{"id":19881,"date":"2011-03-02T08:15:51","date_gmt":"2011-03-02T13:15:51","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=19881"},"modified":"2011-03-02T08:15:51","modified_gmt":"2011-03-02T13:15:51","slug":"forex-daily-market-commentary-the-dollar-continues-recovering","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/03\/02\/forex-daily-market-commentary-the-dollar-continues-recovering\/","title":{"rendered":"Forex Daily Market Commentary: The Dollar continues recovering"},"content":{"rendered":"

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

FUNDAMENTAL OUTLOOK at 0800 GMT (EDT +0400)<\/strong><\/strong>
\n
\nUSD<\/em><\/strong><\/p>\n

The dollar continued to recover lost ground on the back of weaker risk appetite. Ratings agency comments about Greece and Portugal did not help. Nor did calls for a cut to the OCR by New Zealand Prime Minister Key. Weaker-than-expected Australian Q4 GDP also contributed to the sombre mood. EURUSD traded 1.3744-1.3811, USDJPY 81.82-81.98. Gold and oil remain elevated and the Nikkei-225 is down 2.4% at the time of writing. US data releases were largely in line and Fed Chairman Bernanke offered little new in his semi-annual testimony on monetary policy to Congress. Bernanke said the Fed is not debasing the dollar and pointed to the need for sustained stronger job creation. He also believes that the recent jump in commodity prices will not have a permanent effect on broader inflation. The ISM Manufacturing slightly exceeded estimates. ADP employment data is due.
\n
\nEUR<\/em><\/strong><\/p>\n

S&P said its ratings on Greece and Portugal remain on credit-watch negative. In Greece\u2019s case, the agency said the rating will depend on the features of the proposed new European rescue mechanism due to come into being in 2013. Greece\u2019s compliance with the terms of the existing EU\/IMF rescue plan is also a consideration. S&P added that Portugal may have to resort to EFSF and IMF funding, in which case the rating would depend on the terms of any consequent loan agreements.
\nEurozone PMI releases were generally strong, beating consensus in Germany, Italy, and France. The German unemployment rate also fell marginally to 7.3%. The Eurozone CPI estimate came in line with expectations at 2.4%, still significantly above the ECB\u2019s target level.
\n
\nGBP<\/em><\/strong><\/p>\n

A number of BoE policymakers testified before a parliamentary committee, but no new views were expressed. Governor King once again said that raising interest rates to make a gesture is \u201cself-defeating\u201d. Deputy Governor Bean echoed King\u2019s previous comments that inflation in the region of 4-5% is likely, but will then come down.
\n
\nAUD<\/em><\/strong><\/p>\n

The AUD weakened slightly when Q4 GDP came in fractionally softer than expected at +0.7%q\/q (cons. +0.7%) and +2.7% y\/y (cons. 2.8%).
\n
\nNZD<\/em><\/strong><\/p>\n

The NZD fell sharply after Prime Minister Key said he would welcome a cut in the OCR, and that he cannot rule out a recession in the first half of this year
\n
\nCAD<\/em><\/strong><\/p>\n

The BoC left policy unchanged as expected, and did not signal any near-term shift. Officials noted improving performance in the US and in Canada, but they also cited challenges from persistent CAD strength and an uncertain global outlook. Elevated oil prices are supportive for Canada and we continue to expect the BoC to resume tightening ahead of the rest of the G10 dollar-bloc central banks.<\/p>\n

TECHNICAL OUTLOOK<\/strong>
\nGBPUSD 1.6330 resistance.
\nEURUSD BULLISH Focus is on 1.3862 break of which would expose 1.3948\/74 zone. Near term support is at 1.3705.
\nUSDJPY BEARISH Support defined at 81.62; move below this would expose 81.13. Initial resistance is at 82.24, yesterday\u2019s high.
\nGBPUSD BULLISH Initial resistance at 1.6330, the reaction high defined yesterday, ahead of 1.6379. Support is defined at 1.6145.
\nUSDCHF BEARISH Support zone is at 0.9228\/00, breach of this would expose 0.8951 next. Near-term resistance at 0.9392.
\nAUDUSD BULLISH Pullback through 1.0088 exposes 1.0002. While this holds, expect recovery towards 1.0202 and 1.0256 next.
\nUSDCAD BEARISH Break of 0.9684 would expose 0.9600. Resistance at 0.9800.
\nEURCHF BEARISH Support lies at 1.2706, break of this would expose 1.2686 and 1.2592. Near-term resistance is at 1.2893.
\nEURGBP BULLISH As long as support at 0.8423 holds, expect gains towards 0.8555 ahead of 0.8593.
\nEURJPY NEUTRAL 114.19 and 111.96 mark the near-term directional triggers.<\/p>\n

Forex Daily Market Commentary<\/strong><\/em> provided by<\/em><\/strong> GCI Financial Ltd<\/strong><\/a>.<\/strong><\/span><\/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 continued to recover lost ground on the back of weaker risk appetite. Ratings agency comments about Greece and Portugal did not help. Nor did calls for a cut to the OCR by New Zealand Prime Minister Key. Weaker-than-expected Australian Q4 GDP also contributed to the sombre mood.<\/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-19881","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/19881","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=19881"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/19881\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=19881"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=19881"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=19881"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}