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


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FBS Holdings Inc.
is an international brokerage company providing top quality financial and investment services all over the world. The principles we base our work on are transparency, honesty and professionalism. Our dedicated team of highly educated and experienced professionals works on the development and enhancement of FBS services.

FBS activities in general include:
Online forex trading
Online CFD, Futures, Indices, Stocks and other markets trading
Analytical and informational support

FBS offers a completely new approach to trading accounts variety and services pattern. We now offer 3 types of accounts, and each of them is designed to fit the needs of certain group of traders. These are cent accounts, dollar accounts with fixed spread and ECN accounts.

FBS operates on Metatrader 4 platform, the world's most wide-spread and comfortable trading software, known for many years among traders. Every customer can use free unlimited demo accounts to try out our trading services and develop one's own trading strategy without any risk of loss.

Markets news, comments, calendar and more
Analytical support is one of our strongest advantages. FBS has a large in-house analytical department, gathering top level professionals in market research. Our analysts provide round-the-clock analytical support, with over 120 total market news, comments, opinions, predictions and many more. Our analysts also provide comments for several business broadcasting companies and TV shows.

Missions and statement
What makes FBS different from rivals - is our devotion to the business and industry we all work in. FBS is the first customer-oriented brokerage in the world. Our mission is to provide the highest service level, set the highest goals and reach them. We are enhancing our services every day and satisfy the needs and concerns of our customers. In today's rapidly evolving world this is the only right strategy to develop the business and provide services.

Regulation and licensing
FBS is a fully regulated and licensed brokerage under the authority and control of Financial Services Commission. The Licence №: C108005331


FBS Representative

John Snow: euro’s rescue needs resolute measures
John Snow, the former U.S. Treasury Secretary, believes that the single currency may end its life if the euro zone nations don’t unite all their policies.
According to him, fiscal consolidation is certainly the most important, but the merging of labor and capital markets might be necessary as well.
Snow believes that the main thing to worry about is that what’s happening with the government bonds as the debts of a state are too big to bailout and the number of countries to help is too big, there will be a moment when there will be no one to help indebted nations.
The International Monetary Fund won’t be very useful as it also depends on donations.
The economists also spoke about the danger of hyperinflation as the governments can start printing money trying to save themselves.

Bank of Tokyo Mitsubishi UFJ: pound will drop to $1.38
Analysts at Bank of Tokyo Mitsubishi UFJ Ltd. claim that even though British currency has already significantly depreciated they expect pound to survive a further decline to $1.38.
As a result, they recommend selling sterling versus the greenback.

Pimco: euro zone's growth pace will be below the avarsge
Economists at Pacific Investment Management Co., managing more than $1 trillion in assets, claim that despite the fact that world’s markets survive a confident rebound the European economic growth will stay below the average level. According to them, the current structural factors are more powerful than the cyclical ones.
The specialists say that the extension of the euro zone’s crisis all over the world is quite possible as the markets worry that the countries’ debts are too high to get over this situation.
Bank of America Merrill Lynch estimates that European countries will need about 2 trillion euro in order to repay their obligation during the next 3 years.
Pimco predicts that the problems will last for the long term. The past year demonstrated the cyclical advance of the global markets but that didn’t actually help to raise employment and investments.

Bank of Nova Scotia: no factors for euro's growth
The single currency slumped close to its minimum since March 2009 losing 1.2% this week trading versus US dollar.
It was affected as the markets are worrying that the indebted euro area’s countries will act too slow to fight the budget deficits efficiently.
Strategist at Bank of Nova Scotia in Toronto claim that there are no factors that could make investors be bullish on euro. Even though the tension eased when there was agreement on the bailout the markets still don’t make out how the fiscal tightening measures will be brought to life.
Strategists at UBS AG in London agree that the market is absolutely negative on euro.

US initial jobless claims slightly declined
According to the data for the week before May 8, the number of initial jobless claims declined by 4,000 to 444,000. Such improvement is regarded as rather week because the revised figures of the previous week turned out to be up by the same amount. However, the 4-week average got to the lowest level since the end of March decreasing by 9,000 to 450,500.
As for continuing claims for the week before May 1, they became a bit higher to 4.627 million while the four-week average climbing to 4.640 million.
Such results became better but not better enough to expect sizable growth of payrolls in May.

USD/CAD: the pair rebounded to 1.0180
US dollar managed to compensate the losses it experienced versus loonie this week and began recovering. At today’s European session the pair hit the week minimum at 1.0107.
The pair USD/CAD was able to add 80 pips and get above 1.0180. The greenback was supported by the decline in oil price and renewed risk aversion.
If the pair goes up, resistance levels will be at 1.0215 (May 12 maximum) and 1.0270. If the rate declines, support levels may be found at 1.0145 and 1.0105/00 (session’s minimum).

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FBS Representative

UBS AG: euro will fall to $1.15 by December
Analysts at UBS AG predict that euro will lose more than 8% by December getting to the minimal level since November 2003 at $1.15. According to the specialists, it will happen because the euro zone’s countries will be reducing their spending and the Federal Reserve will raise interest rates faster than the European Central Bank.
As for the end of 2011, the single currency may fall to $1.10, while the previous UBS forecast was at $1.25.
The analysts are also bearish on pound expecting that it will decrease to $1.35 by the end of 2010 and then extend to $1.38 by the end of 2011.

Paul Volcker: there’s the risk of euro zone’s collapse
According to former Federal Reserve Chairman Paul Volcker, there is an evident risk of euro area’s collapse due to Greek fiscal crisis. The size of the enormous bailout provided for the country speaks for that quite clearly.
There are now assumptions that euro could be helped by strengthening of the European integration in politic and economic way. Voller says he can only be hopeful. He believes that much depends on European governments’ actions.
The economist claimed that the single currency was very useful for euro recently and without it European countries would be in much worse state. The problems occurred as some countries in the region who didn’t respect the fiscal discipline.

Commerzbank: 1.2445 and 1.2330 – targets of euro’s decline
The single currency slumped from 1.3100 breaking down through 1.2600 level yesterday.
EUR/USD is currently trading at 1.2473.
Technical analysts at Commerzbank expect that euro may resume lowering to 2008 and 2009 minimums at 1.2445 and 1.2330.
If the European currency manages to recover, resistance levels are found at 1.2606/56 and 1.2740 (the 38.2% retracement of the recent decrease).

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Bearish bets on euro

Analysts at Commerzbank AG believe that the single currency will survive further decline as the demand for it slumped and investors have no confidence in euro supposing that austerity measures in euro zone’s countries will worsen the economic situation in the region. The specialists speak about the so-called free fall of the euro.
According to the economists at Barclays Plc in London, investors are eager to know if the current euro-zone crisis is similar to the 2008 banking crisis.
Strategists at CLSA Asia Pacific Markets expect that the Europe’s bailout program will weaken the European currency resulting eventually in euro’s slump to parity with the greenback.
Standard Bank: euro may recover to $1.25 by the end of 2010
Analysts at Standard Bank Plc claim that the single currency is likely to end the year getting up to $1.25. According to them, this can happen as the European Central Bank acts in order to achieve low inflation following the path of Japan.
The specialists underline that the ECB was conducting such policy before and this happened to strengthen euro.

Quantum Global: euro will fall to $1.20
Strategists at Quantum Global Wealth Management believe that the single currency is getting closer and closer to its long-term fair value at $1.20. If the pair EUR/USD breaks below this level, they would regard the possibility of beginning to buy euro again. According to the specialists, the pressure on euro is still that high that it can lower the European currency to that point.
The company cut its euro cash holdings by 3% from 50% in 2008. Quantum Global expects that the inflation in the euro zone will be minimal and the ECB will keep interest rates low. It acts in order to secure its investments choosing short-dated bonds issued by Germany, France and Belgium.

Resona Bank: weak euro will prevent deflation
Analysts at Resona Bank Ltd. believe that the single currency is likely to go down below the 4-year minimum versus the greenback. According to them, it may happen because the European Central Bank regards euro’s depreciation as the way to prevent deflation.
Even with the bailout program the economy of euro zone’s countries will survive hard times as such nations as Greece and Portugal will cut their budget spending. The specialists claim that in such situation when there is a risk of deflation, weak euro would be better for the region’s economy.
Resona Bank believes that the euro zone will certainly survive if Greece manages to conduct necessary fiscal tightening measures. The analysts suppose that European debt crisis won’t affect the global credit system and the development of the world’s economy.

Standard Bank: euro will gain versus pound
Analysts at Standard Bank recommend investors to buy the single currency versus sterling. The specialists expect that euro will rise to 88 pence. If the European currency declines to 84.35 pence, it will be necessary to stop trading.

Commerzbank: pound will rebound versus US dollar
British currency managed to rebound a bit versus the greenback. Pound got up from 14-month minimum at 1.4245 that it hit yesterday. Technical analysts at Commerzbank claim that the cable may survive a further increase to 1.4780/1.4875 area.

Canadian dollar is gaining versus US dollar
Canadian dollar went up trading against the greenback. Loonie’s growth was caused by first in the last 6 days crude oil advance. Crude oil for June delivery gained 3% rising to $72.21 a barrel on the Nymex from yesterday’s 5-month minimum below $70 a barrel.
The pair is currently trading in 1.0260 area.
If the rate goes down, support levels are situated at 1.0200/10 (May 14 minimum/intra-day level) and 1.0150 (May 11, 12 minimum). If the pair grows, resistance levels will be at 1.0320/30 (intra-day resistance), 1.0380 (May 14 maximum) and 1.0430/40 (May 17 maximums).

National Australia Bank: AUD/USD consolidated between 0.8700 and 0.8790
Australian dollar dropped on Monday to new 3-month minimum at 0.8680 as Reserve Bank of Australia after increasing its key interest rate 6 times in 7 meetings came to the conclusion that the borrowing cost became high enough. Today the pair AUD/USD consolidated between 0.8700 and 0.8790.
Strategists at National Australia Bank Ltd. in Sydney claim that if the expectations for the RBA to lift up rates by 45 basis points over the next year disappear, Australia’s dollar will survive further declines.
Aussie made several attempts to jump but it didn’t have necessary strength. The 13-day MA intersected the 200-day MA from the top, while the 21-day MA is about to cross over the 100-day MA. As a result, we can see bearish pressure on Australian currency.
AUD/USD is currently trading in 0.8765/70. If the rate goes down below 0.8700, support levels are situated at 0.8645 and 0.8595. If the pair grows, resistance levels will be at 0.88, 0.8855 and 0.8880/0.89.

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FBS Representative

Commerzbank: euro won’t fall below 1.2135

The single currency began declining again yesterday. It dropped from 1.2445 to 1.2135 that represents 50% retracement of the advance from 2000 to 2008. Technical analysts at Commerzbank believe that euro’s slump may stop at this support level.
The specialists expect that the pair EUR/USD will consolidate for a period of time as risk/reward ratio for selling euro got lower. Never the less, the European currency won’t be able to get high, resistance is situated in 1.2445/1.2510 area.

Mizuho advises buying loonie versus pound
Analysts at Mizuho Asset Management Co. recommended investors to buy Canadian dollars for British pounds. The specialists claim that the Bank of England is likely to keep the interest rates low in order to stimulate UK economy that is now in rather bad condition.
As for Canada, traders think that the central bank of the country might lift up its key rate by at least 1.5 percentage points in 2011 from the current level of 0.25%.
According to the International Monetary Fund’s forecast British economy will gain 1.3% in 2010, while Canadian one may extend by 3.1%.

Germany prohibited naked short-selling on sovereign debt
The single currency slumped to the 4-year minimum versus the greenback. It happened as the concerns about the future of the euro zone strengthened again. Germany prohibited so-called naked short-selling on sovereign debt and some financial stocks of main German institutions until March 31, 2011. Strategists at Brown Brothers Harriman & Co. claim that that put European policy-making credibility under question.
When securities are sold naked, the trader doesn’t own the shares but use the shares borrowed from broker.
In addition, German Chancellor Angela Merkel claimed today that euro is at risk and the debt crisis may have a negative impact on the rest of the world.

BNY Mellon: pound fell to 14-month minimum
British currency got today to the 14-month minimum versus the greenback. Strategists at Bank of New York Mellon Corp. in London claim that sterling is affected by the increased risk aversion. European debt crisis is weighting on the pound’s dynamics. Euro today experienced new decline as Germany banned short-selling of euro government bonds and shares of ten banks and insurance companies.

If the pair goes down below 1.4235, support levels will be at 1.4100 (March 30 2009 minimum) and 1.3975.
If the rate increases, initial resistance is at 1.4370 (session’s maximum), 1.4405 (intra-day level) and 1.4500/15 (May 18 maximums).

EUR/CHF: euro gained 200 pips in an hour
European currency jumped today by 200 pips in an hour trading versus franc. This bounce can be explained by the possible intervention of the Swiss National Bank. Euro rate extended from 1.4002 to 1.4203 getting above its maximum since May 10. Then the pair reversed and declined to 1.4115 and after that rose again, according to the hour chart.
EUR/CHF is currently trading in 1.4170/80 area.
If the rate goes up, resistance levels lie at 1.4205 (session maximum), 1.4250 and 1.4320. If the pair declines, the most important support is found at 1.4000. If euro gets lower than that it would fall to the record minimums.

Bank of Montreal: euro is recovering versus dollar
European currency is recovering from the 4-year minimum versus the greenback. This time euro was supported by the expectations that European leaders may take measures to help the single currency. There was a speculation that the European Central Bank can act in order to stop the depreciation of the common currency.
Strategist at Bank of Montreal in Chicago claim that the market’s sentiment is rather positive as investors are hopeful awaiting that European authorities will propose some measures to improve the current situation. According to the specialists, euro zone has to conduct a wide discussion on its future and decide on sanctions for those member states that are breaking the rules.
The pair EUR/USD is currently trading in 1.2330 area.
If the rate goes up, resistance will lie at 1.2445 (May 18 maximum). If the pair declines, support levels will be found at 1.2135 (50% retracement of the 2000/2008 advance), 1.2030 (April 2006 minimum) and 1.2000 (psycho level).

BNP Paribas: EUR/CHF growth won't last long
Strategists at Mizuho Corporate Bank Ltd claim that euro’s today advance could be caused by Swiss National Bank’s selling of the national currency. They comment that investors are covering short euro positions.

Analysts at BNP Paribas SA think that the single currency won’t be gaining for a long time as it will be affected by the further development of European debt crisis. As a result, BNP Paribas doesn’t believe that euro will be able to hold at the current high levels.

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FBS Representative

Bank of America-Merrill Lynch: euro may drop to $1.16

Strategists at Bank of America-Merrill Lynch expect the single currency to survive a significant decline.
According to the specialists, euro is getting closer to $1.2134 representing 50% retracement of its growth from a record minimum at 82.30 U.S. cents in 2000. If the European currency falls past this level, it can slump to $1.16. The last time euro traded at this level was in November 2005.
The analysts believe that market will be negative on euro in the middle term as investors will be concerned about euro zone’s fiscal problems. They suppose that it would be hard for European authorities if they decide to make intervention in currency markets.

Societe Generale: Central banks can reduce euro reserves
The fact that the some of the world's largest money managers’ and central banks’ sentiment on euro is very negative can harm the single currency’s future dynamics.
As euro was following the downtrend during the last several months and lost 15% versus the greenback since the beginning of 2010, large hedge funds got in the center of market’s attention. The central banks can have actually much more discouraging influence on Forex market even if they just stop euro purchases. According to economists at Societe Generale in Hong Kong, this process has got slower and central banks have become less active that represents the growing risks.
South Korean central bank claimed in May that euro is no longer attractive as reserve currency as it used to be. Iran reported this week about the possibility of changing currency ratio in its reserves.
However, some institutions still regard the depreciation of euro as the opportunity to buy it. Monetary authorities of some emerging economies, such as China, were trying to diversify their currency reserves and reduce the part of US dollars in favor of the European currency.

Commerzbank: euro's trying to correct
The single currency was up during American and early Asian trade. It managed to compensate Tuesday losses.
Technical analysts at Commerzbank observe the embryonic reversal from the main support at 1.2135 representing 50% retracement of advance from 2000 to 2008.
If the rate goes up, EUR/USD has to overcome inter-month pivot at 1.2445 in order to show further corrective growth. The rebound will be aimed to 1.2510, 1.2735 and 1.2850.

Saxo Bank: daily currency forecast
Analysts at Saxo Bank claim that the trend for EUR/USD will be neutral and the pair will be fluctuating in range between 1.2270 and 1.2430. If the single currency breaks above 1.2440 it can head upwards to 1.2525 zone.
USD/JPY: the pair may rise to 92.95. As a result, it’s advised to buy the greenback at 90.73-91.00/10.
EUR/JPY: the pair’s maximum was at 113.80, it may be trading today below this level but higher than 112.50.
GBPUSD: the pair is expected to decline to 1.4300 and pounds should be sold below 1.4505.
AUDUSD: the pair is likely to stay in 0.83-0.8390 zone.
USDCAD: if the pair goes below 1.04 it would hit 1.0340. Resistance lies at 1.0505.

Nomura: euro forecast cut to $1.15
Strategists at Nomura Securities Co. decreased their euro forecast from $1.30 by the end of 2010 to $1.15. By the end of June the single currency is likely to fall to $1.18.
According to the specialists, even if the debt crisis becomes less tense investors will reduce the amount of assets denominated in euro and this will be affecting the European currency.
According to the median forecast of analysts surveyed by Bloomberg, euro will trade at $1.25 by the end of the year.

Standard Bank: G7 help is needed to save euro
Analysts at Standard Bank Plc believe that government interventions could only postpone the slump of euro but it will fail to save the single currency from dropping. The specialists note that such situation is quite likely if euro keeps falling.
As a result, the monetary authorities of the euro zone’s countries suppose that there is the necessity of other G7 nations’ help to make an intervention efficient. Standard Bank expect that the United States will agree if the euro zone asks them for help.

Windsor Brokers: uptrend for USD/CHF
The greenback was rising against Swiss franc since the middle of April in 1.0500 area. It went above 1.1445 resistance on Tuesday and got to one-year maximum at 1.1585. After that the pair USD/CHF declined below 1.1500.

Technical analysts at Windsor Brokers Ltd claim that the pair is still within the uptrend that is confirmed by yesterday’s spike rejection at 1.1417. It will be aimed at growing to 1.1675 while the rate doesn’t get lower than 1.1449.
If the pair goes up, resistance levels will be found at 1.1584, 1.1605 and 1.1675. The analysts place support at 1.1449, 1.1417 and 1.1402.

Windsor Brokers: GBP/USD is consolidating in the short-term
British currency recovered from 14-month minimum versus the greenback at 1.4235 capping at 1.4465 during the Asian trade. At the beginning of the European session the pair GBP/USD decreased to 1.4315. Then though market’s sentiment became more positive sterling didn’t manage to get higher than 1.4400/05 resistance.
If the pair goes up above the intra-day resistance at 1.4400/05, resistance levels will be found at 1.4465 (May 19 maximum) and 1.4525 (May 18 maximum). If pound declines, support levels will be at 1.4320 (session’s minimum), 1.4275 and 14-month minimum at 1.4235 (May 19 minimum).
Analysts at Windsor Brokers Ltd claimed that GBP/USD is consolidating in the short-term above the year’s minimum at 1.4235. If the pair trades above 1.4273, it may rebound to 1.4517/47 zone. Never the less, in the medium term the outlook will be negative.

SmartTrade: demand for yen grew due to the Korean conflict
Japanese currency rose versus all 16 of its main competitors. It happened as the demand for yen as a safer currency went up due to the conflict between North and South Korea.
According to the group of 25 experts from different countries, a 1,200-ton South Korean ship was blown up by North Korean torpedo.
Economists at NTT SmartTrade Inc. believe that the news about the torpedo attack represents a geopolitical risk and this will make Japanese currency being bought as a refuge.
South Korea’s won declined versus all major counterparts. It lost 3% versus yen.

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FBS Representative

UBS AG: dollar’s becoming a growth currency

Analysts at UBS AG claim that during the next 10 years the greenback may be referred to as the growth currency. It will happen as the growth pace of US economy will be higher than Europe and Japan. As a result, the specialists see the change of dollar’s role from the haven currency to a riskier one with higher yield.
According to the strategists, dollar is likely to repeat its early 1980s and late 1990s advance moves when it was following the increases in stocks.
At the same time the euro zone seems to be weakened by the debt crisis, while Japan is only beginning to recover from deflation and the U.K. has to deal with its record high budget deficit over the next few years.
In addition, the Federal Reserve might be the first central bank among developed countries to lift up key interest rate. It’s predicted to be raised from с 0-0.25% to 0.5% by December that means giving up monetary stimulation of the economy.

UBS AG: European banking system stability questioned
The single currency survived the biggest decline versus the greenback during the last 4 days. Euro also lost to all of its main competitors. According to analysts at UBS AG in Singapore, it happened as the Bank of Spain supported failing regional lender. As a result, the confidence about the stability of the European banking system weakened.
Never the less, the failed bank named CajaSur represents only 0.6% of Spanish banking assets, so the impact on investment flows might be minimal.
Strategists at BNP Paribas believe that this event doesn’t seem very significant and won’t be able to interrupt the move back into risk appetite that started at the end of last week.

Rabobank: UK spending cut by 6.25 billion pound
British pound had the biggest advance versus the single currency in 2 weeks. It happened as the U.K.’s Chancellor of the Exchequer George Osborne announced the spending cuts by 6.25 billion pounds ($9 billion) in order to reduce the country’s huge budget deficit.
Strategists at Rabobank International in London claim that investors give support to the new government waiting to see how resolute its actions will be.
Broader measures will be reflected in an emergency budget scheduled for release on June 22.

Standard Bank: pound will rise to 75 pence versus euro in 2011
Analysts at Standard Bank note that British pound may strengthen versus the single in 2010. It’s quite possible as the budget deficit won’t weight on UK economy as strongly as it will weight on the European one.
The specialists believe that if the euro zone’s debt crisis keeps developing it won’t mean the beginning of the same problems in the United Kingdom. Even if the country’s budget deficit is higher than in many European countries it’s only one deficit and it doesn’t mean the decline in Britain’s credibility and the cut of its credit rating.
Sterling is likely to rise versus euro to 75 pence in 2011.

GBP/USD weekly forecast
The currency pair GBP/USD is likely to consolidate with week tending to rise until it gets above previously reached 14-month minimum at 1.4230.
Daily chart shows positive signals as the stochastic points at the growth staying at the oversold level, while the negative columns of MACD histogram are getting shorter that means that upward risks grew stronger. Resistance level lies at Tuesday’s maximum at 1.4520. If the pair breaks down through this level it may have its way opened for a slump towards May 11 minimum at 1.4716 and then to the reaction minimum at 1.5053 that’s at the moment close to the 55-day moving average.
If the pair keeps advancing, GBP/USD’s growth target will be at the reaction April 30 maximum at 1.5390 through which goes currently the 100-day MA. Never the less, the decline below the support at 1.4230 will make the pair decline in the short-term and aim it at the reaction March 30, 2009, minimum at 1.4108 and then to the psychologically important 1.4000 level.
In the middle-term the outlook for the pair seems to be rather negative until it stays below the April 15 reaction maximum at 1.5523. The weekly chart points at the decline while the 5-week MA lies below the 15-week MA and is going down. Getting below 1.4000 support will open the way to slumping the next days to March 11, 2009, reaction minimum at 1.3653 and then to January 23, 2009, minimum at 1.3498.

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Mizuho: еuropean currency will drop to $1.10 by the end of 2010

Analysts at Mizuho Corporate Bank Ltd claim that the single will keep declining in the long-term period unless the European Monetary Fund is established.
According to the specialists, 750 billion euro ($921 billion) rescue program provided euro zone’s monetary authorities with time necessary to organize such fund. The fund has to serve the goal of the European financial resources’ coordination in order to bailout the indebted member states. There’s a great need of the special system for that purpose, say the analysts. The market wants the euro zone to take clear and applicable measures of fiscal consolidation moving towards the common budget. Only such policy is able to stop the depreciation of euro, otherwise there’s the danger of monetary union’s collapse.
As the EU policy makers are unlikely to intervene until euro falls to the parity with the greenback, Mizuho forecasts that the European currency will drop to $1.10 by the end of 2010.

Moody’s Investors Service: US has to cut the deficit
Specialists at Moody’s Investors Service Inc. note that US government’s AAA bond rating may found itself in danger of downgrade if there will be no extra measures taken to cut potentially huge budget deficit.
As for the European debt crisis, it was positive for the United States as US Treasury market has become the safe haven greeting money inflows. The stable economic prospects of the country are based on its stable politics and growing fundamentals.
Never the less, according to the specialists, credit crisis and government spending in order to overcome its consequences deteriorated the country’s finance. As a result, the ratio of general government debt to revenue increased during the last 3 years nearly in 2 times exceeding 400%.

Bank of Nova Scotia: loonie will fall to C$1.10 per US dollar
Dependent on growth Canadian currency slumped to the 6-month minimum versus the greenback. It happened under the impact of equity and commodity markets’ decline. In addition the negative impact on loonie was provided by Spanish bank problems and the conflict between the two Koreas.
When investors increased demand for US dollar as a refuge from European crisis, Canada’s dollar depreciated in May by 5.8% against its US competitor. Then loonie managed to compensate its fall following the positive dynamics of North American stocks.
Strategists at Bank of Montreal in Toronto underline the high volatility of the market and now there these several factors against Canadian currency. Analysts at Bank of Nova Scotia in Toronto comment that loonie was gaining on the speculation oа rates’ hike. However, the current situation of uncertainty makes such actions very difficult. The specialists expect loonie to fall to C$1.10 per US dollar.

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Commerzbank: GBP/USD survives short-term correction

British currency was going up during the Asian trade and got close to 1.4520/30 resistance zone. Technical analysts at Commerzbank claim that such move can be regarded as a short-term correction made as the investors’ mood became better.
If sterling climbs above 1.4531, it may rise further to 1.4780/1.4875 (February minimum) or even above 1.5000/50.
If GBP/USD declines below 1.4250, it would mean downward pressure to 1.4000 and then falling towards the 2009 minimum at 1.3500.

The IMF: kiwi’s rate is overvalued by 10-25%
The International Monetary Fund claims that it’s likely that New Zealand’s dollar is overvalued by 10-25%. The organization states that the currency has to decline in order to diminish the country’s current account deficit.
According to the IMF specialists, New Zealand copes with the consequences of the global financial crisis more successfully than most other developed countries. It’s helped by the flexible exchange rate, high demand from Asia and the fact that there is no banking crisis. According to the forecasts, the country’s economy will gain 3% in 2010 and in 2011. Kiwi’s rate rose by more than 20% since the beginning of 2009.
New Zealand’s budget deficit deteriorated due to continuous income-tax reductions and spending initiatives and revenue prospects got down. To rebalance the country’s economy, kiwi has to survive s gradual decline.
The Organization for Economic Cooperation and Development supposes that New Zealand has to remove economic stimulus in the near future raising the benchmark rate from the record-low 2.5%.

Westpac: Aussie won't get above US$0.8350
Australian dollar was rebounding today as the absence of negative news from Europe made investors more willing to take risks, say analysts at TD Securities. All in all, concerns connected with European debt crisis made Australian currency depreciate by more than 14% during the past month.
Never the less, strategists at Westpac recommend selling as the rate’s increasing. They claim that Aussie already reached US$0.8350 area for a few times this week but always failed to rise further.

Saxo Bank: daily currency forecast
EUR/USD: analysts at Saxo Bank claim that EUR/USD can rise to 1.2265 or to 1.2350 before declining. Strong resistance will be found at 1.2135/50 area.

USD/JPY: possible to sell on the growth to 90.35 as the pair is expected to get down back to 89.80/90.
EUR/JPY: if the pair manages to get above 110.30/45, it will manage to rise to 111.45. Support is situated at 109.50 area.
GBP/USD: 1.4365 is acting as a support. If the pair rises above 1.4440, it will be advancing till 1.45.
AUD/USD: 0.8190/00 acts as the strong support. If the Aussie climbs above 0.8330, resistance level will lie at 0.84, while trading below that point would mean the decline to 0.8125.
USD/CAD: if the pair fails to overcome 1.0740, it may fall to 1.0550. Otherwise, it might rise to 1.0850.

Mizuho: British pound’s rebounding versus US dollar
British currency was up versus the greenback for the first time in 4 days getting above from its March 2009 minimum. It happened as China claimed that it wasn’t reviewing euro holdings hiking the demand for assets denominated in the single currency.
The demand for US dollar as a safer asset reduced with increase in European and Asian stocks. In addition, sterling’s relative strength index against the dollar fell yesterday reaching the level signalizing an inevitable recovery.
Analysts at Mizuho Corporate Bank Ltd. in London claim that pound seems to be rising when risk aversion weakens. As a result, UK currency is likely to suffer from the debt crisis.

USD/CHF formed descending triangle pattern
During the last 24 hours the greenback was trading in range between 1.5151 (yesterday’s minimum) and 1.1615 (daily maximum at the opening of Asian trade). When the European session began, USD/CHF retested support level at 1.1515.
The pair is currently trading at 1.1540.
If US dollar goes up, resistance levels will be at 1.1620/25 (May 24/26 maximums), 1.1695 (May 25 maximum) and 1.1720 (April 2209 maximum). If the pair declines, support levels will be found at 1.1515 (May 25/26 minimums), 1.1485 (May 24 minimum) and 1.1445 (May 21 minimum).
The hour chart shows the descending triangle pattern that may signal the pair’s decline. If USD/CHF gets down below 1.1516, it may fall to 1.1333.

The Fed, Bullard: US will benefit from European crisis
St. Louis Federal Reserve President James Bullard claims that European debt crisis isn’t likely to have a negative impact on the United States. On the contrary, the official believes that American economy would be the one to win in this situation.

Thanks to the current problems in euro zone, US longer-term yields managed to decrease. The number of investors attracted by safer US assets increased and as a result the monetary inflows to the US economy went up.
He added inflation in the United States did not appear to be a problem and that any inflation risk would be over the medium term.

ACM: US dollar may decline to 88.40 yen
The greenback went up from Asian session’s minimum at 89.80 getting above 90.40 in its trade versus Japanese yen. Recently the pair USD/JPY reached the maximal level 90.55 on its way to 90.65/70 area that is the top of the last 5 days trading channel.
Technical analysts at Advanced Currency Markets (ACM) still believe that US dollar is to move down to 88.40. The specialists place the main resistance at 90.80/85 area.
If the greenback goes up, resistance levels will be at 90.65/70 (May 24/26 maximums), 90.85/95 (May 19 minimums) and 91.10 (200-day MA). If the pair declines, support levels will be found at 89.70/80 (May 24/26 minimums), 89.55 (intra-day support) and 89.25 (May 25 minimum).

BNP Paribas: euro may go below $1.20
Analysts at BNP Paribas SA claim that the advance of the single currency won’t last for a long time. The specialists expect that euro will get below $1.20 first time in more than 4 years.
Such negative forecast can be explained by the gap between the growth prospects for Europe and the United States. While the EU economy will suffer from budget cuts, US economic rebound’s gaining pace.

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FBS Representative
01/06/10 dollar may decline to 90 yen
Technical analysts at Research Institute Ltd. believe that the greenback is likely to get down to 90 yen level. According to the specialists, this will happen as dollar may be stopped by the important resistance at 91.58 yen. On the other hand, if USD/JPY breaks above this level, it can climb to 92.30 yen.

Saxo Bank: daily currency forecast
EUR/USD: analysts at Saxo Bank outline that the key level for EUR/USD lies at 1.2250. Trading below this mark can drive the pair to 1.2200. Resistance is situated at 1.2330.
USD/JPY: the pair is expected to rise to yesterday’s maximums at 91.55 area, so it’s recommended to buy at 90.40-90.75/80.
EUR/JPY: the pair isn’t likely to get above 112.25. If it declines below 111.30, it may decrease to test 110.80.
GBP/USD: the pair is expected to fall to 1/4435 support and then recover to 1.4540. If it breaks this support, it risks hitting 1.4380.
AUD/USD: the pair is thought to rise to 0.8470 and possibly 0.8550 getting up from the near-term minimum at 0.8355, so it’s necessary to buy Aussie above 0.8310.
USD/CAD: the trend for the pair is regarded as neutral. It’s expected to fluctuate between 1.0420-1.0500. The market’s looking forward to Bank of Canada’s statement.

Commerzbank: GBP/USD may rise to 1.4724/98

British currency went down from Friday’s maximum at 1.4610 consolidating at 1.4500 area during the Asian trade.
Technical analysts at Commerzbank claim that if GBP/USD manages to overcome resistance at 1.4612, it may rise to 1.4724/98 (38.2% Fibo retracement/minimums of the beginning and end of March).
If pound weakens, support levels will be found at 1.4262 (78.6% Fibo retracement of the 2009 slump) and 1.4228 (May minimum). If sterling fails here, this would mean dropping to the psychological level at 1.4000.

Bank of Tokyo-Mitsubishi: euro forecast’s reduced to $1.16
Analysts at Bank of Tokyo-Mitsubishi UFJ Ltd. reduced its forecast for the single currency from $1.22 to $1.16 by the fourth quarter of 2010. The specialists also diminished the estimation of EUR/JPY from 116 to 103 yen per euro.
Even though euro may stop falling in the near term, the economists are negative on the European currency in the medium and long term.
Bank of Tokyo-Mitsubishi UFJ believes that the crisis euro zone is suffering from seems to be very serious harming the region’s economic growth. The downward revision of forecasts is explained by the high pace of euro’s depreciation. The European Central Bank is expected to keep interest rates very low for a long time period.

Dollar rose by 1.42% versus franc
The first quarter pace of Switzerland's economic growth was surprisingly down. It could be possibly explained by the reduction of companies’ investment and government spending.
Swiss GDP gained 0.4% from the fourth quarter, while it was expected to show 0.7% increase.
The greenback climbed today by 1.42% versus Swiss franc. The pair USD/CHF is currently trading at 1.1712.

Euro’s approaching $1.21
The single currency is declining today versus the greenback deepening its already biggest in 10 years monthly slump. It’s currently approaching 1.2100 level. Euro decline is caused by the fears that there are more writedowns at Europe’s banks and the tightening measures will have a negative impact on the European economy’s rebound.
The European Central Bank claimed yesterday that in 2010 euro zone banks may see another 90 billion euro ($110.4 billion) in net writedowns on loans and securities.
In addition, there was some negative data from Italy where the unemployment rose in April to 8.9% from 8.8% the previous month. Euro zone’s index of executive and consumer sentiment dropped from 100.6 in April to 98.4 in June.
Strategists at Quantum Global Wealth Management note that investors are now extremely bearish on euro. As a result, they will be able to start buying European currency only when it declined to its fair value.

BNP Paribas: yen will fall to 110 yen per dollar by the middle of 2011

Analysts at BNP Paribas SA believe that Japanese yen is likely to become the funding currency in carry trade. It may happen as the country’s interest rates tend to be low in year time horizon as Japanese monetary authorities will be trying to prevent deflation. World’s economic growth and abundant liquidity will stimulate carry trade.
According to the specialists, yen will lose 21% falling to 110 per dollar by the middle of 2011. Japanese investors cut hedges on $2.9 billion foreign portfolios as global yield curves start to move sideways. The yield of benchmark Japanese bonds is thought to decrease in the coming year in comparison with many foreign securities. As a result, foreign markets will become more attractive for Japanese investors.

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