{"id":19259,"date":"2011-02-10T08:30:31","date_gmt":"2011-02-10T13:30:31","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=19259"},"modified":"2011-02-10T08:30:31","modified_gmt":"2011-02-10T13:30:31","slug":"forex-daily-market-commentary-213","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/02\/10\/forex-daily-market-commentary-213\/","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 recovered lost ground during the Asia session, after an \t\t\tearlier bout of weakness in the aftermath of Fed Chairman Bernanke’s \t\t\tspeech. EURUSD traded 1.3689-1.3744, USDJPY 82.20-82.60. AUDUSD was \t\t\thit by a decline in full-time jobs in January. Asian equities are \t\t\tslightly weaker at the time of writing, mirroring small losses on \t\t\tthe S&P 500 earlier. Bernanke’s testimony before the House Budget \t\t\tCommittee offered little new insight into his outlook for the \t\t\teconomy or public policy as he largely reiterated his speech from \t\t\tFeb. 3. He again sounded guardedly optimistic and the only (minor) \t\t\tnew information was his acknowledgement of the back-to-back sharp \t\t\tdrops in the unemployment rate. Specifically, he said “Notable \t\t\tdeclines in the unemployment rate in December and January, together \t\t\twith improvement in indicators of job openings and firms’ hiring \t\t\tplans, do provide some grounds for optimism on the employment \t\t\tfront.” But he again said, “It will be several years before the \t\t\tunemployment rate has returned to a more normal level. Until we see \t\t\ta sustained period of stronger job creation, we cannot consider the \t\t\trecovery to be truly established.” Atlanta Fed President Lockhart \t\t\tsaid that the QE2 asset purchase program would stick to buying USTs \t\t\tand would not have its scope widened to include the purchase of \t\t\tmunicipal bonds. Head of the New York Fed’s Markets Group, Brian \t\t\tSack, said that there are no signs that the market is facing a \t\t\tshortage of particular Treasury securities.
\n EUR<\/span><\/em><\/strong><\/p>\n

EU President Van Rompuy said EU leaders will hold a special summit \t\t\ton March 11 to consider new measures to tackle the sovereign issue. \t\t\tThe press continued to report that Bundesbank President Weber may \t\t\tnot seek a second term at the Bundesbank, which could eliminate him \t\t\tas a possible successor to ECB President Trichet, whose term ends in \t\t\tOctober..
\nThe ECB’s Bini Smaghi discussed some potential changes to the EFSF, \t\t\tsuch as debt buybacks, and said interest rates of 6% would ensure \t\t\tdebt sustainability. He also said restructuring would be a plan B \t\t\tfor the current crisis, as it could be more costly in the long run.
\nThe IMF said assistance for Ireland would continue despite the \t\t\tpolitical uncertainty. The Irish government said it informed the IMF \t\t\tand the EC of its decision to postpone further capital injections \t\t\tinto its banks until the election is completed. The Finance Minister \t\t\tdid say that even without these injections, the banks are adequately \t\t\tcapitalized.
\n GBP<\/span><\/em><\/strong><\/p>\n

Our analysts are with the consensus and expects no change at today’s \t\t\tBoE policy decision, which should mean that no explanatory statement \t\t\tis published. That would shift the focus to the Feb. 23 meeting \t\t\tminutes, when the voting breakdown is revealed. However, our \t\t\teconomist does note that “Given that this decision will take place \t\t\tagainst the backdrop of the quarterly Inflation Report [Feb 16], \t\t\tthere is a risk of a surprise vote.” Any vote in favour of a rate \t\t\thike would likely prove strongly sterling-positive in the very short \t\t\tterm. However, over the longer term, monetary policy tightening \t\t\twould likely be viewed as being in conflict with the weak growth \t\t\toutlook.
\n CHF<\/span><\/em><\/strong><\/p>\n

While Swiss officials seem less concerned about deflation these \t\t\tdays, a bad CPI print today could stir up intervention rhetoric. On \t\t\tthe other hand, a strong print would help the Swiss franc, prompting \t\t\tmore rhetoric on currency strength. Nevertheless, we remain \t\t\tconstructive on CHF
\n AUD<\/span><\/em><\/strong><\/p>\n

The AUD fell overnight, despite the creation of 24k new jobs in \t\t\tJanuary, more than consensus expectations of 17.5k. But the mix was \t\t\tnot encouraging – part-time jobs accounted for all the increase, and \t\t\tsome full-time jobs were lost. The unemployment rate held steady, as \t\t\texpected, at 5.0%. Our Australian economics team notes that today’s \t\t\tdata is neither definitively strong enough nor weak enough to \t\t\tprovide clear insight into the near-term rate outlook. They continue \t\t\tto expect the next RBA hike in August.<\/p>\n

TECHNICAL OUTLOOK<\/span><\/strong>
\nEURJPY breaks 112.92.
\nEURUSD BULLISH Violation of 1.3741 has made the pair target 1.3779, \t\t\tbreak of this would expose 1.3826\/62. Near term support is at \t\t\t1.3572.
\nUSDJPY NEUTRAL Rise through 82.67 would expose 82.93 while support \t\t\tlies at 81.78.
\nGBPUSD BULLISH Expect gains to target 1.6186 ahead of 1.6279\/99 \t\t\tzone. Near-term support is defined at 1.6010.
\nUSDCHF BULLISH Focus is on 0.9687 with scope for 0.9764 next; \t\t\tsupport at 0.9524.
\nAUDUSD BULLISH Resistance zone lies at 1.0200\/56 while near term \t\t\tsupport lies at 1.0002.
\nUSDCAD NEUTRAL Resistance lies at 0.9978 while initial support is at \t\t\t0.9869.
\nEURCHF BULLISH Momentum is positive; focus is on 1.3206\/87 \t\t\tresistance zone. Support at 1.2973.
\nEURGBP NEUTRAL Move above 0.8508 has turned the model to neutral; \t\t\t0.8577 and 0.8520 mark the near term directional triggers.
\nEURJPY BULLISH Rise through 112.92 has exposed 114.01\/94 resistance \t\t\tzone. Initial support lies at 112.06 yesterday’s low.<\/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 recovered lost ground during the Asia session, after an earlier bout of weakness in the aftermath of Fed Chairman Bernanke’s speech. EURUSD traded 1.3689-1.3744, USDJPY 82.20-82.60. AUDUSD was hit by a decline in full-time jobs in January.<\/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-19259","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/19259","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=19259"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/19259\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=19259"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=19259"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=19259"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}