Aud/Usd update

Australian Employment Change, which is released monthly, provides a snapshot of the health of the Australian labor market. A reading which is higher than the market forecast is bullish for the Australian dollar.
Here are the details and 5 possible outcomes for AUD/USD.
Published on Thursday at 00:30 GMT.
Indicator Background
Job creation is one of the most important leading indicators of overall economic activity. Thus, the release of Employment Change is a market-mover which can affect the movement of AUD/USD.
In October, the indicator posted a modest gain of 1.1 thousand, well below the estimate of 10.3 thousand. The markets are expecting a strong turnaround for November, with the estimate unchanged at 10.3 thousand. Will the indicator match or beat this rosy prediction?
The RBA did not reduce interest rates last week, but it continues to loudly shout that it wants to see a weaker Australian dollar. This is weighing on the Aussie, which has been struggling against its US cousin. Sharp US employment numbers last week, led by Non-Farm Payrolls has increased speculation of a December taper, which could help the US dollar, as a QE scale down is a US dollar-positive event. So, the overall sentiment is bearish on AUD/USD towards this release.
Technical levels from top to bottom: 0.9283, 0.9180, 0.0947, 0.90, 0.8893 and 0.8747.
5 Scenarios

1. Within expectations: 10.0K to 13.0K: In this scenario, AUD/USD could show some slight fluctuation, but it is likely to remain within range, without breaking any levels.
2. Above expectations: 13.1K to 17.0K: A strong reading could push the pair above one resistance level.
3. Well above expectations: Above 17.0K: A sharp rise in employment numbers could propel AUD/USD upwards, and two or more resistance lines could be broken.
4. Below expectations: 6.0K to 9.9K: A lower than expected reading could pull the pair downwards, with one support level at risk.
5. Well below expectations: Below 6.0K: A very poor reading will likely hurt confidence in the Australian economy and AUD/USD could break two or more support levels.

Eur/Usd Update

EUR/USD continues its upward movement, continuing the trend which we’ve seen all week. The pair is trading in the mid-1.37 range in Wednesday’s European session. In economic news, it’s another quiet day, with no major releases. French Final Non-Farm Payrolls and German Final CPI both matched their estimates. In the US, today’s highlight is Crude Oil Inventories.
Here is a quick update on the technical situation, indicators, and market sentiment that moves euro/dollar.
EUR/USD Technical

• EUR/USD was uneventful in the Asian session, trading close to 1.3760. The pair is unchanged in the European session.
• Current range: 1.3710 to 1.3800.

Further levels in both directions: 

• Below: 1.3710, 1.3675, 1.3615, 1.3525, 1.3440, 1.34, 1.3320, 1.3240, 1.3175 and 1.31.
• Above: 1.3800, 1.3870, 1.3940 and 1.4036.
• 1.3710 continues to provide support. 1.3675 is next.
• The round number of 1.3800 is the next line of resistance. 1.3870 follows.

EUR/USD Fundamentals

• 6:30 French Final Non-Farm Payrolls. Exp. -0.1%, Actual -0.1%.
• 7:00 German Final CPI. Exp. 0.2%, Actual 0.2%.
• 15:00 US Treasury Secretary Jack Lew Speaks.
• 15:30 US Crude Oil Inventories. Exp. -2.2M.
• 18:01 US 10-year Bond Auction.
• 19:00 US Federal Budget Balance. Exp. -142.6B.

*All times are GMT
For more events and lines, see the Euro to dollar forecast.
EUR/USD Sentiment

• European finance minister discuss banking union: EU finance ministers met in Brussels on Tuesday and high on the agenda was a proposal for a European banking union. The aim is to relieve debt-ridden countries from the burden of rescuing failing banks in their countries. Instead, the banks would tap a Eurozone rescue fund, the Single Resolution Mechanism. However, no agreement has been reached on the SRM, and the finance ministers are likely to meet again next week to try and hammer out details of a banking union. ECB head Mario Draghi is a firm supporter of a banking union and has urged national governments to move forward with the plan.
• German data disappoints:  The week started off on a sour note, as German releases fell below market expectations on Monday. Germany’s trade surplus shrank to 16.8 billion euros, down from 18.8 billion in October. Industrial Production declined by 1.2%, the third decline in the past four readings. The estimate stood at 0.8%. German CPI gained 0.2%, which matched the estimate. Although just a modest gain, this was the best figure we’ve seen in the past four months. If German numbers don’t improve, we’re unlikely to see much growth out of the struggling Eurozone economy.
• Will Fed taper in December? Last week’s employment numbers were super, as Unemployment Claims, Non-Farm Payrolls and the Unemployment Rate all impressed. The Fed has said that a stronger employment picture is a prerequisite to tapering, and last week’s numbers certainly increase the possibility of the Fed taking action at its December policy meeting. Other factors also favor a December taper. Currently, the Fed is purchasing $85 billion in assets every month, and a Fed taper will likely boost the US dollar against the major currencies.
• Negotiators reach budget agreement:  With memories of the October government shutdown still fresh on Capitol Hill, Congressional negotiators have reached a budget deal which Congress will have to pass. The agreement will remove the risk of a government shutdown and reduce the deficit by a modest $23 billion. Democrats and Republicans both had criticism of the proposal, but there is general agreement in Washington that the compromise reached is a positive step which removes some of the economic uncertainty we’ve seen in recent months. Con

Markets have not looked this good for a LONG TIME...

So, the dollar failed to rally despite outstandingly positive GDP and employment figures, and the EUR/USD found buyers on dips, pointing to close this first week of December at fresh 5 weeks highs. What happened to “taper trading”? An educated guess will suggest numbers had not been enough to change what market players had already priced in that is, no taper at least until March 2014. But upcoming FED meeting on December 18th, will be the last of Bernanke as chairman. Will he dare to kick start tapering anyway, so he can leave with the feeling of mission accomplished? 

 

Looking to sell at 13830 a double top.

Market consensus seems to disagree with such theory, and rather focus in upcoming head Yellen dovish preferences. But can the EU support a strong EUR? ECB latest decision to stay on hold followed a rate cut to record lows of 0.25%. The EUR/USD tested 1.3290 afterwards, and it has been a one way ride ever since.  And while European recovery is still on doubt, the EUR continues to surge regardless.

The daily chart shows indicators heading higher in positive territory, 20 SMA offering dynamic support for most of these last few days and heading north below current price, and overall, price accelerating above 1.3625, 61.8% Fibonacci retracement of the latest bearish run. So technically bulls prevail now aligned around mentioned Fibonacci support, with the 1.3700 area as immediate resistance: a break above it should lead to a retest of the 1.3831 high posted this year.

On the other hand, bears are quite far from taking control, as dips are still seen as buying opportunities as said before, with levels to watch at 1.3625, 1.3550 and the 1.3490 price zone, 38.2% retracement of the same rally.


View Live Chart for EUR/USD

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USD/JPY A break above 10382 is then heading for 110.50

Many other Yens will follow, eurjpy, cad/jpy, gbp/jpy etc

See my latest video update here : MARKET UPDATE HERE

#FX Majors Market Update

EURUSD

The Euro returns to strength and regains levels above 1.35 handle, following yesterday’s pullback from 1.3559 to 1.3489, where 4-hour 55DMA contained dip. The price consolidates near session high at 1.3540, as near-term bulls are gaining traction after hourly indicators returned to positive territory. Immediate resistance lies at 1.3577, 20/11 recovery peak, with reak higher to resume recovery off 1.3294 and open 1.3600, round figure resistance and 1.3626, Fibonacci 61.8% of 1.3831/1.3294 descend. However, daily studies maintain neutral/negative tone and require caution in case of price’s failure to clear 1.3577. Increased downside risk would be seen on a slide below 1.3500/1.3489, with extension below 1.3460, 22/11 higher low / 61.8% retracement of 1.3398/1.3559, to signal double-top formation.

Res: 1.3577; 1.3600; 1.3626; 1.3645
Sup: 1.3510; 1.3489; 1.3461; 1.3444





GBPUSD

Cable’s near-term price action came under pressure after strong rally stalled on approach to critical barriers at 1.6254/59 and subsequent pullback to 1.6132 retraced 61.8% of 1.6071/1.6239 upleg. Formation of bearish reversal pattern increases downside risk, with extension and close below 1.61 handle, required to confirm. Hourly studies are negative, while larger picture remain bullish that keeps the upside targets in near-term focus, with regain of psychological 1.62 barrier, seen as a signal for renewed attempt higher. Otherwise, slide below 1.61 and more significant 1.6071, 21/11 higher low / daily cloud top, would shift near-term focus lower and confirm further range trading.

Res: 1.6200; 1.6215; 1.6239; 1.6259
Sup: 1.6144; 1.6132; 1.6107; 1.6071




USDJPY

The pair trades in near-term consolidative mode, after posting fresh high at101.90 yesterday. Initial support at 101.30, Fibonacci 23.6% of 99.56/101.90, so far contained, however, weak hourly and 4-hour indicators descending from overbought territory, suggest that correction lower may extend. Next strong support lay at 101.00, higher platform / Fibonacci 38.2%, ahead of 100.73, 50% and 100.60, previous peak, where stronger pullback should find support. Resumption of the uptrend through 102.00, opens 102.48/52, 28/29 / 05 peaks next, ahead of 103.10, Fibonacci 161.8% projection and key barrier at 103.72, 22/05 yearly high.

Res: 101.70; 102.00; 102.50; 103.00
Sup: 101.35; 101.00; 100.60; 100.42




AUDUSD

The pair enters near-term consolidative phase after posting fresh low at 0.9119, with initial 0.9200 resistance capping the upside for now. Improved hourly structure sees scope for further recovery, with additional support given from 4-hour indicators that emerge from oversold zone. Extension above 0.9200 opens 0.9244, Fibonacci 38.2% of 0.9446/0.9119, ahead of strong 0.9270/80 zone, previous lower platform and 50% retracement, where rallies should be limited. Only sustained break above 0.9300 barrier would sideline immediate bears. Overall bears, however, remain in play and are expected to resume larger downmove once corrective phase is completed, with 0.9100 seen as immediate support, ahead of key short-term support and breakpoint at 0.8891, 30/08 low.

Res: 0.9200; 0.9248; 0.9270; 0.9300
Sup: 0.9177; 0.9141; 0.9119; 0.9095

Oil supply, pricing and Outlook for this week..

Oil price (WTI) slipped again last week, while Brent oil rallied: WTI inched down by 0.80%; Brent oil sharply rose by 3.26%. As a result, the gap of Brent oil over WTI expanded: The premium ranged between $11.26 and $14.78 – the highest range since April 2013. Last week, the EIA’s weekly report showed a drop in oil’s stockpiles by 5.9 million barrels and the oil market tightened. The OPEC report showed no change in the OPEC production, but the frictions in Libya and the tension between Israel and Iran may have contributed to the rally of Brent oil.  Will oil rally next week? This week, several reports may affect oil prices. These items include: U.S retail sales, EU and China’s manufacturing PMI, Philly fed index, and EIA oil weekly report.

Here is a weekly outlook and analysis for the oil market for November 18^th to November 22^nd:
Oil Prices – November Overview

During last week, crude oil price (WTI) slipped by 0.80% and reached by Friday $93.84/b; conversely, Brent oil sharply rose by 3.26% to $108.55/b;

In the chart below are the daily changes in WTI and Brent oil prices during the past several months (prices are normalized to January 31^st). As seen below, Brent oil price rallied in the past couple of weeks.
 
Premium of Brent over WTI – November

The gap between Brent and WTI oil widened last week as it ranged between $11.26 and $14.78 per barrel. During the week, the premium increased by $4.19 per barrel.
 
Oil Stockpiles, Demand and Supply

The oil stockpiles slipped by 5.9 MB and reached 1,806.9 million barrels. The linear correlation between the changes in stockpiles has remained stable at -0.198: this correlation implies that oil price, assuming all things equal, may rally next week. But in order to better understand the fundamentals let’s analyze the developments in supply and demand:

Supply: Oil imports slipped again by 0.5% last week. Conversely, oil production sharply rose by 1.8%; the total supply rose by 0.6%;

Demand: Refinery inputs rose again by 0.9% last week. In total the demand remained lower than the supply; the gap between supply and demand is still positive but the difference has slightly narrowed – this may eventually slightly pull up oil prices as the oil market in the U.S tightens.

The chart below shows the changes in the gap between supply and demand (below zero: Demand is above Supply; above zero: Supply is above Demand).
 
As seen above, the currently loose oil market in the U.S coincides with the drop of oil price. But if U.S oil market continues to tighten, as it did during the previous week, this could eventually lead to a rise in oil price.    
The next weekly report will be released on Wednesday, November 20^th and will refer to the week ending on November 15^th.

OPEC Monthly Report

According to the recent OPEC Report, OPEC’s oil production remained nearly flat at 29,894 thousand in October – nearly unchanged from the preceding month. This news suggests the oil supply hasn’t changed despite the tensions in Libya.

IEA Monthly Report

According to the recent monthly update, the global oil supply rose in October by 640 thousand bbl/d to reach 91.8 million bbl/d mainly due to rise in non-OPEC countries’ liquids. The estimate on global demand was slightly raised in 2013 due to stronger than expected oil demand in Europe during Q3. For 2014 the projection are for a 1.1 mb/d gain.

The rise in expected demand for oil in 2014 may have pulled up the price of oil. Global refinery runs for Q4 have been cut by 0.6 mb/d due to reduced European throughputs. These data provide a mixed signal regarding the progress of the oil market.

Middle East and Oil – update

The riots in Libya between rival militias in the outskirts of Tripoli have raised the uncertainty in the region and could eventually further reduce Libya’s oil production, which is currently one third of its normal output. But since Libya’s output currently accounts for only 1.3% of OPEC’s total output, it is likely to have little adverse effect on the oil market. The tensions between Israel and Iran over Iran’s nuclear program continue. The U.S continues to ease the situation but with little success. These tensions could also have some small effect on oil prices. But only if there were to be an escalation in the situation, this could have a significant effect on oil prices.

Oil Related News for the Week

Here are several news items that could influence oil investors:
Wednesday –U.S. Retail Sales Report: This monthly report refers to October; in the previous report regarding September, retail sales inched down by 0.1% (month-over-month); core retail sales rose by 0.4%; this report could signal the developments in U.S’s gasoline demand and thus may affect U.S oil;

Thursday – Flash Chinese German, French and Euro Zone Manufacturing PMI: In the last monthly report regarding October 2013, the Germany’s PMI inched up to 51.5 i.e. the manufacturing conditions are growing but at a slightly faster pace. France’s PMI inched down to 49.4. This report serves signals to the developments in the Euro Area’s manufacturing conditions; this news, in turn, may affect the Euro/USD currency pair and consequently commodities prices;

Thursday – Philly Fed Manufacturing Index: This monthly survey estimates the growth of the US manufacturing sectors. In the last survey regarding October, the growth rate fell from +22.3 in September to +19.8 in October. If the index continues to fall, it may adversely affect not only U.S Dollar but also U.S equity markets and commodities (the recent Philly Fed review);

Oil Outlook and Breakdown

From the supply side, the ongoing drop in imports continued to partly offset the rise in oil production. From the demand side, refinery inputs rose again. In total, the gap between supply and demand has diminished due to the drop in imports; this could suggest the oil market has tightened. In any case, the gap is still high and the demand remains lower than the supply. Looking forward, the upcoming European, American and Chinese reports could offer some additional insight regarding the growth of these economies. The gap between Brent and WTI picked up to the $11-$14 range. This recent rise might be due to stronger than expected demand for oil in Europe, which suggests the oil market in Europe is tighter than estimated. The fundamentals suggest oil prices may rise in the coming weeks especially if the upcoming reports show growth and exceed expectations and if the oil market further tighten. Moreover, if the USD continues to fall, this could also pull up the price of oil.   
The bottom line, on a weekly scale, I guess oil price (WTI) may slightly rise. 

Market Update

AUD/USD Forecast Nov.11-15

2013-11-10 08:00:15-05

AUD/USD posted modest gains last week, as the pair dropped below the 0.94 line, closing at 0.9385. This week’s key event is NAB Business Confidence. Here is an outlook on the major market-movers and an updated technical analysis for AUD/USD. Australian employment numbers were weak and the RBA maintained rates.

EUR/USD: Bearish, Faces Further Downside Pressure

2013-11-10 08:44:58-05

EUR/USD: A follow through on its previous week decline has left EUR targeting further downside. Support lies at the 1.3300 level with a break turning focus to the 1.3250 level and possibly lower towards the 1.3200 level.

GBP/USD Outlook Nov. 11-15

2013-11-10 10:25:15-05

GBP/USD bounced back and crossed above the 1.60 level, gaining about one cent last week. The pair closed at 1.6018. This week’s key events include CPI, Claimant Count Change and Retail Sales.

USD/JPY Outlook Nov. 11-15

2013-11-10 11:35:28-05

The Japanese yen showed some strength last week but ended the week almost unchanged as USD/JPY closed the week just above the 99 line. There are nine events in the upcoming week.

Market Update, plenty of set ups!

MARKET COMMENTARY


Firstly see my video update here : Click Here

Global risk appetite fades after mixed data

Global risk appetite looks like it will have trouble continuing along the positive trajectory posted yesterday, with equities ending the Asian session mixed and the guarded price action escalating during the European session and ultimately driving S&P futures lower before the opening bell.

ISM Non-Manufacturing PMI rises to 55.4, strong employment component – USD follows

The US ISM Non-Manufacturing PMI for October surprised by rising to 55.4 points. It was expected to tick a bit lower to 54 from 54.4 points in September. The services sector (non-manufacturing) is the vast majority of the US economy. The employment component rose from 52.7 to 56.2 points.

UK economic figures demonstrate attraction of GBP

Economic data out today in the UK shows that the little island is recovering much stronger than expected and is now forecast to be among the fastest growing economies in the western world in 2014. Data due out earlier today showed that Britain’s services sector increased in October at the fastest rate since 1997.

 AUD/USD: Trading the Australian Employment Change

 Australian Employment Change, which is released monthly, provides a snapshot of the health of the Australian labor market. A reading which is higher than the market forecast is bullish for the Australian dollar. Here are the details and 5 possible outcomes for AUD/USD. Published on Thursday at 00:30 GMT.

 NZD/USD back to uptrend channel on excellent job figures

 The employment situation in New Zealand, no matter how you look at it, and the improvement also exceeded expectations. The great data could bring forward rate hikes by the RBNZ and has already pushed NZD/USD higher, back to the uptrend channel that it lost recently. Can it challenge the highs of 2013?

 EUR/USD Nov. 6 – Steady Despite Weak PMIs and Retail Sales

 EUR/USD has moved higher on Wednesday, as the pair trades above the 1.35 line in the European session. In economic news, Spanish and Eurozone Services PMIs beat their estimates but the Italian Services PMI lost ground and fell short of expectations. Eurozone Retail Sales declined 0.6%, its weakest reading in nine months.