{"id":18292,"date":"2011-01-19T08:15:35","date_gmt":"2011-01-19T13:15:35","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=18292"},"modified":"2011-01-19T08:15:35","modified_gmt":"2011-01-19T13:15:35","slug":"forex-daily-market-commentary-199","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/01\/19\/forex-daily-market-commentary-199\/","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 fell sharply against its G10 peers during the Asia \t\t\tsession, as global risk appetite continued to build. EURUSD traded \t\t\t1.3362-1.3484, and USDJPY 82.13-82.76. The S&P 500 gained 0.14% on \t\t\tthe day, and Asian equities were also firmer. US economic data \t\t\tyesterday was largely second-tier. The Empire state manufacturing \t\t\tsurvey for January rose to 11.92 from 9.89 in December. The NAHB \t\t\thousing market index was unchanged at 16 in January, just below the \t\t\tconsensus of 17. TICS data showed net foreign inflows to US \t\t\tlong-term securities rose to $85 bn in November from $29 bn in \t\t\tOctober. Today, US housing starts and building permits are due for \t\t\tDecember. However, tomorrow’s jobless claims report will be critical \t\t\tto the dollar’s near-term direction – a substantial fall in claims \t\t\tmay be enough to lend the dollar some much needed support. We remain \t\t\tbullish on the dollar as we await further evidence that the US \t\t\trecovery is accelerating.
\n EUR<\/span><\/em><\/strong><\/p>\n

Yesterday’s meeting of EU finance ministers broke up without \t\t\tagreement on how to address perceived deficiencies in the European \t\t\tFinancial Stability Facility. Belgian Finance Minister Reynders said \t\t\tthe EFSF discussions are progressing, but German Finance Minister \t\t\tSchaeuble did not appear to be in any hurry to support near-term \t\t\tchanges.
\nFrench Finance Minister Lagarde confirmed that the European banking \t\t\tsystem will undergo another round of stress tests due to begin \t\t\tFebruary. She expressed the hope that these would be “extremely \t\t\tspecific, well-documented and well communicated to be of \t\t\tirreproachable quality”.
\nGermany’s ZEW economic surveys were positive with the economic \t\t\tsentiment index rising to 15.40, significantly above consensus at \t\t\t7.0. The Eurozone’s equivalent survey was equally impressive, rising \t\t\tto 25.40. However, markets continue to be mainly driven by \t\t\tdevelopments over the debt crisis.
\nSome details emerged over the next round of bank stress tests to be \t\t\tconducted across Europe later this year. They are expected to be \t\t\tsignificantly more comprehensive in their nature.
\n GBP<\/span><\/em><\/strong><\/p>\n

Headline CPI for December beat market expectations, rising by +3.7% \t\t\ty\/y (prev. 3.4%). Sterling rallied on the numbers, as investors now \t\t\tsee a greater chance that the BoE may hike sooner. However, our UK \t\t\teconomist continues to expect the first rate hike in Q3. This is \t\t\tconsistent with public comments by MPC members recently, which \t\t\treveal some concern over the strong inflation readings, but also a \t\t\twillingness to look through the short-term inflation strength.
\nAttention will now turn to today’s employment report, followed by \t\t\tMPC member Posen’s speech tonight. He voted to begin another round \t\t\tof Gilt purchases in December, and investors will be curious to see \t\t\tif the latest developments have caused him to reconsider his stance.
\n CAD<\/span><\/em><\/strong><\/p>\n

As expected, the Bank of Canada kept its target for the overnight \t\t\trate unchanged at 1.00%. The policy statement reminded markets that \t\t\tthe recovery in net exports is being restrained by the stronger CAD, \t\t\tand this was enough to push USDCAD a little higher. The BoC’s \t\t\tquarterly Monetary Policy Report is due for release later today.
\n AUD<\/span><\/em><\/strong><\/p>\n

Consumer confidence for January fell by -5.7% m\/m, reflecting the \t\t\timpact of extensive flooding.<\/p>\n

TECHNICAL OUTLOOK<\/span><\/strong>
\nUSDJPY breaks 82.31 support.
\nEURUSD BULLISH Remains constructive below 1.3500, a move above this \t\t\tlevel would signal a strong bull trend and expose 1.3575 next. \t\t\tNear-term support lies at 1.3245.
\nUSDJPY BEARISH Negative tone continues with break of 82.31 and \t\t\ttargets 81.89\/61 next. Resistance is at 83.67.
\nGBPUSD BULLISH Recovery eyes 1.6074\/94 resistance zone. Initial \t\t\tsupport defined at 1.5878 yesterday’s low.
\nUSDCHF BULLISH As long as 0.9542 support holds; broader focus is on \t\t\tthe upside with initial resistance at 0.9687 ahead of 0.9784.
\nAUDUSD NEUTRAL Upward momentum with break of 1.0020 resistance; \t\t\tsupport is at 0.9804 while resistance is at 1.0076.
\nUSDCAD BEARISH Tough support at 0.9820; breach of this would favor \t\t\textension of bear trend towards 0.9712. Resistance is at 0.9977 \t\t\treaction high.
\nEURCHF BULLISH Recovery found resistance at 1.2952 ahead of 1.3038; \t\t\tinitial support at 1.2757.
\nEURGBP BEARISH The pair targets 0.8313 ahead of 0.8285. Resistance \t\t\tis at 0.8455.
\nEURJPY BULLISH Push above 111.12 has made the pair focus on 111.16 \t\t\tyesterday’s high ahead of 112.19 next. Support at 109.56 holds.<\/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 dollar fell sharply against its G10 peers during the Asia session, as global risk appetite continued to build. EURUSD traded 1.3362-1.3484, and USDJPY 82.13-82.76. The S&P 500 gained 0.14% on the day, and Asian equities were also firmer.<\/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-18292","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/18292","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=18292"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/18292\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=18292"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=18292"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=18292"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}