Forex Insight

24th of February 2012 - Technical Forex Market Overview

2012-02-24T03:20:00.003-05:00

DAILY MARKET COMMENTARY
24 February 2012 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Break above 1.3322 has opened 1.3435 ahead of 1.3548. Support lies at 1.3187.

USDJPY BULLISH Next resistances are at 80.40 and 80.83. Support lies at 79.86.

GBPUSD NEUTRAL Resistances are at 1.5815 and 1.5881. Key downside trigger is at 1.5645 and next support is at 1.5582.

USDCHF NEUTRAL Support is at 0.8961 and 0.8862. Resistance is at 0.9149 ahead of 0.9207.

AUDUSD NEUTRAL Support lies at 1.0598 and 1.0570. Resistance is at 1.0756 ahead of 1.0845, the Feb. 8 key high.

USDCAD BEARISH Momentum is negative; support lies at 0.9924, a move below which would open the key low at 0.9892. Resistance is at 1.0020.

EURCHF NEUTRAL Resistance is at 1.2084 and support is at 1.2032, the month-to-date low.

EURGBP BULLISH Clearance of 0.8486 has opened 0.8562 ahead of 0.8598. Support lies at 0.8453.

EURJPY BULLISH Resistance is at 107.65 ahead of 108.16. Support is at 106.16.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

24th of February 2012 - Fundamental Forex Market Overview

2012-02-24T03:20:00.001-05:00

DAILY MARKET COMMENTARY
24 February 2012 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

WORLD
The Australian dollar fell towards the end of the Asia session after Fitch downgraded the ratings of three Australian banks. Earlier, AUD got a modest boost from parliamentary testimony by RBA Governor Stevens who painted a relatively upbeat picture of the economic outlook. Crucially, he stuck to previous guidance and did not suggest the RBA is poised to cut the cash rate. Looking to external risks, Stevens said China is getting on top of its problems around inflation and the property market. However, he sounded more cautious on Europe, noting anxiety over the sovereign debt crisis has not gone away, nor will it for some time.

EURNOK traded back above 7.50 overnight, having forcefully broken below a key support level at 7.48 yesterday. With approval in principle now granted for a new Greek aid program, and FX volatilities at multi-year lows, conditions look right for investors to add to risk positions for another week or so - especially in the run-up to the ECB's LTRO on Feb. 29. However, we recommend staying nimble given questions remain over how smoothly the PSI transaction will proceed, especially now that a credit event seems increasingly likely. Also we remain on guard for ratings actions over the coming weeks in response to the ECB's acquisition of de facto super-senior status. Overnight EURUSD traded in a 1.3316-1.3380 range, USDJPY 79.86-80.46.

EUR
The ECB does not appear to have concerns about the likely path of inflation in the Eurozone. ECB President Draghi said he sees no sign of inflationary pressures at the moment - rather 'quite the opposite'. ECB Governing Council member Liikanen echoed that view, and repeated that the ECB has never said there is an interest rate floor at 100bp - effectively implying that the ECB could cut the refi rate further if it felt this were needed.

In an interview with the Wall Street Journal Draghi warned against any watering down of fiscal consolidation targets as this 'would elicit an immediate reaction by the market'. The comments may dampen hopes the ECB would be in a position to influence governments to adopt more pro-growth policies to ease debt burdens rather than simply relying on austerity measures alone.

Draghi rejected the notion that sovereign bond markets might be adversely affected by the ECB's refusal to take losses on its Greek bond holdings. Instead he said the ECB's SMP holdings are small relative to the size of European bond markets. He said he was 'surprised' that the market showed no 'elation' after the new Greek program was approved on Monday.

On Thursday the Greek parliament approved the debt swap law, which contains legislation for retroactive collective action clauses. Finance Minister Venizelos said that 'Greece will be a different country after this transaction'.

German final Q4 GDP figures are due on Friday; we and the market are expecting a 0.2% quarterly decline.

JPY
Moody's kept the outlook on Japan's rating at 'stable', noting that credit-negative factors for Japan have not yet reached the critical mass needed to justify an actual downgrade. Moody's thinks increased purchases of JGBs announced by the BoJ last week will be temporary. However, the agency seemed conscious of the risk that these purchases might weaken the government's resolve to show greater fiscal prudence.

GBP
Two Bank of England MPC members sounded dovish. Fisher said he has an 'open mind' on whether more easing is needed. He repeated that the economic outlook is still 'incredibly uncertain', noting that 'if anything I feel slightly more comfortable about the inflation outlook than the outlook for growth'. He went on to describe a possible upward cost shock due to oil as 'the last thing we need at the moment'. Miles said the UK economic situation is still precarious and monetary policy therefore needs to be expansive.

The second estimate of Q4 UK GDP is due on Friday. Our UK economist is in line with consensus and expects the previous estimate to be confirmed at -0.2% q/q.

AUD
RBA Governor Stevens said the settings of monetary policy are 'about right for the moment'. He stuck to previous policy guidance and, crucially, did not suggest that a cut to the cash rate was in the pipeline. The OIS market was unmoved by the remarks and continues to price in 43bp of further easing over the next 12 months. However, AUD got a moderate boost from Stevens' relatively upbeat assessment of the economic outlook.

Stevens added that the recent bout of AUD strength is a bit 'odd' given that the terms of trade have already peaked. However he said he was not attracted to the idea of trying to prevent AUD from rising further, and said the RBA has carried out no intervention recently.

The Australian dollar fell 30 pips toward the end of the Asia session after Fitch downgraded the ratings of a number of Australian banks. There has been a lot of market interest in the funding costs of Australian banks recently on the grounds that if banks raise their lending rates, this could give the RBA greater freedom to lower the cash rate.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

23rd of February 2012 - Technical Forex Market Overview

2012-02-23T04:01:00.003-05:00

DAILY MARKET COMMENTARY
23 February 2012 – 8:00 GMT
Thursday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD NEUTRAL Key bull trigger is at 1.3322 and next resistance is at 1.3435. Support lies at 1.3187 ahead of 1.3115

USDJPY BULLISH Next resistances are at 80.83 and 81.48. Support lies at 79.68.

GBPUSD NEUTRAL Resistances are at 1.5815 and 1.5881. Key downside trigger is at 1.5645 and next support is at 1.5582.

USDCHF BULLISH Resistance is at 0.9207 ahead of 0.9300. Key downside trigger is at 0.9066.

AUDUSD NEUTRAL Support lies at 1.0570 and 1.0527. Resistance is at 1.0686 ahead of 1.0756.

USDCAD BEARISH Initial support lies at 0.9955, a move below which would open 0.9924. Resistance is at 1.0052.

EURCHF NEUTRAL Resistance is at 1.2084 ahead of 1.2116. Key supports to watch are at 1.2032 and 1.2000.

EURGBP BULLISH Clearance of 0.8486 would open 0.8562 next. Support lies at 0.8379.

EURJPY BULLISH Break of 106.04 has opened resistances at 106.74 and 107.65. Support is at 105.05.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

23rd of February 2012 - Fundamental Forex Market Overview

2012-02-23T04:01:00.001-05:00

DAILY MARKET COMMENTARY
23 February 2012 – 8:00 GMT
Thursday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

WORLD
The Asian session was relatively quiet as markets consolidated further. BoJ Governor Shirakawa said that the latest easing measures were supposed to boost sentiment temporarily and a rise in prices won't change policy. He also suggested that the BoJ will leave policy easy until the 1% inflation target is reached and that this view is backed by the 9-member board. Prime Minister Noda said that he wants more frequent talks with the BoJ governor to boost cooperation. More generally, with the news flow from the Eurozone largely exhausted for now the market reverted to data in search of risk drivers. On Wednesday the results were somewhat more disappointing as US housing numbers suffered revisions to the weaker side, especially the deep revision to the December numbers, and there is some sign of strain in the mortgage market as the mortgage purchase index fell another 2.9%w/w.

This is exactly the area of the US economy where the Fed has expressed significant concern, though even if further dips arise conventional QE may not be the right answer. Ahead on Thursday Germany IFO numbers will be a test of the Eurozone's economic resilience, especially now that the LTRO has had close to two months to make its impact felt on the economy - if any at all. At this stage we still dispute the notion that the ECB's liquidity steps can be a catalyst for renewed credit creation for the Eurozone household and corporate sectors, as banks are largely using the funds for their own refinancing needs and the marginal impact on the real economy is expected to be limited. In the same vein, the next 3-year LTRO may also be used for 'ring-fencing' purposes ahead of a potential credit event regarding Greece, and actually putting the funds to work remains several layers down the order of priority. In the US, initial claims are due and the market is looking for a slight rebound to 355k from last week's 348k. Our economists note that the upcoming reading could be affected by seasonal adjustment problems relating to the Presidents' Day holiday. Overnight EURUSD traded in a range 1.32312 1.326, USDJPY 80-07-80.35.

EUR
The euro came under slight pressure after some weaker Eurozone PMIs. The advance February numbers for the Eurozone composite indicator came in at 49 for manufacturing and 49.4 for services. Our European economist notes that German PMI components suggest the index should stabilize around 50-51. This is the message from the orders - purchases gap. Puzzlingly, all components were flat or up. The services PMI components suggest stabilization: new and outstanding business were both solidly up while business expectations slipped slightly

The Dutch Finance Minister said he is in favour of merging the firepower of the ESM and EFSF, broadly in line with German comments in the past.

EU Commissioner Rehn said the current Firewall for the Eurozone has been inadequate during the debt crisis and again stressed the ESM and EFSF should be 'used together'. Again he toed the Eurozone line by saying a Greek default would have 'dramatic' consequences.

German Chancellor Merkel said that she will maintain the pressure on Greece and the rest of the periphery. She noted that 'everyone must do their homework because otherwise this Europe can't hold together'.

US Treasury's Brainard said the economic recovery remains fragile, and the G20 countries must remain active. On Greece he said that the 'critical issue' is that the Eurozone establish a 'credible firewall', but warned that the US does not intend to seek more funding for the IMF this year, which would be a blow to the Eurozone's hopes for a smaller internal burden in the upcoming bailout.

According to Dow Jones, an IMF official said that the fund would avoid excessive 'risk-taking' in funding the Greek programme, supporting German Finance Minister Schaeuble's recent commentary that the Fund's contribution to the new package is likely to be limited to around EUR13bn (net new monies).

JPY
Overnight BoJ Governor Shirakawa said that the latest easing measures were supposed to boost sentiment temporarily and a rise in prices won't change policy. He also suggested that they will leave policy easy for longer until the 1% target is reached, a policy that is backed by the 9-member board. Prime Minister Noda said that he wants more frequent talks with the Governor in order to boost cooperation.

The Japanese Ministry of Finance continued its rhetoric, despite the strong rally in USDJPY. A senior official said there is nothing strange about USDJPY at 80, and the JPY weakening is due to the BoJ's timely easing and a better risk environment. They continued to state that a strong JPY has a strong negative impact on the Japanese economy.

GBP
BoE dove David Miles (who voted for 75bn of QE) said the UK economic situation is still precarious and monetary policy therefore needs to be expansive.

The BoE minutes for the February meeting revealed that the MPC voted 7-2 to increase the QE program by GBP50 bn. The dovish members Miles and Posen called for GBP75 bn however, which led to a slight sell-off in GBP. The MPC committee acknowledged that the macro environment had improved but argued that underlying problems in the Eurozone remain. Our analysts note that although the minutes are dovish, a group within the committee still believes that inflation will end up higher than the inflation report projections. As a consequence, 'a case can be made for maintaining the stance of policy at this meeting'. This group clearly did not have enough conviction in their view to vote against the majority however..

AUD
Australian Foreign Minister Kevin Rudd resigned, saying that he could not work with Prime Minister Gillard. The immediate impact on AUD is likely to be minimal but further strains on the incumbent government could have a longer term impact.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

21st of February 2012 - Technical Forex Market Overview

2012-02-21T03:09:00.001-05:00

DAILY MARKET COMMENTARY
21 February 2012 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD NEUTRAL Key bull trigger is at 1.3322 and next resistance is at 1.3435. Support lies at 1.3115 ahead of 1.2974.

USDJPY BULLISH Resistance is at 79.89 and 80.24, the August 2011 high. Support lies at 78.80.

GBPUSD NEUTRAL Initial resistance is at 1.5886 ahead of key high at 1.5929. Supports are at 1.5790 and 1.5645.

USDCHF BULLISH Resistance is at 0.9207 ahead of 0.9300. Key downside trigger is at 0.9066.

AUDUSD BULLISH Focus is on 1.0845, a break above which would signal scope for gains towards 1.1081. Key support lies at 1.0629.

USDCAD BEARISH Key support is at 0.9892, the Oct. 27 low, a break here would open 0.9766. Resistance is at 0.9985.

EURCHF NEUTRAL Resistance is at 1.2116 ahead of key high of 1.2133. Support lies at 1.2063 ahead of 1.2032, the month-to-date low.

EURGBP BEARISH Near-term support is at 0.8307 ahead of 0.8278. Key resistance is at 0.8422.

EURJPY BULLISH Clearance of 105.70 has opened 106.04 ahead of 106.74. Support is at 104.42.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

21st of February 2012 - Fundamental Forex Market Overview

2012-02-21T03:08:00.001-05:00

DAILY MARKET COMMENTARY
21 February 2012 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

WORL
After marathon talks that extended well into Tuesday morning, a new bailout deal totalling the targeted EUR130 bn for Greece was finalised. Most of the deal's components had been well flagged to the market, but the mere fact that negotiations did not fall apart helped stabilise sentiment and allowed EURUSD to keep a steady footing above 1.32. Although a significant hurdle has been passed and a disorderly default on March 20 appears to have been avoided, several points remain unresolved. First, the terms on the PSI are slightly harsher than previously determined as private sector investors will need to accept higher nominal losses than previously agreed and at a lower coupon; it remains to be seen whether these terms alone would be enough to trigger CDS as the IIF appears to have stopped short of giving the deal its full endorsement. Second, the Greek government has reserved the right to enact collective action clauses as further measures will depend on private sector participation, though it is already clear that the Greek parliament will move towards relevant legislation in due course. Demands for a larger haircut on private sector holdings appeared to have held up the agreement on Monday, and Eurogroup chair Juncker stressed that a successful PSI is a 'recondition' for the successor aid programme.

The current calculations suggest that Greek debt will come down to 120.5% of GDP in 2020, broadly in line with the IMF's definition of 'sustainability' but IMF chair Lagarde said that the board would need to decide on the new package and the Fund's own contribution in the second week of March. In return, Greece has also won debt relief through a lowering the margin on the loans in the first bailout package to 150bp, while national central banks would also transfer profits to Greece, while Eurosystem holdings would not suffer any losses. A segregated account will be created for aid flows while the troika will enjoy a 'permanent presence' to oversee progress on the necessary reforms. Greek PM Papademos said he was 'happy' with the result and targeted restructuring to be completed by April. We note that the news overnight does remove short-term uncertainty and risk may find some support, but as has been the case so often with the Eurozone throughout the crisis, implementation has proven far harder and there will be new stumbling blocks ahead, not least the prospect of elections returning a government less in favour of today's agreements. Overnight EURUSD traded 1.3186-1.3293 and USDJPY 79.55-79.81.

EUR
After long talks extending well into Tuesday, the Eurogroup meeting finally signed off the second bailout package for Greece. The key terms include (1) a larger nominal loss on holdings by private investors (2) a lower coupon on the new bonds - weighted average is 3.65% over 30 years (3) a lower margin on bilateral loans from the first bailout package (4) profit transfers by NCBs on their investment portfolio holdings.

Greece is set to launch the bond swap tomorrow but the IIF sounded somewhat more hesitant on the deal, calling upon members to consider it 'carefully'. The IIF noted that the neal deal was 'broadly consistent' with earlier agreements, and bondholders will get a 'cash sweetener' in receiving 15% of bonds in the form of EFSF bills.

Depending on the take-up of the PSI, the Greek government will decide on imposing retroactive collective action clauses, though wires have already reported parliament will enact relevant legislation in any case. The new bonds will be governed by English law, which will be considered a form of protection against future unilateral legislation-induced restructuring by Greece.

Greece is expected to set up a 'segregated account' for the aid flows, and this account will be held under Greece's paying agent. Greece is also expected to 'introduce into its law a provision ensuring priority is granted to debt servicing payments', according to Reuters. Despite initial protests against the measure, a 'permanent presence' in Athens will be maintained by the troika.

IMF Managing Director Lagarde said that the board will deal with Greece in the 'second week of March' and did not guarantee commensurate participation upfront. She said that board discussion will be subject to "Greek prior actions" and the deal should also provide Greece with the space to restore competitiveness. The lack of growth measures and focus on austerity could derail the programme if growth continues to deteriorate at its current pace.

Eurogroup chair Juncker said the new deal will 'secure Greece's future in the Eurozone' and preserve Eurozone financial stability. However he warned that a 'successful PSI' is a precondition for the successor programme.

EFSF CEO Regling said the Facility will laregely fund the 2nd Greek bailout and it would also raise money in 'a cashless way', which is consistent with prior agreements reached in July. He also said the collateral enhancement component would be EUR35bn though usage has not been specified.

The ECB settled no purchases for the SMP last week as conditions remain stable for the sovereign bond market. However, this appears heavily dependent on stable outcomes out of Greece, which is far from guaranteed.

The EU offered some promising comments on Portugal, saying that the country is delivering and fiscal implementation has been satisfactory.

JPY
Regardless of the reasons behind the BoJ's sudden switch in attitude, the quantities involved in their potential asset purchases are significant and we expect aggressive deployment of the balance sheet to meet their inflation mandate.

Japanese Finance Minister Azumi said overnight that new agreements had not been reached on IMF funding. This is consistent with Lagarde's position during Eurogroup discussions on Tuesday as the IMF had not yet reached agreement upon its total exposure to the new Greek deal..

GBP
Public sector finances data is due on Tuesday, while MPC member Bean will later give a speech.

AUD
RBA Minutes released overnight noted that rate levels were 'appropriate' given the current economy outlook. In addition, inflation would 'provide scope for easing' if demand dropped materially. The RBA noted that Eurozone risks had diminished but remains concerned about developments in China.

Our economists note that overall the minutes showed a somewhat 'more conditional/less explicit easing bias'. Overall, our economists expect the RBA to hold rates, unless there's a renewed jump in unemployment (or developments in Europe deteriorate sharply). There is still a case for a further easing of policy modestly near term to offset higher bank lending rates and the tighter monetary conditions due to a higher AUD. But we are now less convinced the RBA agrees.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

20th of February 2012 - Technical Forex Market Overview

2012-02-20T04:40:00.003-05:00

DAILY MARKET COMMENTARY
20 February 2012 – 8:00 GMT
Monday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD NEUTRAL Resistance is at 1.3291 ahead of bull trigger at 1.3322. Support lies at 1.3115 ahead of 1.2974.

USDJPY BULLISH Clearance of 79.53 has opened resistance at 80.24. Interim resistance is at 79.89 while support lies at 78.80.

GBPUSD NEUTRAL Key upside trigger is at 1.5929, a break here would open 1.6096 next. Supports are at 1.5790 and 1.5645.

USDCHF BULLISH Resistance is at 0.9300 ahead of 0.9339. Key support lies at 0.9066.

AUDUSD BULLISH Focus is on 1.0845, a break above which would signal scope for gains towards 1.1081. Support lies at 1.0689.

USDCAD BEARISH The pair is testing 0.9926; a clear break here would open 0.9892. Resistance is at 1.0052, a prior low.

EURCHF NEUTRAL Resistance is at 1.2116 ahead of key high of 1.2133. Support lies at 1.2063 ahead of 1.2032, the month-to-date low.

EURGBP BEARISH Near-term support is at 0.8278 ahead of 0.8255. Key resistance is at 0.8422.

EURJPY BULLISH Clear break above 105.70 would open 106.04 next. Support is at 103.44.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

20th of February 2012 - Fundamental Forex Market Overview

2012-02-20T04:40:00.001-05:00

DAILY MARKET COMMENTARY
20 February 2012 – 8:00 GMT
Monday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
China's unexpected weekend decision to cut the reserve ratio requirement by 50bp boosted risk appetite throughout the Asia session. The effect was magnified by the element of surprise. USDJPY scrambled higher to 79.89 but the rally was cut short when the Japanese trade deficit for January came in smaller than expected. Although China's stimulus measure in itself is limited in efficacy and comes amid signs of a slowdown, the PBoC's joining of the ranks of major central banks adding to easing will help to further stabilise economic conditions. Meanwhile expectations continue to build ahead of Monday's meeting of Eurozone Finance Ministers and the outcome of the meeting is likely to be a defining moment for how risk appetite evolves throughout the week. Germany's Finance Minister Schaeuble suggested a decision would be made on the 'whole program' on Monday and he backed away from the idea of a piecemeal step-by-step approval process that could drag on for several weeks. That's a promising development.

However, Eurogroup Chair Juncker indicated that much negotiation is still needed if full agreement is to be reached by Monday night. The Financial Times reported that the Greek parliament is to vote this week on adding CAC clauses into existing Greek bond contracts. This is likely to be seen as a preparatory step towards an enforced compulsory restructuring should voluntary participation levels disappoint. It also raises the risk that Greece will be downgraded again given S&P has already announced that if legislation is passed to insert such clauses then "we would lower the issue ratings on debt issues concerned to 'D' from 'CC'". In addition, any subsequent invocation of these CAC clauses would very likely cause CDS contracts to be triggered, although the decision on this point will rest with ISDA. In a further sign of progress towards a second rescue package for Greece, a Greek official announced that the debt swap for private investors would be launched by March 8, with the aim of concluding the transaction three days later. Overnight EURUSD traded in a range of1.3156-1.3238 and USDJPY 79.35-79.89.

EUR
The Financial Times reported that a decision on both the PSI deal and the new Greek bailout is likely at Monday's Eurogroup meeting. The article noted that "the new programme might still not be fully finalised, though, as a list of new prior actions could be imposed yet again". Meanwhile Dow Jones cited a Dutch Finance ministry report that Greece may only get the second bailout after elections in Greece have passed. It is clear that negotiations remain tense and there are many issues to resolve before the funds are finally released.

Governor Visco of the Italian central bank implied that Italian banks have even greater freedom to participate in the ECB's upcoming 3y LTRO on Feb. 29. He said the pool of eligible collateral available to Italian banks will increase by EUR 70-90 bn as a direct result of the ECB's decision to accept loans as collateral at refinancing operations.

Visco went on to express concern about credit contraction in Italy however, noting the 'very marked' decline in credit advanced to corporates in December, which continued at a more modest pace in January. He said it was 'crucial that the economy does not fall victim to credit asphyxiation'.

Overnight ECB's Asmussen said Greece is not a thread to the world economy, and said that he expected conditions for the second bailout to be completed by Monday. He also noted that the dollar would remain the world's most important reserve currency for the foreseeable future.

Austrian Finance Minister Fekter said that Eurozone officials will discuss an escrow account for the Greek bailout package. However, she said that this is for now being prepared 'on the technical level' and details would be discussed 'intensely' on Monday.

US Treasury Secretary Geithner said that the US will 'encourage' the IMF to support agreement on Greek economic reforms, but failed to commit to new funding for the IMF itself.

On Friday German President Wulff resigned, but we expect no market impact from this.

JPY
Bank of Japan Governor Shirakawa said that the BoJ has 'set a clear stance' and committed the central bank to 'strong monetary easing'. He also said that the BoJ will complete the planned asset purchases programme by year-end. Shirakawa denied there was political interference behind the BoJ's recent decisions.

Finance Minister Azumi stressed that the BoJ had 'effectively adopted an inflation target' and said both he and Shirakawa shared the inflation target view.

GBP
Bank of England MPC member Posen offered his interpretation of the latest quarterly inflation report in a speech on Friday. He would not be drawn on whether yet another round of QE was being considered. However he said that the inflation forecast, which assumes the QE target remains unchanged in future 'gets us close to target with the risks pretty balanced'. We note that his comments suggest some satisfaction with current policy settings - an unusual state of affairs for Posen who has been the most dovish member of the MPC for over a year.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

16th of February 2012 - Technical Forex Market Overview

2012-02-16T03:29:00.002-05:00

DAILY MARKET COMMENTARY
16 February 2012 – 8:00 GMT
Thusday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD NEUTRAL The pair is testing 1.3028; a clear break here would open 1.2973 ahead of 1.2891. Resistance is at 1.3216 ahead of 1.3291.

USDJPY BULLISH Resistances are at 78.76 and 78.98. Support is at 78.18.

GBPUSD NEUTRAL Supports are at 1.5642 and 1.5582. Resistance is at 1.5771 ahead of 1.5849.

USDCHF NEUTRAL Key upside trigger is at 0.9263, a clear break here would open 0.9339. Support lies at 0.9143 ahead of key low at 0.9066.

AUDUSD BULLISH Near-term resistance is at 1.0791 ahead of 1.0845. Support lies at 1.0629.

USDCAD BEARISH Key supports to watch are at 0.9926 and 0.9892. Resistance is at 1.0052, a prior low.

EURCHF NEUTRAL Near-term resistance is at 1.2116 ahead of key high of 1.2133. Support lies at 1.2054 ahead of 1.2032, the month-to-date low.

EURGBP BEARISH Decline through 0.8330 has opened supports at 0.8283 and 0.8265. Key resistance is at 0.8422.

EURJPY BULLISH Resistance is at 103.49 ahead of 104.32. Support is at 101.66.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

16th of February 2012 - Fundamental Forex Market Overview

2012-02-16T03:28:00.001-05:00

DAILY MARKET COMMENTARY
16 February 2012 – 8:00 GMT
Thursday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro extended its weakness during the Asia session amid concern over the failure of Eurozone authorities to secure an aid package for Greece before bond redemptions are due. In comments made after the Eurogroup conference call, Jean Claude Juncker merely said 'decisions' would be made at next week's full meeting but it appears doubts remain over Greece's ability to deliver. The stop-gap solution seems to be to come up with enough funds to repay creditors only while withholding other forms of aid. A bridging loan to last the next month is being planned, though essentially this is only buying time for a fuller discussion on the merits of a longer-term plan.

The headlines were a wake-up call to a market that had grown complacent about the risks around the current negotiations. Nevertheless Juncker said that strong assurances had been received from Greece's political leaders and implied that full agreement is only a few short steps away. He specifically mentioned the need for mechanisms to ensure stronger surveillance and to prioritise the repayment of debt owed to creditor nations. Nevertheless, he said that these outstanding issues would be addressed and declared himself 'confident' that the finance ministers will 'take all the necessary decisions' when they next meet in person on Monday. Greek Finance Minister Venizelos added that the bond swap details would be announced on Monday provided final agreement is reached on the terms of a second rescue plan.

FOMC minutes from the January meeting revealed that 'a few' FOMC officials still cling to the belief that more asset purchases will be needed this year. We note however that mainstream thinking within the FOMC appears to have backed further away from this position, and would only consider additional easing if the US economic outlook darkens. Overnight Australian jobs figures were far better than expected and the unemployment rate dropped to 5.1%, though we expect Grece to remain the dominant driver. EURUSD traded 1.3007-1.3068 and USDJPY 78.36-78.53.

EUR
Eurozone Q4 GDP was slightly above consensus but still fell -0.3% q/q. Italy Q4 GDP was slightly softer though, at -0.7% q/q vs -0.6% cons.

ECB Governing Council Coene said the ECB has agreed it does not wish to make a profit from its transactions in Greek bonds. He said the plan is to return profits to national governments (who are shareholders in the ECB) and then "when the profit from past years is distributed, each government will determine what proportion is due to Greece". It is not clear if Coene is referring only to SMP portfolio profits, or whether a larger redistribution of profits made from other ECB operations and holdings is also being considered. ECB's Asmussen said that it is possible for the ECB to pass any profits made on their bond purchases to the national central banks (NCBs), who can then use them for Greek aid. He stressed once again that a direct contribution to a second Greek assistance package is not possible for the ECB.

China's central bank governor Zhou said BRIC countries are waiting for the right time to help Europe. He said China has not cut its reserves exposure to euro-denominated assets as a result of the crisis.

Late on Wednesday the Eurogroup released their post-conference call statement, noting that the Eurogroup will take 'necessary decisions' on Greece next Monday, while the troika has presented its Greek debt sustainability report. Crucially a EUR325mln cuts target had been 'identified' though they noted 'further considerations' were necessary.

ECB Governing Council member LIikanen said that lower rates were 'conceivable' but warned that ECB would face bigger risks and look into other measures for policy signalling. We expect the ECB to administer another 50bp in cuts this year to stave off economic risks.

JPY
USDJPY gave back some of its recent gains on the back of some worrisome Greek headlines, and upward progress appears to have stalled entirely. Japanese JGB yields fell to 11bp yesterday for the first time in over a year on the back of the BoJ's fresh round of easing. However, given the effective floor on yields is 10bp, the BoJ's ability to induce further yen weakness through conventional means is starting to reach its limits. For USDJPY to continue higher in a sustainable way we will need to see US yields climb materially, which they have so far refused to do.

GBP
The BoE released its quarterly inflation report and sees headline CPI at 1.8% in 2 years, in line with our Economists estimates. While the forecast has increased from the previous report, it is still below 2%, leaving some room for further QE if it is deemed appropriate. The forecasts suggest that inflation will be below target for a good period of the period however. In the press conference, Governor King said he did not believe that asset purchases exhibit diminishing returns.

January jobless claims rose more than expected at 6.9k (vs 3.0k cons). The claimant count rate remained unchanged at 5.0%. however. Average weekly earnings were also up marginally at 2.0%.

AUD
Australian jobs increased by 46.3k in January, far stronger than expected and the unemployment rate dropped to 5.1%.

Our ananlysts note that overall, while a strong print today, over several months, jobs & hours growth is still soft. But the unemployment rate is key, and is now edging down. With hiring intentions staying firm, likely stronger future jobs growth underline why we thought the unemployment rate wouldn't rise much. As for the RBA, our economists note that after having held in February on their forecast for a rise in unemployment to 5.5%, it seems unlikely they're going to now cut again unless the UR jumps 'meaningfully' or Q1 inflation surprises. As such we no longer look for easing up ahead and the AUD will likely sustain short-term support, barring adverse developments in Europe.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

15th of February 2012 - Technical Forex Market Overview

2012-02-15T03:27:00.001-05:00

DAILY MARKET COMMENTARY
15 February 2012 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Resistance is at 1.3291 ahead of 1.3322. Key near-term support lies at 1.3028.

USDJPY BULLISH Clearance of 78.29 had opened 78.76 ahead of 78.98. Support is at 78.29.

GBPUSD NEUTRAL Supports are at 1.5642 and 1.5582. Resistance is at 1.5771 ahead of 1.5849.

USDCHF NEUTRAL Key support lies at 0.9066; a decline through which would expose 0.8961. Resistance is at 0.9263 ahead of 0.9339.

AUDUSD BULLISH Near-term resistance is at 1.0791 ahead of 1.0845. Support lies at 1.0629.

USDCAD BEARISH Momentum conditions are bearish; two key supports to watch are at 0.9926 and 0.9892. Resistance is at 1.0052, a prior low.

EURCHF NEUTRAL Key near-term resistance is at 1.2133 ahead of 1.2149. Support lies at 1.2054 ahead of key low at 1.2032.

EURGBP BEARISH Initial support lies at 0.8330 ahead of 0.8283. Key resistance is at 0.8422.

EURJPY BULLISH Break above 103.29 has opened the way for 103.98 and then 104.32. Support is at 101.66.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

15th of February 2012 - Fundamental Forex Market Overview

2012-02-15T03:26:00.000-05:00

DAILY MARKET COMMENTARY
15 February 2012 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
China's central bank governor Zhou said China would continue to invest in Eurozone sovereign bonds and would play a bigger role in solving Europe's crisis via both the IMF and the EFSF. As usual, the comments were short on specifics, but they helped the euro recover from yesterday's selloff, and carried AUD and NZD higher too. Zhou also expressed his wish that the euro will become a bigger and more important reserve currency. USDJPY held onto yesterday's gains but couldn't make much further headway despite closing above the 200-day moving average for the first time in 10 months. EURUSD traded 1.3080-1.3185 and USDJPY 77.36-78.66 since Tuesday's European close. There was no further news on yesterday's developments in Europe which had triggered concern over whether a second Greek rescue would ever happen.

The face-to-face meeting of Eurozone finance ministers which was planned for today (but which was cancelled yesterday) has not been reinstated, and the plan is still to hold a teleconference instead. Important decisions on Greek funding have been made via teleconference before, but it seems more likely that any decision to go ahead with a second Greek rescue will be deferred until Monday's regular monthly meeting of Eurozone finance ministers. The Wall Street Journal reported that a tentative agreement has been struck between US congressional negotiators on extending the payroll tax cuts and unemployment benefits through to the end of 2012 - both measures are due to expire on Feb. 29 unless extended. Ahead on Wednesday, headlines around the Eurogroup conference call are the key focus but macro releases are also due, including German and Eurozone GDP, the UK employment reports and the BoE Inflation Report, as well as the FOMC minutes.

EUR
ECB Governing Council Coene said the ECB has agreed it does not wish to make a profit from its transactions in Greek bonds. He said the plan is to return profits to national governments (who are shareholders in the ECB) and then "when the profit from past years is distributed, each government will determine what proportion is due to Greece". It is not clear if Coene is referring only to SMP portfolio profits, or whether a larger redistribution of profits made from other ECB operations and holdings is also being considered.

China's central bank governor Zhou said BRIC countries are waiting for the right time to help Europe. He said China has not cut its reserves exposure to euro-denominated assets as a result of the crisis.

On Tuesday afternoon, the Eurogroup meeting originally scheduled for Wednesday was called off, to be replaced by a conference call. Eurozone sources noted that a debt sustainability analysis was not complete, and there were fears the commitments from Greek leaders were 'not firm enough', according to Reuters. Eurogroup Chair Juncker later confirmed the news, noting that the political pledges were not yet received and further technical work with the Troika was needed in 'a number of areas'.

Very late during the US session, Greek New Democracy Party sources reported that their leader would give a written pledge on Wednesday to continue the reforms agreed with the Troika. The PASOK party is expected to do the same. Dow Jones also reported government officials as saying Greece has resolved 'outstanding issues' with the Eurogroup, but the decisions on the bailout are only expected next week.

German Finance Minister Schaeuble said he 'wanted to do everything to help Greece' but refused to rule out the worst-case scenario, noting that 'if everything fails', the Eurozone is much better prepared than two years ago. This is further confirmation that a Greek exit is now being considered as an option, but only under extreme circumstances.

Spanish banks borrowed EUR161.4 bn from the ECB in January, compared with EUR132.4 bn in December. The large increase in demand for ECB cash came after the December LTRO, indicating that either bank funding pressures are rising in Spain or they're heavily playing the sovereign carry trade. The latter effect would fit with the strong demand seen at the January auctions where Spain sold around 20% of its total planned 2012 issuance. If this argument holds, it provides further evidence of the ECB helping support the bond markets and signals a large take-up at the upcoming LTRO.

JPY
USDJPY held onto yesterday's gains but couldn't make any further headway despite closing above the 200-day moving average for the first time in 10 months. Japanese JGB yields fell to 11bp overnight for the first time in over a year on the back of the BoJ's fresh round of easing. However, given the effective floor on yields is 10bp, the BoJ's ability to induce further yen weakness through conventional means is starting to reach its limits. For USDJPY to continue higher in a sustainable way we will need to see US yields climb materially, which they have so far refused to do.

GBP
January CPI fell in line with consensus estimates at -0.5% m/m, +3.6% y/y. Our UK economist notes that UK inflation is now very solidly in a downtrend. The annual rate will continue to fall through this year, with the CPI expected to touch 2% by year-end.
The Bank of England is due to release its quarterly inflation report on Wednesday. The inflation guidance may give a better understanding of policy direction in the coming months, while markets will also take note of the growth forecasts. Our UK economist expects the MPC will acknowledge that conditions have improved since the November report, but also that it stands ready to expand the QE programme should the outlook deteriorate again.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

14th of February 2012 - Technical Forex Market Overview

2012-02-14T02:54:00.002-05:00

DAILY MARKET COMMENTARY
14 February 2012 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Initial resistance is at 1.3322 ahead of 1.3386. Support lies at 1.3156.

USDJPY BULLISH Break above 77.81 would open 78.29, the Nov. 29 key high. Initial support is at 77.02.

GBPUSD BULLISH Resistance is at 1.5886, a move above which would open 1.5947. Key near-term support lies at 1.5730.

USDCHF NEUTRAL Key support lies at 0.9066; a decline through which would expose 0.8961. Resistance is at 0.9201 ahead of 0.9263.

AUDUSD BULLISH Near-term resistance is at 1.0791 ahead of 1.0845. Support lies at 1.0640.

USDCAD BEARISH Initial support is at 0.9926, a break here would open the key low at 0.9892. Resistance is at 1.0052, a prior low.

EURCHF NEUTRAL Support lies at 1.2084, a move below which would expose 1.2053. Key near-term resistance is at 1.2133 ahead of 1.2149.

EURGBP BEARISH Initial support lies at 0.8330 ahead of 0.8283. Key resistance is at 0.8422.

EURJPY BULLISH Next resistances are at 103.29 and 103.98. Support is at 101.66.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

14th of February 2012 - Fundamental Forex Market Overview

2012-02-14T02:54:00.001-05:00

DAILY MARKET COMMENTARY
14 February 2012 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The BoJ unexpectedly followed in the Fed's footsteps and effectively set an inflation target of +1% y/y at today's policy meeting. It also increased its target for asset purchases to help meet this new inflation objective. The asset purchase program was created in October 2010, and the ceiling on its stock of purchases has been raised twice before - but only in increments of JPY5 trn. Today however, the facility's ceiling rose a further JPY10 trn and the aim is to spend all of this exclusively on JGB purchases before year-end.

Moody's downgraded six Eurozone sovereigns overnight: Italy, Spain, Portugal, Malta, Slovakia, and Slovenia. The Aaa ratings of France, Austria, and the UK were affirmed but the outlook on each of these ratings was lowered to negative from stable. Cable dropped 60 pips over the course of the Asia session on the back of this news.

EUR
Moody's downgraded the rating of six Eurozone sovereigns, and lowered the outlooks of two more. Spain was cut two notches, while Italy only fell a single notch and so avoided crossing into Baa territory. Although the outlook on the French and Austrian ratings were cut to negative, this compares favourably with the actual ratings downgrades that both sovereigns suffered at the hands of S&P a month ago. Given France has kept her Moody's triple-A rating at least, the EFSF's own Aaa rating seems safe for now.

ECB reported bond settlements under the SMP at EUR59 mn in week to Feb.10. This is the lightest week of ECB activity since the week ended Dec. 23 and the second-lightest week for buying since Italy and Spain were first included in SMP portfolio in August.

JPY
The BoJ unexpectedly set an inflation target of +1% y/y at today's policy meeting. It also increased its target for asset purchases to help meet this new inflation objective. The asset purchase program was created in October 2010, and the ceiling on its stock of purchases has been raised twice before - but only in increments of JPY5 trn. Today however, the facility's ceiling rose a further JPY10 trn and the aim is to spend all of this exclusively on JGB purchases before year-end.

This is a significant amount of additional easing, and with the BoJ's preferred measure of core inflation currently running at only -0.1% y/y investors are bound to expect further bouts of monetary accommodation down the road. USDJPY climbed 30 pips - a relatively energetic reaction to what is usually a mundane BoJ policy announcement. Separately, the BoJ's long-running Rinban operations were left unchanged and so JGB purchases under that program will continue at a pace of JPY21.6 trn per year.

GBP
Moody's affirmed the UK's Aaa rating, but lowered the outlook to negative from stable. This suggests a one-third chance that the UK may lose its Aaa status in the next 12-18 months. We note that this is not the first ratings action the UK has seen in recent years. On May 21, 2009, S&P also lowered the outlook to negative, only to raise it back to stable over a year later on Oct. 26, 2010. The rating itself was not downgraded during this time. This is however the first time negative aspersions have been cast on the UK's rating since the Eurozone debt crisis erupted.

The Bank of England is due to release its quarterly inflation report on Wednesday. The inflation guidance may give a better understanding of policy direction in the coming months, while markets will also take note of the growth forecasts. Our UK economist expects the MPC will acknowledge that conditions have improved since the November report, but also that it stands ready to expand the QE programme should the outlook deteriorate again.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

13th of February 2012 - Technical Forex Market Overview

2012-02-13T03:02:00.002-05:00

DAILY MARKET COMMENTARY
13 February 2012 – 8:00 GMT
Monday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Initial resistance is at 1.3322 ahead of 1.3386. Support lies at 1.3156.

USDJPY BULLISH Break above 77.81 would open 78.29, the Nov. 29 key high. Initial support is at 77.02.

GBPUSD BULLISH Resistance is at 1.5886, a move above which would open 1.5947. Key near-term support lies at 1.5730.

USDCHF NEUTRAL Key support lies at 0.9066; a decline through which would expose 0.8961. Resistance is at 0.9201 ahead of 0.9263.

AUDUSD BULLISH Momentum is positive; near-term resistance is at 1.0791 ahead of 1.0845. Support lies at 1.0640.

USDCAD BEARISH Initial support is at 0.9926, a break here would open the key low at 0.9892. Resistance is at 1.0052, a prior low.

EURCHF NEUTRAL Support lies at 1.2084, a move below which would expose 1.2053. Key near-term resistance is at 1.2133 ahead of 1.2149.

EURGBP BEARISH Initial support lies at 0.8330 ahead of 0.8283. Key resistance is at 0.8422.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

13th of February 2012 - Fundamental Forex Market Overview

2012-02-13T03:02:00.001-05:00

DAILY MARKET COMMENTARY
13 February 2012 – 8:00 GMT
Monday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The Greek parliament voted in favour of a new package of austerity measures by 199 votes to 74 early on Monday morning. There were 27 abstentions. The euro got a moderate boost once the count got underway, but we saw no follow-through after the result was announced. In a sign of heightened political discord, 45 of the 300 lawmakers were expelled from their political parties for breaking ranks and voting against party lines. Safe passage of the legislation will go some way to alleviating market concerns after five Greek ministers resigned in protest on Friday. It should also provide a positive backdrop to the two upcoming meetings of Eurozone finance ministers on Feb. 15 and Feb. 20.

However, while this austerity vote is designed to help secure a second EU/IMF program for Greece, it is not in itself sufficient. The IMF has already said it also needs to see 'near universal' participation in any private sector debt restructuring before another round of funding can be considered. We doubt a purely voluntary approach will achieve a take-up approaching such levels, which is one reason why we maintain our bearish view on the euro. The private sector involvement negotiations have yet to reach a final conclusion and the IIF has not provided a recent update on the situation. With the prospect of a disorderly Greek default rising as March 20 approaches, investors may start to pull back from the recent rally, though we acknowledge that growth continues to surprise to the upside in general. Ahead this week, the focus will be on policymaker positions: the BoJ and Riksbank will hold policy meetings, while the Bank of England and Federal Reserve release their quarterly inflation report and meeting minutes, respectively. Macro activity surveys will also be released.

EUR
Greek Prime Minister Papademos warned 'a disorderly default would throw the country into a disastrous adventure. It would create conditions of uncontrollable economic chaos and social eruption'.

S&P announced late on Friday that a 'Selective Default' rating would be applied to Greece if collective action clauses (CACs) were implemented directly. However, the agency also warned that if parliament passed legislation to the same effect, an outright 'Default' rating would be applied.

IIF Chief Dallara has urged Greek lawmakers to back reforms. He called on them to 'understand what is at stake' and also called on the ECB to accept a haircut, noting that 'it is important that everyone shares a fair part of the burden'. Nonetheless he acknowledged time is running out ahead of the March 20 major bond redemption.

JPY
Japan's GDP contracted quite sharply in Q4, after having rebounded in Q3. The market had been expecting a decline in economic output, but the -0.6% q/q print was well below the -0.3% q/q expected by consensus. This theoretically raises the risk of a monetary policy response from the BoJ at Tuesday's policy decision. However, we note that the BoJ's stock of short-dated assets purchased to date is still well below the targets set by previous bouts of easing. This means there is little urgency in raising these targets further, and the signalling effect of doing so would likely have little impact on the yen.

GBP
The Bank of England is due to release its quarterly inflation report on Wednesday. The inflation guidance may give a better understanding of policy direction in the coming months, while markets will also take note of the growth forecasts. Our UK economist expects the MPC will acknowledge that conditions have improved since the November report, but also that it stands ready to expand the QE programme should the outlook deteriorate again.

AUD
Several commercial banks in Australia have raised their lending rates in recent days, and another did so overnight. In principle, this provides a little more room for the RBA to ease further. The RBA decided to remain on hold last week, but our Australian economics team expects a 25bp rate cut in May - the final cut in the current easing cycle.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

10th of February 2012 - Technical Forex Market Overview

2012-02-10T03:44:00.001-05:00

DAILY MARKET COMMENTARY
10 February 2012 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Break above 1.3386 would open 1.3435. Support lies at 1.3089.

USDJPY BULLISH Clearance of 77.42 has put focus on 77.75; a break here would open 78.29, the Nov. 29 key high. Initial support is at 77.02.

GBPUSD BULLISH Resistance is at 1.5886, a move above which would open 1.5947. Support lies at 1.5730.

USDCHF NEUTRAL Key support lies at 0.9066; a decline through which would expose 0.8961. Resistance is at 0.9263 ahead of 0.9339.

AUDUSD BULLISH Near-term resistance is at 1.0791 ahead of 1.0845. Key support is at 1.0672.

USDCAD BEARISH Initial support is at 0.9926 ahead of key low at 0.9892. Resistance is at 1.0034.

EURCHF BEARISH Support lies at 1.2086, a move below which would expose 1.2053. Key near-term resistance is at 1.2133.

EURGBP BEARISH Initial support lies at 0.8330 ahead of 0.8283. Key resistance is at 0.8422.

EURJPY BULLISH Rally through 102.54 has opened resistances at 103.98 and 104.32. Support is at 101.66.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

10th of February 2012 - Fundamental Forex Market Overview

2012-02-10T03:43:00.000-05:00

DAILY MARKET COMMENTARY
10 February 2012 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The Eurogroup was not impressed with the inter-party agreement from Athens and late after the Eurogroup meeting yesterday Greek PM Venizelos was sent back to Athens with demands for deeper cuts. It appears that the EU finance ministers are not prepared to sign off the deal until they get a stronger sense that Greece will actually push through with its pledges. Lawmakers there are supposed to vote on the new austerity measures over the weekend and an "implementation law" is supposed to be considered in the next 10-15 days, according to local sources. Eurogroup chair Juncker stated on Thursday that there is now another week for new cuts to be found and he hoped the Eurogroup would be able to sign off on the plans at a new meeting next Wednesday - another deadline markets will need to contend with. In the background, the PSI deal is still running, but the ECB's participation has been of greater focus and now it appears they would not be able to calculate their own participation until Greece reaches agreement with other troika members. This only adds to potential uncertainty up ahead. While the ECB offered no change in policy, Draghi initially refused to be drawn into discussions on the subject, he later revealed his thoughts on the legality of transferring ECB holdings to the EFSF. President Draghi's post-decision conference revealed the ECB's stance on several issues.

On the macro front, little has changed and the bank remains in data-watch mode. Draghi stressed that while economic data has stabilised there are downside risks and it is too early to fully assess the impact of the 3y LTROs. On the subject of the LTROs themselves, Draghi dismissed the idea that there was any stigma attached and said that their use should be seen as a commercial or business decision only. The easing of collateral requirements further - allowing several countries' national central banks to accept credit claims as collateral, may help with overall LTRO volumes, though at a cost to the ECB's balance sheet risks. EURUSD traded 1.3251 - 1.3291, USDJPY77.54-77.75.

EUR
While the ECB offered no change in policy, President Draghi's conference revealed the ECB's stance on several issues. On the macro front, little has changed and the bank remains in data-watch mode. Draghi stressed that while economic data has stabilised there are downside risks and it is too early to fully assess the impact of the 3y LTROs. On the subject of the LTROs themselves, Draghi dismissed the idea that there was any stigma attached and set that their use should be seen as a commercial or business decision only.

The large elephant in the room was of course the ECB's stance on Greece and the majority of questions were directed to this. While Draghi initially refused to be drawn into discussions on the subject, he later revealed his thoughts on the legality of transferring ECB holdings to the EFSF. He stated that swapping the bonds with the EFSF for any loss would simply be debt monetisation but then noted that "if you consider the EFSF is governments, so if the ECB gives money to governments that's monetary financing. If the ECB distributes part of its profits to its member countries as part of the key, capital key, that's not monetary financing." While this quote can be interpreted in many ways it at least leaves the door open for ECB involvement in the debt swap, provided it is done at cost or better.

Following December's announcement of widening collateral eligibility, the ECB published details on the new criteria, which have been established for the national central banks of 7 countries (France, Italy, Spain, Cyprus, Ireland, Portugal, Austria). BoI Director General Saccomani said that the new rules with give Italian banks the chance to increase borrowing by up to EUR70 bn.

Any hopes of a major announcement from the Eurogroup faded on Thursday afternoon., Greek PM Papademos' office said talks with the troika ended 'successfully' but Dutch and German officials then hit the wires to downplay hopes of a final decision. Finally German Finance Minister Schaeuble announced that there will be no deal announced at the Thursday meeting, since the current deal does not fulfil conditions. He added that it is still not clear whether the deal can successfully reduce the debt burden to 120% of GDP., which is what the troika requirements have previously stated.

Eurogroup Chair Juncker said overnight that a new programme will provide a comprehensive blueprint for Greece's debt sustainability. The bailout may comprise of EUR100bn in new loans, and EUR30bn to encourage the debt swap. In addition, he said new proposals on governance and monitoring were required but no decisions were being made. A new Eurogroup meeting has been announced for next Wednesday to approve the programme.

JPY
In figures released overnight, domestic CGPI was softer than expected at -0.1%m/m, 0.5%y/y. Growth and price concerns remain strong - Japanese Finance Minister Azumi warned that Japan will intervene in FX as appropriate, and need to seek other countries' cooperation but won't hesitate to act solo to counter speculation. Current FX levels do not reflect fundamentals.

Prime Minister Noda said JPY rise since last summer putting downward pressure on economy, government and BoJ need to work closely together.

BoJ Governor Shirakawa said that there is currently no policy gap between the BoJ-government, and all central banks share goals of price stability but use differing terms and policy frameworks.

GBP
As expected, the Bank of England delivered an additional GBP50bn in the quantitative easing programme. In the statement, Governor King noted that there were some more positive signs and a gradual strengthening of output should be supported by a gentle recovery in household real incomes but issues in the Eurozone remain the big concern. He also referred to the continued credit squeeze in the UK domestic market. The pound earlier found some support from better than expected trade and industrial production data and the reaction to the QE announcement was relatively muted.

UK December industrial output rose +0.5% m/m vs +0.2% consensus. Our UK economist notes that the outperformance was driven by manufacturing output, which jumped 1% on the month - higher than the 0.2% expected by markets. UK December trade data also beat expectations, with the deficit at GBP7 bn vs GBP8.6 bn cons and GBP8.9 bn last. Our analysts note that this is December data and we already have the preliminary Q4 GDP print. Normally, a big surprise in the monthly print raises the scope for a revision to the GDP outturn, but the ONS has stated that the impact of the IP data on GDP is small.

AUD
The AUD took a knock overnight as the RBA's Statement on Monetary Policy was interpreted as dovish. Our economists note the Central Bank warned the global outlook "remains clouded". A disorderly outcome to debt problems in Europe (and contagion to our trading partners) remains the major downside risk to the global economy. However, this risk has reduced "somewhat". Although risks around the US are more balanced. Asia and China are "skewed slightly to the downside". The RBA also noted uncertainty surrounding "significant structural change", with a "once-in-a-century investment boom in resources", but "high real exchange rate". We continue to look for 25bp in additional easing up ahead, somewhat more optimistic than market expectations.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

9th of February 2012 - Technical Forex Market Overview

2012-02-09T03:35:00.003-05:00

DAILY MARKET COMMENTARY
9 February 2012 – 8:00 GMT
Thursday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Break above 1.3386 would open 1.3435. Support lies at 1.3089.

USDJPY BULLISH Next resistances are at 77.42 and 77.75. Initial support is at 76.71.

GBPUSD BULLISH Resistance is at 1.5947, a rally through which would open 1.6096. Support lies at 1.5789.

USDCHF NEUTRAL Pair is testing the key support area of 0.9115/066, a decline through which would expose 0.8961. Resistance is at 0.9263 ahead of 0.9339.

AUDUSD BULLISH Break above 1.0845 would expose 1.1007. Key support is at 1.0672.

USDCAD BEARISH Key support lies at 0.9892, a decline through this would signal scope for deeper pull back towards 0.9766/25. Resistance is at 1.0034.

EURCHF BEARISH Support lies at 1.2054, a move below which would expose 1.2032. Initial resistance is at 1.2133.

EURGBP BEARISH Initial support lies at 0.8330 ahead of 0.8283. Key resistance is at 0.8422.

EURJPY BULLISH Pressure is on 102.54; a rally through which would open 103.98. Support is at 100.38.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

9th of February 2012 - Fundamental Forex Market Overview

2012-02-09T03:35:00.001-05:00

DAILY MARKET COMMENTARY
9 February 2012 – 8:00 GMT
Thursday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The Greek negotiations appear to be moving into the final stages as Eurogroup chairman Jean-Claude Juncker announced that a press conference is scheduled for 18.00CET on Thursday, after the Eurogroup meets. The Greek Finance Minister is due to travel to Brussels today to agree on terms, but he admitted that there are still outstanding issues ahead of today's discussions. However, the Greek government noted that the only sticking point is on pension reform, which needs to be resolved by Greece's political parties. While progress has clearly been made, negotiations remain tense and further complications to the deal have emerged.

The ECB's involvement in the debt swap remains a crucial element in the process and while we expect no major policy announcements in today's meeting, Draghi's press conference may provide new information on the ECB's official stance. The timing of Juncker's announcement suggests that the major announcements may come after the ECB meeting however. The euro's price action suggests that all of the potential 'good news' out of the Eurozone, including PSI talks and the ECB's involvement in the upcoming debt swap, have all been priced in. Risk assets have also rallied accordingly so there will be a lot of pressure on regional leaders to deliver the necessary results. Resolving the current quarter's worth of Greece-related deliberations will buy the ECB significant time to focus more on policy calibration as it seeks to maintain the slightly better than expected growth momentum seen so far this year.

Elsewhere, the BoE is expected to extend its asset purchase program with consensus estimates of GBP50 bn. Our analysts are in line with consensus but stresses downside risks to that assessment given the moderation in data and gilt market imbalance concerns. Overnight EURUSD traded in a range 1.3216-1.3305, USDJPY 77.02-77.23.

EUR
The Greek negotiations appear to be moving into the final stages as Eurogroup chairman Jean-Claude Juncker announced that a press conference is scheduled for 18.00CET on Thursday. The ECB's involvement in the debt swap remains a crucial element in the process and while we expect no major policy announcements, Draghi's press conference may provide new information on the ECB's official stance.

Releases of the draft agreement suggest the Greek government has agreed to a 20% cut in the minimum wage, delivering another 1.5% of GDP in cuts, further labour reform and bank recapitalisations. EUR300mln of the fiscal adjustment is expected to come from pensions savings, though this appears to the one outstanding issue between the main parties domestically.

A Greek government official said overnight that the country has 15 days to close a EUR300mln budget gap, but loan talks have concluded and most issues 'have been covered'. Greek Finance Minister Venizelos said that he hoped 'the Eurogroup meeting will convene and that it will take a positive decision for the programme'.

Some headlines from the negotiations started to hit the wires on Wednesday. A Eurozone official was quoted as saying that the Greek bond swap 'sweeteners' were likely to be EUR 30 bn in EFSF bonds, of maturity one or two years. On the issue of funding, the source said that the EFSF would raise the funds over a period of time. A Greek Government source cited a draft bailout memo to the IMF, saying that Greek GDP is seen as contracting by 4-5% in 2012.

German Deputy Finance Minister Steffen poured some cold water on the optimism however saying talks between Greece and private sector investors is still difficult and we have achieved worryingly little progress on Greece since 2010. He added that he wants to know from Greece what the result from the talks with creditors is. .

The Irish finance minister said that if the ECB offers discount on Greek bonds, it will strengthen Ireland's efforts for concessions .This is a new development and somewhat goes against the idea of Greek ring fencing. If the ECB decides against any involvement there are questions of seniority but ECB action is now also coming under question by the other bailed-out nations.LCH has reduced the additional margin requirement on some Ireland bonds to 25%; was 35% before

Bloomberg reported that France's debt will rise to 89.1% of GDP in 2012 including ESM - which would add EUR6.5 bn to it in 2012. The euro slipped slightly on this headline, though the move was marginal.

JPY
In figures released overnight, Machine Orders came in at -7.1% (cons. -5.0%). The annualised figure was at 6.3%, vs. cons. 8.5%. Consumer confidence came in at 40.0 (cons. 38.5).

Finance Minister Noda said JPY rise since last summer putting downward pressure on economy, government and BoJ need to work closely together.

BoJ Governor Shirakawa said that the central bank would be reviewing asset purchase figures by checking economy, though we note there are precious few sources of potential stimulus at this stage.

GBP
The Bank of England is expected to deliver an addition GBP50bn in the quantitative easing programme. In addition, industrial production and trade figures will also be released.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

8th of February 2012 - Technical Forex Market Overview

2012-02-08T03:01:00.002-05:00

DAILY MARKET COMMENTARY
8 February 2012 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Clearance of 1.3234 has opened 1.3386 ahead of 1.3435. Support lies at 1.3089.

USDJPY NEUTRAL Support lies at 76.75 ahead of 76.49. Resistance is at 77.15 ahead of 77.42.

GBPUSD BULLISH Break above 1.5883 has opened the resistance at 1.5947 ahead of 1.6096. Support lies at 1.5789.

USDCHF NEUTRAL Pair is testing the key support area of 0.9115/066, a decline through which would expose 0.8961. Resistance is at 0.9263 ahead of 0.9339.

AUDUSD BULLISH Next resistances are at 1.1007 and 1.1081, July 27 2011 high. Support lies at 1.0672.

USDCAD BEARISH Focus is on 0.9892, a decline through this would signal scope for losses towards 0.9766/25. Resistance is at 1.0034.

EURCHF BEARISH Support lies at 1.2032 ahead of 1.2000 and resistance is at 1.2109.

EURGBP BEARISH Initial support lies at 0.8255 ahead of key low at 0.8222. Resistance is at 0.8385.

EURJPY BULLISH Focus is on 102.21/54 area; a rally through which would open 103.98. Support is at 100.38.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

8th of February 2012 - Fundamental Forex Market Overview

2012-02-08T03:01:00.001-05:00

DAILY MARKET COMMENTARY
8 February 2012 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro is trading on a firm note as markets are somewhat more optimistic that several outstanding issues on Greece are close to resolution. Firstly, late into the session on Tuesday a Greek government spokesperson finally announced that political leaders would meet on Wednesday to respond to the bailout proposals by noon. It appears that a tentative deal has been secured with the troika, though some individual points on how the cuts are going to be achieved remain outstanding. More importantly, press reports suggest that the ECB is close to agreeing terms on participating in the Greek debt swap. The Wall Street Journal reported that the central bank will swap its holdings at purchase cost with the EFSF, so it won't take a loose.

Crucially, national central banks will not participate as this may be perceived as resembling fiscal transfers, which currently remain barred in the Eurozone on a legal basis. These central banks are holding Greek bonds in their investment portfolios. Despite some provisioning having been made they will be expected to receive full repayment. These plans are contingent upon resolution of private sector involvement, and investors will likely grill the ECB on details during Thursday's post-decision press conference. Elsewhere, consumer credit numbers in the US were also buoyant, rising by over $19bn in December, after a $20.4bn gain in November.

Our analysts note that this is the largest back-to-back gain since 2001, with figures largely led by non-revolving credit. These figures suggest that credit demand is remerging from the household sector in the US and may prove crucial in driving business expectations up ahead. The JOLTS labour survey out of the US also points to slight gains in job openings as employment conditions continue to improve, consistent with the latest BLS statistics. Ahead today, we expect more details to surface on Wednesday on how Greece is going to proceed on the bailout and the PSI, but all parties involved must realise that the clock is ticking, and with each passing hour the odds of some destabilising unilateral step will rise. EURUSD traded 1.3242-1.3286 overnight, USDJPY traded 76.76-77.15. The data calendar is relatively light today.

EUR
The euro suffered somewhat after German industrial output in December fell by 2.9% m/m vs 0.0% consensus. Our European economist notes that the positive surprises in leading indicators are yet to be reflected in hard data. It's still too early to say if activity is improving. In y/y terms, German IP looks unlikely to drop deep into negative territory.

Dow Jones reported that the meeting between Greece's party chiefs has been pushed back for a second time to Wednesday. Greek officials cited 'technical details' for the delay but based on commentary throughout the day there is clearly significant outstanding disagreement.

Greek conservative leaders Samaras said that he is still opposed to cuts in pensions, which would deepen the recession. He noted that the document on the reform package is still being awaited and the details are needed before he decides to back the measures. German media reported overnight that despite reports of a deal, the troika believes Greece's government has 'immense problems' and is unable to carry out already-approved reforms, citing the draft report of the three institutions providing financing.

According to the wall Street Journal, the ECB is now willing to exchange Greek bonds with the EFSF, but will not take any losses on the exchange. Sources note the exchange will contribute to Greece's debt reduction though it is dependent on the PSI being completed. National Central Banks of the Eurozone will not participate, probably to obviate fears of legal challenges surrounding the perception of a fiscal transfer.

German Chancellor Merkel said she rejected a Greek exit of the Eurozone and that question 'doesn't arise'. She warned that such a step would be of 'incalculable impact', but also warned that current situation is very complicated and there is a lack of 'transparency' on the part of domestic leaders.

The IIF's representatives have left the Greek PM's office after talks on the PSI. No deal was announced, but key leaders of talks have stated that fresh negotiations with private-sector creditors will continue in Paris.

The ECB reported it provided Italian banks with EUR202.6 bln of funding in January, down from EUR209.995 bln in December. analysts note that banks are all saying that most of the ECB funds have not been used for the lending/carry trade, rather just kept as liquidity buffers for forthcoming bond maturities. Customer funding is OK, with deposits and retail bonds flat since the summer. ECB use will likely go up materially in February because of the 3 years LTRO and banks may become more aggressive in carry trades provided there is clarity on both Greece and EBA methodology.

CHF
SNB's Jordan verbally defended the SNB's 1.20 floor when he gave a speech to the Swiss-American Chamber of Commerce. EURCHF rallied 20 pips into the meeting, as the usual speculation of a EURCHF floor rise circulated around markets, but Jordan barely changed his line from a recent FT interview. He said the SNB is firmly committed to the 1.20 floor, can buy unlimited quantities of foreign currency and will take additional steps if warranted.

Jordan stressed that the 'commitment to the floor applies at any time, from the moment the market opens in Sydney on Monday to when it closes in new York on Friday'. This suggests that the SNB are currently on 24-hour watch for EURCHF price action and ready to deploy at a moment's notice.

The Swiss unemployment rate came in at 3.4% (cons. 3.5%).

JPY
Overnight Japan's trade balance came in at -Yen145.8bn, worse than expectations of -?135bn. The current account balance on annualised basis was down -74.7%, coming in at Yen303.5bn. The whole figure for 2011 was Yen9.62tln, the weakest in 15 years and the largest y/y fall on record.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

7th of February 2012 - Technical Forex Market Overview

2012-02-07T02:59:00.001-05:00

DAILY MARKET COMMENTARY
7 February 2012 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH As long as support at 1.3026 holds, look for a move above 1.3234, the Jan. 27 key high, to expose 1.3386.

USDJPY BEARISH Two key supports are at 76.04 and 75.35. Resistance is at 77.15.

GBPUSD BULLISH Focus is on 1.5883, a break above which would open 1.5947. Support lies at 1.5699.

USDCHF NEUTRAL Support lies at 0.9115 ahead of 0.9066, the Nov. 30 key low. Resistance is at 0.9339 ahead of 0.9396.

AUDUSD BULLISH Clearance of 1.0794 has opened the way for further gains towards 1.1007 and 1.1081, July 27 2011 high. Support lies at 1.0672.

USDCAD BEARISH Focus is on 0.9892, a decline through this would signal scope for losses towards 0.9725. Resistance is at 1.0034.

EURCHF BEARISH Support lies at 1.2032 ahead of 1.2000 and resistance is at 1.2086.

EURGBP BEARISH Initial support lies at 0.8255 ahead of key low at 0.8222. Resistance is at 0.8344.

EURJPY BULLISH Clearance of 100.89 would open 101.58. Support is at 99.25.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

7th of February 2012 - Fundamental Forex Market Overview

2012-02-07T02:58:00.001-05:00

DAILY MARKET COMMENTARY
7 February 2012 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
AUD was the stand-out performer overnight, breaking through 1.08 as the RBA surprised investors and left its cash rate on hold at 4.25%. There was a unanimous consensus for a 25bp cut so the move was very surprising. The board noted that policy was appropriate 'for the moment'. This suggests the bank still has an easing bias and will 'adjust the cash rate as necessary to foster sustainable growth and low inflation'. Our analysts continue to see a modest trimming of the cash rate over the coming months given the continued uncertainty around Greece, mixed domestic data and the high AUD.

The currency is now at stretched levels and we would look to fade any move higher from here, in fact on Monday we entered a trade recommendation to go short AUD via a 3m AUD put /USD call option, taking advantage of the recent decline in volatility.

The news wires were quiet on Greece overnight and the EUR managed to recover some lost ground during the US session but the commentary from the Eurozone remains rather gloomy. After talks, German Chancellor Merkel and French President Sarkozy both expressed frustration with the state of PSI and troika talks on Greece, as the Greek PM had to postpone domestic talks on reform to meet the troika's demands. EU leaders have expressed dismay at the slow pace of implementing changes, but also expressed the view that allowing Greece to default or exit the Eurozone would also be unacceptable.

The focus on Tuesday will be on final headlines from domestic parties in Greece and the various agreements made to obtain support for further troika funding. Details for the PSI and OSI will also be sought, but the IIF and Greece have missed so many deadlines over the past few weeks that markets are not particularly attuned to fresh news on this front, given the mathematics involved have been communicated in advance.

Today, industrial production data out of Germany is due, while policymaker commentary by Thomas Jordan may attract some attention, particularly after his comments last week reaffirming the central bank's resolve in defending the Eurozone. Fed Chairman Bernanke's testimony to the Senate Budget Committee should not differ from his House testimony, though a more upbeat tone can be expected in the wake of the latest unemployment report. Overnight EURUSD traded 1.3089-1.3141 and USDJPY 76.50-76.79.

EUR
German industry orders in December rose by +1.7% m/m vs consensus. Our analysts note that the data is driven by foreign orders (+4.3% m/m), while domestic orders declined by 1.4%. The German economy ministry said the Dec orders were not driven by big ticket items. Yet, it probably contained some correction from a very weak November (-4.9%). On total, Q4 order intake was 1.4% down from Q3. So still significant weakening on the cards, but no drop-off as suggested by November data.

Talks between domestic parties in Greece were postponed until Tuesday as the search for an accord before trika negotiations continue. Many parties involved acknowledged that reforms in Greece were behind schedule. However, the Greek EU Commissioner Maria Damanaki said that Greece can 'stay in euro' if reforms are implemented and internal devaluation was 'preferable' to an outright euro exit. She also called for the ECB to act as a lender of last resort. Greek unions have called a general strike for Tuesday.

The Greek Finance Minister said that negotiations with the troika were very tough and negotiations remain difficult. He warned that new issues were arising despite progress in talks.

According to the PASOK party in Greece, Greek Prime Minister has instructed the country's Finance Ministry to 'document the costs' of a Eurozone exit. So far no top leader in Europe has been willing to countenance a Greek exit. On Monday German Chancellor Merkel warned that Germany 'would not accept' a Greek default.

After talks with French President Sarkozy, Merkel remarked that 'couldn't understand' why a few more days were needed and warned that 'time is running out'. Sarkozy sounded more upbeat, noting that an agreement 'has never been so close, neither for private nor public creditors'. The mention of public creditors suggests that the ECB will be part of the final agreements.

EU President Van Rompuy acknowledged that solving the crisis was taking longer than expected, and Greek reform implementation was taking longer than expected. However, he said he 'couldn't promise' a solution for the country.

IMF Chief Economist Olivier Blanchard said that the haircut on Greek debt will be 'very large', and warned that Greece would not be able to return to financial markets for a long time.

German industrial production data are the key release on Tuesday, though markets will be keen to look for fresh initiatives out of Greece..

AUD
The RBA surprised markets by leaving rates on hold at 4.25%. There was a unanimous consensus for a 25bp cut so the move was surprising and the board noted that policy was appropriate "for the moment". This suggests the bank still has an easing bias and will "adjust the cash rate as necessary to foster sustainable growth and low inflation". Our analysts continue to see a modest trimming of the cash rate over the coming months given the continued uncertainty around Greece, mixed domestic data and the high AUD.

Australian retail sales were softer than expectations, coming in at -0.1%m/m (cons. +0.2%). Our economists note the retail trend has clearly weakened, with flat values in the last 3 months, after previously showing some pick-up.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

6th of February 2012 - Technical Forex Market Overview

2012-02-06T03:34:00.002-05:00

DAILY MARKET COMMENTARY
6 February 2012 – 8:00 GMT
Monday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Resistance is at 1.3234 ahead of 1.3386. Support lies at 1.3026.

USDJPY BEARISH Two key supports are at 76.04 and 75.35. Resistance is at 77.15.

GBPUSD BULLISH Key resistance is at 1.5883, a break here would open 1.5947. Support lies at 1.5699.

USDCHF NEUTRAL Support lies at 0.9115 ahead of 0.9066, the Nov. 30 key low. Resistance is at 0.9250 ahead of 0.9339.

AUDUSD BULLISH Initial resistance is at 1.0794 ahead of 1.1007. Support lies at 1.0672.

USDCAD BEARISH Momentum is negative; focus is on 0.9892, a decline through this would signal scope for losses towards 0.9725. Resistance is at 1.0034.

EURCHF BEARISH Support lies at 1.2032 ahead of 1.2000 and resistance is at 1.2086.

EURGBP BEARISH Initial support lies at 0.8273 ahead of 0.8255. Resistance is at 0.8344.

EURJPY BULLISH Rally through 101.58 would open the key high of 102.54. Support is at 99.25.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

6th of February 2012 - Fundamental Forex Market Overview

2012-02-06T03:34:00.001-05:00

DAILY MARKET COMMENTARY
6 February 2012 – 8:00 GMT
Monday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro suffered overnight as fears over the situation in Greece have resurfaced. While the market is hoping for a clinching of a debt swap deal today with private sector creditors, securing cross-party support for further austerity measures and securing further funding from the troika is proving far more difficult. According to political leaders in Athens, the main parties have until noon today (local time) to respond to the troika's demands, and so far there appears some distance between where the national unity government lies and the IMF's targets. Talks continued late into the evening on Sunday and will resume today between the troika and the local authorities. Reports suggest that the main point of contention lies in private sector wage cuts and minimum wage declines, and there are fears that the Greek government will note the country has reached the limits on austerity.

At the same time, talks are continuing between private-sector bond holders and the Greek government, which also took place on Sunday. How to secure contribution from official-sector creditors is still in question, as opposition from various quarters remains strong. We believe the week ahead will be extremely significant for event risk and headlines could become a dominant driver for the euro. The ECB will also meet on Thursday, but key matters may have moved beyond their control by the time the Governing Council meets. Otherwise, the market is at least still managing to find some comfort from economic figures.

US payrolls surprised strongly to the upside on Friday, with 243k jobs added in January (cons. +140k) and the unemployment rate fell to 8.3%. Our economists have now upgraded their outlook for Q1 GDP from 1.5%y/y to 2.3%y/y, and our year-end unemployment rate forecast has been revised to 7.9% from 8.6% previously, though we note that the decline in labour force participation has contributed to the decline. In figures released overnight, retail sales came in softer than expected at -0.1%m/m (cons. +0.2%), though job ads improved. and Germany releases Factory Orders figures. The ECB, BoE and RBA are all meeting on policy this week, and the BoE is expected to decide on an expansion in the asset purchase programme while the RBA is expected to deliver another 25bp in cuts. Overnight EURUSD traded 1.3056-1.3130 and USDJPY 76.50-76.79.

EUR
Over the weekend, Greek Prime Minister Lucas Papademos held crucial talks with leaders of his national unity government to secure support for upcoming bailout talks. Several news sources reported that at present there is still some distance between the Greek authorities and the troika over the conditions for the next tranche. Greece is seeking some degree of easing of conditions but so far the feedback has not been positive.

Papademos said after the talks that the three parties have agreed additional spending cuts worth 1.5% of GDP for this year, and leaders will meet on Monday to finalise plans for bailout talks. The savings will be achieved by cutting wages, non-labour costs. A PASOK spokesman said that the political parties must submit their response to troika proposals by noon on Monday (10:00 GMT). Outstanding issues remaining include labour reform and bank recapitalisation.

Greek Finance Minister Venizelos said that currently 'the moment is very crucial' on Saturday. The troika also met with Greek officials on Sunday afternoon, but Reuters reported that there was 'no indication' on whether issues were resolved, or whether a preliminary deal was possible. Venizelos said that there was great 'impatience and pressure' from the troika and Eurozone partners.

The leader of the LAOS party, Georgios Karatzefaris, who is part of the national unity government, said that political leaders will resume talks on Monday, as opposed to Sunday night originally reported on Saturday by Venizelos. According to Bloomberg, Karatzefaris also said he 'won't accept ultimatums' and called for the terms to be closely examined. He also said 'I won't contribute to the explosion of a revolution due to misery'.

Key Greek opposition leaders Samaras warned that Greece is 'being asked for more austerity', and Bloomberg reported that he 'won't agree to more austerity leading to recession'. As Samaras leads the second-largest party in the Greek parliament, there is real risk of Papademos' government falling if Samaras withdraws support from the national unity coalition.

Press reports suggest that IIF Chief Dallara is currently in Athens finalising PSI talks. Compared with austerity discussions, the PSI talks appear to be close to agreement, though final take up by private-sector creditors remains to be seen. Markets will still need to watch for the potential implementation of collective action clauses and official sector involvement (OSI).

There remains significant opposition in Germany and beyond to public sector involvement in Greek debt relief. Dow Jones reported that German Economics Minister Philipp Roesler is leading opposition, warning sovereign creditors have already made an 'enormous contribution'. The ECB meets this week and its debt swap participation will be a key point of focus at the post-decision press conference.

In more comments released overnight, Chinese Premier Wen Jiabao said China needs to help Europe due to 'strategic considerations', though this does not mean automatic support for further bailout packages. Premier Wen, in talks with German Chancellor Merkel last week, said that China is looking for ways to support Europe via ESM or EFSF but there is no word so far on further IMF support.

In figures released on Friday, Swiss trade figures were softer than expected, coming in at CHF2.07 bn. Exports rebounded by 6.1% but this was offset by rising imports. German factory orders are out on Monday.

JPY
BoJ Governor Shirakawa warned that JPY levels were 'severe' and 'appropriate steps' would be implemented.

GBP
January services PMI was above consensus at +56.0, rising from the December print of 54.0. Our UK economist notes that the headline business activity balance is at a 10-month high and above the long-run series average of 55.0. Details show the highest forward-looking business activity balance since May, the biggest rise on record, the strongest employment growth since March 2008, and fastest new business growth since July. This supports our view that BoE will raise asset purchase target by at most GBP50 bn in the next meeting.

AUD
Australian retail sales were softer than expectations, coming in at -0.1%m/m (cons. +0.2%). Our economists note the retail trend has clearly weakened, with flat values in the last 3 months, after previously showing some pick-up. We and the market are looking for 25bp in interest rate cuts during Tuesday's meeting of the RBA.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

3rd of February 2012 - Technical Forex Market Overview

2012-02-03T02:52:00.001-05:00

DAILY MARKET COMMENTARY
3 February 2012 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Resistance is at 1.3234 ahead of 1.3386. Support lies at 1.3026.

USDJPY BEARISH Focus is on 75.35, a break here would signal scope for deeper pull back. Resistance is at 76.42.

GBPUSD BULLISH Momentum is positive; resistance is at 1.5883, a move above which would open 1.5947. Support lies at 1.5780.

USDCHF BEARISH Support lies at 0.9115 ahead of 0.9066, the Nov. 30 key low. Resistance is at 0.9250.

AUDUSD BULLISH Pressure is on 1.0765, the Sept. 1 high, a clearance of which would signal scope for gains towards 1.1081. Support lies at 1.0570.

USDCAD BEARISH Near-term support lies at 0.9964 ahead of 0.9892, the October 2011 low. Resistance is at 1.0071.

EURCHF BEARISH Support lies at 1.2032 ahead of 1.2000 while resistance is at 1.2086.

EURGBP BEARISH Initial support lies at 0.8273 ahead of 0.8255. Resistance is at 0.8385.

EURJPY BULLISH Rally through 100.89 would expose 101.58. Support is at 98.92.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

3rd of February 2012 - Fundamental Forex Market Overview

2012-02-03T02:51:00.000-05:00

DAILY MARKET COMMENTARY
3 February 2012 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Radio silence out of Europe has kept investors in wait-and-see mode for yet another overnight session. However, interest in USDJPY is intensifying given the pair is hovering above key levels and US payrolls is just hours away. As far as economic data goes, the yen shows greatest sensitivity to the US employment situation, and a weak report later would likely give the yen another push higher. Extremely weak data might even be enough to trigger a round of intervention on Monday, and Japan Finance Minister Azumi's comments overnight reinforce this view. He complained that the latest yen moves were "one-sided", and said the price action was increasingly driven by speculation. This represents a moderate hardening of rhetoric - a step which typically precedes an act of intervention.

Late in the European session, the euro did receive a healthy bounce on the back of comments coming out of Beijing. Speaking with visiting German Chancellor Merkel, Chinese Premier Wen Jiabao noted that China was considering 'greater involvement' in the EFSF and ESM stabilisation funds. However, he added that China was still 'researching' ways to participate, suggesting no imminent developments on this front. Dallas Fed President Fisher stuck to his hawkish views. He described the new Fed projections for the path of the policy rate as 'pure guesses', and said economic data is already on an upswing since those projections were made. We note that he lost his FOMC vote at the end of 2011 but is due to regain it in the Jan. 2014 rotation, along with two other hawks. Consensus opinion is looking for a +140k payrolls print (UBSe. +130k) and for the unemployment rate to remain stable at 8.5%. EURUSD traded 1.3115-1.3154 and USDJPY 76.12-76.26.

EUR
Greece appears to be exerting more pressure on official institutions to participate in the debt swap. Finance Minister Venizelos said that the ECB 'must be mobilised' for a debt deal, as private sector talks are now almost complete. There is still no official word from the ECB on the matter. Official Sector Involvement is clearly now at the top of the agenda ahead of the Feb 6 Eurogroup meeting.

Germany announced that finance ministers from Germany, Netherlands, Luxembourg, Finland (the remaining fully AAA countries in the Eurozone) will meet on Friday in Berlin. There will be a separate Franco-German meeting on Monday.

EU Economics Commissioner Rehn said that the 120% debt-to-GDP ratio target for Greece remains in place. He also called for swift resolution of the debt crisis as the recession could turn 'much nastier' otherwise.

In response, Chinese Premier Wen Jiabao said the country is 'considering increasing its participation in the solution of the European debt crisis through the channels of the EFSF and ESM'. Previously China has not been as active as the Japanese in commenting on its participation, so the mention was considered a slight shift in tone. However, he clarified the comments saying such participation is being 'researched'.

Spain sold EUR4.56 bn in bonds, above their EUR 4.5 bn target. Spanish 10-year yields have fallen below 5% in recent days. The Spanish government also announced bank reorganisation plans, which included increasing the firepower of the FROB, and valued the cost at EUR50 bn. This figure has been flagged in advance. The Spanish government said it would not add to the overall public sector burden.

CHF
Swiss trade figures were softer than expected, coming in at CHF2.07 bn. Exports rebounded by 6.1% but this was offset by rising imports.

Interim SNB President Thomas Jordan stressed that he will defend the peg with the 'utmost determination', in an interview with the Financial Times. He repeated the SNB is ready to buy foreign exchange in 'unlimited quantities' if necessary. The message is essentially unchanged from prior weeks.

GBP
Bank of England MPC member Posen said that he would favour 'another slug of QE' to the tune of EUR75 bn. He also mentioned that the MPC has talked about purchasing assets beyond gilts, especially to help small and medium-sized enterprises. We believe this could suggest some purchases of corporate bonds, but these are early stages and we would wait for details at the next BoE meeting.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

2nd of February 2012 - Technical Forex Market Overview

2012-02-02T03:19:00.001-05:00

DAILY MARKET COMMENTARY
2 February 2012 – 8:00 GMT
Thursday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

AUDUSD 1.0765 resistance

EURUSD BULLISH Resistance is at 1.3234 ahead of 1.3386. Support lies at 1.3026.

USDJPY BEARISH Focus is on 75.35, a break here would signal scope for deeper pull back. Resistance is at 76.42.

GBPUSD BULLISH Next resistances are at 1.5889 and 1.5947. Support lies at 1.5780.

USDCHF BEARISH Support lies at 0.9115 ahead of 0.9066, the Nov. 30 key low. Resistance is at 0.9250.

AUDUSD BULLISH Pressure is on 1.0765, the Sept. 1 high, a clearance of which would signal scope for gains towards 1.1081. Support lies at 1.0570.

USDCAD BEARISH Near-term support lies at 0.9964 ahead of 0.9892, the October 2011 low. Resistance is at 1.0071.

EURCHF BEARISH Support lies at 1.2032 ahead of 1.2000 while resistance is at 1.2086.

EURGBP BEARISH Initial support lies at 0.8273 ahead of 0.8255. Resistance is at 0.8385.

EURJPY BULLISH Rally through 100.89 would expose 101.58. Support is at 98.92.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

2nd of February 2012 - Fundamental Forex Market Overview

2012-02-02T03:18:00.000-05:00

DAILY MARKET COMMENTARY
2 February 2012 – 8:00 GMT
Thursday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Risk assets consolidated yesterday's gains overnight. The dollar failed to regain lost ground and Asian equities followed the S&P 500 higher. Respectable global manufacturing prints certainly helped, but the gradual easing of sovereign stresses in Spain and Italy probably played the greater role. We keep our cautious stance however, noting that European austerity measures are mostly only in their early stages of implementation, so there is scope for further deterioration in economic data as the process of fiscal consolidation begins to bite in earnest. At present, growth forecasts remain relatively conservative, and there is still some upside risk to our expectations of a recession in Europe in particular.

However, pricing in early normalisation or at least policy stability is also too optimistic a view - a fact borne out by Wednesday's US data where both the manufacturing ISM and the ADP report missed expectations. We believe the key risks still lie with the Eurozone, especially Greece as the market will likely start to run out of patience over repeated delays to the debt swap agreement. Today, trade figures are out in Switzerland along with US initial jobless claims. The results of Spain's third auction of the year should be known soon after 0930 GMT. After a very successful pair of auctions in January, hopes are high of a repeat performance. EURUSD traded 1.3146 - 1.3198 and USDJPY traded 76.12-76.35.

EUR
Paul Thomsen, chief of the IMF mission to Greece, suggested that the upcoming rescue plan for Greece would put less emphasis on fiscal consolidation and more on the importance of rapidly implementing structural reforms. He acknowledged that "social tolerance and political support" for further austerity measures has its limits. Thomsen was being interviewed by Greek newspaper Kathimerini.

Speaking in Beijing, German Chancellor Merkel lamented the fact that ratings agency decisions have excessive influence over Eurozone bond markets. She also re-endorsed her incremental approach to deeper integration, saying the Eurozone must move step by step towards a common budget policy.

Eurozone PMIs did not offer much in the way of negative surprises, and largely confirmed the flash estimates. French manufacturing continued to contract in January. German PMI was revised up to 51.0, while the total Eurozone PMI was also slightly better at 48.8.

Our analysts note that the 1.9 point jump in Eurozone manufacturing PMI from December to January was actually the biggest since March 2010, reflecting an across-the-board improvement. They note that output posted the biggest jump since July 2009 and returned to expansionary territory after 6 months, while employment improved for the first time in a year.

Bloomberg reported more details on the current debt swap being discussed. In exchange for a lower coupon, investors could get 'GDP warrants' which could slightly reduce the net present value loss to investors, which is currently being reported at more than 70% and larger than prior expectations.

The IIF reported late on Wednesday that it now expected talks to be concluded in the 'coming days', saying both sides are 'close to finalising' the debt agreement. However, identical assurances have been given previously. The Wall Street Journal reported that differences between Germany and IMF on how to proceed for Greece are holding up the deal, especially on the matter of official sector involvement.

Despite ongoing concerns over Greece, Spanish 10-year yields are back to the lowest levels in over 12 months, ahead of a key auction on Thursday. Italian Prime Minister Monti said he expects Italy to be in a better state next year, but warned that government bond yields need to go down further.

Portugal's finance minister said fiscal adjustment is needed to restore the country's credibility. He said the structural deficit will be 2.6% of GDP in 2012 and said he still planned to return to markets next year. Portugal managed to sell about EUR1.5 bn worth of 3m and 6m bills without much incident. He also said Portugal would not ask for more money or more time.

Eurozone CPI came in at 2.7%, in line with expectations. The high level of CPI and potential second-round effects may yet delay any further policy rate cuts from the ECB. However, liquidity is expected to remain abundant and investors are already starting to focus on the Feb. 29 LTRO.

Ahead on Thursday, Eurozone PPI figures will be released.

JPY
Finance Minister Azumi said that the FOMC's decision to signal a lower-for-longer policy rate has boosted the yen. He said he is "calmly watching the market now, but I can't overlook any acceleration in moves by short-term speculators".

BoJ Board member Yamaguchi said he doubts the recent yen rise will trigger an immediate policy reaction. Given his remit he was referring only to the possibility of further monetary easing from the BoJ, and was not remarking on the risk of FX intervention.

On Wednesday we entered a trade recommendation to buy a 78.75-strike USDJPY one-touch, expiry March 7, 2012. We pay 20% for a potential net payout of 80%. Spot reference at trade entry is 76.15.

With spot now moving lower towards the 2011 lows near 75.50 that prompted the October intervention, we suspect there is an increasing chance of a repeat performance. Switzerland's establishment of a EURCHF floor may have encouraged Japanese policymakers in this regard as it sets a precedent for wealthy nations with zero interest rates and large balance of payments surpluses using FX policy actively to influence monetary conditions.

GBP
UK manufacturing PMI came in much better than expected at 52.1. However, our economists warn that manufacturing only makes a small contribution to UK GDP. Much more important for the economy and the MPC decision next week is the services PMI due on Friday.

Our analysts note yesterday's PMI figures support our view that the MPC will expand its QE programme by less than the GBP75 bn it announced in October.

Bank of England MPC member Posen said the world must break away from the notion of being in an "austerity competition. He added that the bank should create a vehicle to securitise small business loans. He did not divulge whether he was in favour of a further round of QE but said UK inflation would continue to ease and that the recession would have been much worse if the bank had not done QE.

CHF
Trade figures are due for Switzerland on Thursday. The market is expecting a CHF2.5 bn surplus, a slight dip from last month's CHF3.0 bn print. The data will be scrutinize for signs that a strong CHF is still squeezing exporters.

AUD
Australia's trade balance for December was much stronger than expected at A$1.7 bn (cons. A$1.2 bn). Our analysts note that coal and iron ore exports - Australia's two largest commodity exports - actually increased on the month, despite modestly weaker economic data out of China.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

1st of February 2012 - Technical Forex Market Overview

2012-02-01T03:17:00.003-05:00

DAILY MARKET COMMENTARY
1 February 2012 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Next resistance is at 1.3244 ahead of 1.3459. Support at 1.3077 is under test. A clear break below this would open 1.2931.

USDJPY BEARISH Yesterday's closing break below 76.33 has confirmed the breakout of the 76.33-78.29 range and opened 75.35, the Oct 31 key low. Resistance is at 76.55.

GBPUSD BULLISH The key bull trigger at 1.5780 is under test. Clearance of 1.5797 would open 1.5889. Support lies at 1.5642.

USDCHF BEARISH Support at 0.9112 holds for now; next support is at 0.9066. Resistance is at 0.9339 ahead of 0.9413.

AUDUSD BULLISH Resistance at 1.0688 is intact; next resistance is at 1.0765, the September 2011 high. Initial support is at 1.0527 ahead of the key support at 1.0428.

USDCAD BEARISH Support at 0.9975 is under test. A break below 0.9965 would open 0.9892, the October 2011 low. Resistance is at 1.0163.

EURCHF NEUTRAL Support lies at 1.2000 while resistance is at 1.2133.

EURGBP BEARISH Yesterday's sharp sell-off through multiple supports has opened 0.8255 ahead of 0.8222, the Jan 9 key low. Key resistance is at 0.8426.

EURJPY BULLISH A rise above 101.58 would expose 102.54, the Dec. 21 key high. Support is at 98.92.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

1st of February 2012 - Fundamental Forex Market Overview

2012-02-01T03:17:00.001-05:00

DAILY MARKET COMMENTARY
1 February 2012 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The price action overnight was largely driven by a better-than-expected China PMI which gave AUD a modest but temporary boost. The euro meanwhile remained under downward pressure as investors digested yesterday's news reports suggesting Greece is resisting further austerity measures to bring debt down to sustainable levels, and that negotiations on this front are likely to make slow progress. This is a timely reminder that the proposed bond swap is just one element in a broader deal that must be agreed in full if Greece is to secure fresh funding through a second rescue package. Despite the latest headlines - which are undoubtedly a cause for concern - there is still time for a grand deal to be forged and this could eventually precipitate a risk rally. But eventual success will require delicate negotiations on a number of matters where political realities may collide with financial necessities. Elsewhere, US data ran into some speed bumps as the Chicago PMI came in weaker than expected, albeit at resilient levels. Ahead on Wednesday, manufacturing PMI numbers will be released globally and investors will be hoping for stable growth to compensate for jitters coming out of the sovereign debt front. EURUSD traded 1.3045-1.3093 and USDJPY 76.15-76.31.

EUR
Eurozone data was generally weak on Tuesday. German retail sales fell 1.4% on the month bringing the y/y number to -0.9%. French consumer spending also disappointed at -0.7% m/m and -3.1% y/y. The Eurozone unemployment rate increased to 10.4% from 10.3, in line with consensus. However, the German labour market continues to show signs of improvement - with unemployment falling by 34k in January.

There was a general lack of commentary by Eurozone leaders on Tuesday, as most of the details on upcoming Eurozone decisions were adopted on Monday. However, this has put Greece's PSI talks back in the limelight. Several news sources have reported that talks between the Greek government and the Troika have also reached an impasse doubts are surfacing as whether Greece can agree to new austerity measures to manage debt levels back down to target.

Reuters reported that a deal between Greece and private sector bondholders could be reached as soon as Wednesday, but the overall deal would require public sector participation. Whether this can be achieved via the ECB, or national central banks' writedowns remains to be seen. The Greek Finance Minister has warned that private sector creditors could see an NPV writedown of more than 70%, which is bigger than what has been discussed previously.

Eurogroup Chair Juncker said he had not decided on whether to call a special meeting on Greece. His spokesman noted that there are no decisions yet as to whether talks will recommence next week. There have been some expressions of impatience amongst European leaders over the duration of the talks. The Dutch Finance Minister warned that the talks could not drag on 'for a couple more weeks', while the French Finance Minister stressed that a deal was expected by the end of the week, but similar comments have been uttered before.

Irish PM Kenny affirmed that Ireland will hold a referendum on the fiscal compact if needed.

German Manufacturing PMI and harmonised CPI figures are due on Wednesday.

CHF
The SNB's foreign FX reserves declined to CHF 257.5 billion in December. The data is tough to interpret regarding EUR holdings. The balance sheet number is driven by EURCHF FX swaps maturing and being rolled over. Hence, it is just a snapshot at any one time, and says little about the SNB's intentions. What seems clear is that the SNB is trying to keep the outstanding liquidity more or less constant via rolling over the bulk of the FX swaps The more important question, of course, is where exactly and how the SNB would choose to start defending the floor. Our expectation has been that we will see their bid somewhere slightly above 1.20, and that it will not trade through, even for a short time, as this would be very risky.

EURCHF has continued to grind lower in recent days and we suspect there could be more challenges for the franc up ahead as the cross traded sub 1.2040 on Tuesday. Retail sales figures and manufacturing PMI numbers for Switzerland are also due on Wednesday.

GBP
UK December mortgage approvals disappointed, at 52.9k vs expectations of 54.0. Our analysts note that today's data is unlikely to have a major impact on the MPC decision. More interesting is the M4, a measure of money supply watched by the MPC. The 3m annualised rate fell from 3.2% to -0.8%.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

31st of January 2012 - Technical Forex Market Overview

2012-01-31T03:22:00.001-05:00

DAILY MARKET COMMENTARY
31 January 2012 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Initial resistance is at 1.3244 ahead of 1.3459. Support lies at 1.3077.

USDJPY BEARISH Decline through 76.33 has opened the way for losses towards 75.35. Resistance is at 76.78.

GBPUSD NEUTRAL Resistance is at 1.5740 ahead of the key bull trigger at 1.5780. Support lies at 1.5642 ahead of 1.5517.

USDCHF BEARISH Support at 0.9112 is intact for now; next support is at 0.9066, the Nov. 30 key low. Resistance is at 0.9229.

AUDUSD BULLISH Resistance is at 1.0688 ahead of 1.0765, the September 2011 high. Support lies at 1.0527.

USDCAD BEARISH Support lies at 0.9975 ahead of 0.9892, the October 2011 low. Resistance is at 1.0071.

EURCHF NEUTRAL Support lies at 1.2000 while resistance is at 1.2109.

EURGBP BEARISH A push below 0.8338 would open 0.8310. Key resistance is at 0.8422.

EURJPY BULLISH A rise above 101.58 would expose 102.54, the Dec. 21 key high. Support is at 99.99.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

31st of January 2012 - Fundamental Forex Market Overview

2012-01-31T03:21:00.001-05:00

DAILY MARKET COMMENTARY
31 January 2012 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Risk appetite was boosted overnight by an article in the Financial Times claiming that the ECB's next 3y LTRO (due on Feb 29) could see demand for up to EUR1 trn in cash, double the previous amount. If so, it would go a long way towards alleviating term funding concerns for Eurozone banks as their bonds fall due throughout the year. There were no major surprises out of Monday's Eurozone summit. In French President Sarkozy's words, the summit 'went as planned'. Most of the decisions adopted on Monday, such as early execution of the ESM and updates on the situation in Greece ,were flagged well in advance. The Czech Republic joined the UK in opting out of the fiscal compact, with Sarkozy noting this was largely due to 'constitutional reasons'.

There has been a significant pullback in rhetoric since plans for potential transfer of fiscal sovereignty from Greece to Brussels were first floated over the weekend. However, governments remain aware that time is running out to finalise talks on the second Greek rescue before the mid-February deadlines, especially as the current debt-swap plans have not even been concluded. Portugal, the other elephant in the room, was not discussed outright at Monday's summit but the moves in bond markets surely have not gone unnoticed, and markets may need to brace for fresh volatility if yields continue to spiral higher. Ahead on Tuesday, macro figures are due across Europe, while consumer confidence is out in the US.

EUR
The Italian treasury sold a total of EUR7.5 bn worth of bonds, near the top of estimates. While the yields were down from the last auctions, our fixed income strategists were slightly disappointed by the results. They note that the bid/cover on the 5y was close to historical lows, despite EUR37 bn worth of redemptions and coupons this week, only a fraction of which was ploughed back into the auction.

Ireland's European Affairs Minister Lucinda Creighton said that if voters rejected a fiscal treaty, it would be hard for the country to remain in the Eurozone. The Irish government is due to decide in the coming month whether the text of the fiscal compact agreed last night will need to be ratified via referendum. Even if the government opts for parliamentary ratification, a potentially time-consuming Supreme Court challenge could be in store.

The Czech Republic has joined the United Kingdom in opting out of the fiscal compact. This was confirmed by EU President Van Rompuy. The Czech Prime Minister said that the new treaty was 'difficult to accept' and said its participation in negotiations 'will be purely symbolic'.

Several Eurozone officials confirmed that the ESM Treaty will be signed in March and will come into force in July. There were no details on the potential for strengthening the firepower of the fund, and the issue is due to be revisited in March. Portugal did not come up in discussions and the Portuguese PM ruled out any need for a Greece-like PSI.

Newswires reported that a special summit on Greece might be held in February to discuss fiscal sovereignty issues in particular, although there has been no official confirmation. German Chancellor Merkel said that rapid sealing of the fiscal pact is an 'important step' towards a stability union. However, when pressed on Greece, she said she did not back demands for greater oversight, which was suggested by some of her government partners earlier. French President Sarkozy affirmed this view, saying he is opposed to placing Greece under budgetary control.

In a further warning of Spain's aggregate fiscal position, S&P has cut the ratings or outlook on several Spanish regions. The ratings agency attributed the moves to recent action on the sovereign, in addition to the wider economic issues facing the country. Spain is due to issue bonds on Thursday, having aggressively front-loaded its funding so far this year, taking advantage of more preferable market conditions.

ECB Governing Council member Nowotny warned that the Eurozone economy could stagnate in 2012 and a recession for a certain period could materialise.

JPY
USDJPY continues to drift lower in the wake of the dovish FOMC. Finance Minister Azumi issued the usual warning overnight that there has been no change in Japan's stance on FX intervention, and that he stands ready to take FX steps if needed.

AUD
Australia produced a batch of relatively subdued data overnight, reinforcing our economists' view that the RBA is likely to cut the cash rate by 25bp next week. Business conditions and confidence were still below average in December, and credit growth was modest.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

30th of January 2012 - Technical Forex Market Overview

2012-01-30T04:47:00.001-05:00

DAILY MARKET COMMENTARY
30 January 2012 – 8:00 GMT
Monday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Momentum is positive; focus is on 1.3197, a break here would open 1.3244 next. Support lies at 1.3078.

USDJPY BEARISH Support comes in at 76.55 ahead of key low at 76.33. Resistance is at 77.49.

GBPUSD NEUTRAL Key bull trigger is at 1.5780; a clearance of which would expose 1.5811. Support lies at 1.5651 ahead of 1.5517.

USDCHF BEARISH Next supports are at 0.9112 and 0.9066. Resistance is at 0.9339 ahead of 0.9413.

AUDUSD BULLISH Resistance is at 1.0688 ahead of 1.0765, the September 2011 high. Support lies at 1.0588.

USDCAD BEARISH Momentum conditions are bearish; support lies at 0.9975 ahead of 0.9892, the October 2011 low. Resistance is at 1.0052, a prior low.

EURCHF NEUTRAL Support lies at 1.2058 while resistance is at 1.2133.

EURGBP BEARISH Initial support lies at 0.8310 ahead of 0.8273. Key resistance is at 0.8422.

EURJPY BULLISH Resistance is at 102.54, the Dec. 21 key high, a break of which would pave the way for gains towards 104.32. Support lies at 100.03.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

30th of January 2012 - Fundamental Forex Market Overview

2012-01-30T04:46:00.000-05:00

DAILY MARKET COMMENTARY
30 January 2012 – 8:00 GMT
Monday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Fitch downgraded five Eurozone sovereigns on Friday night shortly after Eurozone bond markets had closed. Italy, Spain, Slovenia were cut two notches each, while Belgium and Cyprus dropped one notch apiece. The downgrades themselves were signalled weeks ago, and were expected to occur before the end of January so EURUSD continued to rally in spite of the news, eventually closing above 1.32 for the first time in seven weeks. The timing of the downgrades is unfortunate given Italy's second BTP auction of 2012 is due to take place around 1000 GMT today. However our Eurozone rates strategists expect the supply to be easily absorbed, with demand boosted by redemptions and coupon payments worth about three times the debt on offer. Brisk demand is likely to give the euro another temporary boost.

The first EU summit of 2012 is due to get underway this afternoon. The objective is to finalise two texts: the new fiscal compact, and the treaty changes required to introduce the ESM rescue vehicle. Talks on the Greek bond swap made further progress over the weekend, and we expect a positive outcome in a matter of days. Despite the latest positive news flow we remain intensely cautious on the euro's prospects in the run-up to the March 20 Greek bond redemption. Already new hurdles to a second financial rescue are appearing. Over the weekend press reports surfaced on German plans for greater surveillance over Greece's fiscal affairs.

The fact that such proposals are even under discussion indicates that official sponsors are extremely wary of Greece's ability to bring its debt down to sustainable levels. The proposals have already met a frosty response in Greece and the controversy indicates how difficult it will be reach final agreement on the second rescue even if a bond swap deal is ultimately reached on a voluntary basis. With the euro having already rallied six big figures from the lows, we remain on alert for opportunities to enter fresh shorts. The US is due to release the core PCE report - a metric which has suddenly risen in importance after the Fed's adoption of an inflation target based specifically on this measure.

EUR
Both Greek Finance Minister Venizelos and the IIF said they expect to finalise the debt swap deal this week.

Over the weekend, several newswires reported that Germany wanted Greece to cede fiscal control to European institutions, or a to a European budget tsar. The measures were given official backing by German cabinet member Philipp Roesler. The reception to these proposals was understandably chilly in Greece - Finance Minister Venizelos warned against asking Greece to choose between economic assistance and national dignity. Although concluding a voluntary bond swap is an important element in a second financial rescue of Greece, many other issues clearly remain unresolved. We expect more euro-negative news of this sort to hit the headlines ahead of the March 20 bond redemption.

On Friday, Fitch downgraded Belgium, Spain, Italy, Cyprus and Slovenia. Ireland's rating - also on review - was affirmed.

According to Der Spiegel, Greece's funding needs from the second rescue package have ballooned again, this time to EUR145 bn, up from previous estimates of EUR130 bn. The figure is largely due to the deteriorating economic outlook in Greece, and puts pressure on the troika to support the strongest possible deal with private-sector creditors.

ECB member Gonzales-Paramo said the ECB is not involved in the Greek debt negotiations and highlighted the central bank's restrictions about lending to governments. He also said that the ECB has not committed to any minimum interest rate, suggesting that further cuts below the 1% level remain possible.

ECB Governing Council member Nowotny said he expects that the second 3y LTRO scheduled for Feb 29 is likely to be "similarly well used" as the first one given the "enormous refinancing need" of Eurozone banks.

The Sunday Times reported that the Irish government is lobbying the ECB to allow the repayment of a EUR31 bn loan to be delayed by 10 years. This would reduce the overall cost of the bailout for Irish banks.

Austrian Chancellor Faymann expressed support for increasing the Eurozone's bailout funds, including combining the firepower of the ESM and EFSF. In addition he has expressed support for granting the ESM a banking license, which has been a red line for Germany.

JPY
Moody's said the divergence between Japan's actual fiscal position and its deficit reduction goals could widen further, adding that the risk of a crisis would rise if credible fiscal action is not taken.

Prime Minister Noda said Japan is already helping Europe by buying EFSF bonds, and will continue to do so.

GBP
Bank of England MPC member Miles said it is "presumptuous" to conclude that another round of QE in February is inevitable. He said the decision will hinge on the forecasts contained in the quarterly inflation report. Nevertheless, he did acknowledge that CPI has been on a "pretty steep" downward trajectory recently. previously.

AUD
Fitch put a number of Australian banks on ratings watch negative, which caused AUDUSD to briefly slip 20 pips before recovering within minutes.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

27th of January 2012 - Technical Forex Market Overview

2012-01-27T04:04:00.001-05:00

DAILY MARKET COMMENTARY
27 January 2012 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BULLISH Focus is on 1.3197, a break here would open 1.3244 next. Support lies at 1.3090.

USDJPY BULLISH Key resistance is at 78.29, a rally through this level would open the way for further gains towards 79.53. Support lies at 76.87.

GBPUSD NEUTRAL Near-term resistance is at 1.5728 ahead of the bull trigger at 1.5780. Support lies at 1.5517 ahead of 1.5451.

USDCHF BEARISH Next supports are at 0.9112 and 0.9066. Resistance is at 0.9339 ahead of 0.9413.

AUDUSD BULLISH Key resistance is at 1.0765; a rally through which would open the way for gains towards 1.1081. Support lies at 1.0428.

USDCAD BEARISH Near-term Support lies at 0.9975 ahead of 0.9892, the October 2011 low. Resistance is at 1.0049.

EURCHF NEUTRAL Support lies at 1.2058 while resistance is at 1.2133.

EURGBP BEARISH Initial support lies at 0.8310 ahead of 0.8273. Key resistance is at 0.8422.

EURJPY BULLISH Focus is on 102.54, a clearance of this level would pave the way for gains towards 104.32. Support lies at 100.98.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

27th of January 2012 - Fundamental Forex Market Overview

2012-01-27T04:03:00.001-05:00

DAILY MARKET COMMENTARY
27 January 2012 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The USDJPY rally that began three days ago reversed completely overnight. Falling US Treasury yields in the aftermath of the dovish FOMC meeting were to blame. USDJPY had been following gradually ever since, and fresh long positions put on just ahead of the meeting finally had their stops triggered overnight. RBNZ Governor Bollard provided some more colour on his decision earlier this week to keep rates on hold. He said the OCR has not been raised since the emergency rate cut in March 2011 because of ongoing aftershocks in Christchurch which have delayed the reconstruction effort. The "deepening Euro crisis" also contributed to the decision to keep rates on hold.

Australia's debt management office announced plans to issue A$700 mn of 2022 bonds on Feb 1, and another A$700 mn of 2018 paper on Feb. 3. These are the first Australian commonwealth bonds to be issued this year, and given overseas investors continue to show a keen appetite for Australian debt, we would not be surprised to see some AUD inflows on the back of this. In Europe, there are some signs of healing in the Italian bond market, and the 10y yield slipped back below 6% yesterday for the first time since early December.

The focus has now shifted towards whether the ECB is willing to participate in the Greek debt swap, and European legislators are keen to point out that the boost to sentiment would be very strong, at very little financial cost to the ECB. Newswires reported that the IIF will meet with the Greek government on Friday to discuss 'legal and technical issues'. EURUSD traded 1.3078-1.3153 and USDJPY 76.90-77.51.

EUR
The Wall Street Journal reported that private sector creditors are willing to accept a coupon rate of below 4% on the new Greek bonds involved in the debt swap. Without naming sources, the story originates from local newspaper Ethno, which states that the IIF "will submit a new improved offer with an average interest rate of 3.75%".

Dow Jones reported that Greece will continue debt talks with creditors on Friday. A senior official said discussions will continue on a 'technical and legal' level, without giving details.

Eurogroup Chair Juncker said that even if the ECB took Greek debt losses (by participating in debt-swap talks) they would be small. However, he also stressed that the Eurogroup and the IMF are not pushing for the ECB to take any such losses.

Dow Jones reported that the IMF is to seek a Saudi contribution to the Eurozone bailout fund. Despite a lot of talk about expanding both Eurozone and IMF resources to tackle the debt crisis, so far there has been very little tangible progress by non-European G20 governments to contribute. Canadian Finance Minister Jim Flaherty said that Europe can solve its debt crisis 'without new IMF aid'.

On Thursday the German GfK consumer confidence survey came in slightly better than expected at 5.9. On Friday import price figures are due.

JPY
Prime Minister Noda said the Japanese government would work together with the BoJ to tackle yen strength, but the yen did not react to his remark.

GBP
The headline CBI reported sales balance was -22 in January, down from +9 in December. This marks the worst reading since March 2009.

Given the soft GDP report this week and the BoE minutes, our UK economist notes that the stage is set for more QE. However he has lowered his expectation for the size of the next QE installment and is now calling for a GBP 25 bn-50 bn increase in the asset purchase target in February - down from a GBP75 bn expansion previously.

AUD
Australia's debt management office announced plans to issue A$700 mln of 2022 bonds on Feb 1, and another A$700 mln of 2018 paper on Feb. 3. These are the first Australian commonwealth bonds to be issued this year, and given overseas investors continue to show a keen appetite for Australian debt, we would not be surprised to see some AUD inflows on the back of this.

NZD
RBNZ Governor Bollard said he has not raised the OCR again since the emergency rate cut in March 2011 because of ongoing aftershocks in Christchurch which have delayed the reconstruction effort. The "deepening Euro crisis" has also contributed to the decision to keep rates on hold.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

26th of January 2012 - Technical Forex Market Overview

2012-01-26T03:53:00.003-05:00

DAILY MARKET COMMENTARY
26 January 2012 – 8:00 GMT
Thursday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD NEUTRAL Key upside trigger is at 1.3077 and support lies at 1.2839.

USDJPY BULLISH Pressure is on 78.29, a rally through this level would open the way for further gains towards 79.53. Support lies at 77.62.

GBPUSD NEUTRAL Resistance is at 1.5670 ahead of the bull trigger at 1.5780. Support lies at 1.5517 ahead of 1.5451.

USDCHF NEUTRAL Key downside trigger lies at 0.9244, a clear break below this level would open 0.9176 next. Resistance is at 0.9413 ahead of 0.9498.

AUDUSD BULLISH Initial resistance is at 1.0573, a move above this level would open the key high of 1.0753. Support lies at 1.0428 ahead of 1.0359.

USDCAD NEUTRAL Key support lies at 1.0052, a decline through this level would trigger a bear trend and expose 0.9975. Resistance is at 1.0189 ahead of 1.0254.

EURCHF BEARISH Initial support lies at 1.2058 ahead of 1.2000. Resistance is at 1.2133.

EURGBP BEARISH Momentum is negative; near-term support lies at 0.8273 ahead of 0.8255. Key resistance is at 0.8422.

EURJPY BULLISH Resistance is at 101.89 ahead of key high of 102.54. Support lies at 100.03.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

26th of January 2012 - Fundamental Forex Market Overview

2012-01-26T03:53:00.001-05:00

DAILY MARKET COMMENTARY
26 January 2012 – 8:00 GMT
Thursday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The FOMC surprised markets by pledging to leave rates on hold until late 2014 and committing to an explicit inflation target. The Fed will target the y/y change of core personal consumption expenditure (PCE) at 2%, moving away from the previous informal target range of around 1.7% to 2%. The Fed also said it was not appropriate to adopt a fixed goal for employment because "the level of unemployment that can be achieved without sparking inflation is not largely determined by monetary factors". The dollar fell across the board upon the announcement, reversing the gains from the previous sessions.

Risk assets rallied, and EURUSD broke through 1.3100. In the post-statement conference Bernanke said that unless there's a substantial strengthening in the economy, the Fed will be holding those unusually low rates for a long time. He also said that leaving rates on hold until 2014 implies that sales of the balance sheet will not come before 2015. In the first ever "longer-run goals and policy strategy" it was revealed that 11 of the 17 members believe a rate hike is not appropriate before 2014. This change in strategy is likely to fuel the recent risk rally and will be encouraging for investors looking to move back into risk assets in the short term. Earlier, there was more strong data out of Germany with the Ifo improving once again while the January BoE minutes showed a 9-0 vote for no change in rates and the asset purchase program. The minutes acknowledge that the most serious near-term risks have moderated, but the overall tone remains dovish.

As expected the RBNZ left its cash rate on hold but NZD was swept higher as part of the US dollar move. Ahead today, there are few major policy announcements in the G10 space but markets will remain sensitive to news out of the Eurozone as investors analyse the changes to Fed policy. EURUSD traded in a range of 1.3121-1.3047 and USDJPY 77.56-76.98.

EUR
ECB sources told Bloomberg that the central bank remains opposed to taking losses on its Greek debt holdings. German CDU's Meister called the call on the ECB to join the PSI as 'indecent', and said that IMF and politicians cannot dictate to the ECB. The role of the ECB in the PSI negotiations has been a fiercely debated topic n recent days. Yesterday, the FT reported that the IMF are putting the ECB under pressure to accept losses on its Greek holdings as the current stance is causing problems with private investors.

The Greek securities regulator said it will extend the short selling ban. This has been in force for several months already so is no surprise.

There was more strong data from Germany. The January IFO business. climate index rose to 108.3 vs 107.6 consensus. The expectations index rose to 100.9 vs 99.0 consensus. Our analysts note that this is clearly risk-on news and will support views of those who believe that the worst is over. This also confirms that Germany might continue to do better than the Eurozone average this year. As this was the third rise in a row, it may be seen as a turning point in the business cycle, according to the Ifo's own interpretation. In our view, this still hinges on credit conditions, which in turn depend on the sovereign crisis. Here the ECB's December LTRO clearly provided a lot of short-term support, but we think it is too simplistic to believe it will solve the crisis for good.

GBP
The January MPC minutes showed a 9-0 vote split for no change in rates and the asset purchase program. The minutes acknowledge that the most serious near-term risks have moderated, but the overall tone remains dovish. Our analysts note that there is a group in the MPC now a little less worried about the inflation undershoot. That group the 'risks to inflation were more finely balanced and it was less clear than inflation would fall below the target in the medium term'. The committee still believes that there major downside risks to the global economy remain and that economic growth in the euro area will remain weak for the foreseeable future. This leaves the door open for more QE for Feb. There is a downside risk to our Pound 75bn forecast.

Q4 GDP was softer than expectations at -0.2% q/q vs consensus of -0.1%. The pound was sold heavily into the data however with the market positioned short, there was minimal negative impact on the release.

AUD
Although the headline Q4 CPI was weaker than expected, core CPIs were slightly higher and AUD eventually rose 50 pips on the numbers. Specifically, the trimmed mean core reading climbed 0.6% in Q4 (cons. +0.5%) and the Q3 number was revised up to 0.4% (prev. 0.3%). Our Australian economists note that this puts the annualized rate back in the middle of the RBA's 2-3% target band, making the February policy decision a close call. Nevertheless, they continue to expect a 25bp cut to the cash rate in February.

NZD
As expected, the RBNZ left its cash rate on hold. Governor Bollard said. it remains prudent to keep the OCR on hold at 2.5%. The words 'for now' were dropped from the statement, suggesting the bank will be on hold for longer.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

25th of January 2012 - Technical Forex Market Overview

2012-01-25T03:20:00.001-05:00

DAILY MARKET COMMENTARY
25 January 2012 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD NEUTRAL Key upside trigger is at 1.3077 and support lies at 1.2839.

USDJPY BULLISH Focus is on 78.29, a rally through this level would open the way for further gains towards 79.53. Support lies at 77.62.

GBPUSD NEUTRAL Resistance is at 1.5670 ahead of the bull trigger at 1.5780. Support lies at 1.5517 ahead of 1.5451.

USDCHF NEUTRAL Pair is testing 0.9244, a clear break below this level would trigger a bear trend and open 0.9176 next. Resistance is at 0.9413 ahead of 0.9498.

AUDUSD BULLISH Momentum is positive; initial resistance is at 1.0573, a move above this level would open the key high of 1.0753. Support lies at 1.0428.

USDCAD NEUTRAL Key downside trigger lies at 1.0052, a decline through this level would expose 0.9975. Resistance is at 1.0189 ahead of 1.0254.

EURCHF BEARISH Initial support lies at 1.2058 ahead of 1.2000. Resistance is at 1.2133.

EURGBP BEARISH Near-term support lies at 0.8273 ahead of 0.8255. Key resistance is at 0.8422.

EURJPY BULLISH Resistance is at 102.54, the Dec. 21 key high, a break above which would open the way for 104.32. Support lies at 100.03.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

25th of January 2012 - Fundamental Forex Market Overview

2012-01-25T03:15:00.001-05:00

DAILY MARKET COMMENTARY
25 January 2012 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
USDJPY continued to march higher during the Asia session despite domestic Japanese exporters selling into the rally. The move got underway during the US session yesterday, likely in anticipation of a significantly less-dovish Fed. Data confirming that Japan's trade balance slipped into deficit territory for 2011 for the first time since 1980 also probably supported the pair at the margin. However, we note that the current account still remains in surplus due to coupon-related inflows from overseas investments so USDJPY should remain heavy in the Asia timezone despite the end of the trade surplus.

The true test for USDJPY will be today's FOMC meeting where the Fed will unveil a new set of rate forecasts for the first time. There are three events to watch: the policy statement will first be released, followed later by the new projections for how for policy rate will evolve over the coming years. Fed Chairman Bernanke's post-meeting press conference will then start 15 minutes later. We expect journalists to quiz him extensively on the possibility of further QE, and we doubt he will rule it out entirely, especially given uncertainty over how the Eurozone sovereign debt crisis will evolve. Stronger core Australian CPI gave AUD a substantial boost overnight while EURUSD traded in a range of 1.3014-1.3047 and USDJPY 77.62-76.98. BoE minutes and UK Q4 GDP data are also due.

EUR
Greek Finance Minister Venizelos said he expects to conclude a PSI deal in the next few days and has a green light from the Eurogroup to do so. Dow Jones reported EU Commissioner Rehn as saying that the 'building blocks are in place' for a Greek PSI agreement, and that it would be preferable to reach agreement in January rather than February.

S&P sovereign ratings head Chambers said Greece will likely be downgraded to 'selective default'. This is unlikely to trigger CDS in our view - indeed, the practical consequences would be almost nil, as even the ECB has been persuaded to continue to accept Greek debt that is rated default.

Flash PMIs in the Eurozone were strong. The January composite PMI rose to 50.4 (cons. 48.5, prev 48.3). Our European economists note that there is good news also from sub-components. Manufacturing output was up to 50.0 (from 47.1), and this points to further stabilization. There was the same from service business expectations, which rose to 56.0 (from 53.6). Employment also seems to be holding up at 50.5 (up from 49.9).

JPY
USDJPY broke above a key resistance level during the US session despite no change in stance at the BoJ's policy meeting yesterday. It appears the market has started to price in a less dovish Fed at tonight's FOMC meeting on the back of strengthening US economic data. We have our doubts however, and our US economists expect Bernanke to stick to his dovish tone. Having said that, the newly minted projections for the evolution of the policy rate have the potential to trigger significant changes on the US Treasury yield curve so we would not be surprised to see an increase in USDJPY volatility.

GBP
The BoE minutes are due today and although we expect them to reveal a unanimous decision to leave both rates and the asset purchase program unchanged, there may be some subtle hints regarding future QE from the BoE. The current program is due to finish in February and we expect further purchases to be announced in due course. On Tuesday BoE Governor King, speaking from Brighton, held out the possibility of more asset purchases 'if needed'.

AUD
Although the headline Q4 CPI was weaker than expected, core CPIs were slightly higher and AUD eventually rose 50 pips on the numbers. Specifically, the trimmed mean core reading climbed 0.6% in Q4 (cons. +0.5%) and the Q3 number was revised up to 0.4% (prev. 0.3%). Our Australian economists note that this puts the annualized rate back in the middle of the RBA's 2-3% target band, making the February policy decision a close call. Nevertheless, they continue to expect a 25bp cut to the cash rate in February.

CHF
EURCHF got a modest boost after SNB Board Member Danthine showed no change in stance. He still expects Swiss franc depreciation 'in the future', and said the SNB stands ready to buy 'unlimited' foreign currencies.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

24th of January 2012 - Technical Forex Market Overview

2012-01-24T03:28:00.001-05:00

DAILY MARKET COMMENTARY
24 January 2012 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Support lies at 1.2839, a move below which would open 1.2734. Key resistance is at 1.3077.

USDJPY NEUTRAL Key upside trigger lies at 77.34 and initial support lies at 76.55.

GBPUSD NEUTRAL Resistance is at 1.5629 ahead of 1.5670. Support lies at 1.5416 ahead of 1.5311.

USDCHF BULLISH Near-term resistance is at 0.9413, a rise through which would open 0.9498. Key supports are at 0.9306 and 0.9244.

AUDUSD BULLISH Momentum is positive; clearance of 1.0496 has opened the way for gains towards 1.0567 and then 1.0753. Support lies at 1.0359.

USDCAD NEUTRAL Key bear trigger lies at 1.0052 while resistance is at 1.0189.

EURCHF BEARISH Momentum conditions are bearish; tough support lies at 1.2000 and resistance is at 1.2133.

EURGBP BEARISH Support lies at 0.8255, a break here would open 0.8222, the Jan. 9 key low. Resistance is at 0.8378.

EURJPY NEUTRAL Initial resistance is at 100.34 ahead of 100.76, a prior low. Support lies at 98.56 ahead of 97.69.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

24th of January 2012 - Fundamental Forex Market Overview

2012-01-24T03:27:00.000-05:00

DAILY MARKET COMMENTARY
24 January 2012 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro settled above 1.30 during the US session as investors remain hopeful of a settlement on the Greek PSI. However, reports remain conflicting - a finance ministry source noted that there will be a final offer on the bond swap by February 13th, and the Eurogroup said that current talks on the debt deal were 'constructive', but other sources warned that there is currently no intention by either the Eurozone or the IMF to give more money to Greece.

However, there is more talk of a larger firewall for the Eurozone, especially via combining the ESM and EFSF if IMF funding is harder to come by. As a lot of the upside in EUR has come on the back of expectations of a positive outcome, swift unwinding could occur if reports suggest the result is to the contrary. In addition, we are cautious on the wider macro picture as even if the PSI were more aggressive, it is hard to see Greek debt coming down towards sustainable levels, which could complicate troika talks up ahead. Otherwise, activity was limited throughout the Monday session as most of Asia was on holidays for the lunar new year.

Today the dataflow out of Europe will start to pick up, in addition to the Ecofin meetings. German and pan-Eurozone PMI numbers are key ahead of the ECB's macro assessments, as simply providing liquidity to the banking sector will not be deemed enough as a growth stimulus and further policy measures may be on the way, despite persistent inflationary pressures. Meanwhile, there will be more focus on the Fed's upcoming decisions, especially the execution of new policy tools such as interest rate forecasts or even inflation targeting. Overall, barring a sudden collapse in PSI talks risk may continue to trade on a buoyant tone due to reallocation needs, but we continue to view this as a temporary respite and will look for good levels to consider entering new euro shorts. EURUSD traded 1.2855-1.3053 and USDJPY 76.87-77.08 on Monday.

EUR
The euro rallied after German CDU budget spokesman Barthle said that running the EFSF and the ESM in parallel is being discussed within the party.. This has been suggested on many occasions in the past however. Back in December, when the leveraging EFSF idea was losing ground, this idea was mentioned by 'EU sources'. It would effectively create a much bigger firewall if it happened but there are of course many stumbling blocks to its implementation - increased guarantees and potential German constitutional court challenges. However, later during the session the FT reported that German Chancellor Merkel is willing to countenance the combination, in return for even tough fiscal rules.

The details of the Greek bond swap have yet to be finalized, despite further signs of progress. Over the weekend the IIF (Institute of International Finance) gave its most upbeat assessment yet of the current state of play, noting that the elements of an agreement are "coming into place". It appears that terms have in fact been provisionally agreed between Greece and the IIF, but the plan is now being vetted by the EU/IMF. The Financial Times reported that the EU/IMF have already raised objections to the proposed coupon on the grounds that its perceived generosity would prevent Greece returning to a sustainable debt position. All the signs are that a deal will not now be struck in time for Monday's meeting of Eurozone finance ministers. There was little news from the ongoing talks in Greece on Mondy morning, although a Greek government spokesman said there was no chance of the debt swap talks failing.

Portugal 5y CDS spread hit a record wide of 1280bp on Monday. Spillover risk from Greece is still high and should there be a coercive restructuring in Greece, markets could well price in the same for Portugal.

The Eurogroup met on Monday but there was precious little to announce as talks are ongoing between Greece and private creditors. Meanwhile, there remain disagreements over the size and execution of the ESM's size and sources warned that there won't be any fresh funding for Greece under current circumstances. According to Dow Jones, major creditor funding 'won't be increased by a single euro' but without any decisions on the debt deal at this point, troika talks on the next tranches won't commence until month-end.

Dow Jones reported that Greece will make a formal offer on Bond Swap by February 13th - and officials noted that the current talks on the debt deal and Greece's second bailout were 'constructive'.

German Chancellor Merkel said that a bridge loan for Greece was not necessary. She also stressed that she 'will keep fighting' for fiscal discipline but warned the crisis won't end 'from one day to the next'. The Ecofin group of EU finance ministers will meet on today.

CHF
Interim SNB Chair Jordan again signaled the SNB's determination to defend the floor in EURCHF at 1.20. He said there is "no alternative" to the floor, adding that it will be kept "until it's no longer needed". Again he held out the prospect of additional policy measures if deflationary forces rise. Ahead on Tuesday SNB Governing Board member Danthine will be on the wires.

GBP
The MPC's Adam Posen said he and 'most of the MPC' believe that the UK will return to roughly pre-crisis productivity growth trends. He also warned that 'lack of confidence' is keeping the economy down and it was right that the BoE conducted QE to stop inflation from falling too low.

Today, fiscal figures will be out with public sector net credit requirement. Fiscal slippage is a key issue for the UK government at this stage and crucial for the maintenance of the AAA rating.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

20th of January 2012 - Technical Forex Market Overview

2012-01-20T03:32:00.001-05:00

DAILY MARKET COMMENTARY
20 January 2012 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Near-term support lies at 1.2734, a move below which would open 1.2624. Resistance is at 1.2947.

USDJPY BEARISH Momentum is negative; key support lies at 76.33 with interim support at 76.55. Resistance is at 77.13.

GBPUSD BEARISH Break below 1.5311 would expose 1.5273 next. Resistance is at 1.5501.

USDCHF BULLISH Resistance is at 0.9498, a rise through which would open the key high of 0.9596. Key support lies at 0.9306.

AUDUSD BULLISH Initial resistance is at 1.0450 ahead of 1.0496. Support lies at 1.0303.

USDCAD NEUTRAL Key bear trigger is at 1.0052 while resistance is at 1.0188.

EURCHF BEARISH Support lies at 1.2051, a move below which would open the key support at 1.2000. Resistance is at 1.2130.

EURGBP BEARISH Near-term support lies at 0.8303 ahead of 0.8255. Resistance is at 0.8376.

EURJPY BEARISH Initial support lies at 97.69, a break below which would open 97.04. Resistance is at 99.35.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

20th of January 2012 - Fundamental Forex Market Overview

2012-01-20T03:31:00.000-05:00

DAILY MARKET COMMENTARY
20 January 2012 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro continued its rebound on Thursday, trading in a 1.2839-1.2972 range against the dollar, on the back of strong auction results and hopes of a satisfactory conclusion to PSI talks in Greece. Spanish and French auctions were taken favorably by the markets and the euro pushed higher in the European session. The IIF will continue discussions on Friday and a deal is already expected, though wires have suggested several different proposals remain on the table. Expectations have reached a certain level such that any potential missteps could prove costly for sentiment.

Nevertheless, given the information flow over the past week most investors would probably not want to be excessively short the euro, or hold positions which express a similar view to the downside. The troika have clearly stated that there won't be fresh funding for Greece's upcoming payment requirements until the PSI is settled, and a satisfactory solution removes one further barrier towards crisis resolution, though from a wider standpoint, macro adjustment throughout the Eurozone must be a priority and on this front good news will be far harder to come by. For example, there is no guarantee that Greece will embark on a sustainable debt path post-PSI. In addition, scrutiny over the fiscal compact will return, and reports today suggest again that the final agreement may not prove as watertight as agreed during the initial discussions as once again allowances for 'exceptions' are being made.

Late during the US session, Moody's warned that while a disorderly default in Greece is not their 'central case view', the probability is rising. An orderly decline in the euro remains a part of that process; improvements on the Greek front will help ensure financial stability, and more importantly avert wider sovereign contagion, but we believe investors will need to be cognizant of the wider macro backdrop. Ahead on Friday, markets will be looking for further assurances that the global economy will be able to avert recession, especially if the flash manufacturing PMI out of China rebounds above 50. UK retail sales figures are due, and CPI figures are due in Canada. USDJPY traded in a 76.70-77.32 range on Thursday..

EUR
Auctions in Spain and France were well received by the market. In a 3-line auction, the Spanish treasure managed to issue over EUR 6.6bn, above initial estimates of EUR4.5bn. The yields were also relatively low, at an average 5.403% on the 10-year (compares to 6.975% in November) and strong bid-to-covers. Most importantly, Spain has now issued almost EUR17bn of bonds in the last two weeks, which constitutes around 20% of their yearly issuance. The French auction was also relatively successful, issuance was at the top of estimates of EUR8bn.

The ECB said that EUR3.317 bn was borrowed using the overnight loan facility and EUR395.327 bn was deposited. This is a big drop in overnight deposits, but that is due to technical reasons (a new maintenance period kicked in yesterday) and not due to an improvement in market functioning. We expect deposits to keep rising further from here, and to make new highs, perhaps within days.

Fitch said that it expects to downgrade most of the 6 Eurozone countries by 1-2 notches by the end of its ratings review. This refers to Spain, Slovenia, Italy, Ireland and Cyprus, which are on review until the end of January.

Despite S&P's downgrade, EFSF lending capacity should be adequate for all programmes underway, Slovak FinMin Miklos says.

More details on the Greek PSI were released on Friday, as it appears final details on the bond swap terms need to be refined but parties may be closer to agreement. The Wall Street Journal reported that Greece is now proposal a 3.6%-3.7% initial coupon which will 'progressively increase over time'. EU officials said it was 'very possible' that a deal would be done on Friday. The IIF, however, is looking for a 4% initial coupon and increases every two years.

The draft of the ESM treaty noted that the combined capacity of Eurozone temporary and permanent bailout funds remains at EUR500bn. Collective action clauses will be introduced in all new Eurozone bonds one month after it comes into force. However, member states will be able to deviate from balanced budget goals in 'exceptional circumstances' if there are 'unusual events' or 'periods of severe economic downturn'.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

19th of January 2012 - Technical Forex Market Overview

2012-01-19T03:21:00.002-05:00

DAILY MARKET COMMENTARY
19 January 2012 – 8:00 GMT
Thursday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Near-term support lies at 1.2734, a move below which would open 1.2624. Resistance is at 1.2902.

USDJPY BEARISH Key support lies at 76.33 with interim support at 76.55. Resistance is at 77.13.

GBPUSD BEARISH Decline through 1.5273 would open 1.5235 next. Resistance is at 1.5409 ahead of 1.5501.

USDCHF BULLISH Resistance is at 0.9498, a rise through which would open the key high of 0.9596. Support lies at 0.9306.

AUDUSD BULLISH Next resistances are at 1.0496 and 1.0567. Support lies at 1.0303.

USDCAD NEUTRAL Support lies at 1.0104 ahead of bear trigger at 1.0052. Resistance is at 1.0188 ahead of 1.0253.

EURCHF BEARISH Initial support lies at 1.2051 ahead of key support at 1.2000. Resistance is at 1.2130.

EURGBP BEARISH Near-term support lies at 0.8303 ahead of 0.8255. Resistance comes in at 0.8376.

EURJPY BEARISH Support lies at 97.69, a break below which would open 97.04. Resistance is at 98.80 ahead of 99.35.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

19th of January 2012 - Fundamental Forex Market Overview

2012-01-19T03:21:00.001-05:00

DAILY MARKET COMMENTARY
19 January 2012 – 8:00 GMT
Thursday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Both the AUD and NZD fell after disappointing domestic data releases. Unusually, the euro carried on regardless and further consolidated its recent gains. The possibility of a deal between Greece and private sector bond holders appears to be growing, according to the Financial Times. Our house view that coercive measures may be needed further down the line remains unchanged. The news comes on the back of the IMF's proposal for a fresh $500bn funding call, which would be a significant boost to the funds' resources. Whether Largarde's call for new one-off contributions obtains much buy-in from non-Eurozone nations remains to be seen, but the momentum clearly matters for risk and the euro. EURUSD traded 1.2835-1.2879 and USDJPY 76.69-76.85 during the Asia session, while acceptable US data also helped equity markets finish yesterday on a more buoyant note. Industrial production was slightly softer than expected at +0.4%m/m, while PPI registered a decline of 0.1%. TIC data showed a rise in long-term capital flows into the US, and we expect such trends to remain a source of structural support for the dollar. Ahead on Thursday, the US releases CPI data. Price figures may attract more attention in the US in the short term as there is talk of an explicit inflation target being adopted by the Federal Reserve.

EUR
The Financial Times has reported that Greece is nearing a deal with private-sector creditors on a debt swap. Rather than a fixed coupon, which had been a point of contention, the current deal on the table looks for a variable rate, starting at 3% before rising to 4.5%. The IIF noted discussions would continue on Thursday, while the IMF will be waiting in the wings as talks on further aid cannot begin in earnest until the PSI is completed.

German Chancellor Merkel today tried to allay market fears of a watering down of the fiscal compact. She noted that negotiations are ongoing.

The euro rallied after Bloomberg reported that the IMF has said that they will propose boosting their lending resources by $1 trn. The comments were not official however so we question the reliability of the figures. It is clear that negotiations are underway behind the scenes so comments like this are to be expected. The current size of the available resources is $385 bn and Eurozone countries have pledged another c. $200 bn - so the rest would need to come from other countries, including the US, Japan and BRICs. While any development of this magnitude would be a significant boost to risk appetite, we note that previous G20 meetings have had a tendency to disappoint market expectations. Earlier, IMF chief Lagarde said the fund's staff is still exploring ways to ensure 'adequate fund firepower'.

A 'senior Fitch Director' said that a two-notch downgrade of Italy is 'still an option'. Fitch still has Italy at A+ and has suggested action before month end. Ratings agencies remain in focus of Eurozone governments, though French President Sarkozy again played down the loss of France's AAA status by calling the downgrade itself a 'non event'.

The German government has cut its 2012 growth forecast to 0.7% from 1% earlier. Germany sold EUR3.44 bn of its 0.25% two-year Schatz notes on Wednesday, paying an average yield that set a new a multi-decade low.

JPY
ECB Governing Council member Nowotny tentatively joined the EURJPY intervention debate in an interview with Japan's Nikkei newspaper. He said he understands Japan's concerns about a weak euro, but added that it was premature to declare that the euro's moves are one-sided given that it continues to move within its normal range.

GBP
Nationwide consumer confidence figures were in line with consensus expectations and fell to 38 (prev. 40) - only two points above the lowest reading ever.
NOK Targets: EURNOK 1m 7.70, 3m 7.80.

AUD
AUDUSD drifted lower in the aftermath of a mixed - but generally soft - employment report. Employment fell -29.3k in December, despite expectations of a 10k increase. A steady unemployment rate was some consolation however, and full time employment actually increased. Our Australia economists still expect the RBA to trim rates again in February.

NZD
NZDUSD fell 50 pips overnight after Q4 CPI came in sharply below expectations at 1.8% y/y (cons. 2.6%, prev. 4.6%). Our New Zealand economist still thinks the RBNZ will remain on hold until June, but he acknowledges the risks to global growth, domestic demand, and inflation raise the risk that the OCR remains on hold for longer.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

18th of January 2012 - Technical Forex Market Overview

2012-01-18T03:55:00.001-05:00

DAILY MARKET COMMENTARY
18 January 2012 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Initial support lies at 1.2624, a move below which would open the key low at 1.2588. Resistance is at 1.2879.

USDJPY BEARISH Momentum is negative; key near-term support lies at 76.33 while resistance is at 77.13.

GBPUSD BEARISH Decline through 1.5273 would open 1.5235 next. Resistance is at 1.5409.

USDCHF BULLISH Key resistance is at 0.9596; a break above this level would open the way towards 0.9784, the January 2011 high. Key support lies at 0.9407.

AUDUSD BULLISH Next resistances are at 1.0496 and 1.0567. Support lies at 1.0303.

USDCAD NEUTRAL Near-term directional triggers are at 1.0319 and 1.0052.

EURCHF BEARISH Key support lies at 1.2000 while resistance is at 1.2130.

EURGBP BEARISH Support lies at 0.8255 ahead of key low at 0.8222. Resistance comes in at 0.8376.

EURJPY BEARISH Near-term support lies at 97.04, a break below which would open 95.68. Resistance is at 98.80.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

18th of January 2012 - Fundamental Forex Market Overview

2012-01-18T03:54:00.001-05:00

DAILY MARKET COMMENTARY
18 January 2012 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Japan's Finance Minister Azumi spoke but, unlike yesterday, did not mention EURJPY specifically. Intervention was still on his mind though. He said it would be hard for Japan to emulate the Swiss approach and defend a particular line in the sand, noting that the supply of yen in global markets is vast. This is the first time this idea has been so firmly rejected. He warned though that Japan stood ready to take firm steps against speculative FX moves. In Europe, the IIF is expected to resume debt talks with Greece today for a satisfactory conclusion on PSI involvement. The closer to the relevant deadlines the parties involved get, the bigger the risk of a large selloff if talks ultimately fail. Greece has already been talking openly about adopting coercive measures - sentiment echoed by Prime Minister Papademos overnight. Although data globally has managed to continue supporting investors' general growth expectations, standards are pretty low at this point and we expect risk currencies to remain vulnerable. For example, on Tuesday, the German ZEW was strong, with the economic sentiment index printing 21.6 (vs. expectations of -49.4). Such figures were cheered by the market, notwithstanding the fact that sentiment remains deep in negative territory. A ZEW economist said that ECB liquidity, lower yields and better US data boosted sentiment. Eurozone periphery spreads versus Germany tightened and equity markets finished up across most of Europe. The US Empire State manufacturing index for January was above consensus at 13.5 and the indexes of new orders, shipments, and employment all improved. EURUSD traded 1.2718-1.2788, USDJPY 76.66-76.85 in Asia.

EUR
In an interview with The New York Times, Greek Prime Minister Papademos said that he will consider introducing legislation to force bondholders to take losses if they refuse to participate in the voluntary bond swap agreement, negotiations on which resume today. Earlier, IIF Chief Charles Dallara called upon all sides in the negotiations to work 'in good faith' and with a 'sense of urgency'.

IMF chief Lagarde said the fund's staff is still exploring ways to ensure 'adequate fund firepower'. Since Q4 2011 efforts to further boost the fund's resources, especially via non-Eurozone sources, have not proven fruitful as the rest of the G20 continue to call for Europe to act more to contain the debt crisis.

The EFSF sold EUR1.501 bn of 6-month bills at 0.266%. The bid-to-cover ratio was 3.1x. Demand did not appear to be materially lower following Monday night's S&P downgrade. The size was not particularly large, but it was in line with its initial targeted amount.

The ECB's Nowotny said the ECB is looking at alternatives to sovereign bond buying, but is not in a position to stop the SMP at the moment. He added that the need for intervention is widely recognized but within the ECB council, there is still scepticism over bond buying. These comments offer an interesting take on the SMP program and illustrate the tensions inside the bank. In the past, the ECB has bought covered bonds, but we do not think that this means it will switch the SMP program into other assets just yet.

Fitch analyst Edward Parker said that Greece is insolvent and will default. While these are the views of the analyst, they echo those of many commentators. Yesterday, S&P Managing Director of Sovereign Ratings Moritz Kraemer said he believed Greece 'would default soon'. He also suggested that policymakers were working to avoid a 'disorderly default' as such a development would have consequences for other countries.

S&P commented on the prospect of further downgrades for banks, insurers and some government-related entities, following its Eurozone sovereign downgrades on Friday. The ratings agency said that it will decide on ratings for the institutions within 4 weeks.

CHF
The Swiss Economics Minister said EURCHF should be 1.35-1.40, Bloomberg reported. EURCHF rallied slightly on the headlines but we see limited impact from the statement. The Swiss KOF indicator is due on Wednesday.

JPY
Finance Minister Azumi again alluded to Japan extending help to Europe via the IMF. He said both Japan and China need to seek a realistic way of achieving this, but that the attitude of the US would determine the IMF's role in Europe's sovereign debt crisis.

Azumi warned again about Japan's own fiscal position, saying that smooth JGB bond sales and low JGB yields are no excuse for complacency, given that bond yields can jump suddenly and sharply.

Dow Jones reported that Japan bought 8% of the EFSF 6m bills auctioned yesterday, citing a Ministry of Finance official. Japan bought 20% of the first bond auctioned a year ago, according to official announcements at that time.

GBP
December CPI came in at +4.2% y/y, in line with consensus. Our UK economist notes that the slowdown is driven by prices of petrol, gas and clothing. Inflation should continue to fall in the months ahead, with CPI expected to end the year below 2%.

CAD
As expected, the Bank of Canada left the overnight rate target unchanged at 1.00%. The bank said the outlook for the global economy has deteriorated and uncertainty has increased". It also now expects the pace of Canadian growth to be more modest than previously envisaged, largely due to the external environment".

Government data showed that foreigners bought a net C$15 bn ($14.8 bn) of Canadian securities in November, the most in six months.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

17th of January 2012 - Technical Forex Market Overview

2012-01-17T03:23:00.001-05:00

DAILY MARKET COMMENTARY
17 January 2012 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Initial support lies at 1.2588 ahead of 1.2500. Resistance is at 1.2879.

USDJPY BEARISH Intraday momentum is negative; Key near-term support lies at 76.33. Resistance is at 77.34.

GBPUSD BEARISH Decline through 1.5273 would open 1.5235 next. Resistance is at 1.5409.

USDCHF BULLISH Recovery through 0.9596 would open up the way towards 0.9784, the January 2011 high. Key near-term support lies at 0.9407.

AUDUSD BULLISH Clearance of 1.0387 has opened the way for gains towards 1.0447 and then 1.0496. Initial support lies at 1.0229.

USDCAD NEUTRAL Near-term directional triggers are at 1.0319 and 1.0052.

EURCHF BEARISH Support lies at 1.2000, while resistance is at 1.2148.

EURGBP BEARISH Outlook is bearish; a move below 0.8222 would expose 0.8205. Resistance comes in at 0.8376.

EURJPY BEARISH Support lies at 95.90 ahead of the psychological level of 95.00. Resistance is at 98.80.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

17th of January 2012 - Fundamental Forex Market Overview

2012-01-17T03:22:00.000-05:00

DAILY MARKET COMMENTARY
17 January 2012 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro experienced a double-dose of upside during the Asia session. First, Japan's Finance Minister Azumi raised the possibility of intervention in EURJPY, but said he has not yet made a decision on the matter. We see the immediate intervention risk as remote, but investors were in no mood to take chances. China's Q4 GDP growth then came in stronger than expected, boosting the euro and taking AUDUSD briefly through 1.04. EURUSD traded 1.2649-1.2737, USDJPY 76.67-76.88. Earlier, a senior official at S&P ratings said in an interview with Bloomberg TV that he expected Greece to default soon. The EFSF was also downgraded one notch to AA+. With troika officials descending upon Athens this week, it is clear the stakes are being raised and there may be some need for contingency planning ahead.

We continue to envisage coercive action by Greece, and while reports suggest that retroactive collective action clauses will be put into use, with the troika's blessing, the Eurozone authorities would want to ensure such action remains a one-off. Otherwise, the market managed to absorb the ratings news with relative ease, as France launched a successful bill auction where the one-year yield actually fell. However, Portugal may prove to be a bigger worry in the short term, as it now holds junk status with all three major ratings agencies, which may have caused the country's paper to drop out of bond indices. The forced liquidation of real money holdings has led to a sharp rise in yields, though in the past few weeks the European authorities and IMF have continued to view the country's programme as on track. CPI figures are due in the UK and Eurozone, and the German ZEW is also out. We have revised our short-term FX forecasts and continue to target a stronger dollar - our 3m EURUSD view is now at 1.15.

EUR
The EFSF has been downgraded to AA+ by S&P. This came in the wake of the agency's downgrades of France and Austria. The facility's CEO, Klaus Regling, said in response that the EFSF's investor base was well-diversified and noted that it still possessed AAA ratings from two other agencies. However, ECB President Draghi warned that such a move would have 'consequences'.

Moody's said it would keep France's AAA rating but that its stable outlook was under pressure. It said it would update the market during the first quarter of this year as part of its broader Eurozone assessment.

Germany swiftly rejected any chance of raising its guarantees for the EFSF. Chancellor Merkel's spokesperson said that current funding was adequate, and the Finance Ministry also said that it saw no need to act on the ESM.

S&P Managing Director of Sovereign Ratings Moritz Kraemer said he believed Greece 'would default soon'. He also suggested that policymakers were working to avoid a 'disorderly default' as such a development would have consequences for other countries.

It is clear that talks between the Greek government and the IIF on the PSI have reached an impasse, with the institute's head Dallara warning that a deal was needed 'urgently', but he also said current interest rates being offered by Greece were 'completely unreasonable'.

Earlier on Monday Greek PM Papademos again stressed that 'leaving the euro is not an option for Greece' and said talks with creditors would continue..

CHF
Switzerland's combined producer and import price index for December came in higher than consensus estimates, increasing by +0.3% m/m. The y/y reading was still a -2.3% fall. Our Swiss economist notes that print is above all the result of higher producer prices. These increased by +0.2% on the month, resulting in a decline of -2.2% y/y. On the margin the data is EURCHF-negative, although the cross will be driven by external forces in the near term.

JPY
Japan's Finance Minister Azumi referred to EURJPY overnight, becoming the second Japanese finance official to do so in as many days. The rhetorical intensity increased a notch too, and Azumi referred directly to the possibility of intervention in the cross. He said he first wanted to examine current FX moves before making his decision. Both EURJPY and EURUSD turned bid on the headlines.

We see no imminent risk of intervention in the cross, and expect Japan to maintain its historical focus on USDJPY instead. We note that Japan last bought EURJPY in May 2003, when the cross was trading at about 130, but the amounts were small, infrequent, and largely symbolic.

Yesterday, Senior Vice Finance Minister Igarashi warned that EURJPY moves were a bit 'rapid' and that his ministry would monitor these moves closely.

Azumi added that S&P's decision to downgrade the EFSF one notch to AA+ will not immediately change Japan's policy of purchasing EFSF bonds.

GBP
UK CPI is out on Friday. The market is looking for a 4.2% headline print but we doubt this will affect the BoE's broader outlook, as the likelihood of QE extension remains high in the coming months.

Given the UK's ratings status remains solid compared to most of the Eurozone, and the Gilt market continues to provide the necessary liquidity, we continue to see EURGBP trading lower and move our 3m target to 0.80, in line with our year-end forecasts.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

13th of January 2012 - Technical Forex Market Overview

2012-01-13T03:29:00.001-05:00

DAILY MARKET COMMENTARY
13 January 2012 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH A bounce through 1.2818 has exposed 1.2947. The underlying trend remains bearish with focus on the Jan. 11 low of 1.2662.

USDJPY BEARISH A break below 76.61 would expose the key low of 76.33. Resistance is at 77.34.

GBPUSD BEARISH The pair targets 1.5272; a push below the level would expose 1.5192, the 61.8% retracement of the 1.4231-to-1.6747 uptrend. Resistance is at 1.5501

USDCHF BULLISH A recovery through 0.9596 would open up the way towards 0.9784, the January 2011 high. Key near-term support lies at 0.9306

AUDUSD BULLISH Recovery eyes 1.0387; a break here would be an important bullish development to expose 1.0447. Initial support lies at 1.0229 ahead of 1.0146.

USDCAD NEUTRAL The key near-term directional triggers are at 1.0319 and 1.0077

EURCHF BEARISH Support lies at 1.2000, while resistance is at 1.2254.

EURGBP NEUTRAL Key resistance is at 0.8422; a break here would trigger a bull trend. Support lies at 0.8288.

EURJPY BEARISH Violation of 97.28 would expose 95.00, the base of the bear trend channel drawn off the April 11 high. Resistance is at 98.85.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

13th of January 2012 - Fundamental Forex Market Overview

2012-01-13T03:28:00.000-05:00

DAILY MARKET COMMENTARY
13 January 2012 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro's rebound continued during the Asia session, buoyed by yesterday's rally across Eurozone sovereign bond markets. EURUSD traded 1.2807-1.2873, USDJPY traded 76.69-76.84. Strong demand at Thursday's Spanish auction has raised hopes for a positive outcome when Italy tries to sell EUR3-4.75 bn of BTPs today. Our Eurozone rates strategy colleagues expect the relatively small amount of supply to be easily absorbed, which we expect will give the euro a short-term boost. However, they doubt the performance of Italian debt will be as impressive today as it was yesterday. Even though fundamentals have not budged by one inch for the Eurozone, it appears that there is demand out there for sovereign paper. Spain's Tesoro sold almost EUR10 bn across three lines, double the guidance and over 10% this year's planned issuance.

The ECB left interest rates unchanged yesterday, and President Draghi sounded the expected warning bells over the Eurozone economy, but said that there were some 'signs of stabilisation', albeit at very low levels. The ECB was also non-committal on future policy moves, and on the SMP programme, but it appears current market conditions did not warrant a very dovish stance. However, this does not change our bearish outlook on the euro, and we remain short EURUSD as a trade recommendation. In the US, however, retail sales surprised to the downside as core figures fell by 0.2% (cons. 0.3%). The December budget deficit was also higher than expected at -$86bn (cons. -$83.7bn). Trade figures are due out in the US and Canada, along with the University of Michigan Confidence reading.

EUR
Fitch said on Thursday that France's debt and deficit make it the weakest AAA in the Eurozone, and warned that there is a significant risk of an Italy downgrade.

The Greek deputy finance minister said that Greece may need more funds from European partners if participation of private investors in the PSI scheme falls short of 100%. Despite reports from Greek and EU sources that the PSI negotiations are going well, positive signals from the IIF have been in short supply and the issue remains unresolved.

Charles Dallara, the Managing Director of the IIF warned that all parties must confirm they are seeking a voluntary deal and it 'has to be done really in the next few days'. He said he was 'concerned' about the lack of 'clear process' over Greece, according to the Wall Street Journal

The IMF warned that Greek IMF loans depend on a private bondholder deal, as full financing for any programme was required. In addition the IMF said it was still targeting a 120% debt-to-GDP ratio for the country and warned that higher ratios would be unsustainable. The next mission to the country is planned for Jan 17.

Italian industrial output was surprisingly strong in November, coming in at +0.3% m/m. This still marks a 4.1% y/y decline however. Prime Minister Monti said Italy is against the introduction of more rigid restrictions or further sanctions in the fiscal pact. Monti added that the ECB could be "more relaxed" after the fiscal pact is concluded. The ECB has continually stated that developments on the fiscal front are necessary before further ECB action.

GBP
Industrial production in November fell -0.6% m/m, lower than expectations of -0.1%. Our UK economist notes that the sharp drop is because of a contraction in oil and gas extraction and electricity production. Manufacturing, the dominant component of overall industrial production, came in at -0.2% m/m instead of -0.1% expected. This raises the possibility of negative GDP growth in Q4, but it's important to note that the industrial sector is much smaller than the services sector. We have a GDP growth forecast of -0.2% q/q for Q4

The Bank of England kept rates on hold, and said that the BoE expects the programme to end in early February, presumably after the next BoE meeting. Our UK economist notes that this gives the MPC an extra month to think through their forthcoming decision - data on the domestic front data such as the PMIs will be key, along with any signs of life in the bank unsecured term-funding market.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

6th of January 2012 - Technical Forex Market Overview

2012-01-06T04:02:00.001-05:00

DAILY MARKET COMMENTARY
6 January 2012 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Support lies at 1.2642, today's intersection of the bottom of the trend channel drawn off Nov. 14 high, ahead of key low at 1.2588. Resistance is at 1.2947.

USDJPY BEARISH Near-term support lies at 76.61, a break here would expose 76.33. Resistance is at 77.50.

GBPUSD BEARISH Initial support is at 1.5402, a break here would open the key low of 1.5362. Resistance is at 1.5629.

USDCHF BULLISH Pressure is on the key high of 0.9548, a clearance of which would open the way towards 0.9784 with interim resistance at 0.9602. Support lies at 0.9413.

AUDUSD BULLISH Resistance is at 1.0387, a move above this level would open 1.0447 next. Support is at 1.0127.

USDCAD BEARISH Support lies at 1.0104 ahead of the key support at 1.0052. Resistance is at 1.0269.

EURCHF NEUTRAL Initial resistance is at 1.2254 ahead of 1.2398. Support lies at 1.2126 ahead of 1.2051.

EURGBP BEARISH Focus is on 0.8202, a decline through this level would open the way for 0.8142, the August 2010 low. Resistance is at 0.8289.

EURJPY BEARISH The cross is testing 98.66, a clear break below which would open 97.65. Resistance is at 100.31.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

6th of January 2012 - Fundamental Forex Market Overview

2012-01-06T04:00:00.001-05:00

DAILY MARKET COMMENTARY
6 January 2012 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
In a typical prelude to a US payrolls release, FX markets traded in very tight ranges in Asia until newswires reported speculation of a nuclear incident in North Korea. Officials in Seoul and Tokyo later rejected the idea, but not before EURUSD broke to new 15-month lows, and AUDUSD dropped 20 pips. Expectations for a buoyant payrolls report are still running high after the December ADP employment report came in strongly above expectations at +325k. Our analysts note though that the figures may not be a forward indicator of stronger official BLS payroll numbers today, and they keep their forecast for private payrolls unchanged at +150k (headline +125k).

End-of-year reconciliations of payroll records typically result in an artificially high ADP estimate. That was the case last year, and appears to have been the case this year as well. Caution is therefore clearly warranted. St. Louis Fed President Bullard noted that the Fed may choose to adopt inflation targeting this year. Given the Fed's current stance, this could suggest targeted asset purchases until headline CPI or core PCE reaches a certain level. Given that zero rates are here to stay until 2014 or so (according to current pricing), it is clear that any inflation target in the medium term will be calibrated through quantitative balance sheet targets rather than interest rates. Elsewhere, Eurozone concerns remain amid reports that the IMF had pushed back its payment schedule for Greece, and the Eurozone financial sector remains under scrutiny. Ahead on Friday, in addition to the unemployment report, Canadian jobs numbers are out and Swiss CPI will be released. EURUSD traded 1.2764-1.2799 and USDJPY 77.07-77.26.

EUR
France sold a total of EUR7.96 bn in a four-way auction, towards the upper end of supply expectations. In general the result was treated as decent, though this failed to arrest the euro's decline. The Euribor fixing coming in lower than expected minutes afterwards did not help the euro's cause either.

Italian 10y yields closed above 7% again yesterday and the spread over the German 10-year has now widened to well over 500bp. Our euro rates strategists expect Italian bonds to remain under selling pressure into Italy's first auction of the new year on Friday, Jan. 13.

German data were disappointing. Retail sales for November came in at -0.9% m/m (cons. 0.2%). Eurozone figures were weak as well: industrial new orders grew by 1.6% in October.

Reuters reported that due to a delay in payment for the latest tranche from the troika, the aid payment schedule for Greece will be delayed by 3 months. This could complicate Greece's efforts to meet major bond redemptions in March, although the intention remains to replace the initial rescue program with a new one once the terms of the private sector participation plan are agreed.

CHF
Swiss inflation numbers for December are due. The SNB has already revised lower CPI figures in the wake of growth headwinds and a still-overvalued currency, but declined to raise the floor in EURCHF at their December meeting. The market is expecting a -0.5% print (UBSe. -0.7%), which doesn't appear to meet the definition of massive deflation that would need to be met to justify additional measures, such as raising the floor..
GBP
UK services PMI surprised to the upside for December, coming in at 54.0 vs. 52.1 prior.

Latest data showed that Gilt purchases by institutional investors in October and November were the largest on record, according to the Financial Times. We believe the move was in part driven by such investors rethinking their previous policy of diverting from periphery debt into the Eurozone AAA core. Now, it appears, Gilts are serving as an alternative safe haven, although we would caution against buying sterling purely for this reason given the UK's own challenging fiscal position.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

5th of January 2012 - Technical Forex Market Overview

2012-01-05T03:43:00.001-05:00

DAILY MARKET COMMENTARY
5 January 2012 – 8:00 GMT
Thursday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Focus is on 1.2858; a decline through which would signal scope for deeper pull back towards 1.2588. Resistance is at 1.3077.

USDJPY BEARISH Support lies at 76.33, a move below this level would open key low of 75.35. Near-term resistance is at 77.17.

GBPUSD BEARISH Initial support is at 1.5502, a break of which would open 1.5469. Resistance is at 1.5692.

USDCHF BULLISH Pressure is on 0.9470, a clearance of which would expose the key high of 0.9548. Key support lies at 0.9244.

AUDUSD BULLISH Resistance is at 1.0387, a move above this level would open 1.0447 next. Support is at 1.0233.

USDCAD BEARISH Key support lies at 1.0052, a break below which would open 0.9975. Resistance is at 1.0220.

EURCHF NEUTRAL Initial support lies at 1.2126 ahead of 1.2051. Resistance is at 1.2254 ahead of 1.2398.

EURGBP BEARISH The cross is testing 0.8285, a close below this level would open the way for 0.8252 and 0.8202 next. Resistance is at 0.8372.

EURJPY BEARISH Focus is on key low at 98.66, a decline through which would open 97.65. Resistance is at 100.31.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

5th of January 2012 - Fundamental Forex Market Overview

2012-01-05T03:42:00.001-05:00

DAILY MARKET COMMENTARY
5 January 2012 – 8:00 GMT
Thursday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
FX markets traded mostly sideways during the Asia session, although the dollar enjoyed a very modest bid tone. News reports over the state of Spain's governments and banks are leading to further uncertainty, even though the overall story is not new. As such, we still regard any rally above 1.30 in EURUSD as unsustainable. Meanwhile, the US has managed to register some more positive data. Factory orders increased by 1.8% in November - less than expected but still robust compared to the US' G10 peers. In comments made in a paper, Fed Chairman Bernanke warned that more action was needed on the housing market, and further price declines are still possible. Today, several job surveys are out in the US, ahead of the upcoming payrolls release. Retail sales figures are also due in Germany and France is due to auction a range of OATs, aiming to raise EUR7-8 bn. Our euro rates strategy team sees this as an important test of investor appetite for French paper following the significant spread widening of France over Germany in the past two weeks. Fortunately, France still holds a AAA rating and the auctions are expected to be supported particularly by domestic investors after the recent underperformance of longer-dated French paper.

EUR
Germany's services PMI for December was revised down to 52.4 from 52.7 preliminary, but that still represents a significant lift from November's 50.3. The news from Italy was more worrying however. Italian services PMI fell to 44.5 (cons. 45.3), from 45.8 in November. Our analysts note that the latest data indicate negative Q4 growth for Italy, perhaps in the region of -0.3% to -0.5%.

The flash Eurozone CPI for Dec. was in line with expectations at +2.8% y/y. This supports the ECB's forecasts made in their December meeting. Our European economists expect the ECB will cut the refi rate by a further 50bp in Q1.

Eurogroup Chair Juncker said that a 'return to the drachma is not an option for Greece' and called 2012 a 'key year' for the Eurozone. German Chancellor Merkel announced she will meet with Italian Prime Minister Monti next week.

Germany sold EUR5 bn in 10-year bonds. The official bid to cover ratio was 1.3x. Portugal sold EUR1 bn in 3m T-bills, and the auction was well covered.

The Financial Times reported that Spain expects banks to set aside up to EUR50 bn in new provisions. Citing Economy Minister Guidnos, the report stressed the need for the Spanish banking sector to clean up balance sheets, without leaning too much on central government assistance.

There is increasing scrutiny on Spain's fiscal health, especially that of its regions and banking system. There were reports, later denied, that Spain was seeking IMF and EU help for its banking system. In addition, there were reports that a Spanish region needed help from the central government to repay an overdue loan. This was also denied, but it underscores that even though the Spanish national balance sheet appears to be robust, contingent liabilities from the banking sector and regions may weigh on sentiment, and could add to downside pressure in the euro.

Greek PM Papademos warned that the country faces risk of a disorderly default in March without a bailout deal, and everything is to be determined in the coming weeks.

On Thursday, German retail sales and Eurozone industrial new orders are due.
GBP
UK PMI construction surprised to the upside at 53.2, while consumer credit numbers were also robust at ?0.4bn. Mortgage approvals increased slightly to 52.9k. However, M4 money supply continued to decline, falling by 0.6% m/m.

Sterling has rallied strongly of late but we expect growth headwinds to weigh more on sentiment ahead. A weaker than expected reading in today's important services PMI could prompt the market to reappraise its view on sterling's prospects.

AUD
Australia's trade surplus for November came in weaker than expected at a 9-month low. Although AUD was unperturbed, our Australia economics teams observe that iron ore and coal exports - Australia's two main exports - fell quite sharply. This provides the first tangible evidence that softening external conditions are beginning to have a negative impact on the domestic economy.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

4th of January 2012 - Technical Forex Market Overview

2012-01-04T04:02:00.001-05:00

DAILY MARKET COMMENTARY
4 January 2012 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Momentum is negative; initial support lies at 1.2904 ahead of key low at 1.2858. Resistance is at 1.3119.

USDJPY BEARISH Support lies at 76.33, a move below which would open key low of 75.35. Near-term resistance is at 77.17.

GBPUSD BEARISH Break below 1.5469 would open 1.5402 next. Resistance is at 1.5692 ahead of the upside trigger at 1.5728.

USDCHF BULLISH Resistance is at 0.9470, a clearance of which would expose the key high of 0.9548. Key support lies at 0.9244.

AUDUSD BULLISH Pair tested the key resistance of 1.0380, a clear break above this level would open the way for 1.0447 and 1.0496. Support is at 1.0233.

USDCAD BEARISH Key support lies at 1.0052, a break below which would open 0.9975. Resistance is at 1.0220.

EURCHF BEARISH Initial support lies at 1.2126 ahead of key low at 1.2012. Resistance is at 1.2254.

EURGBP BEARISH Focus is on 0.8303, a push below which would expose 0.8285, January 2010 low. Resistance is at 0.8426.

EURJPY BEARISH Near-term support lies at 99.42 ahead of key low 98.66. Resistance is at 100.93.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

4th of January 2012 - Fundamental Forex Market Overview

2012-01-04T04:01:00.000-05:00

DAILY MARKET COMMENTARY
4 January 2012 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Markets mostly trod water during the Asia session as the absence of news headlines and G10 economic data releases provided no incentive to participate. It was Japan's first day back after the holiday season, but activity is still well below typical daily levels. The FOMC minutes from the December meeting confirmed that several members are still uncomfortable with the current pledge to keep rates unchanged until mid-2013. This should not come as any surprise given three dissenting votes were cast when the policy language was first adopted. Of greater interest were plans to change the Fed's communication strategy. This strategy has been in flux for over a year now and, as a result, the Fed Chairman now gives post-meeting press conferences four times per year.

The December minutes revealed yet another innovation - at the January meeting the Fed will provide projections on how policymakers think the Fed Funds target will move in the future, and these forecasts will be updated quarterly along with the wider set of quarterly economic forecasts already provided. This would be a first for the Fed, but is (somewhat) similar to the approach already used by the Riksbank where a view on the future path of the repo rate is given. This latest Fed initiative did not come out of the blue - it had been flagged weeks ago in the Wall Street Journal.

The new approach is likely to provide greater clarity and granularity on the Fed's policy intentions. It is also likely to offer the Fed greater flexibility in tweaking its guidance, rather than relying entirely on the written word. We doubt the dollar will be negatively impacted by the new approach alone unless the rate forecasts suggest an inert Fed beyond mid-2013. This is a risk we are watching. Still with the US, the economy has maintained its upward momentum as ISM manufacturing surprised to the upside at 53.9 (cons. 53.5), and construction spending was also firm. EURUSD traded in a range of 1.3049-1.3077 and USDJPY 76.62-76.82.

EUR
The EFSF plans to issue a new EUR3 bn 3-year bond "in the near future, subject to market conditions". The bond is intended to fund the rescue programmes for Ireland and Portugal. This would be the fifth bond issued in support of these two programmes, and would take outstanding EFSF issuance to EUR19 bn. We note that the EFSF has a triple-A issuance capacity of EUR440 bn, although a possible downgrade of France could lower this ceiling considerably.

Bundesbank President Weidmann stuck to his stance that it would be wrong for the ECB to become a lender of last resort to governments.

A Greek government spokesman said the country must finalise the financial rescue agreement which was reached with the EU in October, or "we will be out of the markets, out of the euro".

German unemployment fell by 22k, larger than the 10k decline expected by consensus. The jobless rate edged down to 6.8% from 6.9%, hitting yet another euro-lifetime low.

According to newswire sources, the IIF said it must have a Greek debt deal done in the 'days ahead' on the basis of the Oct. 26/27 agreement. We still see a strong risk of coercive (as opposed to voluntary) restructuring by Greece this year, accompanied by a triggering of CDS contracts. We very much doubt the risk is fully reflected in the price of the euro, and would look for further euro downside if headlines suggested a coercive restructuring was being pursued.

French government sources said the country has still not been notified of any change to its AAA rating by S&P. France was put on negative watch on Dec. 5 (along with 14 other Eurozone nations) largely pending the outcome of the Dec. 9 EU summit.
CHF
December PMI was surprisingly strong at 50.7 vs consensus of 45.6. Our Swiss economist notes that the two most important sub-indices, production (56.1) and to a lesser degree order backlog (53.5) managed to move back into expansionary territory at the end of 2011. This very good print supports the argument that the SNB's floor under EURCHF is having a stabilising effect on Switzerland's production sector, as is the somewhat improved business sentiment across Europe.

This week, we went long EURCHF at 1.2155 targeting a move up to 1.2500, with a stop at 1.1990.

GBP
Sterling caught a bid after UK December manufacturing PMI rose to 49.6, vs consensus of 47.4. Export orders rose at the fastest pace since April. This is still weak on a quarterly comparison, but is showing signs of some improvement from earlier in the quarter.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

3rd of January 2012 - Technical Forex Market Overview

2012-01-03T03:06:00.001-05:00

DAILY MARKET COMMENTARY
3 January 2012 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

USDCAD 1.0126 support

EURUSD BEARISH The pair is undergoing correction; decline through the key low of 1.2858 would open the way for losses towards 1.2600. Resistance is at 1.3119.

USDJPY BEARISH Initial support lies at 76.33 ahead of the key low of 75.35. Resistance is at 77.17.

GBPUSD BEARISH Support lies at 1.5469, a break below which would open 1.5402 next. Resistance is at 1.5572 ahead of 1.5728.

USDCHF BULLISH Resistance is at 0.9470, a clearance of which would expose the key high of 0.9548. Support lies at 0.9307.

AUDUSD BULLISH Momentum is positive; our focus is now on 1.0380, a move above which would open 1.0447. Support is at 1.0196.

USDCAD BEARISH Pressure is on 1.0126, a break below this would open 1.0052. Resistance is at 1.0220.

EURCHF BEARISH Initial support lies at 1.2126 ahead of key low at 1.2012. Resistance is at 1.2254.

EURGBP BEARISH Focus is on 0.8303, a push below which would expose 0.8285, January 2010 low. Resistance is at 0.8426.

EURJPY BEARISH Initial support lies at 98.66 ahead of 97.89. Resistance is at 100.00.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

3rd of January 2012 - Fundamental Forex Market Overview

2012-01-03T03:05:00.000-05:00

DAILY MARKET COMMENTARY
3 January 2012 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Risk currencies got off to a good start overnight with most of Asia returning from the holiday season. A strong non-manufacturing China PMI helped to keep risk sentiment supported, although the rise in FX was already underway. This latest data print complements China's manufacturing PMI released over the weekend which was also surprisingly firm. AUD, the chief beneficiary, briefly touched 1.0300 having spent the past three weeks trading below, and NZD is firmly back above 0.78. EURUSD also reached higher ground, trading in a range of 1.2922-1.2989.

In contrast with the good news from China, Eurozone growth remains sluggish. Yesterday's pan-Eurozone December PMI was confirmed at only 46.9, and with many member states either embarking on or accelerating their austerity programs, all the signs are that 2012 will be difficult year. Italian and Spanish sovereign debt auctions are not due until next week, allowing investor attention on US economic data in the interim. ISM manufacturing is due today, and in contrast to Europe further output expansion is expected in the US (cons. 53.4, prev. 52.7).

The political scene is particularly active this year globally, and the Iowa caucuses are also due to be held today, kicking off the US' electoral race in earnest. The economy is expected to dominate popular concern, and the FOMC will also chime in with its own view as the minutes of the last meeting are released. We went long EURCHF overnight, taking advantage of recent weakness in the cross - we look for a move up to 1.25 over the coming weeks.

EUR
German manufacturing PMI came in at 48.4 for December. This was stronger than the previous month's 48.1 print but still showed contraction in output. However, Tuesday's employment figures are expected to provide for more pleasant reading.

Germany and France have consolidated their presence within the ECB as Joerg Asmussen and Benoit Coeure replaced Juergen Stark and Lorenzo Bini-Smaghi on the ECB's Executive Board. These were expected appointments though investors will now watch carefully to see if the central bank will be more willing to compromise on acting as a lender of last resort to governments.

German Chancellor Merkel and French President Sarkozy will meet in Berlin next Monday to consult on further steps to resolve the Eurozone debt crisis. Key topics of discussion may include the agenda for the first EU leaders' summit of 2012, where growth is expected to feature prominently on the agenda, as well as implementation of the December summit's agreements.

The ECB settled EUR462 mln in bond purchases last week, a significant step up from EUR19 mln the week prior but still well short of last year's highs.
CHF
Overnight, we went long EURCHF at 1.2155 targeting a move up to 1.2500, with a stop at 1.1990. On Sept. 6, 2011, the SNB imposed a floor under EURCHF at 1.20 and pledged to buy 'unlimited quantities' of foreign currency to enforce it. Four months of success has boosted the credibility of the floor, and we doubt the 1.20 level will be allowed to give way.

On Friday, December CPI is due, and a weak print is likely to reinforce market opinion that the SNB could eventually raise the currency floor, both to ward off deflationary pressures and to boost Swiss economic activity. Our Switzerland economist is below consensus and expects CPI to drop to -0.7% y/y (cons. -0.6%). Thin trading conditions over the holiday period have allowed the cross to settle back down to levels last seen almost two months ago, presenting an attractive opportunity to get long for a gradual push higher over the weeks ahead.

Swiss PMI is due on Tuesday, we expect a better reading of 46.7 (cons. 45.4) but it is clear the Swiss economy is suffering and pressure on the SNB to act will remain strong. PMI figures are also due in the UK and Norway.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

27th of December 2011 - Technical Forex Market Overview

2011-12-27T03:46:00.002-05:00

DAILY MARKET COMMENTARY
27 December 2011 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Initial support lies at 1.2994 ahead of key low at 1.2946. Resistance is at 1.3091, today's intersection of the trendline drawn off the Oct. 27 high ahead of 1.3197.

USDJPY NEUTRAL Near-term directional triggers are at 78.29 and 77.69.

GBPUSD NEUTRAL Key upside trigger is at 1.5780 with interim resistance at 1.5728. Support lies at 1.5582 ahead of 1.5497.

USDCHF NEUTRAL Resistance is at 0.9415 ahead of key high of 0.9548. Support lies at 0.9307 ahead of 0.9235.

AUDUSD BULLISH Rise through 1.0219 would expose 1.0258. Support lies at 1.0052.

USDCAD BEARISH A break below 1.0168 ahead of key low of 1.0052. Resistance is at 1.0309 ahead of 1.0389.

EURCHF BEARISH Initial support lies at 1.2164, a break below which would expose 1.2123, the Oct. 3 key low. Resistance is at 1.2254.

EURGBP BEARISH Key support is at 0.8303, a decline through which would expose the year-to-date low of 0.8285. Resistance is at 0.8390.

EURJPY BEARISH Key support area is at 101.05/100.76, a violation of which would open the psychological support of 100.00. Resistance is at 102.54.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

27th of December 2011 - Fundamental Forex Market Overview

2011-12-27T03:45:00.002-05:00

DAILY MARKET COMMENTARY
27 December 2011 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Asian markets remained in a holiday mood overnight and FX flows were extremely light. News flow too was thin and Japanese economic data was second-tier and not market-moving. USDCNY fixed at a new low, but the adjustment on the previous fixing was minor, and the headline failed to attract much attention. EURUSD traded 1.3043-1.3077 and USDJPY 77.90-78.03. The minutes of the BoJ's Nov. 15-16 and Nov. 30 policy meetings were released together. The latter was an unscheduled meeting called to discuss the possibility of coordinated action on central bank swap lines - action which was subsequently taken later that day. The board emphasised that Japanese financial institutions were not having difficulty funding themselves in foreign currencies, but that "the possibility could not be ruled out" that Japan's financial system could be "adversely affected should conditions in global financial markets deteriorate further". US economic data is due in the form of house prices and the Conference Board Consumer Confidence reading. Impressed by the recent improvement in jobless claims and housing starts, our US economics team have raised their forecast for Q4 GDP to 3.0% annualised rate from 2.5% previously.

EUR
The ECB announced it settled only EUR0.019 bn worth of sovereign bond purchases in the week ended Friday, down from EUR3.361 bn the week before. This is the slowest pace of buying under the securities markets program since it was reactivated in early August. The total stock of bonds accumulated now stands at EUR211 bn, allowing for the maturation of some of the bonds purchased since the program began in May 2010.
JPY
Finance Minister Azumi said somewhat optimistically that the yen would return to levels reflecting the real state of the economy when the European and other crises are solved. He said the strong yen was partly to blame for Japan's export weakness in Q4.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

23rd of December 2011 - Technical Forex Market Overview

2011-12-23T03:38:00.006-05:00

DAILY MARKET COMMENTARY
23 December 2011 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Initial support lies at 1.2994 ahead of key low at 1.2946. Resistance is at 1.3197.

USDJPY NEUTRAL Pair is trading in a narrow range with directional triggers at 78.29 and 77.49.

GBPUSD NEUTRAL Key resistance is at 1.5780 ahead of 1.5889. Support lies at 1.5497 ahead of 1.5465.

USDCHF NEUTRAL Support lies at 0.9235 ahead of 0.9176. Resistance is at 0.9415 ahead of key high of 0.9548.

AUDUSD NEUTRAL Resistance is at 1.0219 ahead of 1.0258. Support lies at 1.0052 ahead of 0.9895.

USDCAD BULLISH Near-term resistance is at 1.0309 ahead of 1.0389. Key support is at 1.0194.

EURCHF BEARISH Initial support lies at 1.2164 ahead of 1.2123, the Oct. 3 key low. Resistance is at 1.2254.

EURGBP BEARISH Support is at 0.8303, a decline through which would expose the year-to-date low of 0.8285. Resistance is at 0.8390.

EURJPY BEARISH Key support area is at 101.05/100.76, a violation of which would open the psychological support of 100.00. Resistance is at 102.54.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

23rd of December 2011 - Fundamental Forex Market Overview

2011-12-23T03:38:00.003-05:00

DAILY MARKET COMMENTARY
23 December 2011 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
Flows were very light in Asia as markets gradually wind down for the holiday season.

The Wall Street Journal reports that the Fed is reconsidering the policy rate guidance it provided in August - when it signalled that rates would likely stay at zero until mid-2013. The article says the FOMC is poised to revamp its policy communication strategy at the Jan. 25 policy meeting, and could indicate that rates are likely to stay near zero until 2014 or beyond. The report cited FOMC members' fear of weak economic conditions as the reason to move to an even more dovish stance.

Also, a day after the ECB engaged in 'quasi-QE' via its 3-year refinancing operation, outgoing Executive Board member Bini-Smaghi stated in an interview with the Financial Times that quantitative easing should be an option for the ECB if deflation risks were to emerge. We note that the recent data prints out of Germany and the ECB's own inflation forecasts still suggest outright ECB QE (outside of the SMP mandate) is not on the horizon, but we have seen over the last two years that previous taboos in the Eurozone have been broken one by one, and the same could happen again.

In the US, Q3 GDP figures were revised lower to 1.8%y/y. The University of Michigan Index also came in weaker than expected at 68.0 (cons. 69.9). However, jobless claims were again lower than expected, creating a visible downtrend which suggests the US labour market may be in better shape than commonly assumed. On Friday, Canadian GDP is due and the US will have the durable goods and personal income and spending report for November.

EUR
In an interview with the Financial Times, the ECB's outgoing Executive Board member Bini-Smaghi said that he 'did not understand the quasi-religious discussion' over quantitative easing. He acknowledged that the US and the UK are adopting current measures because the central banks of these countries saw strong deflation risk, whereas this is so far not the case for the Eurozone. However, he also stated 'But if conditions changed and the need to further increase liquidity emerged, I would see no reason why such an instrument, tailor made for the specific characteristics of the euro area, should not be used.'

On the SMP programme, Bini-Smaghi refused to commit to any explicit form of action, such as purchase or yield targets. However, he called for 'constructive ambiguity' on the matter and noted that central banks still need to be mindful of their mandates. ECB President Draghi has stressed in the past that acting as a lender of last resort to governments is not in the ECB's mandate.

The Portuguese government announced that a Chinese State-Owned Enterprise had won the auction for its 21% stake in a major energy company. This is an example of how we believe China will chose to help the Eurozone - via strategic acquisition of assets rather than an increase in bond purchases or greater IMF support.
GBP
UK Q3 GDP was revised higher slightly to +0.6% q/q from +0.5% y/y. Our UK economist noted that this trend-like pace in Q3 comes after a very poor holiday and weather disrupted Q2. In fact, Q2 data was revised down from 0.1% to 0.0%. Forward-looking indicators point to a stagnant economy in Q4.

The UK current account deficit for Q3 was much wider than expected at GBP15.2 bn from GBP7.4 bn last, expanding to 4% of GDP. We note that the quarterly data is volatile and prone to revision and that the trend thus far has been for the trade deficit to narrow after the currency depreciation in 2008.

NZD
Moody's affirmed New Zealand's sovereign rating at AAA, outlook stable. The agency did observe though that the rating could face downward pressure if the upward trend in public debt was not corrected. We note that both S&P and Fitch already cut the rating one notch to AA+ on Sept 29.

Another earthquake, measuring 5.9, struck Christchurch during the Asia session. NZD briefly fell 20 pips but soon recovered fully.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

21st of December 2011 - Technical Forex Market Overview

2011-12-21T04:33:00.001-05:00

DAILY MARKET COMMENTARY
21 December 2011 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Near-term support lies at 1.2994 ahead of key low at 1.2946. Resistance is at 1.3146.

USDJPY NEUTRAL Key directional triggers are at 78.29 and 77.49.

GBPUSD NEUTRAL Resistance is at 1.5735 ahead of 1.5780, the Nov. 30 key high. Support lies at 1.5497 ahead of 1.5465.

USDCHF NEUTRAL Support lies at 0.9235 ahead of 0.9176. Resistance is at 0.9415 ahead of key high of 0.9548.

AUDUSD NEUTRAL Initial support lies at 1.0060 ahead of key low at 0.9861. Resistance is at 1.0182 ahead of 1.0258.

USDCAD BULLISH Resistance is at 1.0309, a move above which would expose 1.0389. Key support is at 1.0194.

EURCHF BEARISH Key supports to watch are at 1.2123 and 1.2012. Resistance is at 1.2254.

EURGBP BEARISH Break below 0.8356 has opened support at 0.8332 and then 0.8308. Resistance is at 0.8390.

EURJPY BEARISH Support lies at 101.38 ahead of 100.76, the year-to-date low. Resistance is at 102.49.

SCHEDULE

Please visit our Economic Calendar for a for a schedule of market news and events: http://www.fibosignals.com/5585/calendar.html.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

21st of December 2011 - Fundamental Forex Market Overview

2011-12-21T04:32:00.001-05:00

DAILY MARKET COMMENTARY
21 December 2011 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The Bank of Japan left policy entirely unchanged at its meeting overnight, as widely expected. Market focus is now fixed squarely on Europe again as the ECB gears up for the first of two three-year LTROs. By all accounts, the take up is expected to be strong and, if so, markets would likely interpret this as a positive development. Asian equities and the AUD in particular were stronger overnight, partly in anticipation of what the liquidity injection will mean for risk appetite. Not only will some of the funding be recycled back into government debt, but the release of abundant liquidity would also secure bank financing over the coming year. We still believe it is difficult to reconcile a government desire for banks to continue buying debt with the need for banks to reduce risk exposure associated with government debt, but it appears all parties involved want to use the tenders as a stop-gap while governments move forward with the fiscal compact in the Eurozone. In other news, economic data continues to surprise to the upside in the US, but also in Germany. New Zealand current account figures were also released overnight, which showed a wider than expected deterioration to -N$4.6bn. EURUSD traded 1.3072-1.3127 and USDJPY 77.76-77.91. The BoE minutes are also scheduled for release shortly before today's LTRO announcement.

EUR
The German IFO rose to 107.2 in December. The print confirms that the domestic economy remains on very solid footing despite what is going on in the periphery. However, this also means that the German sense of urgency remains subdued.

A Spanish bill auction was well received. The Tesoro sold EUR5.64 bn of bills, above the target once again. This indicates that better market conditions are helping to offload supply, although the recent success may also be due to the upcoming LTRO. Market expectations for the amount of liquidity allotted vary widely, but average around EUR 250 bn. Our European economists are looking for a take-up in the LTRO of around EUR320 bn. The result is due to be released at around 10:15 GMT.

Reuters reported that 10 Italian banks are now looking to use the 3-year operation and have requested, and obtained Italian State Guarantees on bank bonds to enable their use as collateral for the ECB tender. Similar schemes have been adopted by both Irish and Greek governments to allow their banks to access cheaper ECB funding. Although banks can obtain funding this way, this does increase the ECB's exposure to the government's overall credit position.

Eurogroup chair Juncker said that Europe does not give the impression abroad that it is doing everything possible to save the euro. However, he warned that there is no political alternative to reducing debt. The comments come amid concerns that national austerity programmes are damaging growth prospects, with the IMF announcing it was bringing forward financing earmarked for Ireland, though the fiscal targets remain unchanged.

Fitch has put several Eurozone banks on downgrade watch after their corresponding sovereigns were hit with similar warnings. The agency warned that it was 'not expected' to resolve France's negative outlook until 2013.

European Union President Van Rompuy confirmed that the next EU leaders summit will be on January 30th. This date had been moved several times until today's announcements. He said that the summit will focus on jobs, and the need to 'take strong action on employment'.
GBP
Moody's warned that the UK's headroom to maintain its AAA rating had diminished, citing the Eurozone's current economic and financial troubles. It said that the UK's rating may be less able to absorb shocks, though the agency said this was merely an annual review of the ratings itself and not outright action being taken. The UK Treasury welcomed the statement.

The Bank of England will likely remain dovish in its December MPC meeting minutes due on Wednesday. We expect the vote on both policy decisions to remain unanimous.

JPY
The Bank of Japan kept its policy rate unchanged at 0-0.1%, and made no adjustments to either its asset purchase or lending programs.

R&I ratings, Japan's domestic credit rating agency, cut the long term sovereign rating one notch to AA+ from AAA. USDJPY only climbed 5 pips in response. R&I warned on Nov. 30 that the rating was vulnerable, so today's move was not a surprise. Moody's, S&P, and Fitch have rated Japan below triple-A for over a decade.

NZD
New Zealand's current account deficit in the third quarter widened to NZ$4.6bn, much larger than market expectations of NZ$3.8bn. The 12m to Q3 deficit also widened to $8.68bn (cons. NZ$7.95bn).

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

20th of December 2011 - Technical Forex Market Overview

2011-12-20T03:25:00.003-05:00

DAILY MARKET COMMENTARY
20 December 2011 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Pair is consolidating above 1.2946; a move below this would open 1.2867, the Jan. 10 key low. Resistance is at 1.3146.

USDJPY NEUTRAL Pair is trading sideways with directional triggers at 78.29 and 77.49.

GBPUSD BEARISH Initial support lies at 1.5465 ahead of key low at 1.5409. Resistance is at 1.5630.

USDCHF BULLISH Tough support lies at 0.9331; as long as this level holds, watch out for a break above 0.9548 to expose 0.9602.

AUDUSD BEARISH Key support lies at 0.9861; a break below this would expose 0.9833. Resistance is at 1.0045.

USDCAD BULLISH Key resistance is at 1.0424, a violation of which would open 1.0474. Support is at 1.0298.

EURCHF BEARISH Momentum is negative; two key supports to watch are at 1.2123 and 1.2012. Resistance is at 1.2254.

EURGBP BEARISH Key support area is at 0.8373/56; a break below this would expose 0.8332 next. Resistance is at 0.8426.

EURJPY BEARISH The cross is consolidating above 100.76; a break below this would open the psychological level of 100.00. Resistance is at 102.49.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

20th of December 2011 - Fundamental Forex Market Overview

2011-12-20T03:25:00.000-05:00

DAILY MARKET COMMENTARY
20 December 2011 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The Eurozone's finance ministers' conference call managed to secure fresh resources for the IMF, though again there was a distinct lack of unanimity. Only four non-Eurozone nations agreed to participate. It had been hoped that the fund's resources could be boosted to EUR200 bn but instead only EUR150 bn was pledged. The IMF said it 'welcomed' the 'substantial' boost to its resources, though there are some strict conditions attached to prevent the impression that the funding lines via Eurozone national central banks is simply debt monetization by stealth. The Eurozone financial leadership yet again failed to agree upon an expansion in resources for the combined EFSF and ESM, which still stands at EUR500bn amid stiff German opposition. The RBA minutes produced little in the way of surprises. The Japanese government again announced plans to boost its FX intervention capacity, but there was no currency reaction. EURUSD traded 1.2988-1.3020 and USDJPY 77.92-78.06. The Riksbank policy decision is due.

EUR
The Eurozone's 17 finance ministers agreed to provide EUR150 bn for the IMF, while the Czech Republic, Denmark, Sweden and Poland will also provide supplementary financing. The allocations will go into the IMF's general fund, and may in principle be used to fund future IMF rescues, though not exclusively those inside the Eurozone.

The Bundesbank said Germany is set for a long upswing as the expansive monetary policy should support growth.. It sees inflation at 1.8% in 2012 and 1.5% in 2013.

ECB member Noyer said that the restoration of confidence will be a difficult and lengthy task. He said it is important the ECB continues to ensure price stability, and that its interventions relate only to the preservation of medium-term price stability. Large-scale government bond purchases are seen as well beyond the ECB's role as lender of last resort however.

In his testimony before the European parliament ECB President Draghi affirmed his belief in the euro, and said he had 'no doubts whatsoever over its strength, its permanence and irreversibility'. He again clearly underlined opposition to monetary financing, while warning that banks are not only short of funding but also capital. Investors will be watching the take-up of Thursday's three-year LTRO closely to see whether fresh ECB funding for banks may be large enough to alleviate sovereign stress.

ECB Executive Board member Bini-Smaghi said the ECB had never been 'dogmatic' about interest rates. He also said that the size of bond purchases needs to be determined from 'time to time', but acknowledged the need for financial stability, as without it there wouldn't be any price stability.

On Tuesday the German IFO survey is out. The market is looking for a slight decline in the business climate print to 106.0, from 106.6 last month. We are below consensus and look for a dip to 105.5 The GfK survey and producer price numbers will also be released.
GBP
UK consumer confidence rebounded in November off October's record low. Although it came in above expectations at 40 (cons. 36), sterling was slow to benefit.

BoE MPC member Fisher said that downside risks to the UK economy arising from the Eurozone are bigger than those due to inflation. He said the situation is potentially more dangerous than in 2008. He also said that deflation is also a bigger risk than inflation staying high.

The Bank of England will likely remain dovish in its December MPC meeting minutes due on Wednesday. We expect the vote on both policy decisions to remain unanimous.

Rightmove housing prices showed another sequential decline, of 2.7%m/m. However, prices remain 1.5% up on an annualised basis.

JPY
Finance Minister Azumi announced plans to increase Japan's FX intervention firepower by raising the amount of bill issuance that can be used to fund intervention operations. The newly-proposed ceiling is JPY 195 trn, up from JPY 165 trn currently, although parliamentary approval will be needed before the change can take effect. If successful, this will be the third time since 2010 that the limit has been raised. The latest move suggests Japan has every intention of continuing its policy of sporadic FX intervention, although the yen did not react to the announcement.

Azumi added that Japan intends to diversify some of its FX reserves into CNY bonds, noting that there are advantages to both Japan and China if they hold each other's bonds. The Nikkei newspaper had earlier reported that Japan intends to buy up to $10 bn worth of CNY bonds, on a phased basis. We note that this amounts to less than 0.1% of Japan's total FX reserves, and we agree with Azumi that these purchases are not likely to affect the USD.

AUD
The minutes were released from the Dec. 6 RBA policy meeting where the cash rate was cut by 25 bp. The Board seemed anxious about the sovereign debt crisis in Europe, and were extremely uncertain over how it would be resolved. Our Australian economists think the RBA is in a 'wait and see' mode as far as the need for further rate cuts is concerned, and they stick to their view that a further 25 bp cut will likely materialize in February.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

19th of December 2011 - Technical Forex Market Overview

2011-12-19T04:30:00.002-05:00

DAILY MARKET COMMENTARY
19 December 2011 – 8:00 GMT
Monday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Key support is at 1.2946; a break below this would open 1.2867, the Jan. 10 low. Resistance is at 1.3084.

USDJPY NEUTRAL Near-term directional triggers are at 78.29 and 77.49.

GBPUSD BEARISH Key downside trigger is at 1.5409 with interim support at 1.5434. Initial resistance is at 1.5557.

USDCHF BULLISH Pressure is on support at 0.9331; as long as this holds, watch out for a break above 0.9548 ahead of 0.9602.

AUDUSD BEARISH Focus is on 0.9861; a break below this would expose 0.9833. Resistance is at 0.9993.

USDCAD BULLISH Key upside trigger is at 1.0424, a violation of which would open 1.0474. Support is at 1.0298.

EURCHF BEARISH Initial support is at 1.2123, key low from Oct. 3. A break below this would open 1.2012, Sept. 19 low. Resistance is at 1.2398.

EURGBP BEARISH Tough support lies at 0.8356; a break below this would expose 0.8332. Resistance is at 0.8426.

EURJPY BEARISH The cross is consolidating above key support at 100.76; a break below this would open the psychological level of 100.00. Resistance is at 102.99.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

19th of December 2011 - Fundamental Forex Market Overview

2011-12-19T04:30:00.001-05:00

DAILY MARKET COMMENTARY
19 December 2011 – 8:00 GMT
Monday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
North Korean media announced that leader Kim Jong-il died over the weekend, sending USDJPY briefly higher. Officials from Japan and the Republic of Korea stressed that both countries remain on their guard, although the yen recovered when fears of an immediate military reaction receded. Although Kim Jong-il had already picked his third son Kim Jong-un as the next head of state, a smooth leadership transition is by no means guaranteed, and we remain cautious on the yen in the immediate future given the headline risk.

Late on Friday, Fitch put the ratings of several Eurozone countries on review and lowered the outlook on France to 'negative' from 'stable'. We note that S&P already has France's rating on review and, Fitch's move does not break new ground. However, Fitch also warned that a comprehensive solution for the Eurozone debt crisis is 'beyond reach' - a comment which may reinforce market concerns that an elegant solution to the crisis may not be politically possible. Moody's downgraded Belgium by two notches to Aa3 after keeping it on review for two months. Although the market is better prepared for further ratings action, the risk of more bad news on this front before the year-end is likely to keep investors on the edge. The Riksbank is scheduled to announce its policy decision later this week, while GDP figures are due in several countries.

EUR
Fitch put six Eurozone countries ratings watch negative and also lowered the outlook on France to negative. The countries affected were Belgium, Italy, Spain, Slovenia, Cyprus and Ireland. This comes on the back of S&P announcing a review of 15 of the 17 Eurozone countries two weeks ago. The market is continuing to watch for any S&P decision for France, as S&P had previously noted it would make a decision as soon as the European Union summit concluded.

Moody's lowered Belgium's rating from Aa1 to Aa3, with a negative outlook. The agency warned that risks from deterioration in funding conditions would hurt Belgium and the government's efforts to push through fiscal consolidation.

In a Financial Times interview, ECB President Draghi again indicated his opposition to ramping up ECB bond purchases. He also broached the subject of Eurozone exit - he said that leaving would not help the exiting country given that inflationary pressures would be unleashed, and given austerity measures would still need to be introduced. He also rejected the suggestion that it would be good for the remaining Eurozone countries if a weak country were to leave. His rationale is that a Eurozone exit by a single country would amount to a "substantial breach of the existing treaty", and once that line is crossed "you never know how it ends really". ECB President Draghi is due to speak again at 15:30 GMT today.

ECB Executive Board member Bini-Smaghi said the ECB had never been 'dogmatic' about interest rates. He also said that the size of bond purchases needs to be determined from 'time to time', but acknowledged the need for financial stability, as without it there wouldn't be any price stability.

ECB Executive Board Member Stark explained his reasons for resigning this year in an interview. He expressed dissatisfaction with state of the monetary union and its direction. He stressed "It's a fundamental orientation of this monetary union, to forbid the monetary financing of government debt through the ECB. He also said that the ECB's bond buying program is limited in its scope, and that the bank cannot indefinitely increase its balance sheet.
GBP
UK Deputy Prime Minister Clegg described recent comments from France on the UK's economy as 'unacceptable' and called for the rhetoric to be calmed. However, he warned that Britain could be 'isolated' from Europe due to recent decisions at the European Union Summit.

Ahead this week, the Bank of England will likely remain dovish in its December MPC meeting minutes due on Wednesday. We expect the vote on both policy decisions to remain unanimous.

Markets are also likely to focus on November public finance data. The government revised up its forecast for the fiscal deficit from ?122bn to ?127bn for the current fiscal year in the Autumn Statement. We agree with its new forecasts.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

16th of December 2011 - Technical Forex Market Overview

2011-12-16T03:19:00.003-05:00

DAILY MARKET COMMENTARY
16 December 2011 – 8:00 GMT
Friday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Support lies at 1.2946; a break below would open key support at 1.2867, Jan. 10 low. Resistance comes in at 1.3176.

USDJPY NEUTRAL Key directional triggers are at 78.29 and 77.49.

GBPUSD BEARISH Break below 1.5409 would expose key low at 1.5272 from Oct. 6. Initial resistance is at 1.5589.

USDCHF BULLISH As long as support at 0.9331 holds, watch out for a break above 0.9548 ahead of 0.9602. Key support lies at 0.9331.

AUDUSD BEARISH Decline through 0.9861 would expose 0.9833. Resistance is at 1.0045.

USDCAD BULLISH Near-term resistance is at 1.0356; a move above this would open 1.0424. Support is at 1.0282.

EURCHF BEARISH Break below 1.2226 has opened 1.2123 ahead of 1.2012. Resistance is at 1.2398.

EURGBP BEARISH Key support lies at 0.8356; a break below this would expose 0.8332. Resistance is at 0.8426.

EURJPY BEARISH Tough support is at 100.76, a break below this would open the psychological level of 100.00. Resistance is at 102.99.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

16th of December 2011 - Fundamental Forex Market Overview

2011-12-16T03:19:00.001-05:00

DAILY MARKET COMMENTARY
16 December 2011 – 8:00 GMT
Friday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The EUR has traded back above 1.30 amid tight ranges as activity winds down towards the holiday season. Nonetheless there still wasn't much reason to be cheerful - IMF Chairman Lagarde said that the global economic outlook is gloomy, and no region and country is immune. She said that all countries must take action to improve growth. Earlier, EURCHF fell 1 big-figure after the SNB offered no change in policy at today's meeting. The statement was largely a repeat of the September one and they do not appear to see the inflation outlook as having deteriorated enough to justify action at this point. The bottom of the outlook is now seen at -0.8% in Q1 compared to -0.5% in Q2.

For EURCHF, the situation is pretty much unchanged from before the statement: the threat of moving the floor higher at some point remains very much alive. Elsewhere risk appetite stabilised, the euro remains around the 1.30 level. Reuters cited EU diplomats as saying another EU summit is expected to be held Feb. 7-8 in Brussels. This could be the growth summit which has been mentioned in recent days, although further details were lacking. The US remains somewhat of a bright spot though, as yesterday's labour market figures showed jobless claims falling sharply to the lowest level in more than three years, to 366k. The current account deficit also shrank to below 3% of GDP, showing that US rebalancing is continuing. However, this implies weaker domestic consumption and with UK retail sales numbers also disappointing to the downside yesterday, emerging markets will struggle to find alternative growth sources and this will remain a drag on sentiment heading into the next year. EURUSD traded in a range of 1.3013-1.3044, USDJPY 77.80-77.91. Ahead today CPI is due in the US. Our economists note that the 0.1% decline in the overall CPI that we forecast for November (cons: +0.1%) reflects another fall in energy prices.

EUR
Reuters cited EU diplomats as saying another EU summit is expected to be held Feb. 7-8 in Brussels. This could be the growth summit which has been mentioned in recent days, although further details were lacking.

Yesterday's Spanish auction passed successfully. The Tesoro allotted around 6bn euros in total, well above the original target level. Our fixed income strategists note that this puts Spain's funding back in line with the 2011 target of EUR94 bn. This was Spain's last bond auction in 2011

Eurozone manufacturing PMI for December came in at 46.9, better than expectations for 46.0, and after 46.4 in November. The services sector PMI came in at 48.3, better than expectations for 47.0 and after 47.5 in November. The composite measure was 47.9, ahead of expectations for 46.5, and after 47.0 in November.

Late during the US session, Fitch downgraded five big European commercial banks by one notch each, pointing to 'stronger headwinds facing the banking industry as a whole'.

German Chancellor Angela Merkel spoke to the bundestag. She said that Europe has embarked on an irreversible process to fiscal union. She added that the UK is still an important partner in the EU despite refusing to back fiscal integration. She also said there are no quick, easy solutions to the crisis, which will last years.

IMF Chief Lagarde said that all countries must work together to resolve Europe's debt crisis. She said that it was important for countries to face the issues, and 'not being in denial'. She also called for patience to allow individual countries to allow the democratic process to run its course.
GBP
UK November retail sales fell to -0.4% m/m and +0.7% y/y, from October's revised +1.0% and +1.1% (preliminary +0.6% and +0.9%) and against forecasts for -0.3% and +0.4%. Clothing and footwear sales improved by 1.1% m/m but were still only 0.1% better on the year. Food sales were down 0.8% m/m and were down 0.6% on the year.

CHF
EURCHF fell 1 big-figure after the SNB offered no change in policy at today's meeting. The statement was largely a repeat of the September one and clearly they do not see the inflation outlook as having deteriorated enough to justify action at this point. The bottom of the outlook is now seen at -0.8% in Q1 compared to -0.5% in Q2. For EURCHF, the situation is pretty much unchanged from before the statement: the threat of moving the floor higher at some point remains very much alive

SNB Chairman Hildebrand said the central bank doesn't see any "sustained" drop in prices, but rather "temporarily negative" inflation rates. These comments explain why they did not take action. He blames deflation in October-November on import prices, but reiterates that the SNB stands ready to act if necessary "at any time".

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

14th of December 2011 - Technical Forex Market Overview

2011-12-14T02:38:00.002-05:00

DAILY MARKET COMMENTARY
14 December 2011 – 8:00 GMT
Wednesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURUSD BEARISH Break below key supports at 1.3146 and 1.3047 has reinforced the bear trend. Next supports are at 1.2962 and 1.2867. Resistance is at 1.3237.

USDJPY NEUTRAL Key resistance is at 78.11 a break above this would open 78.29; key support lies at 77.49.

GBPUSD BEARISH Yesterday's sharp move broke through 1.5459 to open 1.5423, key low from Nov. 25. Next support is at 1.5272. Initial resistance is at 1.5630.

USDCHF BULLISH Rise through 0.9401 signals extension of gains towards 0.9506, Feb. 22 high. Next resistance is at 0.9602, Feb 17 high. Support lies at 0.9165.

AUDUSD BEARISH Key supports to watch are at 0.9938 and 0.9833. Resistance is at 1.0163.

USDCAD BULLISH Focus is on resistance at 1.0364, a break above which would open 1.0413, the 76.4% retracement of the decline from 1.0524 to 1.0052. Support is at 1.0168.

EURCHF NEUTRAL A clear break above 1.2474 would favour extension of gains towards 1.2646. Key support lies at 1.2226.

EURGBP BEARISH Trend is bearish; next support is at 0.8384 ahead of 0.8356. Resistance is at 0.8555.

EURJPY BEARISH Key support lies at 100.76, the low from Oct. 4. Resistance is at 102.99.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

14th of December 2011 - Fundamental Forex Market Overview

2011-12-14T02:38:00.001-05:00

DAILY MARKET COMMENTARY
14 December 2011 – 8:00 GMT
Wednesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
The euro's slide south continued overnight amid fresh doubts over the summit's results and implementation strategy. While a headline that the German Chancellor was ruling out raising the upper limits of ESM funding (according to coalition sources) led to some selling, the move was largely option barrier and stop-loss related initially. The news itself is not new but underscored just one of the many aspects of the deal which remains of concern to market. The second problem is more immediate, as the governments which have signed up to the plan are now expressing doubts over the ratification process and whether parliamentary backing could be secured. This threatens a drawn-out process for fiscal consolidation which markets may not have much appetite for.

The rebound in periphery bond yields yesterday is a clear sign of such risks, especially has more downgrades loom across Europe. A second wave of selling came with a disappointing reaction to the FOMC's statement, which contained very little new information and certainly no sign of new easing. Despite speculation of significant changes in communications strategy, the statement merely repeated that "exceptionally low" rates will last through to at least mid-2013. Our US economists note that there was a small change to the wording on inflation; they now say "Inflation has moderated since earlier in the year, and longer-term inflation expectations have remained stable" compared with the previous statement that said inflation "appears to have moderated". Ahead today, Norges Bank will meet to set it's policy rate and the market consensus is for a 25bp cut. While the decision will be close, the ECB's move last week, along with a deterioration in Norwegian data may be enough to sway the decision. External forces have also deteriorated significantly since the last meeting, which will be one of the main points of discussion by Governor Olsen. EURUSD traded 1.3016-1.3052 and USDJPY 77.94-78.04.

EUR
The euro came under heavy pressure once again in the European session. While a headline that the German Chancellor was ruling out raising the upper limits of ESM funding (according to coalition sources) led to some selling, the move was largely option barrier and stop-loss related. The news itself is not new and Merkel has previously voiced her opposition on this subject. This move spilled over into other markets however and sentiment quickly moved back risk averse territory.

The issue of Greek PSI appears to be in trouble once again. Dow Jones reported that the Greek government and private creditors continue to disagree on the proposed 50% bond haircut and it is tough to see how a 90% participation rate will be achieved. The exclusion of PSI in any future bailout was in itself an implicit admission that the PSI idea does not work well, in our view.

EU and IMF officials will meet with Greek Prime Minister Papademos on December 16 as part of the next review. The outcome of this review will be significant, with several large redemptions due in Greece in Q1.

The Bundesbank gave some clarity on the IMF potential agreement. In a letter to the German finance ministry, it said that it is only prepared to provide a bilateral credit line to the IMF if the IMF directly asks for it, and this could only be used by the IMF's General Resources Account. The maximum size would bt EUR 45 bn which would be offered provided that other states make their contributions.

The EFSF sold 1.97 bn euros of new 3-month bills with a bid to cover ratio of 3.2 at an average yield of 0.2222%. Overall it can be viewed as reasonably successful. Similarly, a Spanish auction was well received, where a total of just under 5 bn euros of 12 and 18-month bills were taken by the market. Sources noted that Japan bought about EUR260m of the debt sale, around 13% of total. This was slightly higher than their reported take-up of 10% for the last EFSF bond auction.

German Chancellor Merkel will give a statement to the German parliament tomorrow on the fiscal compact.

Eurozone industrial production is due today, markets are looking for a 2.0% sequential decline in October.
GBP
November CPI came in at +4.8% y/y in November from +5.0% y/y in October, inline with forecasts. The RPI reading was 5.2%, from October's 5.4%. The ONS reported that the biggest downward pressures on inflation came from food (+4.0% y/y, from +5.0% y/y in October); transport (+7.2% from 7.7%); clothing (+2.8% from 3.6%); furniture (5.0% from 5.7%). The biggest upward influences were from alcohol & tobacco, +9.7% from +9.1%.

Our analysts note that this inflation data is unlikely to have any material impact on monetary policy. The MPC expects inflation to fall sharply next year once the effects of energy cost increases and the VAT effect drop out of the comparison.

BoE MPC member Spencer Dale noted that there is scope to increase the bond buying program if nececssary. He said inflation will fall sharply in 2012 and will be below 3% in March next year. He said the Eurozone's crisis is casting a shadow over UK prospects in 2012. Near-term growth has weakened very materially, and funding constraints could lead to tighter credit conditions.

CHF
Swiss PPI is due today, in the last key data print before the December policy assessment. We and the market are looking for a 0.2%m/m decline, in a further sign of escalation in deflation risks.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

13th of December 2011 - Technical Forex Market Overview

2011-12-13T04:13:00.003-05:00

DAILY MARKET COMMENTARY
13 December 2011 – 8:00 GMT
Tuesday

_____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

TECHNICAL DATA

EURGBP clears 0.8486 support

EURUSD BEARISH The pair targets 1.3212; a break here would open 1.3146 next. Near-term resistance is at 1.3386.

USDJPY NEUTRAL The near-term bull and bear triggers are at 78.29 and 76.58 respectively.

GBPUSD BEARISH Support lies at 1.5526 ahead of 1.5459. Key resistance is at 1.5780.

USDCHF BULLISH Recovery through 0.9331 signals scope for further gains towards 0.9401. Support lies at 0.9176.

AUDUSD NEUTRAL Resistance is at 1.0225 ahead of 1.0380. Support lies at 1.0048.

USDCAD NEUTRAL Resistance is at 1.0288, while support lies at 1.0168.

EURCHF BULLISH The cross is consolidating below the key resistance at 1.2474 a break above which would open 1.2646. Key support lies at 1.2226.

EURGBP BEARISH The break of 0.8486 has exposed 0.8456 the 61.8% retrace of the rally from 0.8068 to 0.9084. Resistance is at 0.8554.

EURJPY BEARISH A push below 103.01 would open the key support at 102.49. Resistance is at 104.53.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

13th of December 2011 - Fundamental Forex Market Overview

2011-12-13T04:13:00.001-05:00

DAILY MARKET COMMENTARY
13 December 2011 – 8:00 GMT
Tuesday

____________________________________________________________________
Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
_____________________________________________________________________

FUNDAMENTAL ANALYSIS at 0800 GMT

USD
EURUSD continued its post-summit slide as the market has reverted to the conclusion that not enough has been done. Although some stability measures for financial markets have been welcome, the summit agreements themselves raise plenty of new questions, to which the market is not convinced that the answers would be favourable, such as the ratification process and the relevant democratic mandates by individual EU governments. In addition, investors are also querying whether enough has been done to avoid some major downgrades in the coming weeks and months from all the ratings agencies.

French President Sarkozy appears to be resigned to the fact that his country will lose the coveted AAA rating, which would immediately translate into new questions for the costs of the Eurozone's bailout mechanisms as the underlying guarantees come under strain. Yesterday's gains in Eurozone periphery yields is another warning that the battle to tackle sovereign debt is far from over, and the countries at risk must not count on any immediate reduction in borrowing costs to alleviate the strains of austerity. Ahead today, attention will turn to the Fed. We expect the last meeting of the year to be more about communication policy rather than underlying economics, which in general have remained favourable. We may have to wait until the minutes are released later in the month to get the full details however. EURUSD traded 1.3162-1.3203 and USDJPY 77.84-77.96.

EUR
Fitch said it is too early to judge effectiveness of fiscal compact due to uncertainty in implementation. It added that the ECB is the only truly credible firewall against liquidity and solvency crises in Europe. Earlier, risk assets came under pressure after Moody's reported that the EU summit on Thursday night did not produce the decisive initiatives that had been hoped for. The absence of clear measures to stabilize the credit markets meant that the eurozone remains vulnerable to further shocks, and they would therefore revisit the ratings of all EU sovereigns in Q1 2012.

French President Sarkozy said overnight that the loss of AAA status 'could be overcome' and he would respond 'with a cool head' if it happened. He said it would be 'one more difficulty, but not insurmountable'. S&P warned recently that France could face a 2-notch downgrade.

The Wall Street Journal reported that Fed Chairman Bernanke recently urged the ECB's President Mario Draghi to respond aggressively to the Eurozone crisis.

German Chancellor Merkel will give a statement to the German parliament tomorrow on the fiscal compact. Today EU's Van Rompuy and Barroso will be hosting debate on the EU summit in the EU parliament.

The ECB bought just EUR635 mn of bonds under the SMP last week, well below expectations and a clear sign that the ECB is waiting for European politicians to fully address the underlying problems before any structural change in their policy.

Greek Finance Minister Venizelos says that he hopes to have completed the PSI talks by the end of January.

The European bond markets came under further pressure on Monday, although volumes were low. An Italian 12m auction was relatively well received however, with the yield coming below the market at 5.95%. Germany and Spain will also tap the markets this week in the final major bond supply week of the year.

The ZEW survey is out in Germany today. The market is looking for another decline to 31.0.
GBP
Elsewhere UK Prime Minister David Cameron defended his decision to veto treaty changes at last weeks EU Summit in front of parliament but nonetheless faced strong criticism from the opposition. Domestically, there is concern over the stability of the ruling coalition, as Deputy Prime Minister Nick Clegg called the outcome of the summit 'bad for Britain' which could leave the country marginalized. Cameron reiterated previous comments that IMF funds 'can't be used to support the euro'. We view these as important as they are far more in line with the US/Canadian line on the purpose of the IMF than the recent EU talk. Some may see this as signs of an even deeper rift between UK and Eurozone than already is obvious.

Ahead today CPI is due in the UK and the market is looking for a 0.2%m/m gain in prices, though the annualised figure could fall to 4.8%. RPI is expected to come in at 5.1%, down from 5.4%. The numbers are less relevant given the BoE is already engaging in fresh QE.

AUD
The November NAB survey of business conditions increased to +1.0, from October's -0.4 print. Business confidence was flat at 2.0%, but stronger than the August low of -8.8. Our economists note that overall, recent trends in business conditions suggest the economy's momentum is tracking sideways at a modest pace, though on the positive side sentiment has held well despite the Eurozone's issues.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.

12th of December 2011 - Technical Forex Market Overview

2011-12-12T03:10:00.001-05:00

DAILY MARKET COMMENTARY
12 December 2011 – 8:00 GMT
Monday

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Market Analysis Desk
Foreign Exchange Research: www.fibosignals.com/5585/resources.html
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TECHNICAL DATA

EURUSD BEARISH Near-term support lies at 1.3259 ahead of key low at 1.3212. Resistance is at 1.3487.

USDJPY NEUTRAL Near-term directional triggers are at 78.29 and 76.58.

GBPUSD NEUTRAL Key resistance is at 1.5780 ahead of 1.5889. Support lies at 1.5561 ahead of 1.5526.

USDCHF BULLISH Momentum is positive; the pair approaches key resistance at 0.9331 a break above which would open 0.9401 next. Support lies at 0.9112.

AUDUSD BULLISH Resistance is at 1.0380 ahead of 1.0447. Support lies at 1.0048.

USDCAD BEARISH As long as resistance at 1.0344 is intact, watch for a move below 1.0041 to open 0.9975.

EURCHF BULLISH The cross is consolidating below the key resistance at 1.2474 a break above which would open 1.2646. Key support lies at 1.2226.

EURGBP BEARISH Momentum is negative; key supports to watch are at 0.8486 and 0.8456 the 61.8% retrace of the rally from 0.8068 to 0.9084. Resistance is at 0.8620.

EURJPY BEARISH Support lies at 103.01 ahead of key support at 102.49. Resistance is at 104.53.

A. White
Analyst at Fibosignals.com

DISCLAIMER: Fibosignals.com’s 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 used as investment advice. Fibosignals.com assumes no responsibility or liability from gains or losses incurred by the information herein contained. Opinions, conclusions and other information expressed in this message are not given or endorsed by Fibosignals.com unless otherwise indicated by an authorized representative.