Things Are About to Get Much Worse for Energy Firms in Argentina – Interview with Sam Logan

Things Are About to Get Much Worse for Energy Firms in Argentina – Interview with Sam Logan


Angering Spain by seizing and nationalizing a majority of Repsol’s shares in YPF and ramping up the rhetoric over the Falkland Islands as exploration deals promise to make the territory a major oil player overnight, Argentina is making few friends in the fossil fuels industry these days. Sam Logan, owner of the Latin America-focused private intelligence boutique, Southern Pulse, speaks to about the politics of populism behind Argentina’s energy aggression.

Samuel Logan is the founding partner of Southern Pulse, a private human intelligence organization focused on investigating security, politics, energy, and black market economics in Latin America. Southern Pulse investigators operate from hubs in Mexico, El Salvador, Colombia, Brazil, and Chile to leverage Southern Pulse’s HUMINT network, unique access, and deep understanding of the region to mitigate risk for public and private sector clients with exposure to political, security, financial, or legal risk in Latin America.

 In the interview Sam Talks about:

  • Why Carlos Slim bought shares in YPF
  • Why Argentina won’t take any definitive action in the Falklands
  • Why things will get worse for energy firms in Argentina
  • Argentina’s brewing political crisis
  • Argentina’s future relationship with Spain


Interview conducted by Jen Alic of In April, Argentina nationalized Spanish Repsol’s shares in YPF and now shareholders have approved a move that could see a sharp cut in dividend payouts and a redirection of profits to investment. This is in line with President Cristina Fernandez de Kirchner’s justification for nationalizing Repsol’s shares in YPF. She had accused Repsol of fleecing YPF by using too much of its profits for shareholder benefits rather than investing in exploration and turning Argentina into an importer of fuel. Will this essentially political and economic populism help or harm Argentina?

Sam Logan: While there are certainly short-term gains to be realized, the long-term effects of the Argentina-Spain relationship and Argentina’s relationship with other oil majors will result in significant setbacks in investment confidence and overall appetite for working with the Argentine government. What we would like to know is what is missing from this story and what role certain vested interests, such as the Eskenazi family (minority YPF shareholders brought on by the Kirchners who later defaulted on their Repsol loans) and Carlos Slim, have played in the YPF saga.

Sam Logan: The Eskenazi family really took a hit from this action. When brought on board by the Kirchners, they took out loans to buy their stakeholder position in YPF. The payback on those loans was based partially on dividend payments. So the Kirchner nationalization and subsequent decision on dividends has left them in default. Carlos Slim, who got 8% of YPF when Eskenazi defaulted, was simply making a personal investment, not a political statement. When you’re the world’s richest man, it’s not particularly risky to make low-value purchases and hold them long term to see if they pan out. Populism is also at play in Argentina’s renewed push over the Falkland Islands. Last week, Premier signed a $1 billion deal develop Rockhopper Exploration’s Sea Lion field in the Falkland Islands and Argentina is threatening to sue Premier for illegal activity. How will this play out for Argentina, and for big oil? What can we expect in the near- medium-term?

Sam Logan: The Argentine lawsuit will move forward and the UK firms will ignore the action, but BP could get caught in the crossfire as a UK firm with holdings in Argentina. Already we’ve seen Kirchner’s administration apply pressure to BP. How are oil and the Falklands used as symbols of national sovereignty in Argentina?

Sam Logan: The Falklands have long been used as symbols in Argentina, and this is an issue that crosses party lines so there is more political currency available for the Falklands issue across the Argentine political spectrum. There could be more saber rattling, but at this point I don’t see the Argentine government taking definitive action. Would you agree that at the heart of the matter is Argentina’s misguided energy policy, in place since 2003?

Sam Logan: It’s not just energy. This is more about Argentina’s overall economic policies and the steadily increasing economic pressures the Kirchner government is facing. Inflation, currency controls and price controls on gasoline all play a huge role in this market, which extends well beyond the recent actions with YPF. Let’s not forget that until recently Argentina was a natural gas exporter. Due to a long-term political negligence and mismanagement of infrastructure, Argentina is dependent on multinational energy firms to develop deposits and other known reserves – not to mention the potential for hydraulic fracturing. Ultimately, the irrational behavior Argentina has shown against multinational energy firms underscores a brewing political crisis that shows little to no sign of abatement in the near-term. It’s likely to get worse for energy firms in Argentina before it gets better.


Interview by. Jen Alic of


Rescued banks engaged in riskier lending – BIS paper

By Central Bank News

    Banks that received public funds during the 2008 financial crises were involved in riskier lending than banks that did not need a government bailout, according to a working paper published by the Bank for International Settlements (BIS).
    The paper, by economists Michael Brei and Blaise Gadanecz, examined the loan risk of 87 banks – 40 of which received public funds – and found that before the crisis, the rescued institutions had a significantly higher share of leveraged, and thus riskier, loans  in their portfolios of syndicated loan signings than their non-rescued peers.
     While the finding is hardly surprising, the authors found evidence that those banks that were rescued took on the risk mainly in their home markets,  “possibly reflecting their expectation that rescues are more likely to occur at home, where they may count as more systemic or wield more market power than abroad,” the paper said.

    The authors also tried to ascertain whether the public rescue operations, such as the 2008 Troubled Asset Relief Program (TARP) in the US, made the rescued banks shy away from risky lending toward safer loans.
    “Although risk started diminishing across the board in 2009, we fail to find significant consistent evidence that with the onset of the crisis in 2008, rescued banks have reduced their risk relatively more than non rescued banks,” the paper said.
    The authors said their findings were consistent with current literature that says rescued banks take on higher risks because they expect to be rescued, a concept often referred to as moral hazard.
    “Rescued banks may either be erring in risk management or consciously taking advantage of the implicit bailout guarantee,” the paper said.

Understanding the Basic Language of Option Trading

JW Jones –

“Anticipate the difficult by managing the easy.”
~ Lao Tzu ~

The peculiar vocabulary and concepts inhabiting an options trader’s thoughts are often the source of confusion to visitors to my world. I have often pondered that learning to understand options is a lot like learning a foreign language. When you arrive in the country whose language you seek to learn, you need a functional vocabulary immediately.

In order to be able to understand my world, I thought it would be helpful to discuss a bit of my language since it is helpful to grasp a few basics. I want to touch on some of the basic concepts necessary to form the basis for a functional language we can use to communicate concepts underlying a rational (hopefully) thought process leading to trade design and management.

In ruminations to come we will return to these fundamental concepts and begin to understand their function in the dynamic world of an options trader. The nuances of their specific structures are beyond the scope of this blog. We will return to consider these factors in virtually every trade because they re-appear each and every day in my world. For today, just shake their hands and remember their names.

One point not often discussed is the way in which options are priced. The quoted option price is in reality the sum of two separate components. These are referred to as the intrinsic and the extrinsic portions of the premium. I think of these as steak and sizzle respectively.

As I type, AAPL has closed at around $395. The January 390 call has 41 days to expiration and could have been bought for $18.90. Of this sum, $5 represents intrinsic premium and $13.90 represents extrinsic or time premium.

This is an important distinction because it is the extrinsic premium which is subject to time decay and change due to variations in implied volatility. We will get to a discussion of implied volatility in next week’s missive.

The intrinsic premium is subject to change solely due to changes in the price of the underlying security. There is no sizzle in the intrinsic premium; you can buy the option today, exercise it to buy stock, sell the stock, and pocket the $5. Of course, your trading career will not last long with that sort of trade, but my point is that the intrinsic premium has an easily calculable true value.

The situation with the extrinsic premium is quite different. The value changes not only with time to expiration but also with the constantly changing implied volatility. It is for this reason that an option trader must be very careful with this extrinsic component. Depending on the specific option under consideration, extrinsic premium may represent all, a portion, or a trivial amount of the entirety of the option premium.

Another important concept is that of the “moneyness” of an option. An individual option can be classified in one of three categories of “moneyness:”

  • At-the-money
  • In-the-money
  • Out-of-the money

At-the-money options by definition consist of a single strike price. Both in-the-money and out-of-the-money strikes usually contain several individual strikes within their groups.

In our example of AAPL, the at-the-moneystrike is the 395 strike. The in-the-money strikes consist of all calls with strike prices below 395 and all puts with strike prices above 395. The out-of –the-moneystrikes consist of all calls above the 395 strike and all puts below the 395 strike.

Obviously since the price of the underlying defines the category into which an option is classified, the category into which an individual option fits is fluid and changes dynamically with the price of the underlying asset.

The reason for taking the time to discuss in some detail this classification of “moneyness” is that there are important reliable characteristics of each type of option.

At-the-money options characteristically contain the absolute greatest dollar amount of extrinsic premium. In-the-money options have the least amount of extrinsic premium. Out-of-the-money options consist entirely of extrinsic premium, and therefore only contain sizzle . . . no steak can be found there.


Because the functional characteristics of these three categories of options differ, it is a basic strategy to combine options of different “moneyness” to achieve trades with the best probability of success and the highest risk/reward scenarios.

For example, buying an in-the-moneycall and selling an at-the-money call gives birth to a call debit spread, a high probability trade structure for the trader who is bullish in the underlying.

Next week we will cover the stealth concept of option trading, implied volatility. Failure to understand the impact of this variable is the most common cause of beginning options traders’ failure to succeed.

Join My Premium Options Writing Trading Service to Start Earning Monthly Income: JW Jones –

This material should not be considered investment advice. J.W. Jones is not a registered investment advisor. Under no circumstances should any content from this article or the website be used or interpreted as a recommendation to buy or sell any type of security or commodity contract. This material is not a solicitation for a trading approach to financial markets. Any investment decisions must in all cases be made by the reader or by his or her registered investment advisor. This information is for educational purposes only.




Technical Analysis: USD/CAD

By (Dublin) – The Canadian dollar increased as the demand for riskier asset returned in the market last week. Standing at only 28 pips from parity, the Canadian dollar took advantage as Draghi, The European Central Bank President indicated that the bank will take decisive measures to preserve the euro. The USD/CAD cross opened the week with a move upwards, breaking the resistance line at 1.02 for a short period. The pair then dropped to 1.0028, but the support line at 1.0030 has held firm this week with the currency currently trading at 1.0037 as the market for key releases from Canada.

The first major release is the Canadian GDP data which will be released on Tuesday at 1230hrs. The Canadian economy expanded by 0.3 percent on April after it increased by 0.1 percent in March. Major sectors that grew noticeably include the mining and oil and gas sectors which grew by 2.7 percent. The market is expecting another growth of 0.2 percent when the data is released. Together with the GDP data, the RMPI/IPPI report will be released. The Industrial Product Price Index was unchanged in April while the Raw Material Price Index dropped by one percent in the same month. This time, the market expects a rise of 0.6 percent in IPPI and a growth of 1.7 percent in RMPI.

With these reports expected from Canada and releases from projected to disappoint, the USD/CAD pair is expected to remain in the downtrend channel this week. Further, any strong move from Draghi will push the Canadian dollar higher against the US dollar and a push to parity might be experienced.

Some of the technical levels we are looking at this week include from the top; a resistance line at 1.0245 which served as a separator for an upward move in May 2010, it has regain some momentum now as it has capped the pair in July 2012.  The 1.02 round figure remains distinct separator as it has taken this role during the month of July. Other major resistance lines include 1.0150, 1.0066, and 1.0030. Support lines include parity, 0.9950, 0.99, 0.9840 and 0.9725.

Disclaimer is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at are those of the individual authors and do not necessarily represent the opinion of or its management. 

Article provided by is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
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How Will the FOMC Statement Impact the EUR/USD?

Source: ForexYard


At FOREXYARD, we believe in keeping our clients prepared for potentially significant news events. As such, traders will want to pay careful attention to the US FOMC Statement, set to be released on Wednesday, August 1st at 18:15 GMT. As can be seen in the chart below, the last FOMC Statement, on June 20th, led to significant fluctuations for the EUR/USD.

Don’t miss out on another opportunity to capitalize on market volatility!

A slowdown in the US economy, highlighted by last week’s Advance GDP figure, has led some analysts to speculate that the FOMC may decide to take steps to boost the US economy. If so, the dollar is likely to see heavy volatility as a result. This is an excellent opportunity for forex traders to take advantage of potentially significant news, so don’t miss out!

Read more forex news on our forex blog

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

Turkcell: Emerging Market Growth at Crisis European Prices

By The Sizemore Letter

Europe may be mired in crisis and global growth may be slowing, but it is business as usual at Turkish mobile giant Turkcell Iletisim Hizmetleri ($TKC).

Turkcell released second quarter results late last week that beat expectations. Group revenues rose by 13 percent and Turkish revenues were up 9 percent—not bad at all given that the country shares borders with a Europe mired in crisis and a Syria in the midst of a civil war that threatens to destabilize the region. Net income was also up 13 percent.

These results came in ahead of expectations and sent shares sharply higher. After bottoming out in late May, Turkcell shares are up by fully a third. Not a bad two-month run, all things considered.

Turkcell (NYSE: TKC)

Looking under the hood, the there is a lot to like. Subscribers of Turkcell Turkey rose 192 thousand to 34.7 million during the quarter, despite intense competition from international telecom juggernaut Vodafone (VOD), and the mix of prepaid and postpaid subscribers continues to shift in favor of more profitable and consistent post-paid contracts. Average revenues per user continue to climb due to increased data usage; they were up 5.6 percent for the quarter.

Smartphone usage—with the lucrative data plans it entails—also continues to rise though the smartphone penetration rate remains low at 15 percent.

This is about as good of a story as you can find in an emerging market stock of Turkcell’s quality. As a country, Turkey’s cell phone penetration rate is only 88 percent; in most advanced countries, the number is far in excess of 100 percent. (Yes, there are more mobile devices than people. Are you surprised? I didn’t think so.) This means that Turkcell can growth through three distinct avenues:

  1. Reaching new customers who previously did not own a cell phone
  2. Converting pre-paid customers to more profitable post-paid contract customers
  3. Upgrading regular feature-phone customers to smart-phone customers

Bottom line, Turkcell is fine way to invest in the long-term growth of Turkish living standards and the rise of the Turkish middle class.

Turkcell is also an interesting contrarian play. As I wrote last month (see “Bring in the Tanks”), the struggle for control of Turkcell’s board has made the stock something of a pariah. Turkcell hasn’t paid a dividend in two years because the two rival shareholder factions can’t sit in a room together for long enough to agree to pay it.

The boardroom circus keeps a lid on share prices, but I’m ok with that. It will get fixed, and soon. The Turkish government is losing patience, and the fiasco has become something of a national embarrassment. In the meantime, we’re able to accumulate shares of one of the finest emerging market stocks on the market at very reasonable prices. Turkcell sells for just 11 times expected 2013 earnings.

Turkcell was my choice in InvestorPlace’s 10 Stocks for 2012 contest, and I reiterate my “buy” recommendation today.

Disclosures: Sizemore Capital is long TKC.

If you liked this article, SUBSCRIBE to Sizemore Insights via e-mail today.

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How to Become a Better Trader: Know Thyself

EWJ Editor Jeffrey Kennedy offers wisdom to guide your search for trading success.

By Elliott Wave International

Jeffrey Kennedy has more than 20 years of experience as an Elliottician and trader. As editor of our new Elliott Wave Junctures service, he helps traders and investors improve their trading skills — which includes expanding their own self-knowledge.

“If you are serious about trading, I strongly recommend that you spend as much time examining your emotions while you are in a trade as you do your charts before you place one.”

“Success in trading comes from the consistent application of a proven methodology. If you don’t define your methodology, then your trading style could change with each new issue of Stocks and Commodities magazine. Trying a variety of analytical techniques rather than consistently following one is a problem for traders, and it’s also a great way to lose your trading account.”

Jeff trades with the trend, and specifically likes to “buy pullbacks in uptrends and sell bounces in downtrends.” He prefers a three to five day time frame. And he keeps his emotions in check, avoiding what he calls the “Lottery Syndrome,” the too-common bad habit among traders who let small profits slip away by pursuing the statistically elusive jackpot.

Can you define your own trading style as easily, or do you continue to struggle with major pitfalls from Jeff’s list below?

1. Inability to Admit Failure
Have you ever held on to a losing position, because you ‘felt’ that the market was going to come back in your favor? This behavior is the ‘Inability to Admit Failure.’ No one likes being wrong, and for traders, being wrong usually costs money. What I find interesting is that many of us would rather lose money than admit failure. I now know that being wrong is much less expensive than being hopeful.”

2. Fear of Missing the Party
This one is responsible for more losing trades than any other. Besides encouraging overtrading, this pitfall also causes you to get in too early. How many of us have gone short after a five-wave rally just to watch wave five extend?

The solution is to use a time filter, which is a fancy way of saying, wait a few bars before you start to dance. If a trade is worth taking, waiting for prices to confirm your analysis will not affect your profit that much. I would much rather miss an opportunity than suffer a loss, because there will always be another opportunity.”

3. Systems Junkie
My own biggest, baddest emotional monster was being the ‘Systems Junkie.’ Early in my career, I believed that I could make my millions if I had just the right system. I bought every newsletter, book and tape series that I could find. None of them worked.

I even went as far as becoming a professional analyst – guaranteed success, or so I thought. Well, it didn’t guarantee anything really. Analysis and trading are two separate skills; one is a skill of observation, the other is a skill of emotional control. Being an expert auto mechanic does not mean you can drive like an expert, much less win the Daytona 500.


Jeffrey Kennedy shares his 20 years of wisdom in analysis and trading — to help you decide when to act — in a new FREE report, 6 Lessons to Help You Find Trading Opportunities in Any Market.This report includes 6 different lessons that you can apply to your charts immediately. Learn how to spot and act on trading opportunities in the markets you follow.Get Your Free Trading Lessons Now >>


This article was syndicated by Elliott Wave International and was originally published under the headline How to Become a Better Trader: Know Thyself. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.



Central Bank Meetings “Could Put Pressure on Gold”, Fed “Can Still Sit Tight” But Draghi “Needs to Put Money Where His Mouth Is”

London Gold Market Report
from Ben Traynor
Tuesday 31 July 2012, 07:15 EDT

U.S. DOLLAR gold prices held above $1620 an ounce Tuesday morning in London, while stocks and commodities were also broadly flat and major government bond prices ticked higher with markets looking ahead to key central bank policy decisions later in the week.

Silver prices meantime hit a four-week high at $28.47 per ounce.

“With wider markets setting the flow direction for [gold] bullion, underlying demand for the metal remains soft and has barely provided any significant direction,” says a note from Swiss precious metals refiner MKS.

“Gold may come under some pressure in the run-up to this week’s central bank meetings,” adds a note from Australian and New Zealand bank ANZ, referring to monetary policy decisions due from the Federal Reserve, European Central Bank and Bank of England.

The ECB’s Governing Council and the Bank’s Monetary Policy Committee both announce their decisions Thursday, while the Federal Open Market Committee does so a day earlier on Wednesday.

In a survey of economists by newswire Bloomberg, 88% said they expected the Fed will hold off launching a third round of quantitative easing asset purchases, known as QE3.

“The [US] economy is basically treading water,” says Michael Gapen, senior US economist at Barclays, citing last week’s first estimate of GDP that showed economic growth slowed to an annual rate of 1.5% in the second quarter.

“The Fed [has] the ability to sit tight for now [as] market conditions haven’t weakened that much.”
“We do not feel that this week will see an announcement of outright quantitative easing,” agrees Standard Bank commodities strategist Marc Ground.

“We expect the Fed to wait until there are stronger signals that the US economy is faltering. As such, we feel that any rallies off the back of QE3 hopes should be viewed with skepticism, and caution that the week could see heightened volatility.”

“[Fed policymakers] are at the end of their rope and are probably searching for every last option for what they can do,” argues Michael Feroli, chief US economist at JPMorgan Chase in New York.

“You can’t rule anything out because they’re going to flail around and try every last thing they can.”

“Traditionally, gold prices closely follow US monetary policy indications,” says a note from HSBC.

“Some of the tools the Fed could use include extending the use of quantitative easing, extending ‘Operation Twist’, or employing new tools such as cutting interest on reserves, or extending interest rate guidance.”

Here in Europe, “there is a risk of disappointment around Thursday” when the ECB makes its decision reckons Nick Parsons, London-based head of markets strategy at nabCapital, a division of National Australia Bank.

ECB president Draghi said last week that the central bank “is ready to do whatever it takes” to save the Euro, a statement widely taken to suggest official purchases of distressed sovereign debt on open markets.

“There is a clear danger that expectations might be too high,” says nabCapital’s Parsons.
“[Draghi has] got to put his money where his mouth is.”

“Market expectations regarding additional monetary policy measures are too highly optimistic,” agrees Bayram Dincer at LGT Capital Management.

“The negative price dynamic [for gold] post-ECB could range between $50-60 [an ounce]…but we expect good support at the $1560 price level.”

The European Union meantime has launched an investigation of Draghi following a complaint that the ECB chief’s membership of an alleged lobbying group creates a conflict of interest and compromises his independence, CNBC reports.

The complaint relates to Draghi’s membership of the Group of Thirty (G30), an economic and financial discussion forum that also includes former Fed chairman Paul Volcker, former ECB president Jean-Claude Trichet, current Bank of England governor Mervyn King and Princeton professor Paul Krugman among its members.

Elsewhere in Europe, German unemployment rose in July for the fourth month in a row, figures published Tuesday show.

“To some extent the labor market has been Germany’s active immunization against the ongoing Eurozone crisis,” says Carsten Brzeski, senior economist at ING Belgium.

“However, signs that this immunization is fading away are hard to miss. Employers have continuously downscaled their recruitment plans and employment expectations in the manufacturing industry have dropped.”

Ben Traynor

Gold value calculator   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.

(c) BullionVault 2011

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.


BOE MPC Poised to Hold Stimulus Amid Weak Economic Figures

Article by AlgosysFx

Official figures last week showed Britain remained in recession in Q2, after the economy shrank by a shocking 0.7 percent. Though, the Monetary Policy Committee is likely to wait until November before pumping more stimuli into the ailing economy. By then the latest £50 Billion round of quantitative easing will have been completed, and the committee will have had chance to consider the initial impact of the Government’s £80 Billion funding for lending scheme, which comes into effect within this week.

Bank of England policymakers are likely to hold off on a further stimulus injection, despite figures that are expected to show the economy was still flat lining into Q3. The Bank’s Monetary Policy Committee is expected to leave interest rates on hold at 0.5 percent and quantitative easing unchanged at £375 Billion, even as Britain’s hard
hit manufacturing and construction sectors suffer further setbacks amid a double-dip recession.

The Markit/CIPS manufacturing PMI on Wednesday is expected to show that British manufacturing shrank for a third straight month in July, amid weak demand at home and abroad. Economists are forecasting a fall in the headline index to 48.4 points in July from 48.6 points in June, where anything below 50 signals contraction. The equivalent survey for construction a day later is also expected to show a sector in decline in July.

A separate report by an accountancy firm said construction insolvencies were likely to rise this year, as a combination of government spending cuts, the end of the Olympic boost and bad weather conspired to create a perfect storm in the sector.

Retail collapses rose 10.3 percent in Q2 as the wet weather exacerbated tough trading conditions. Meanwhile, other figures showed insolvencies rose to 426 between April and June, from 386 in the same quarter last year. High profile failures have included Clinton Cards and Game.

It was even reported that business confidence was falling amid a weal economy. Businesses are holding back on investing, still nervous about the future. Companies expect capital investments to grow by just 1 percent over the next 12 months in a worrying sign for the economy. However, the outlook for Britain’s services companies looks slightly better than some sectors. The services PMI on Friday is forecasted to rise to 51.6 points in July from 51.3 percent, signaling modest expansion. Bank of England data published on Monday was expected to show a fall in mortgage lending and approvals in June, while Nationwide is likely to report on Wednesday a 0.2 percent
fall in house prices in July; meaning house prices were about 2 percent lower than a year earlier.

However, there is widespread hope that the Olympics will give the economy a boost in Q3 but economists have warned it is unlikely to be enough to prevent the British economy from shrinking in 2012 as a whole.

Get more news and analysis at AlgosysFx Forex Trading Solutions


USD/JPY Forecast: Major Events This Week

By (Dublin) – Last week’s comments by the European Central Bank President Mario Draghi led to a change of trend in the USD/JPY cross. The pair started the week on a low but latter increased at the cross of the week. This week will be shaped by major events coming from Japan and the US. Focusing on the recent data from Japan, there is deflation in the currency which might force the BOJ to act. Investors will be looking for any indication of such a move from the BOJ official statement and releases. Here is a brief overview of some of the events from Japan.

Preliminary Industry Production will be released on Sunday at 2550hrs. The previous report had shown a drop of 3.1 percent in May. However, Industrial Production in the country dropped more than this registering a drop of 3.4 percent. The market expects an increase of 1.6 percent this time round. Manufacturing PMI and Household Spending will be known on Monday at 2315hrs and 2330hrs respectively.

On Tuesday, at 0130hrs, the Average Cash Earnings will be released. The last release showed a drop of 0.8 percent for June from the same month’s reading last year. The market is looking for a 0.1 percent raise this time round. The Housing Starts report will be announced the same day at 0500hrs GMT. There was an increase of 9.3 percent according to the previous reading and a further increase of 9.5 percent is expected this time round. There will be another report on Wednesday from Japan, the Monetary Base report. In June, there Monetary Base report showed an expansion in Japanese Monetary Base from 2.4 percent to 5.95 percent. The market expects this to continue with a 6.2 percent expansion.

Some of the technical levels to look out for this week include resistance lines at 80.20, 80.00, 79.79, 79.10 and 78.68. Support levels include the 78.00, 77.50, 77, 76.60 and 76.26.


Disclaimer is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at are those of the individual authors and do not necessarily represent the opinion of or its management. 

Article provided by is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
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