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US Session: Lack Of Fuel For Risk Appetite Allows The Dollar To Rally
October 27, 2009 4:46 PM CET
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G10 Advancers and Decliners vs USD |
| | CAD | 0.32 |  | | | AUD | 0.20 | | | | JPY | 0.16 | | | | GBP | 0.02 | |  | NZD | -0.16 | | | DKK | -0.25 | | | EUR | -0.28 | | | CHF | -0.31 | | | NOK | -0.39 | | | SEK | -1.34 | |
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Global Indexes |
Current Level |
% Change |
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| FTSE 100 Index | 5'215.04 | + 0.45 | | DAX Index | 5'635.52 | - 0.12 | | SMI Index | 6'368.95 | + 1.04 | | S&P 500 Index | 1'069.02 | + 0.19 | | DJIA Index | 9'920.26 | + 0.53 | | Nikkei 225 Futures | 10'230.00 | - 1.25 | | Hang Seng Futures | 22'191.00 | - 1.81 |
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World Markets |
Current Level |
% Change |
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| Gold | 1'039.00 | + 0.05 | | Silver | 16.80 | - 1.64 | | VIX | 24.52 | + 0.86 | | Crude wti | 79.53 | + 1.08 | | USD Index | 76.23 | + 0.23 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| ABC Consumer Confidence, 25 Oct | -49 | -50 | USD/21:00 | | Retail Trade SA, % m/m Sep | 0.2 | 1.0 | JPY/23:50 | | Retail Trade, % y/y Sep | -1.6 | -1.8 | JPY/23:50 | | Wed 28 Oct | - | - | - | | Germany CPI, % m/m y/y Oct | - | - | EUR/- | | CPI, % q/q (y/y) Q3 | 0.9 (1.2) | 0.5 (1.5) | AUD/00:30 | | NBNZ business confidence, index Oct | - | 49.1 | NZD/02:00 | | Consumer Confidence, index Oct | 6.0 | 5.6 | SEK/08:15 | | Manufacturing confidence, index Q3 | -17.1 | -20.0 | SEK/08:15 | | Retail sales, % m/m (y/y) Sep | 0.5 (3.0) | -2.1 (1.2) | SEK/08:30 | | Unemployment rate AKU, % Aug | 3.1 | 3.0 | NOK/09:00 | | Durable goods orders, % m/m Sep | 1.0 | -2.4 | USD/12:30 | | Norges Bank Rate Announcement, % Oct | 1.50 | 1.25 | NOK/13:00 | | New home sales, % m/m Sep | 2.6 | 0.7 | USD/14:00 | | RBNZ Rate Announcement, % Oct | 2.50 | 2.50 | NZD/20:00 | | Trade balance, NZD bn 12m YTD Sep | -1803.0 | -2365.0 | NZD/21:45 |
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Currency Tech |
EURUSD
R 2: 1.5020
R 1: 1.4967
CURRENT: 1.4830
S 1: 1.4795
S 2: 1.4684
GBPUSD
R 2: 1. 6484
R 1: 1.6390
CURRENT: 1.6340
S 1: 1.6240
S 2: 1.6200
USDJPY
R 2: 93.10
R 1: 92.50
CURRENT: 92.05
S 1: 91.30
S 2: 90.75
AUDUSD
R 2: 0.9347
R 1: 0.9260
CURRENT: 0.9185
S 1: 0.9113
S 2: 0.8985
USDCAD
R 2: 1.0960
R 1: 1.0790
CURRENT: 1.0650
S 1: 1.0520
S 2: 1.0380
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Market Brief |
The USD has reclaimed more ground against its major counterparts today as a lack of economic data and indifferent performance in equity markets provided little stimulus for risk appetite. The DXY is now comfortably above the 76-handle at 76.20; with EURUSD back around 1.4800 levels and USDCHF testing major resistance up at 1.0250.
The main market-moving news this morning was Swedish PPI data that posted a disappointing -0.9% print on the month vs. expectations for a more benign -0.5% decline. EURSEK rallied quickly from 10.2130 to 10.2600 after the number, and has since extended its move to touch a high of 10.3165 as the figures underline the idea that inflation worries are unlikely to be a source of pressure for the Riksbank in the coming months.
Despite equity markets being mixed on the day (and indeed both the S&P and Dow Jones opening higher), the USD began another climb higher; a move that accelerated quickly after US Consumer Confidence came in weaker than expected at 47.7 in October (53.5 forecast), whilst the Richmond Fed Manufacturing index also missed forecasts with a 7 print vs. 14 expected. EURUSD dropped through support at 1.4850 to a low of 1.4788, and in sympathy we saw gold slump towards its critical support near $1030 (low $1032.80).
With very little remaining on the docket for today, there are a number of big risk events due tomorrow: both the Norges Bank and RBNZ rate announcements (where we expect Norwegian rates to increase 25bps to 1.50%), Australian CPI (likely to be a key driver of future RBA hawkishness), Swedish Retail Sales and US Durable Goods Orders.
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European Session: Risk Appetite Wanes As Equities Falter
October 27, 2009 8:53 AM CET
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G10 Advancers and Decliners vs USD |
| | NZD | 0.41 | | | | AUD | 0.40 | | | | DKK | 0.25 | | | | GBP | 0.23 | | | | JPY | 0.21 | | | | EUR | 0.20 | | | | NOK | 0.11 | | | | CHF | 0.10 | | | | CAD | 0.01 | | | SEK | -0.08 | |
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Global Indexes |
Current Level |
% Change |
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| Nikkei 225 Index | 10'212.46 | - 1.45 | | Hang Seng Index | 22'219.01 | - 1.64 | | Shanghai Index | 3'021.46 | - 2.83 | | FTSE 100 Index | 5'191.74 | - 0.97 | | DAX Index | 5'642.16 | - 1.71 | | SMI Index | 6'303.35 | - 1.17 | | S&P future | 1'065.50 | - 0.08 |
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World Markets |
Current Level |
% Change |
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| Gold | 1'041.93 | + 0.33 | | Silver | 17.13 | + 0.34 | | VIX | 24.31 | + 9.16 | | Crude wti | 78.85 | + 0.22 | | USD Index | 75.83 | - 0.30 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| M3, % y/y (3mma) Sep | 2.2 (2.5) | 2.5 (3.0) | EUR/09:00 | | CBI distributive trades survey, reported sales Oct | -4 | 3 | GBP/11:00 | | S&P/Case-Shiller house price index, % y/y Aug | -11.9 | -13.3 | USD/13:00 | | Consumer confidence index Oct | 53.5 | 53.1 | USD/14:00 | | Richmond Fed Manu. Index Oct | 14 | 14 | USD/14:00 |
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Currency Tech |
AUDUSD
R 2: 0.9347
R 1: 0.9260
CURRENT: 0.9185
S 1: 0.9113
S 2: 0.8985
USDCAD
R 2: 1.0960
R 1: 1.0790
CURRENT: 1.0700
S 1: 1.0520
S 2: 1.0380
EURJPY
R 2: 139.20
R 1: 138.70
CURRENT: 137.15
S 1: 136.29
S 2: 135.22
USDMXN
R 2: 13.475
R 1: 13.330
CURRENT: 13.245
S 1: 13.100
S 2: 12.855
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Market Brief |
There were very few scheduled risk events yesterday but a late slump across equity markets prompted a defiant rally from the USD, and caused EURUSD to plummet from 1.5000 to 1.4840 lows (currently 1.4920). GBP spent yesterday as one of the best performers against the USD, perhaps predictable given the extent of Friday’s sell-off; but despite CAD gaining some ground as BoC’s Carney failed to repeat or expand on his prior currency intervention comments, it too later succumbed to the wave of USD strength.
The move appeared to be triggered by an aggressive sell-off in the S&P on high volumes, led predominantly by financial and insurance names. Specifically, there was speculation about the imminent withdrawal of home-buyer tax credits that dragged down banking stocks, as investors panicked about the consequences for the housing market without stimulus. It is likely there will be more to come in this corrective move; the high volumes going through on the equity futures may highlight a near-term top – and whilst we do still believe the broader global recovery trade still dominates, we have been long overdue a correction and at some stage investor confidence in equity valuations will run out of steam for this leg of the rally. Given the high correlation between EURUSD, equities and gold, it’s unsurprisingly then that gold plunged through downside support to touch a low of $1037 overnight (currently $1042).
Asian equities are down across the board this morning; the blame apportioned to the slump in commodity prices. Today’s key risk events will be Swedish PPI, Eurozone M3 and US Consumer Confidence. Although the latter is likely to be the biggest market mover, we feel risk sentiment will be more sensitive to any moves in the equity markets in the coming session that economic data.
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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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