{"id":17892,"date":"2011-01-10T08:10:06","date_gmt":"2011-01-10T13:10:06","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=17892"},"modified":"2011-01-10T08:10:06","modified_gmt":"2011-01-10T13:10:06","slug":"forex-daily-market-commentary-192","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/01\/10\/forex-daily-market-commentary-192\/","title":{"rendered":"Forex Daily Market Commentary"},"content":{"rendered":"

By GCI Forex Research<\/strong><\/p>\n

Fundamental Outlook at \t\t\t0800 GMT (EDT + 0400)<\/strong><\/p>\n

USD<\/span><\/em><\/strong><\/p>\n

The dollar see-sawed during the Asia session. Some dollar strength \t\t\tat the open eventually gave way to selling after remarks out of \t\t\tChina recommended additional FX reserve diversification. EURUSD \t\t\ttraded 1.2867-1.2930, USDJPY 82.94-83.29. December non-farm payrolls \t\t\tincreased by fewer than expected, rising by only +103k (cons. \t\t\t+150k). The unemployment rate unexpectedly fell sharply to 9.4% \t\t\t(cons. 9.7%, prev. 9.8%), but this was largely due to a contraction \t\t\tin the workforce. Fed Vice-Chairman Yellen offered a spirited \t\t\tdefence of the Fed’s decision to embark on quantitative easing in \t\t\tgeneral, and the latest round in particular. She identified three \t\t\tchannels through which these purchases could help, citing “a reduced \t\t\tcost of credit to consumers and businesses, a rise in asset prices \t\t\tthat boosts household wealth and spending, and a moderate change in \t\t\tthe foreign exchange value of the dollar that provides support to \t\t\tnet exports.” Yellen was critical of suspicions that the Fed’s asset \t\t\tpurchases were designed “to promote U.S. growth at the expense of \t\t\tother nations by depreciating the dollar”. She noted that, by \t\t\tstimulating domestic growth, QE is also likely to boost demand for \t\t\tforeign goods in the US, and thereby promote growth abroad. Chicago \t\t\tFed President Evans, a 2011 FOMC voter, said the threshold is high \t\t\tfor making any adjustments to the Fed’s policy stance, but that he \t\t\tis keeping an “open mind” about whether the Fed needs to go beyond \t\t\tthe proposed $600 bn in Treasury purchases. Minneapolis Fed \t\t\tPresident Kocherlakota also showed little sign that he would vote \t\t\tfor a premature end to QE2.
\n EUR<\/span><\/em><\/strong><\/p>\n

Reuters cited an unnamed “senior Eurozone source” who claimed that \t\t\tPortugal is being pressured by France and Germany and others to \t\t\trequest financial assistance from the EU\/IMF. The source noted that \t\t\tno talks on a potential aid package have yet taken place, although \t\t\tPortugal’s bond auction on Wednesday could be a trigger for an \t\t\tactivation request for assistance.
\nReuters also reported that Portugal is in the process of making a \t\t\tprivate placement of bonds to diversify its investor base. The \t\t\treport cited an unnamed spokesperson at Portugal’s finance ministry \t\t\twho declined to comment on the identity of the potential buyer. \t\t\tPortugal’s maiden bond auction for 2011 is scheduled for Wednesday.
\nGermany’s Christian Social Union, an ally of Chancellor Merkel’s \t\t\tChristian Democratic Union, released a policy paper stating that the \t\t\tECB should focus on its core role of fighting inflation, and that \t\t\tthe bond-buying strategy must be capped.
\n AUD<\/span><\/em><\/strong><\/p>\n

November retail sales came in exactly in line with expectations, \t\t\trising only +3% m\/m (prev. -0.8%). After the unseasonally wet \t\t\tweather and flooding through December and January, our Australian \t\t\teconomists expect only a modest pick-up in retail in the near term. \t\t\tThe data reinforces their view that the RBA will be on hold for \t\t\tmost, if not all, of H1.
\n CAD<\/span><\/em><\/strong><\/p>\n

The December payrolls report was slightly stronger than expected, \t\t\twith payrolls rising +22k (cons. +20k), and the unemployment rate \t\t\tstabilising at 7.6% (cons. 7.7%). Giving his reaction to the \t\t\tnumbers, Prime Minister Harper described them as “encouraging” but \t\t\twarned of “significant challenges in the global economy and our \t\t\texport markets … that threaten the global economy and threaten our \t\t\town recovery”.<\/p>\n

TECHNICAL OUTLOOK<\/span><\/strong>
\nEURCHF focus shifts to 1.2402.
\nEURUSD BEARISH Bear trend remains eyeing 1.2830\/1.2796 support. \t\t\tResistance is at 1.3021.
\nUSDJPY NEUTRAL Break above 83.67 would open up the way towards 84.51 \t\t\tmid-December high; support at 82.63.
\nGBPUSD NEUTRAL Support is at 1.5345 while resistance is at 1.5665.
\nUSDCHF NEUTRAL Focus on the tough 0.9774 Fibonacci resistance. \t\t\tSupport lies at 0.9469.
\nAUDUSD NEUTRAL Look for a break below 0.9863\/31 support zone to \t\t\ttrigger the negative tone; resistance at 0.9993.
\nUSDCAD BEARISH Clearance of 0.9917 exposes 0.9889\/25 area. Initial \t\t\tresistance is at 1.0004.
\nEURCHF BEARISH Break of 1.2456 shifts focus to 1.2402, resistance at \t\t\t1.2564.
\nEURGBP BEARISH Sharp decline on Friday slashed through 0.8347\/35 \t\t\tsupport area exposing 0.8274; resistance at 0.8335 previous low.
\nEURJPY BEARISH Push below 107.61 exposes 105.97 key low, resistance \t\t\tat 108.55.<\/p>\n

Forex Daily Market Commentary<\/strong><\/em> provided by<\/em><\/strong> GCI Financial Ltd<\/strong><\/a>.<\/strong><\/p>\n

GCI Financial Ltd (\u201dGCI\u201d) is a regulated securities and commodities trading firm, specializing in online Foreign Exchange (\u201dForex\u201d) brokerage. GCI executes billions of dollars per month in foreign exchange transactions alone. In addition to Forex, GCI is a primary market maker in Contracts for Difference (\u201dCFDs\u201d) on shares, indices and futures, and offers one of the fastest growing online CFD trading services. GCI has over 10,000 clients worldwide, including individual traders, institutions, and money managers. GCI provides an advanced, secure, and comprehensive online trading system. Client funds are insured and held in a separate customer account. In addition, GCI Financial Ltd maintains Net Capital in excess of minimum regulatory requirements.<\/p>\n

DISCLAIMER: GCI\u2019s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.<\/p>\n

The dollar see-sawed during the Asia session. Some dollar strength \t\t\t at the open eventually gave way to selling after remarks out of \t\t\t China recommended additional FX reserve diversification. EURUSD \t\t\t traded 1.2867-1.2930, USDJPY 82.94-83.29. December non-farm payrolls<\/div>\n","protected":false},"excerpt":{"rendered":"

The dollar see-sawed during the Asia session. Some dollar strength at the open eventually gave way to selling after remarks out of China recommended additional FX reserve diversification. EURUSD traded 1.2867-1.2930, USDJPY 82.94-83.29. December non-farm payrolls <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-17892","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/17892","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/comments?post=17892"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/17892\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=17892"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=17892"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=17892"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}