{"id":20038,"date":"2011-03-11T07:35:13","date_gmt":"2011-03-11T12:35:13","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=20038"},"modified":"2011-03-11T07:35:13","modified_gmt":"2011-03-11T12:35:13","slug":"forex-daily-market-commentary-japan-hit-by-strong-earthquakes-and-tsunamis","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/03\/11\/forex-daily-market-commentary-japan-hit-by-strong-earthquakes-and-tsunamis\/","title":{"rendered":"Forex Daily Market Commentary: Japan hit by strong earthquakes and tsunamis"},"content":{"rendered":"

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

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

The yen spiked half a big figure lower after a strong earthquake hit Japan, and risk currencies in genera fell. EURUSD traded 1.3775-1.3832, USDJPY 82.78-83.30. One Thursday the S& P 500 finished 1.9% weaker amid a rise in risk aversion, and Treasury yields moved lower across the curve. Initial jobless claims surprised to the upside at 397k. The rise appears to reflect technical distortions rather than genuine deterioration and, despite the latest data, claims continue to show a downtrend since January. Also, the trade deficit dropped more than expected to $46.3bn.
\nRetail sales and the University of Michigan confidence index are due Friday. Further improvement here would keep us constructive on our 3m view of increasing dollar strength.
\n
\nEUR<\/em><\/strong><\/p>\n

An EU summit is scheduled for today and expectations for any definite actions to emerge from it are low. But that may not derail the euro in the near-term as officials still have plenty of meetings to fall back on and rising sovereign bond yields could give the impression that officials will make some difficult decisions amid a worsening situation. Any resolution on the pressing issues will likely have to wait for the Eurogroup\/Ecofin meetings on March 14-15 and then the next EU summit on March 24-25. The European Commission website indicates a press conference could come around 2000GMT.
\nMoody\u2019s downgraded Spain by one notch to AA2 with a negative outlook. The ratings agency cited concerns over the eventual cost of bank restructuring and structural issue over broader government finances. The move brings Moody\u2019s into line with S&P, but below Fitch. The Bank of Spain said 12 Spanish lenders need to raise EUR 15.2bn to meet new minimum capital levels otherwise they could face partial nationalization. The lenders have until September to meet these new core capital requirements of either 8% or 10%, depending if the lender is listed or not.
\n
\nGBP<\/em><\/strong><\/p>\n

The BoE kept its policy rate and asset purchase target unchanged, as expected. Sterling weakened immediately after the decision. We now turn our attention to the MPC minutes due on March 23. Today, BoE Governor King is due to speak on the stability of the international monetary and financial system..
\n
\nCAD<\/em><\/strong><\/p>\n

The trade surplus sharply narrowed from a revised down C$1.7bn to C$0.1bn, and added to downward pressure on the Canadian dollar during the session\u2019s decidedly risk-off tone.
\nFor the labour data, we expect a more modest net increase of +5k for employment vs. consensus +25k and we are looking for an unchanged unemployment rate of 7.8% vs. consensus of a dip to 7.7%. While disappointing job data could weaken the CAD, it would not deter us from continuing to look at Canadian dollar relative value longs versus AUD or NZD.<\/p>\n

TECHNICAL OUTLOOK<\/strong>
\nEURJPY constructive above 114.19.
\nEURUSD BULLISH While the pair holds above 1.3744\/32, expect recovery towards 1.3925 and 1.4036 next.
\nUSDJPY BULLISH Break of 83.07 has exposed resistance at 83.54. Near-term support defined at 82.21.
\nGBPUSD NEUTRAL Move below 1.6031 and 1.5964 thereafter would trigger negative tone. Initial resistance is defined at 1.6213.
\nUSDCHF BEARISH Focus is on 0.9236\/00 support zone, move below this would expose 0.8951. Initial resistance is at 0.9392 ahead of 0.9421.
\nAUDUSD BEARISH Look for a break below 0.9944 to trigger bear trend. Near-term resistance is at 1.0118.
\nUSDCAD BEARISH Focus is on initial support 0.9668; break of this would expose 0.9600. Resistance is defined at 0.9776 ahead of 0.9800.
\nEURCHF BEARISH The cross targets 1.2788 with scope for 1.2706 next. On the upside, resistance holds at 1.3040.
\nEURGBP BULLISH Break of 0.8636 is required to confirm the uptrend and pave the way towards 0.8654\/72 area. Near-term support is at 0.8534.
\nEURJPY BULLISH Remains constructive above 114.19, resistance is at 116.00\/65 area.<\/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 yen spiked half a big figure lower after a strong earthquake hit Japan, and risk currencies in genera fell. EURUSD traded 1.3775-1.3832, USDJPY 82.78-83.30. One Thursday the S& P 500 finished 1.9% weaker amid a rise in risk aversion, and Treasury yields moved lower across the curve.<\/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-20038","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/20038","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=20038"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/20038\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=20038"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=20038"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=20038"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}