{"id":18041,"date":"2011-01-13T08:42:31","date_gmt":"2011-01-13T13:42:31","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=18041"},"modified":"2011-01-13T08:42:31","modified_gmt":"2011-01-13T13:42:31","slug":"forex-daily-market-commentary-195","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/01\/13\/forex-daily-market-commentary-195\/","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 price action was relatively quiet during the Asia session as \t\t\tmarket participants digested yesterday’s developments inside the \t\t\tEurozone. The euro surrendered some of yesterday’s gains however, \t\t\tand EURUSD traded 1.3082-1.3145. USDJPY traded 82.81-83.18. \t\t\tAustralian jobs data disappointed, temporarily weakening AUDUSD. US \t\t\tequities closed almost 1% higher and a strong auction for a \t\t\tre-opened 10y issue helped bring Treasury yields back from earlier \t\t\tsession highs. With few data releases, market participants focused \t\t\ton the Fed’s Beige Book and comments from Dallas Fed President \t\t\tFisher, a 2011 FOMC voter. The Beige Book contained few surprises \t\t\tas, “Economic activity continued to expand moderately from November \t\t\tthrough December.” But there was a brighter note as officials noted \t\t\tthat, “Lending activity remained stable across most Districts. \t\t\tCredit quality has been steady to improving.” Our economists believe \t\t\teven stabilization in lending is an improvement and provides an \t\t\tincremental boost to growth. Fisher again sounded cautious on QE2 \t\t\tand is wary of expanding the Fed’s balance sheet further. Similar to \t\t\tother Fed officials, he focused on the need for further fiscal\/tax \t\t\tpolicy changes for additional stimulus but he did not sound ready to \t\t\tpull the plug on QE2 yet. Jobless claims are due and Fed Chairman \t\t\tBernanke speaks at an FDIC panel on lending.
\n EUR<\/span><\/em><\/strong><\/p>\n

Belgium’s Prime Minister Leterme said that he does not think Belgium \t\t\tneeds help from the stability fund, and that there is no \t\t\tjustification for bond spread widening. He insisted he would do \t\t\twhatever it takes to defend the euro.
\nPortugal’s much-anticipated bond auction passed without incident \t\t\tyesterday. The bid-cover ratios were good though the yields remained \t\t\televated. The Portuguese Finance Minister said that 80% of the \t\t\tdemand from the auction was from foreign sources. There were also \t\t\theadlines that Chinese officials remain interested in Eurozone \t\t\tsovereign bonds, including EFSF bonds, but the comments still \t\t\tsounded conditional.
\nGerman Chancellor Merkel said Germany would do what is needed to \t\t\tsupport the euro but a government spokesperson later said now may \t\t\tnot be the time to discuss EFSF expansion. The European Commission’s \t\t\tBarroso said EU leaders may decide on potential EFSF changes in \t\t\tearly February and a Bloomberg story specifically noted Greek bond \t\t\tpurchases could be discussed at Tuesday’s Ecofin meeting, as part of \t\t\tplans to expand the size and scope of the EFSF. The story cites \t\t\tunnamed sources ‘with direct knowledge of the talks’.
\nGerman Finance Minister Schaeuble said European nations are working \t\t\ton a mid-term solution to the current debt crisis that could include \t\t\ta comprehensive package but that no agreement is expected at the \t\t\tnext Eurogroup meeting, though a deal may be possible at an upcoming \t\t\tsummit.
\nAn internal EU report for the EU Commission (seen by Reuters) \t\t\tsuggests that the European Stability Mechanism could take in \t\t\tcontributions direct from financial institutions and it is in the \t\t\tinterest of the financial system that institutions contribute to the \t\t\tsafety net. Applying a banking tax of 0.2% of the Euro area bank \t\t\tassets would allow around EUR50 bn to be raised.
\n GBP<\/span><\/em><\/strong><\/p>\n

Our team does not expect a change in the BoE’s policy stance and as \t\t\thas been the case recently, the minutes will be key. MPC votes will \t\t\tlikely show another three-way split but it will interesting to see \t\t\thow the sustained inflation levels are affecting their thinking.
\n CHF<\/span><\/em><\/strong><\/p>\n

SNB Vice President Jordan said Swiss franc strength poses a threat \t\t\tto growth but did not comment if the SNB would take action to weaken \t\t\tthe currency. He did appear to be especially concerned about how the \t\t\tEurozone crisis might unfold and what it might mean for the CHF. He \t\t\tdismissed the idea of pegging the CHF to the EUR. Jordan said the \t\t\tSNB would have to raise rates over the medium term to maintain price \t\t\tstability but that it had some flexibility over the timing of rate \t\t\thikes.
\n AUD<\/span><\/em><\/strong><\/p>\n

The December employment report disappointed expectations. Employment \t\t\trose by +2.3k (cons. +25k, prev. 54.6k). The unemployment rate fell \t\t\tto 5.0% (cons. 5.1%, prev. 5.2%), but this was largely due to a \t\t\tfalling participation rate. Our analysts team continues to look for \t\t\tthe next RBA hike in July.<\/p>\n

TECHNICAL OUTLOOK<\/span><\/strong>
\nUSDCAD holds above 0.9825.
\nEURUSD BEARISH Currently holds support at 1.2867 ahead of 1.2796 \t\t\tFibonacci level. Resistance is at 1.3170.
\nUSDJPY NEUTRAL 83.67 and 82.63 mark the near-term directional \t\t\ttriggers.
\nGBPUSD BULLISH Sharp rise through 1.5709 has exposed 1.5822 ahead of \t\t\t1.5911; support at 1.5583 yesterday’s low
\nUSDCHF BULLISH Upside potential with focus on 0.9852 ahead of \t\t\t0.9916. Support is at 0.9605.
\nAUDUSD BEARISH The pair found support at 0.9804 ahead of 0.9753; \t\t\tresistance at 1.0015.
\nUSDCAD BEARISH Lower boundary of 0.9889\/25 support area holds; a \t\t\tbreak here would expose 0.9712.Resistance is at 0.9951.
\nEURCHF NEUTRAL Rise through 1.2726 has exposed 1.2797; initial \t\t\tsupport at 1.2517.
\nEURGBP BEARISH Violation of 0.8285 would expose 0.8252; resistance \t\t\tat 0.8339.
\nEURJPY BEARISH As long as resistance holds at 110.24, expect losses \t\t\tto target 106.83 ahead of 105.80\/44 support zone.<\/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","protected":false},"excerpt":{"rendered":"

The price action was relatively quiet during the Asia session as market participants digested yesterday’s developments inside the Eurozone. The euro surrendered some of yesterday’s gains however, and EURUSD traded 1.3082-1.3145. USDJPY traded 82.81-83.18.<\/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-18041","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/18041","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=18041"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/18041\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=18041"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=18041"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=18041"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}