Daily FX Commentary: (Morning Report)
EUR/USD
The single currency holds positive sentiment for now, as corrective dips from day’s fresh high at 1.3400, so far being held at initial 1.3330 support. However, further easing towards Strong Support Zone at 1.3300/1.3280, cannot be ruled out, as the price cracks dynamic 20 day EMA support at 1.3350 and hourly indicators still in descending mode and 4h ones reversing from overbought zone. Overall bulls, however, remain intact, with upside targets standing at 1.3485/1.3500.
Res: 1.3389, 1.3402, 1.3450, 1.3485
Sup: 1.3335, 1.3300, 1.3280, 1.3247
GBP/USD
The pair lost ground after break below 1.6100 support accelerated losses, retracing 76.4% of 1.5991/1.6177 rally so far at 1.6031. Weakened near-term structure sees immediate risk of retesting 1.6015, daily Ichimoku cloud base and strong 1.6000/1.5991 support zone, below which to open 1.5960, Fib 76.4% of 1.5826/1.6380, possibly 1.5900, round figure / 200 day MA, on a break. Holding above 1.6000, would signal further sideways movements, as long as 1.6177 stay intact, but prevailing negative tone sees increased downside risk.
Res: 1.6088, 1.6104, 1.6121, 1.6154
Sup: 1.6031, 1.6006, 1.5991, 1.5960
USD/JPY
Near-term price action moves in corrective mode, reversing from today’s fresh 2 ½ years high at 89.66. Loss of bullish momentum on hourly and 4h chart indicators emerging out of overbought territory, see potential for further retracement, before bulls re-assert, as larger picture bullish structure remains intact despite overbought readings. Further easing below 89.00 handle, also hourly 55 day EMA, would focus more significant 88.40, previous top, possibly 88.00, near 61.8% of 86.81/89.66, reinforced by ascending 4h 55 day EMA that maintains bulls since mid-November, where any stronger dips should be contained.
Res: 89.34, 89.66, 90.00, 90.39
Sup: 89.00, 88.73, 88.40, 88.00
USD/CHF
The pair emerges from dangerous zone, as bounce from lows near 0.9100 support, clears initial 0.9177 resistance and approaches psychological 0.9200 barrier. Improved hourly studies reduce the downside risk, however, break and close above 0.9200 is seen as supportive element for possible further recovery towards 0.9230, Fibonacci resistance and 09 Jan low, Ahead of more significant 0.9270/0.9300, key near-term resistance zone. However, failure under 0.9200, would keep the downside vulnerable, as 4h chart studies are still in the negative territory.
Res: 0.9200, 0.9210, 0.9234, 0.9272
Sup: 0.9165, 0.9142, 0.9110, 0.9100
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Daily Market Commentary: (Evening Report)
Market Movers
- techMARK 2,190.95 -0.77%
- FTSE 100 6,107.86 -0.22%
- FTSE 250 12,759.14 -0.30%
- Bernanke could spark market volatility
- Traders cautious ahead of US earnings season
- Eurozone industrial production disappoints
Dovish comments from a member of the Federal Reserve weren't enough to lift stocks on Monday, as markets remained cautious ahead of a speech by Ben Bernanke this evening and earnings reports from Wall Street heavyweights later this week.
Markets across Europe were supported early on by remarks from Federal Reserve Bank of Chicago President Charles Evans who said that the government should put "in place policies that slowly but surely bring the prospects of future revenues into balance with future spending".
He said that "monetary policy has an important contribution to make" and that the central bank will maintain its expansionary policies until its main goals are met.
However, as analyst Craig Erlam from Alpari explained this afternoon: "There's been an element of caution in the markets today, ahead of Bernanke's speech later at the University of Michigan. We tend to see a lot more volatility in the markets when Bernanke speaks and with the markets being caught off-guard by the apparent three-way split at the last meeting, over when to end the current asset purchases, Bernanke is likely to be bombarded with questions."
Meanwhile, following on from Wells Fargo's results on Friday, traders are now awaiting results from other banking giants this week, including Goldman Sachs, Morgan Stanley, JPMorgan and Bank of America.
Erlam said: "Expectations are extremely low around fourth-quarter earnings, despite stock indices trading at multi-year highs, which suggests there's plenty of room for the rally to continue in the short - term."
Weighing on market sentiment today was worse-than-expected industrial production data from the Eurozone. Output fell at an annual rate of 3.7% in November, the largest contraction since November 2009.
- Traders cautious ahead of US earnings season
- Eurozone industrial production disappoints
Dovish comments from a member of the Federal Reserve weren't enough to lift stocks on Monday, as markets remained cautious ahead of a speech by Ben Bernanke this evening and earnings reports from Wall Street heavyweights later this week.
Markets across Europe were supported early on by remarks from Federal Reserve Bank of Chicago President Charles Evans who said that the government should put "in place policies that slowly but surely bring the prospects of future revenues into balance with future spending".
He said that "monetary policy has an important contribution to make" and that the central bank will maintain its expansionary policies until its main goals are met.
However, as analyst Craig Erlam from Alpari explained this afternoon: "There's been an element of caution in the markets today, ahead of Bernanke's speech later at the University of Michigan. We tend to see a lot more volatility in the markets when Bernanke speaks and with the markets being caught off-guard by the apparent three-way split at the last meeting, over when to end the current asset purchases, Bernanke is likely to be bombarded with questions."
Meanwhile, following on from Wells Fargo's results on Friday, traders are now awaiting results from other banking giants this week, including Goldman Sachs, Morgan Stanley, JPMorgan and Bank of America.
Erlam said: "Expectations are extremely low around fourth-quarter earnings, despite stock indices trading at multi-year highs, which suggests there's plenty of room for the rally to continue in the short - term."
Weighing on market sentiment today was worse-than-expected industrial production data from the Eurozone. Output fell at an annual rate of 3.7% in November, the largest contraction since November 2009.
Europe Market Report
Europe midday: Eurozone industrial production drops by most since 2009
- OECD leading indicators show growth stabilising
- Praet (ECB): Too early to talk about exit
- Spanish 10 year bond yields 8bp higher ahead of Thursday auction
- Yen at 20-month low versus the single currency
FTSE-100: 0.15%
Dax-30: 0.58%
Cac-40: 0.42%
FTSE Mibtel 30: 0.43%
Ibex 35: 0.16%
Stoxx 600: 0.03%
European equities are continuing to trade slightly higher despite the release of weaker than expected Eurozone and Italian industrial production figures earlier on and ahead of several policy speeches from different members of the US Federal Reserve, including the President Ben Bernanke himself, tonight.
That comes after two members of the US Fed expressed unease with the current policy settings last week.
Acting as a backdrop, most market commentary is calling attention to remarks out from the chief of the Chicago Federal Reserve, Charles Evans, overnight, to the effect that markets can rest assured that the central bank will maintain its expansionary policies until its main goals are met.
Worth mentioning, industrial production in the Eurozone contracted by 3.7% year-on-year in November, the largest contraction since November 2009, with widespread weakness by sectors but while at the same time being concentrated in periphery countries. Production from the capital goods sector rose by 0.7% versus the prior month, albeit after the previous two months' sharp drops.
The Organisation for Economic Cooperation and Development's (OECD) composite leading indicator for the Eurozone, during the month of November, rose to 99.5 points from 99.4 in the previous month, and points to growth stabilising.
Acting as a backdrop, the Yen hit a 20 month low versus the single currency today.
- Praet (ECB): Too early to talk about exit
- Spanish 10 year bond yields 8bp higher ahead of Thursday auction
- Yen at 20-month low versus the single currency
FTSE-100: 0.15%
Dax-30: 0.58%
Cac-40: 0.42%
FTSE Mibtel 30: 0.43%
Ibex 35: 0.16%
Stoxx 600: 0.03%
European equities are continuing to trade slightly higher despite the release of weaker than expected Eurozone and Italian industrial production figures earlier on and ahead of several policy speeches from different members of the US Federal Reserve, including the President Ben Bernanke himself, tonight.
That comes after two members of the US Fed expressed unease with the current policy settings last week.
Acting as a backdrop, most market commentary is calling attention to remarks out from the chief of the Chicago Federal Reserve, Charles Evans, overnight, to the effect that markets can rest assured that the central bank will maintain its expansionary policies until its main goals are met.
Worth mentioning, industrial production in the Eurozone contracted by 3.7% year-on-year in November, the largest contraction since November 2009, with widespread weakness by sectors but while at the same time being concentrated in periphery countries. Production from the capital goods sector rose by 0.7% versus the prior month, albeit after the previous two months' sharp drops.
The Organisation for Economic Cooperation and Development's (OECD) composite leading indicator for the Eurozone, during the month of November, rose to 99.5 points from 99.4 in the previous month, and points to growth stabilising.
Acting as a backdrop, the Yen hit a 20 month low versus the single currency today.
Spanish house transactions fall
The German wholesale price index for the month of December remained flat versus the previous month (Consensus: 0.1%).
Eurozone industrial production decreased by 0.3% month-on-month in November (Consensus: 0.2%), weighed down by very large falls in the periphery countries, such as Ireland, Italy and Spain.
Italy's industrial production dropped by an unexpected 1.0% month-on-month in November (Consensus: 0%).
Spanish house transactions fell at a 6.1% year-on-year pace in November, versus a rise of 12.8% in the previous month.
Euro/dollar still trading higher
The euro/dollar is now up by 0.20% to the 1.3369 dollar level.
Front month Brent crude futures are now rising by 0,557 dollars to the 111.26 mark on the ICE.
US Market Report
US open: Apple weighs on Wall Street
- Apple down 3 per cent on reports of lower component orders
- Gartner says global PC shipments fell 4.9 per cent in Q4
- Obama to speak at 16:30
Dow Jones Industrials: 0.02%
Nasdaq Comp.: -0.40%
S&P 500: -0.21%
The major US equity benchmarks are now trading mixed following a lower open and on a day bereft of economic data or first tier company earnings announcements.
Filling the vacuum is Apple. Its shares dropped by almost 5% after the Nikkei newswire reported that the company is reducing its production plans following lower than expected sales of its iPhones.
For its part The Wall Street Journal cited two unnamed sources according to which the company has lowered its first quarter orders for iPhone screens by almost half.
Some market commentary is also calling attention to the potential impact which new open source operating systems could end up having on incumbents such as Apple.
Billionaire investor Charles Icahn has acquired a stake in offshore rig contractor Transocean.
Hewlett Packard is higher after JP Morgan upgraded its views on the company's shares to neutral from underperform.
IBM has been downgraded by JP Morgan to neutral from overweight.
Ten-year US Treasury yields are now falling by 2 basis points, to the 1.84% mark.
Front month West Texas crude futures are now down by 0.12% to the 93.75 dollar mark on the NYMEX.
- Gartner says global PC shipments fell 4.9 per cent in Q4
- Obama to speak at 16:30
Dow Jones Industrials: 0.02%
Nasdaq Comp.: -0.40%
S&P 500: -0.21%
The major US equity benchmarks are now trading mixed following a lower open and on a day bereft of economic data or first tier company earnings announcements.
Filling the vacuum is Apple. Its shares dropped by almost 5% after the Nikkei newswire reported that the company is reducing its production plans following lower than expected sales of its iPhones.
For its part The Wall Street Journal cited two unnamed sources according to which the company has lowered its first quarter orders for iPhone screens by almost half.
Some market commentary is also calling attention to the potential impact which new open source operating systems could end up having on incumbents such as Apple.
Billionaire investor Charles Icahn has acquired a stake in offshore rig contractor Transocean.
Hewlett Packard is higher after JP Morgan upgraded its views on the company's shares to neutral from underperform.
IBM has been downgraded by JP Morgan to neutral from overweight.
Ten-year US Treasury yields are now falling by 2 basis points, to the 1.84% mark.
Front month West Texas crude futures are now down by 0.12% to the 93.75 dollar mark on the NYMEX.
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