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US Session: Equities and Dollar Both Decline the Correlation may be Breaking
January 07, 2009 11:05 PM CET
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G10 Advancers and Decliners vs USD |
| | Gbp | 1.33 |  | | | Chf | 1.15 | | | | Jpy | 1.08 | | | | Dkk | 0.79 | | | | Eur | 0.74 | | | | Nok | 0.65 | | | | Sek | 0.33 | |  | Cad | -0.91 | | | Nzd | -1.19 | | | Aud | -1.46 | |
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Global Indexes |
Current Level |
% Change |
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| DJIA futures | 8,742.00 | - 2.32 | | S&P future | 920.00 | - 1.13 | | Nasdaq futures | 1,239.75 | - 2.46 | | FTSE futures | 4,470.50 | - 2.89 | | CAC futures | 3,343.00 | - 1.50 | | DAX futures | 4,955.00 | - 1.58 | | SMI Futures | 5,688.00 | - 0.85 |
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World Markets |
Current Level |
% Change |
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| Crude wti | 42.68 | - 12.15 | | Gold | 844.15 | - 2.29 | | Silver | 11.06 | - 3.66 | | USD Index | 82.28 | - 0.69 | | VIX | 43.39 | + 12.53 |
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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: 0.7475
R 2: 0.7355
R 1: 0.7265
CURRENT: 0.7207
S 1: 0.7035
S 2: 0.6920
S 3: 0.6853
EURJPY
R 3: 129.70
R 2: 128.56
R 1: 127.40
CURRENT: 126.58
S 1: 125.18
S 2: 123.70
S 3: 122.57
USDSGD
R 3: 1.4972
R 2: 1.4905
R 1: 1.4895
CURRENT: 1.4748
S 1: 1.4675
S 2: 1.4503
S 3: 1.4330
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Market Brief |
Dollar strength experienced a strong reversal in today’s trading session. The EurUsd rose 100pips to the low range of 1.36, while the UsdJpy dropped a bit over 100pips through 93 to high 92 price area. The GbpUsd surged 200pips pushing the pair back above 1.50 ahead of the BoE rate announcement scheduled for tomorrow. Equity markets deteriorated in the US and Europe, with all the major indexes closing on the negative side. Bond yields were active but have since moderated levels still well below historical averages. Commodities slid across the board with oil down 12% at $42bbl, and gold off 2.4% at $843oz.
Eurozone PPI declined to an annualized rate of 3.3% vs. the consensus figure of 4.4%. This data point is evidentiary to the notion that deflation is growing trend in the region. This will alleviate some of the inflationary concerns expressed by the ECB in recent commentary, therefore allowing room for further easing as anticipated. German unemployment came in worst than expected at 7.6% vs. 7.5% which is key factor in measuring the health within the labor market of the Eurozone’s largest economy. Most of the global deflation trend is due to falling commodity prices which may be a key component in providing any financial stability for consumers. The Euro actually gained despite the negative employment news out of Germany and growing probability of further rate cuts. The market may have overreacted to the ADP employment in the US , which was compounded by negative earnings by technology company Intel and a short-term correction may be on the horizon in EurUsd.
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Asian Session - Australian Retail Sales Improve
January 07, 2009 10:42 AM CET
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G10 Advancers and Decliners vs USD |
| | CHF | 1.54 | | | | JPY | 1.06 | | | | DKK | 0.83 | | | | EUR | 0.71 | | | | SEK | 0.36 | | | | NZD | 0.41 | | | | NOK | 0.22 | | | AUD | -0.02 | | | CAD | -0.15 | | | GBP | -0.65 | |
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Global Indexes |
Current Level |
% Change |
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| Nikkei 225 Index | 9,239.24 | + 1.74 | | Hang Seng Index | 14,987.46 | - 3.36 | | Shanghai Index | 1,924.01 | - 0.67 | | FTSE 100 Index | 4,557.41 | - 1.75 | | DAX Index | 4,964.88 | - 1.22 | | SMI Index | 5,770.50 | - 0.49 | | DJIA futures | 8,879.00 | - 0.78 |
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World Markets |
Current Level |
% Change |
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| Gold | 863.08 | - 0.09 | | Silver | 11.37 | - 1.01 | | VIX | 38.56 | - 1.33 | | Crude wti | 48.20 | - 0.78 | | USD Index | 82.67 | - 0.21 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| Producer prices, % m/m | -1.2 ,4.3y | -0.8 ,6.3y | EZ / 10.00 | | BRC shop price index, % y/y | -- | 2.7 | UK / 10.30 | | ADP private employment change, thous | -485 | -472 | US / 13.15 |
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Currency Tech |
AUDUSD
R 3: 0.7475
R 2: 0.7355
R 1: 0.7265
CURRENT: 0.7207
S 1: 0.7035
S 2: 0.6920
S 3: 0.6853
EURJPY
R 3: 129.70
R 2: 128.56
R 1: 127.40
CURRENT: 126.58
S 1: 125.18
S 2: 123.70
S 3: 122.57
USDSGD
R 3: 1.4972
R 2: 1.4905
R 1: 1.4895
CURRENT: 1.4748
S 1: 1.4675
S 2: 1.4503
S 3: 1.4330
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Market Brief |
The Usd was weaker in the Asian session, as concerns over upcoming US economic data took center stage. The EurUsd traded up to 1.3616 from 1.3450, while the UsdJpy dropped sharply in late session, trading from 94.00 to 93.00. The AudJpy, a current barometer for risk appetite, slipped to 67.00 support from 67.80, despite Nikkei being in positive territory and crude prices falling back to $48.53bll. European equity indexes are trading lower and US index futures are point to a weak open. Yesterday's release of the FOMC Dec 16th minutes highlighted that members were steadfast to holding Fed Funds low for an extended period. In addition, the minutes also exposed potential options the Fed may implement if conventional policy doesnʼt have the desired effect. We are expecting the Usd to be on back footing today, as US economic data comes into focus with the release of ADP employment survey ( a precursor to Fridays NFP).
Yesterday's Eurozone CPI estimate came below expectations at 1.6%y/y vs.1.8% exp. Inflation is expect to continue to drop in the first half of 2009. The combination of weak activity data and low inflation, along with recent dovish commentaries by ECB members, makeS us expect a 50bp cut at next week's ECB meeting, on a path to 1%.
In Australia, November's Retail Sales were released this morning and increased by 0.4% m/m, despite expectations of a -0.4% m/m decline. We have attributed the uptick to the RBA's aggressive rate cuts and declining fuel prices, which have supported spending.
German unemployment unexpectedly rose to 7.6% vs. 7.5% exp this morning, which confirms the downturn in wider economic activity has finally hit the resistant labour market.
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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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