Daily Markets News From FBS

[⭐ kaito kid]

HSBC: long-term bearish AUD/USD

HSBC expects AUD/USD to drop to $0.9000 by the end of this year and to $0.8600 by the end of 2014 as the Fed’s tapering of monetary stimulus will revive US dollar. Note that according to Bloomberg, HSBC was the most accurate at predicting AUD over the past year. Emirates NBD and CIBC, the second and third-best forecasters, see a deeper decline to $0.8500 during 2014.

The Fed’s now expected to start slowing its bond-buying in December, while the RBA rate is projected to rate cut in the first half of next year.

The impact of a boom in Australia’s resources sector is now fading. The RBA expects the weakest growth since 2009 this year. Australian trade deficit in August was almost in 2 times bigger than expected. Data release last month showed that payrolls unexpectedly dropped and the unemployment rate climbed to a 8-year high. The OECD says that even after this year’s decline, AUD is still 27% overvalued versus USD.

http://fxbazooka.com/en/analitycs/show/697

[⭐ kaito kid]

Oct. 9: Asian session

EUR/USD got twice rejected in the $1.3600 area – yesterday and today and is currently trading in the $1.3565 area. The Fed releases minutes of last month’s meeting when it unexpectedly refrained from trimming bond purchases at 18:00 GMT. US government remains partially shut down. Euro halted a decline before a report forecast to show German industrial production rebounded in August (10:00 GMT) and the ECB president speaks today at 22:00 GMT. GBP/USD was also constrained by resistance at $1.6125/20 and is trading in the $1.6070 area. The UK will release manufacturing production figures at 08:30 GMT, as well as trade balance and the Bank of England’s credit conditions survey.

USD/JPY rose from the 200-day MA at 96.76 to 97.40. Yen declined after a White House official said President Barack Obama will nominate Janet Yellen today to head the Fed, boosting demand for higher-yielding assets. USD/CHF remains in 0.9015/65 area.

AUD/USD rose to $0.9484 yesterday, but the closed at $0.9420. Today Aussie is trading a bit on the upside before a report tomorrow that is forecast to show that Australian jobs gained in September. NZD/USD is fluctuating around $0.8285. USD/CAD rose approaching 1.0380.

http://fxbazooka.com/en/news/show/585

[⭐ kaito kid]

GBP/USD is hit by UK data

GBP/USD slid below $1.6000 and is testing support at $1.5955 (Sept. 24 low). Pound was hit by weak UK data: industrial & manufacturing production declined, while trade deficit didn’t contract as much as expected.

Support lies at $1.5920 (23.6% Fibo of the advance from July and also a support line). Resistance is $1.6050, $1.6130 and $1.6170.

Chart. H4 GBP/USD

http://fxbazooka.com/en/news/show/588

[⭐ kaito kid]

Deutsche Bank on US default possibility

The market participants regard US default as an unlikely event. Still the consequences of such outcome would be so bad, that investors start “think the unthinkable.” The closer America approaches to default and the longer the uncertainty persists, the more intense will be the flight to safe havens. According to DB, JPY, CHF, EUR and GBP will be preferred refuges (in this order). The bank doesn’t rule out USD/JPY falling to 90.00 and EUR/USD rising to $1.40.

“The longer it takes to come to a political agreement, the bigger the medium-term bearish USD consequences,” echoes Morgan Stanley.

If the technical default actually happens, it will be very damaging for USD’s long-term reserve status. Presumably the Fed and potentially other Central banks would be drawn into the fray in pursuing additional QE. “Ironically the less disruptive a technical default is, the more it would raise the probability of it happening again, adding to the prospect of more disruptive events in the future,” warns DB.

http://fxbazooka.com/en/analitycs/show/705

[⭐ kaito kid]

BofA: stay bullish on EUR

Analysts at Bank of America Merrill Lynch recommend staying bullish on EUR/USD and buying on the pullbacks low as long as the pair trades above $1.3452/1.3412. The specialists expect euro to push towards $1.3711 (Feb. high) and higher.

http://fxbazooka.com/en/analitycs/show/704

[⭐ kaito kid]

GBP/USD: Ichimoku analysis

Daily. Last week GBP/USD failed to hold above $1.6200. The overbought market went against the bulls who hoped to make the price settle above this handle. During the week the pair was declining and entered Tenkan-Kijun channel on Friday. The fact that the prices fixed below Tenkan (TS) – is the sign of the possible continuation of the short-term downtrend. The immediate support is at $1.6000. If this level is breached, the price may slide to Kijun line (KS). Note though that Tenkan and Kijun are still set to rise. In addition, Senkou Span A (SSA) strengthens the bullish Cloud.

Chart. Daily GBP/USD

H4. The picture isn’t that bright on H4. At the end of last week, the pair dropped deep into the Ichimoku cloud. The Tenkan and Kijun formed the Dead Cross ©, which is still relevant as the bulls so far haven’t broken up the resistance of the Kijun line (KS). Therefore, in the next few days there’s a high probability of further corrective decline that can stop only at the lower bottom of the Cloud.

Chart. H4 GBP/USD

http://fxbazooka.com/en/analitycs/show/701

[⭐ kaito kid]

EUR/USD: Ichimoku analysis

Daily. During the past week EUR/USD renewed local extremes formed in September: the pair traded above $1.3640 last Thursday almost reaching the target levels of short-term growth – $1.3650. However, by the end of the trading day on Friday, the bears appeared at the market and pulled the currency pair to Tenkan-sen. This line ($1.3550) keeps euro from serious corrective decline inside the Tenkan-Kijun channel. If this support is breached, EUR/USD will soon fall to $1.3470. The overall situation is still quite positive (Ichimoku cloud is in the bullish state), but very inconvenient for future purchases as Chinkou Span shows an overbought market.

Chart. Daily EUR/USD

H4. On H4 the pair is once again trading below the Tenkan and Kijun lines. Note that these lines formed the dead cross ©, which indicates a change in the short-term sentiment. Therefore, in the near future we can expect more bearish pressure on the upper limit of the Ichimoku cloud. This support will likely be breached as Chinkou Span is located under the price chart. All in all we observe a steady sideways move at this timeframe – all lines of the indicator are horizontal.

Chart. H4 EUR/USD

http://fxbazooka.com/en/analitycs/show/700

[⭐ kaito kid]

Oct. 10: Asian session

US dollar rose as, according to Bloomberg, US Congressional leaders were said to be open to a short-term increase in the nation’s debt limit. The Fed’s last meeting minutes released yesterday showed that most official think the QE tapering could start as soon as the next 2 monetary meetings and halting all QE purchases by the middle of 2014. Don’t miss US unemployment claims at 12:30 GMT.

EUR/USD is trading just below $1.3500, a bit above yesterday’s low at $1.3485. Demand for the euro was supported ahead of data today forecast to show industrial output gained in France and Italy. The ECB’s President Mario Draghi will speak again at 16:20 GMT. Yesterday he said that many US commentators “mistook the euro for fixed exchange-rate regime, when in fact it is an irreversible single currency.”

GBP/USD keeps testing support at $1.5920. Yesterday pound lost more than 100 pips. The Bank of England is expected to keep policy unchanged today (11:00 GMT).

USD/JPY rose to 97.76. US dollar’s rising for the third day after it got support from the 200-day MA. Yen weakened before the Bank of Japan’s Governor Haruhiko Kuroda speaks today (16:00 GMT). USD/CHF rose to 0.9130, to the highest level since the end of September.

AUD/USD declined to $0.9400 after data showed a smaller-than-forecast gain in employment (9.1K vs. 15.2K). The nation’s unemployment rate dropped from 5.8% to 5.6%. NZD/USD slid to $0.8250. USD/CAD reached 1.0420.

http://fxbazooka.com/en/news/show/589

[⭐ kaito kid]

Key currency options

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 (14:00 GMT).

Here are the key options expiring today:

EUR/USD: $1.3465, $1.3495, $1.3510, $1.3525, $1.3550, $1.3560, $1.3600, $1.3620;

GBP/USD: $1.5950, $1.6000, $1.6070;

USD/JPY: 96.00, 96.15, 96.25, 97.00, 97.10, 97.25, 98.10, 99.40;

USD/CHF: 0.9000;

AUD/USD: $0.9385 $0.9400 $0.9450 $0.9500;

USD/CAD: 1.0315 1.0330;

EUR/JPY: 132.80;

EUR/GBP: 0.8410 0.8520;

http://fxbazooka.com/en/news/show/591

AUD/JPY: 90.00.

[⭐ kaito kid]

10 October 2013,

BoE: policy unchanged

The Bank of England’s Monetary Policy Committee maintained the official Bank Rate at 0.5%. The Committee also voted to maintain the stock of asset purchases financed by the issuance of central bank reserves at 375 billion pounds.

The minutes of the meeting will be published on Wednesday, October 23.

GBP/USD is a bit higher at $1.5950.

http://fxbazooka.com/en/news/show/592

[⭐ kaito kid]

US jobless claims miss forecast

US jobless claims came much worse than expected (374K vs. 307K expected) rising to the highest level since the beginning of April.

USD/JPY rose to 98.00. EUR/USD kept the range. The single currency’s trading just 15 points above $1.3500. So did GBP/USD which descended from today’s high at $1.5970 to the middle of the range around $1.5940.

The lack of action in EUR and GBP may be explained by the fact that the market players await news about US budget and deficit problems.

http://fxbazooka.com/en/news/show/593

[⭐ kaito kid]

USD/JPY approached resistance

USD/JPY rose to 97.80 approaching the downtrend line from September highs. The pair was supported by the hopes that US debt limit will be raised in time, as well as solid Japanese core machinery orders data (+5.4%). Nikkei rose by more than 1%.

The pair has entered the Ichimoku Cloud on H4. Still the near-term conditions look overbought and there’s much of the resistance ahead. Resistance is at 97.87/93 (short-term resistance line), 98.05, 98.25 and 98.65. Support is at 97.60, 97.20 and 96.60. Commerzbank points out that USD/JPY has to overcome 97.90/98.10 for the move up to “look more like a bullish trend than a corrective bouncing.”

Rochford Capital: “As soon as you start to see signs of an agreement being reached on the debt ceiling, USD/JPY will fly back up to 99.00 pretty quickly.”

Chart. H4 USD/JPY

http://fxbazooka.com/en/analitycs/show/706

[⭐ kaito kid]

CB, SEB: bearish on EUR/USD

EUR/USD is trading sideways today after it declined yesterday quitting the $1.3600/3550 range. On the downside the single currency hit $1.3487 today, on the upside – $1.3545.

Commerzbank expects the pair to slide to $1.3460/53 (August high, 23.6% retracement of the advance from July) and then probably $1.3300 (3-month channel support). SEB also underlines that a break below $1.3462 will confirm a bearish setup.

Chart. H4 EUR/USD

[⭐ kaito kid]

ECB has no reasons to cut rates

Analysts think that the ECB is preparing something. In their view, the next policy move will be not a change in the benchmark rate, but rather a non-standard step.

According to Bloomberg News surveys, the majority of experts think that President Mario Draghi will unveil new liquidity measures such as longer-term refinancing operations (LTRO), while the interest rates will remain at 0.5% through the first half of 2015.

ING: “As long as soft indicators improve and hard data follows suit, there is no reason for the ECB to cut rates. A new LTRO could kill several birds with one stone: it could solve possible liquidity problems, could lower money-market rates and, above all, would help lock in market expectations.”

Comments from the ECB show that the central bank’s assessing the option, but is in no hurry to act. The next ECB meeting will take place on Nov. 7.

http://fxbazooka.com/en/analitycs/show/709

[⭐ kaito kid]

Oct. 14: Asian session

EUR/USD opened with a small gap and rose to $1.3565, though it’s still below Friday’s high at $1.3580. GBP/USD edged up to $1.5988. USD/JPY opened with a gap down at 98.22 after closing at 98.54 on Friday. USD/CHF opened with a gap down at 0.9090 after closing above 0.9100 on Friday. US dollar fell as talks between President Barack Obama and House Republicans hit an impasse and US senators from both parties struggled to draft an accord that averts a US default. Euro gained before a report due today at 09:00 GMT is expected to show industrial production in the region rebounded in August. The Eurogroup finance ministers will meet today in Luxembourg.

AUD/USD opened with more than 40-pip gap down, but then rose back to the Friday’s close in the $0.9470 area. Data over the weekend showed China trade surplus came significantly below expectations because of the drop in exports. China September CPI came at 3.1% y/y (forecast: 2.8%). Australia August home loans dropped by 3.9% m/m vs. the expected 2.5% contraction. NZD/USD rose to the upper border of recent weeks’ trading range at $0.8350, closing the morning bearish gap. New Zealand September HPI came at 2.6% m/m. USD/CAD opened with a gap up at 1.0360, but then slid by 10 pips lower. Canadian and the US banks are closed in observance of Thanksgiving Day.

http://fxbazooka.com/en/news/show/595

[⭐ kaito kid]

Key currency options

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 (14:00 GMT).

Here are the key options expiring today:

EUR/USD: $1.3470, $1.3580, $1.3590;

USD/JPY: 97.85, 98.00, 98.15, 98.13, 98.30, 98.50, 98.65, 98.90, 99.00;

USD/CHF: 0.9125, 0.9150

AUD/USD: $0.9450, $0.9500, $0.9550

USD/CAD: 1.0400;

EUR/JPY: 133.25;

EUR/GBP: 0.8450, 0.8460;

GBP/JPY: 157.60.

http://fxbazooka.com/en/news/show/597

[⭐ kaito kid]

EUR/USD: Elliot waves analysis

Weekly. The pair has presumably completed the construction of a correctional wave (b) of [2]. In line with this, in the near future we expect a decline in wave © of [2].

Chart. Weekly EUR/USD

Daily. The wave (b) has taken shape of a widening horizontal triangle. Let’s examine the structure of the last section in detail.

Chart. Daily EUR/USD

H4. The final upward wave © has taken shape of the Ending Diagonal Triangle. Now we are seeing the price decline in the wave [1], this wave is taking form of a wedge. Quite often, at the beginning of a new trend a wedge is formed. When the wave [1] is complete, we’ll see a correction [2] . When the waves [1] and [2] are fully formed, the decline will continue.

Chart. H4 EUR/USD

Roman Petuchov for FX BAZOOKA

http://fxbazooka.com/en/analitycs/show/711

[⭐ kaito kid]

GBP/USD: Elliot wave analysis

Weekly. GBP/USD may have completed the construction of the wave [iI]. In the near future a new trend may start.

Chart. Weekly GBP/USD

Daily. The construction of the wave [1] is close to an end. When it’s over, the pair will start forming upward corrective wave [2].

Chart. Daily GBP/USD

H4. The layout of the downward impulse wave [1] is shown at the picture. In the near future we’ll see the completion of the wave 5 of (5) of [1]. Then pound will begin a corrective movement upwards. The approximate trajectory of the wave is represented at the chart.

Chart. H4 GBP/USD

Roman Petuchov for FX BAZOOKA

http://fxbazooka.com/en/analitycs/show/713

[⭐ kaito kid]

USD/JPY: Elliot waves analysis

Daily. The pair keeps forming the wave . Then this wave is complete, we’ll see a decline in the wave [c] of 2.

Chart. Daily USD/JPY

H4. At the moment the pair’s forming the wave (E) in line with the forecast. Most likely, the next week the construction of this wave will continue, as shown at the chart.

Chart. Daily USD/JPY

Daily. The chart shows an alternative that must be considered in trading. There’s a possibility that the construction of wave 1 is not yet complete. Now we are seeing the formation of the wave (IV) in the form of a horizontal triangle, and this wave has already been completed. If this assumption is true, in the near future we’ll see a significant increase in wave (V). However, no matter which option is chosen by the price movement, we’ll be waiting for an upward movement this week.

Chart. Daily USD/JPY

Roman Petuchov for FX BAZOOKA

http://fxbazooka.com/en/analitycs/show/714

[⭐ kaito kid]

AUD/USD: Elliot wave analysis

Weekly. The pair keeps forming downward impulse wave III.

Chart. Weekly AUD/USD

Daily. The pair may have finished the construction of a corrective wave [4]. In the near future we expect a decline in the wave [5].

Chart. Daily AUD/USD

H4. The pair keeps forming the wave (2). The construction of this wave was delayed, so in the near term we expect a start of a decline in wave (3). It’s possible that we’ll see a top-down “shot” of a price. After such protracted corrections there are often strong price movements.

Chart. H4 AUD/USD

Roman Petuchov for FX BAZOOKA

http://fxbazooka.com/en/analitycs/show/715

[⭐ kaito kid]

Oct. 15: Asian session

USD weakened today against higher-yielding currencies as equity markets signaled optimism about US Senate discussions on raising the nation’s debt limit to avert a default, curbing demand for refuge assets such as JPY. USD/JPY reached the highest level since Oct. 1 at 98.70. USD/CHF is trading in the 0.9100 area. Senate Democratic and Republican leaders said yesterday they made significant progress toward an accord. The emerging agreement would suspend the debt limit through Feb. 7, 2014, fund the government through Jan. 15 and require a House-Senate budget conference by Dec. 13, reports Bloomberg referring to an anonym source in Senate. A deal could be announced today.

EUR/USD recovered to $1.3570 after a dip to $1.3550 earlier in the session. Yesterday the pair has retested the $1.3600 mark, but failed to fix on these highs. Euro zone will release ZEW economic indices at 9:00 GMT. ECOFIN meeting starts in Brussels today. GBP/USD was rejected from the levels just below $1.6000. Britain will release CPI at 08:30 GMT.

AUD/USD rose to $0.9540 (highest since June) following the tonight’s release of the RBA October minutes. There wasn’t much new in the release, but policy outlook has become more neutral. Further rate cuts still remain an option for the bank, but RBA underlined that policy would directly depend on dataflow. NZD/USD has touched $0.8405. Kiwi saw a small dip tonight as New Zealand Treasury said in their 2013 annual report that the currency exchange rate remained elevated. USD/CAD is falling for the third day and returned to the previous resistance (and now support) around 1.0330.

http://fxbazooka.com/en/news/show/600

[⭐ kaito kid]

Key currency options

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 (14:00 GMT).

Here are the key options expiring today:

EUR/USD: $1.3475, $1.3550, $1.3575, $1.3600, $1.3625;

GBP/USD: $1.5900, $1.6100;

USD/JPY: 97.15, 98.00, 98.65, 98.75, 99.00;

USD/CHF: 0.9110, 0.9165;

AUD/USD: $0.9500;

USD/CAD: 1.0350, 1.0390, 1.0400, 1.0430;

EUR/JPY: 133.25;

EUR/GBP: 0.8450, 0.8500.

http://fxbazooka.com/en/news/show/601

[⭐ kaito kid]

Goldman Sachs: outlook for GBP

According to strategists at Goldman Sachs, GBP/USD will hit $1.6800, $1.6900 and $1.6500 in 3, 6 and 12 months.

"The UK has experienced a substantial improvement in activity indicators in recent months. Part of this may be related to a recovering Euro area economy and part linked to the acceleration in credit growth. The composite PMI stands at close to the highest level since the mid-1990s. This economic strength will likely support capital inflows, which would offset some of the external vulnerability linked to the relatively large current account deficit," they explain.

However, Goldman believes that pound's ability to strengthen versus the euro is limited. Analists expect EUR/GBP to trade at $0.8200, $0.8300 and $0.8500 in 3, 6 and 12 months.

http://fxbazooka.com/en/analitycs/show/719

[⭐ kaito kid]

GBP/USD below $1.6000

GBP/USD is trading below the $1.6000 mark on Tuesday, holding below the yesterday’s peak at $1.6020. The pair is trading in the area of the July-September support trend line and holds below the H4 Ichimoku cloud.

US budget problems remain in focus this week. The market is also waiting for the release of the UK inflation figures for September at 8:30 GMT (forecast: +2.6%, prior: +2.7%). Tomorrow morning Britain is scheduled to release a bunch of important labor market data.

Support: $1.5950, $1.5915, $1.5900

Resistance: $1.6000, $1.6020, 1.6070/80

Chart. H4 GBP/USD

http://fxbazooka.com/en/news/show/603

[⭐ kaito kid]

EUR/USD dropped to $1.3500

EUR/USD slid to $1.3500. German ZEW survey came mixed (economic sentiment index improved, while current situation index deteriorated). This news overshadowed good results of Spanish debt action. US dollar’s strengthening on hopes about the debt and budget solution. Chinese Deputy Finance Minister Zhu Guangyan said that the US must undertake its responsibility to uphold stability of international financial markets.

Resistance is at $1.3550, $1.3600/05 and $1.3630.

Support is at $1.3500, $1.3487 and $1.3477.

Chart. H1 EUR/USD

http://fxbazooka.com/en/news/show/605