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US Session: Consumer Confidence Sinks to Historical Low Squeezing Risk appetite
January 27, 2009 6:57 PM CET
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G10 Advancers and Decliners vs USD |
| | Gbp | 1.18 |  | | | Jpy | 0.48 | | | | Nzd | 0.25 | |  | Aud | -0.09 | | | Chf | -0.28 | | | Dkk | -0.31 | | | Eur | -0.32 | | | Cad | -0.45 | | | Nok | -1.09 | | | Sek | -1.41 | |
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Global Indexes |
Current Level |
% Change |
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| DJIA futures | 8,065.00 | + 0.35 | | S&P future | 835.50 | + 0.57 | | Nasdaq futures | 1,186.00 | + 0.55 | | FTSE futures | 4,122.00 | - 1.08 | | CAC futures | 2,930.50 | - 0.88 | | DAX futures | 4,302.50 | - 0.64 | | SMI Futures | 5,254.00 | - 1.98 |
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World Markets |
Current Level |
% Change |
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| Crude wti | 43.33 | - 5.25 | | Gold | 897.30 | - 0.67 | | Silver | 12.06 | - 0.08 | | USD Index | 84.61 | - 0.14 | | VIX | 45.01 | - 1.49 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| No Major Events Scheduled | | | |
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Currency Tech |
AUDUSD
R 3: 0.7049
R 2: 0.6845
R 1: 0.6685
CURRENT: 0.6676
S 1: 0.6495
S 2: 0.6419
S 3: 0.6290
EURJPY
R 3: 125.29
R 2: 122.17
R 1: 118.82
CURRENT: 119.07
S 1: 113.75
S 2: 112.50
S 3: 112.10
USDSGD
R 3: 1.5335
R 2: 1.5249
R 1: 1.5120
CURRENT: 1.4964
S 1: 1.4925
S 2: 1.4810
S 3: 1.4759
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Market Brief |
The dollar started slow, but picked up momentum as the risk aversion trade remains in play. The EurUsd slipped 35pips to the mid range of 1.31, while the UsdJpy remained flat at 89 consistent with activity in other asset classes. The GbpUsd continues to battle back gaining 150pips to mid 1.41 level, still a ways to go following last week’s steep drop. Equity markets are slightly higher in the US with the Dow up .7% or 56pts, and the FTSE mostly sideways down a mere 0.3% or 2pts. Bond yields were mixed across the US treasury curve, however in Europe prices rallied strong putting pressure on alternative safe-haven investments. Commodities are lower in both energy and precious metals sectors, gold is holding strong at $900oz and oil declined to $43bbl.
German Ifo beat expectations at 83 vs. the estimate of 81, the data itself is still weak but any positive news is magnified in this environment. Expectations for the business climate remain depressed, and GDP should also retract in union with string of negative data. The risk aversion trade has an overwhelming control over price direction trumping the economic and technical story. Performance in the Euro and Gbp will most likely move in tandem with trends in risk appetite, so watching equities and volatility will be essential. Our bias is for further weakness in the majors against the dollar, but once fundamentals come back into play another sharp correction may be upon boosting some currencies that were oversold.
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Asian Session – Unexpected Rally in Risk Appetite
January 27, 2009 10:17 AM CET
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G10 Advancers and Decliners vs USD |
| | GBP | 2.09 | | | | SEK | 1.89 | | | | EUR | 1.14 | | | | AUD | 1.10 | | | | DKK | 1.07 | | | | NOK | 1.03 | | | | CHF | 0.74 | | | | CAD | 0.59 | | | | NZD | 0.47 | | | JPY | -0.57 | |
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Global Indexes |
Current Level |
% Change |
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| Nikkei 225 Index | 8,061.07 | + 4.93 | | FTSE 100 Index | 4,189.14 | - 0.47 | | CAC 40 Index | 2,952.51 | - 0.09 | | DAX Index | 4,332.65 | + 0.13 | | SMI Index | 5,376.39 | - 0.75 | | DJIA futures | 8,163.00 | + 1.58 | | S&P future | 844.80 | + 1.68 |
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World Markets |
Current Level |
% Change |
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| Gold | 894.37 | - 0.99 | | Silver | 12.01 | - 0.49 | | VIX | 45.69 | - 3.34 | | Crude wti | 47.28 | + 3.38 | | USD Index | 84.06 | - 0.78 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| IFO business climate, index Jan | 81.3 | 82.6 | GE / 9.00 | | IFO current assessment, index Jan | 85.0 | 88.8 | GE / 9.00 | | IFO business expectations, index Jan | 77.9 | 76.8 | GE / 9.00 | | Current account, ¤bn (sa) Nov | -8.0 | -6.4 | E15 / 9.00 | | CBI distributive trades, reported sales Jan | -53.0 | -55 | UK / 11.00 | | S&P/Case-Shiller house price index, % y/y Nov | -18.0 | -18.0 | US / 14.00 | | Consumer confidence, index Jan | 38.0 | 38.0 | US / 15.00 |
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Currency Tech |
AUDUSD
R 3: 0.7049
R 2: 0.6845
R 1: 0.6685
CURRENT: 0.6676
S 1: 0.6495
S 2: 0.6419
S 3: 0.6290
EURJPY
R 3: 125.29
R 2: 122.17
R 1: 118.82
CURRENT: 119.07
S 1: 113.75
S 2: 112.50
S 3: 112.10
USDSGD
R 3: 1.5335
R 2: 1.5249
R 1: 1.5120
CURRENT: 1.4964
S 1: 1.4925
S 2: 1.4810
S 3: 1.4759
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Market Brief |
The Usd was generally stable in the Asian session, after yesterday's significant decline, as risk appetite rallied. The EurUsd traded higher from 1.3140 to 1.3260, while the UsdJpy climbed from 89.00 to 89.88. The Usd, Jpy and Chf have been put on the back foot by a rash of optimism surrounding the stock market, squeeze of short positions and hawkish comments from ECB members. Yesterday, Timothy Geithner was confirmed by the US Senate as the new Treasury Secretary and his first order of business will be to determine whether a new government vehicle will be needed to hold illiquid and troubled assets, which presently weigh down the banking sector's balance sheets. And in other US news, President Obama $825bln stimulus package is expected to meet significant opposition in the US Senate. Despite the improvement in risk appetite, supported by a rally in equity and commodity prices, we expect this sentiment to fade quickly with capital moving back into safe haven trades (supported by an early collapse of gold prices). European equity markets are firm and US futures are pointing to a positive open.
The BoJ minutes from the December meeting clearly illustrated the mounting concern of BoJ members attributable to rapidly failing economic conditions. Members stating economic data were "deteriorating sharply" and conditions were "an emergency". Not really surprising, considering the collapse of recent economic data.
In the European session, the markets will be watching the German IFO survey. Markets are expecting business climate index to have fallen further to 81.0 in January from 82.6 in December. We expect the primary driver of the fall to be due to a decline in current conditions index, as manufacturing sector and construction falter. In a side note, ECB member Weber commented on the official rate, saying that economic data will determine the next move (in-line with Trichet's comments).
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ACM Advanced Currency Markets SA (hereinafter referred as ACM) is a professional financial intermediary, directly regulated by the Swiss Federal Department of Finance, Anti Money Laundering Control Authority. As forex specialist, ACM provides only currency trading via highly professional forex trading software. All customers are aware that this information or any part thereof has been prepared without taking account of your objectives, financial situation and/or needs. This information is not intended as personalized investment advice and does not constitute a recommendation. It is not an offer or solicitation of any offer to purchase or sell any financial instrument. The analysis is based on the information which ACM finds reliable and accurate, but ACM does not assume any responsibility for any material nor for the transactions made on the basis of the information or the estimates of the analysis. ACM cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct, indirect and/or consequential loss arising from any use of this information, document or its content. All opinions and estimates constitute ACM analysis as of the data and are subject to change without notice. ACM does not warrant the accuracy or completeness of information contained herein, such information is subject to change and is not intended to influence your investment decisions. Past performance is not a reliable indicator of future performance.
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