Technical and Fundamental Outlook, EUR, USD, AUD, JPY, GBP
Technical and Fundamental Outlook, EUR, USD, AUD, JPY, GBP Economist Shayne Heffernan of www.livetradingnews.com takes a look at the session ahead for Currencies
Europe Market Snapshot
After a good start with a decrease in Spanish bond yields yesterday at the beginning of the 2 day Eurotop, Investors are losing their patience with the twisting and turning of the European politicians.
France keeps pushing for a swift introduction of a banking union while Germany keeps pressing the brakes to make sure everything will be thoroughly implemented.
Since no big news is expected to come out of this Eurotop and decisions seem to be pushed for the top planned in December, the rally that started this week has come to an end. Even with the good news out of the U.S. the Spanish IBEX slipped 0.34% and the Italian MIB had to give up 0.3% on the news that the amount of bad loans has increased even further.
EUR/USD didn’t hold the European opening levels of 1.3075 and fell back again as the EMU current account and Italian industrial data. For the second time today, the 1.3050 area is providing a safety net against further losses and the pair is bouncing from there.
There is support at 1.3000/1.2995 ahead of key support at 1.2832/39 (200 day ma and uptrend).
GBP/USD having failed at the near term resistance line, at 1.6163, and getting back down to the 3 month support line, at 1.6046, from where a rebound is expected first.
We expect 1.5975 (October low) and 1.5912/00 zone (50% retracement of the move up from July and also the 23rd August high)
Asia Market Snapshot
The USDJPY keeps flirting with its 3 month high as the Japanese Yen stays under pressure now more analysts expect new easing from the BOJ. Asian stocks started lower as technology shares got pushed down after disappointing numbers from Google and Microsoft.
The USDJPY will find support at 79.06, and a fall through could take it to the next support level of 78.79. The pair is expected to find its first resistance at 79.53, and a rise through could take it to the next resistance level of 79.73.
Trading trends in the pair today are expected to be determined by the release of the all industry activity index, leading economic index and coincident index in Japan.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
Bank stocks managed to limit the losses and even though there was a decrease in the Chinese FDI numbers some Asian markets managed to keep their numbers in the green towards the end of the session with the Nikkei up 0.11% an increase in the Hang Seng of 0.18% and the ASX 200 up 0.25%. Gold fell further down back down towards the 1730.
AUD/USD’s rebound from 1.0148 could extend higher to 61.8% retracement of 1.0624 to 1.0148 at 1.0442 and above. On the downside, break of 1.0292 is needed to signal completion of such rebound from 1.0148. Otherwise, further rise will now be mildly in favor in near term.
US Market Snapshot
After disappointing jobless claims that came in 46000 worse than expected American markets got an extra hit when Google’s financial results were made public three and a half hours before their official release due to a human error.
Google was down 9% when trading in the stock was suspended.
When trading in the stock resumed after Larry page’s speech it managed to recoup some of it losses.
Google finally closed with a loss of 8%. The U.S. markets did see positive news as the Philadelphia fed manufacturing index showed a greater than expected gain which helped markets bounce off session lows.
The DJ30 managed to limit the loss to 0.06% while the Nasdaq had to give up 1% at market close.
Today’s Key Economic Releases
Currency Time (GMT) Event
EUR 08:00 Current Account
GBP 08:30 Public Sector Net Borrowing
CAD 12:30 CPI (MoM)
CAD 12:30 CPI (YoY)
CAD 12:30 Core CPI (MoM)
USD 14:00 Existing Home Sales
Heffernan Capital Management
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Shayne Heffernan Ph.D.
Economist/Hedge Fund Manager
Shayne Heffernan oversees the management of funds for institutions and high net worth individuals. He is also an active consultant working with Corporations around the World.
He is recognized as one of the leading Economists in South East Asia, as well as the preeminent authority on ASEAN. His opinions and forecasts are widely read by decision makers in the region and Internationally.
Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reached a peak of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.
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