

"The policy is designed to encourage banks to instead lend that money out to benefit the economy."

"After an initial move to negative deposit rates earlier this year, the ECB lowered the rate further in September, leading to some banks now pushing those costs onto customers."

"This could be the catalyst for the next move lower in the Euro, as wealthy individuals and larger corporations may choose to heavily reduce Euro holdings to avoid the costs."

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Oct 20, 2014

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[OctaFX_Farid]

Banks start to charge customers for deposits in euro - Investec

FXStreet (Łódź) - Jonathan Pryor, Corporate Treasury Analyst at Investec observes that following ECB's introduction of negative deposit rates some large global banks have begun to charge their clients for holding cash in euros.

Key Quotes

"This is the first glimpse of the trickledown effect of the ECB's recent move to negative deposit rates (negative deposit rates mean banks are paying to park their money with the ECB)."

"The policy is designed to encourage banks to instead lend that money out to benefit the economy."

"After an initial move to negative deposit rates earlier this year, the ECB lowered the rate further in September, leading to some banks now pushing those costs onto customers."

"This could be the catalyst for the next move lower in the Euro, as wealthy individuals and larger corporations may choose to heavily reduce Euro holdings to avoid the costs."

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Oct 20, 2014

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[OctaFX_Farid]

EUR/USD lacks momentum

FXStreet (Córdoba) - EUR/USD continues to trade within a familiar range Monday as the dollar remains broadly unchanged in a quiet start to the week.

In line with expectations Eurozone data failed to inspire EUR/USD, which despite recovering from a low of 1.2729, lacked momentum and remained capped by 1.2780 on the upside. At time of writing, the pair is trading at the 1.2765 area, just a few pips higher on the day.

With no first-tier data scheduled for this week in the euro area, markets will be watching closely for any official ECB announcement on covered bond buying.

EUR/USD technical levels

As for technical levels, immediate resistances for EUR/USD line up at the 1.2835/45 area (Oct 17 & 16 highs), followed by 1.2882 (Oct 15 high) and 1.2900 (psychological level). On the flip side, supports could be seen at 1.2730 (intraday low), 1.2704/00 (Oct 16 low/psychological level) and 1.2623 (Oct 15 low).

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Oct 20, 2014

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[OctaFX_Farid]

EUR/USD lacks momentum

FXStreet (Córdoba) - EUR/USD continues to trade within a familiar range Monday as the dollar remains broadly unchanged in a quiet start to the week.

In line with expectations Eurozone data failed to inspire EUR/USD, which despite recovering from a low of 1.2729, lacked momentum and remained capped by 1.2780 on the upside. At time of writing, the pair is trading at the 1.2765 area, just a few pips higher on the day.

With no first-tier data scheduled for this week in the euro area, markets will be watching closely for any official ECB announcement on covered bond buying.

EUR/USD technical levels

As for technical levels, immediate resistances for EUR/USD line up at the 1.2835/45 area (Oct 17 & 16 highs), followed by 1.2882 (Oct 15 high) and 1.2900 (psychological level). On the flip side, supports could be seen at 1.2730 (intraday low), 1.2704/00 (Oct 16 low/psychological level) and 1.2623 (Oct 15 low).

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Oct 20, 2014

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[OctaFX_Farid]

USD/JPY drops below 107.00

FXStreet (Córdoba) - The US dollar erased all gains versus the Yen and closed a bullish gap. USD/JPY failed to hold above 107.00 and after breaking below 106.92 (previous low) fell to 106.82, reaching a fresh daily low.

Price remains near the lows holding bearish momentum as stocks in Europe drop further, favoring the yen in the market. The pair is trading back at the same level it closed Friday, after erasing all gains.

USD/JPY levels to considerer

To the upside, immediate resistance lies at 107.17/20 (area that capped the recent rebound from 106.92) and above here at 107.35/40 (daily high), followed by 107.60. On the opposite direction support might lie 106.80 and below here at 106.55 and 106.30.

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Oct 20, 2014

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[OctaFX_Farid]

Speculators reduce bullish bets on WTI Crude

FXStreet (Mumbai) - The bullish bets on Crude prices stand at six week low as the Crude prices fell into a bear market territory over the last four months.

Speculators and money managers reduced net-long positions in West Texas Intermediate by 8.1 percent in the week ended Oct. 14. Meanwhile, the Commodity Futures Trading Commission (CFTC) data showed, short crude positions jumped to the highest level in 22 months.

However the CTC data comes with a one-week delay, thus the positioning may have changed in the last week after major investment banks predicted the rout may be over. As per Stephen Schork, president of Schork group, “The market has found an area of support around $80”.

WTI Crude is trading 0.40% higher today at USD 82.39/barrel, down from a high of USD 82.73/barrel hit earlier today.

WTI Crude Technical levels

WTI Crude has an immediate resistance of 84.78, above which prices can test 86.00 levels. On the other hand, Crude may re-test 80 levels if the prices fail to sustain above 82.00 levels.

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Oct 20, 2014

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