USD
Brief:
1.Yesterday's US economic releases, -actual- US Housing starts -Apr- (458k) and ABC Consumer confidence -May17- (-45).
2.USD fell against most currencies today as stocks in Europe and Asia rose amid a report showed Spain's economy fell more than initially expected in 1st quarter and recession soars towards a critical level at near 20%, slightly increasing demand for the dollar as safe haven.
3.USD fell against most currencies yesterday despite US stocks fell as 3 US financial firms' efforts to return government bailout money fueled speculation banks have sufficient cash, reducing demand for the currency as safe haven.
4.The dollar remained weak against most currencies yesterday as a report showed builders unexpectedly broke ground on the fewest homes on record in April, led by plunge in condominiums and apartment buildings.
On the upside:
•Stocks may retreat on profit taking.
On the downside:
•Further selling pressure on outlook that recession in US and Europe may be stabilizing.
To monitor:
•Treasury Secretary Geithner at senate hearing and Publication of FOMC meeting minutes.
•Fed/Treasury members' statements/comments.
•US Indexes movement.
•News/statements related to major corporate.
•Other Central bank member’s statements/comments.
•Cross currency strength and weakness. (GBP, EUR, AUD, NZD, CAD and JPY –Main-)
Suggested pairs of the day:
Short: EUR/USD – GBP/USD – AUD/USD – USD/JPY –
Long: USD/CAD -
Possible main pairs are: EUR/USD – GBP/USD – USD/JPY – USD/CAD -
-According to 12.10GMT price-
JPY
Brief:
1.Today's Japan economic releases, -forecast- Japan Tertiary index -Mar- (-1.5%), BOJ Rate decision (0.10%) and BOJ Monetary Policy Meeting.
2.Today's Japan economic releases, -actual- Japan GDP -QoQ- (-4.0%), Japan GDP Domestic Product annualized -1stQ- (-15.2%), Japan Nominal GDP -1stQ- (-2.9%), Japan GDP Deflator -1stQ- (1.1%), Japan Convenience store sales -Apr- (4.3%).
3.JPY fell against most currencies today as stocks around the world rose on speculation the worst of the financial crisis is over, and Bank of America sold $13.5Billion of shares to raise capital.
4.JPY fell against most currencies yesterday on optimism economy in the US will recovery soon, overshadowed US stocks decline which led by banks' shares, as Moody's investors service said commercial property values plunged and housing starts unexpectedly slid 13% to an annual rate of 458,000 in April.
On the upside:
•Stocks may retreat as outlook on non-banking sectors' companies earnings remain weak.
On the downside:
•The yen may weaken on speculation Japan's government will offer more stimulus package.
•Stocks may advance further on economic data which indicates global economy is recovering.
To monitor:
•Treasury Secretary Geithner at senate hearing and Publication of FOMC meeting minutes.
•US Indexes movement.
•Corporate fiscal report.
•Fed/Treasury members' speech.
•BOJ Members' statements/comments.
•News related to major institution.
•Other central bank member’s statements/comments.
•Economist comments on US/Japan economy, economic releases or sector growth.
Suggested pairs of the day:
Short: GBP/JPY – EUR/JPY – AUD/JPY – USD/JPY -
Possible main pairs are: EUR/JPY – USD/JPY – AUD/JPY - GBP/JPY
-According to 12.10GMT price-
EUR
Brief:
1.Today's Euro-zone economic releases, -actual- Germany PPI -YoY-MoM- (-2.7% - -1.4%), Italy Industrial orders -MoM- (-2.7%), Italy Industrial sales -MoM- (-0.8%) and Italy Current account -Mar- (-2266 Euros)
2.Tomorrow's Euro-zone economic releases, -forecast- France Services PMI -May- (46.8), France Manufacturing PMI -May- (41.0), Germany Manufacturing PMI -May- (37.0), Germany Services PMI -May- (44.2), Euro-zone Manufacturing PMI -May- (38.3) and Euro-zone Services PMI -May- (44.5).
3.EUR advances versus the dollar today as stocks in Asia and Europe rose despite a report showed Spain's economy shrank more than initially estimated in the 1st quarter as consumer spending extended its slump and unemployment soared toward 20%, while Germany Finance ministry said the country may be showing the first signs recovering from the worst economic recession since WW2.
4.EUR strengthened against most currencies yesterday as demand for the dollar as safe haven fall on growing optimism US and Europe's economy will return to growth soon and as earlier report showed Germany business confidence rebounded from a 26-year low in April.
On the upside:
•Speculation on additional stimulus/fiscal package for Americans.
On the downside:
•Stocks may retreat further on selling pressure.
To monitor:
•Treasury Secretary Geithner at senate hearing and Publication of FOMC meeting minute
•Fed/Treasury members' statements/comments.
•US Indexes movement.
•News related to major corporate.
•ECB Member's statements/comments.
•Cross currency movement. –Main- (USD)
•Other central banks member’s statements/comments.
Suggested pairs of the day: (Light)
Short: EUR/JPY – EUR/CHF – EUR/USD – EUR/AUD –
Possible main pairs are: EUR/JPY - EUR/USD – EUR/AUD -
-According to 12.10GMT price-
Crude oil
Brief:
1.Crude oil rose to its highest in 6 months before a report forecast to show that US crude inventories dropped from their highest level in nearly 19 years as fuel consumption rose.
2.Crude oil climbed to a 6-month high yesterday as the dollar weakened and equities rebounded from earlier losses, reducing commodities appeal as hedge.
3.Oil prices remained strong yesterday as analysts said US crude oil inventories dropped last week and optimism on global economy will rebound in 2nd half of the year grows amid economy figures indicates worst of financial crisis has bottomed.
On the upside:
•Speculation on additional stimulus package.
On the downside:
•May retreat further on increasing supplies
To monitor:
•Treasury Secretary Geithner at senate hearing and Publication of FOMC meeting minute
•Fed/Treasury members' statements/comments.
•US Indexes movement.
•OPEC members' comments/statements.
•USD movement.
•Geopolitical risk.
•Forecast on near term US economic releases and economic growth.
Trade suggestion: (Light)
“Short” Crude oil around mid $60 and high $60 (Today's economic releases, US indexes movement, USD movement)
-Exit all positions before market closes-
inquiries
-According to 12.10GMT price-
Time lapse prediction: (according to current situation)
Present (12.10PM) – 14PM GMT:
•USD slightly recovers in early trading session.
•US capital markets slightly retreats early trading session.
•JPY slightly recovers in early trading session.
•EUR slightly retreats in early trading session.
•Crude oil slightly weakens in early trading session.
14PM – 16PM GMT:
•USD strengthens in mid trading session.
•US stock markets retreats in mid trading session.
•JPY strengthens in mid trading session.
•EUR retreats in mid trading session.
•Crude oil weakens in mid trading session.
16PM – 21PM GMT:
•USD slightly weakens in late trading session.
•US capital markets slightly recovers in late trading session.
•JPY slightly retreats in late trading session.
•EUR slightly strengthens in late trading session.
•Crude oil slightly advances in late trading session.
Loh Chang Yuen,
Junior Strategist
All rights reserved: Admiral Markets Ltd
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