Comments and forex-analytics from FBS Holdings Inc. brokerage company

[wynnasuju]

BBH: outlook for AUD/USD
Tuesday, May 8, 2012 - 14:30

The Aussie weakens against the greenback on Tusday after weak trade data report.

Trade deficit in March reached 1.59B vs.1.38B deficit forecasted and 0.75B deficit in February. The Australian Government, however, remains forecasting a return to surplus by 2012/13, as promised last year.

According to analysts, tight fiscal policy and eased monetary policy will continue pushing the AUD/USD pair down. Strong resistance for the pair lies at 1.0220 level. In a longer-term analysts expect the pair to fall to 0.9860.

Chart. Daily AUD/USD

BBH: outlook for AUD/USD // FBS Markets Inc.

 

[wynnasuju]

Taylor: Greece will abandon euro in June
Wednesday, May 9, 2012 - 05:45

The resent changes on European political landscape made some analysts come up with more radical forecasts of euro’s future than they used to have before. For example, John Taylor, the head of the world’s largest currency hedge fund FX Concepts, now thinks that Greece may leave the euro area already in June.

The specialist warns that the nation’s government will soon have no more cash, while European institutions won’t be able to give it more money due to the emerging political split between France and Germany. Greece itself is in the situation of uncertainty: if the policymakers fail to form a governing coalition, there will be other Parliament elections in the middle of the next month.

“I think that people are feeling the implications of a Greek exit aren’t so bad. If Greece leaves the euro, Europeans will turn around and huddle together and say, ‘how do I help Portugal and Spain?” Taylor says.


Taylor: Greece will abandon euro in June // FBS Markets Inc.

 

[wynnasuju]

Deutsche Bank: outlook for USD/JPY
Wednesday, May 9, 2012 - 07:00

The yen strengthens against the greenback this week as the Japanese currency benefits from its “safe haven” status.

Analysts at Deutsche Bank, however, recently revised their forecast for USD/JPY to bullish after being bearish since 2008. They now expect the pair to rise to 82 yen by the end of 2012, compared with previous forecast 75 yen.

In their view, USD/JPY may strengthen in a short term, but the trend is descending.

Chart. Daily USD/JPY

Deutsche Bank: outlook for USD/JPY // FBS Markets Inc.

 

[wynnasuju]

Analysts: BoE may extend QE program
Wednesday, May 9, 2012 - 08:45

On Thursday, May 10, the Bank of England holds its monthly meeting. Some analysts expect the regulator to extend its asset purchase program tomorrow.

According to the BoE governor Mervyn King, the inflation in the U.K. is too high and the nation's economic recovery too slow. The annual rate of inflation, which was 3.5% in March, remains well above the BOE's 2% target. Mervyn King said last week that the current crisis is far from over.

Investec: In conditions of sticky inflation versus stuck economy the BoE may add another £25bn to its £325bn program of QE on its Thursday meeting. The committee will worry more about low growth than an inflation rate that is taking longer to come down than it predicted.

Capital Economics: The BoE may add £25bn to its asset purchase program in autumn.

Commerzbank: The BoE may adopt the wait-and-see approach: despite the fact that in a longer term the QE extension is possible, now we expect the bank to leave the room for maneuver in case if the markets require support.

Photo: Daniel Jones

Analysts: BoE may extend QE program // FBS Markets Inc.

 

[wynnasuju]

Scotia Capital: better to sell EUR vs. GBP
Wednesday, May 9, 2012 - 10:15

Analysts at Scotia Capital recommend selling the single currency versus British pound as an alternative for trading volatile EUR/USD which has been fluctuating this year in the $1.30/35 area, so that many traders burned their fingers. “EUR/GBP is still really euro, but the risk/reward is better than with EUR/USD.”

The specialists note that Europe’s future looks dim in both cases: either the currency union will continue with austerity measures and there will be a long period of slow growth in the region, or it won’t, so the crisis will dramatically escalate. According to Scotia Capital, EUR/GBP will slide to 0.77 by the end of 2012.

Scotia Capital: better to sell EUR vs. GBP // FBS Markets Inc.

 

[wynnasuju]

Euro may rise against… Aussie
Wednesday, May 9, 2012 - 13:00

Analysts at Commerzbank believe that the single currency may rise versus its Australian counterpart to 1.2906/1.3004 (200-day MA, 2010-2011 minimums, April 2012 maximum).

The specialists say that euro’s advance is likely to end there. However, if the resistance is breached, EUR/AUD may climb to 1.3111. The bank remains bullish on the pair in the short-term as long as it’s trading above 1.2646 (April 30 minimum).

According to the bank, if euro slips below 1.2646 and 1.2641 (55-day MA), it will slide to 1.2571 (April minimum), the level below which the pair’s prospects will become negative.

Chart. Daily EUR/AUD

Euro may rise against

 

[wynnasuju]

RBS: betting on USD/CHF advance
Thursday, May 10, 2012 - 06:45

The current turmoil in Europe makes analysts come up with more and more ideas of how to avoid exposure to risks associated with the single currency.

Strategists at Royal Bank of Scotland propose buying US dollar versus Swiss franc. In their view, the Swiss National Bank will continue to maintain EUR/CHF floor, so that franc won’t have chance to appreciate. At the same time, the bank is bullish on the greenback due to relatively positive economic reports released so far. RBS thinks USD/CHF may strengthen to 0.9950.

Chart. Daily USD/CHF

RBS: betting on USD/CHF advance // FBS Markets Inc.

 

[wynnasuju]

Key options expiring today
Thursday, May 10, 2012 - 08:00

Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (2 p.m. GMT).

Here are the key options expiring today:

EUR/USD: $1.3000, $1.3085, $1.3100, $1.3130 and $1.3150;

USD/JPY: 79.05,80,00 and 80.25, 81.00;

EUR/JPY: 106.35;

GBP/USD: $1.6060, $1.6300;

AUD/USD $1.0000, $1.0195, $1.0200;

AUD/JPY: 83.00.

Have a profitable trading day!

Image from deNull:

Key options expiring today // FBS Markets Inc.

 

[wynnasuju]

EUR/USD: technical comments from Commerzbank
Thursday, May 10, 2012 - 08:15

Analysts at Commerzbank claim that there is considerable divergence on H4 chart, so they expect a corrective rebound today.

Chart. H4 EUR/USD

At the same time the situation on the daily chart remains negative. Commerzbank targets $1.2624 (January minimum) with support at $1.2809 (January 17 maximum). Rebound will become possible if EUR/USD overcomes resistance at $1.3080 (May 4 minimum) and $1.3233/50 (late April/ early May highs area).

Chart. Daily EUR/USD

EUR/USD: technical comments from Commerzbank // FBS Markets Inc.

 

[wynnasuju]

Bloomberg Poll: hard times for Europe ahead
Thursday, May 10, 2012 - 09:15

The market is always about sentiment. During the last 2 years we have been continually discussing the possibility of disintegration in Europe. More than half of the experts surveyed by Bloomberg think that the 17-member currency union will once again become 16-memer one and that this will happen in 2012.

According to Bloomberg Global Poll, 57% out of the 1,253 investors believe that Greece will quit euro zone this year. In addition, 80% of respondents foresee more stress for the European bond markets.

Note that 47% of interviewed expect Spanish default, 63% – the one of Portugal and about 25% – the one of Italy or Ireland. As for Greece, 94% of investors said it will default on its debt. The nation has already restructured its debt to private bondholders.

The survey was conducted on May 8.

Lloyds Banking: “Another flare-up of the crisis is likely. The key variable for Europe is domestic politics.”

Photo by Bloomberg

Bloomberg Poll: hard times for Europe ahead // FBS Markets Inc.