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Daily FX Commentary: (Morning Report)
EUR/USD
The Euro remains under pressure, following today’s rejection under 1.3000 barrier and sharp fall that tested 1.2900, figure / trendline support / 4h Senkou span A. Bounce from here failed to sustain gains, despite regaining 1.2960, Fib 61.8% of 1.2990/1.2900 descend and Asian session low, as hourly studies hold in the negative zone and descending 20 day EMA capping gains for now. As 4h chart studies are attempting below the midlines and price slides below MA’s, day’s low at 1.2900 remains in focus, with break here to spark fresh weakness and possible test of key near-term supports at 1.2825/00, 200 day MA / 01 Oct low. Any further bounce requires break above 1.3000, psychological barrier and Fib 61.8% of larger 1.3070/1.2900 descend, to ease immediate bear-pressure.
Res: 1.2960, 1.2990, 1.3000, 1.3030
Sup: 1.2900, 1.2875, 1.2825, 1.2800
GBP/USD
Cable undergoes near-term consolidative action, following fresh bearish extension and test of psychological 1.6000 support. Overall negative tone keeps near-term focus at the downside, however, oversold conditions on 1 & 4h charts, do not rule out further correction, before bears re-assert. Previous low at 1.6066 and round figure resistance at 1.6100, offer solid barriers and are expected to cap any bounce, before bears take control. Loss of 1.6000 to open another important hurdle at 1.5910/00, previous high of 23 Aug / Fib 38.2% of 1.5267/1.6308 and 55 day MA.
Res: 1.6045, 1.6066, 1.6100 1.6140
Sup: 1.6000, 1.5958, 1.5910, 1.5900
USD/JPY
The pair remains under pressure, moving within a narrowing range, with 78.00 still holding the downside, but gains being limited by descending 55 day EMA, approx 38.2% of 78.86/78.07 downleg. Slight improvement on hourly studies, still needs to see break above minimum 78.40/60 zone, tentative bear-trendline / Fibonacci resistance, to re-focus upper barriers at 78.86 and 79.00, ahead of key hurdles at 79.21/32. Otherwise, slide through 78.20, day’s low and pivotal 78.00, would spark fresh weakness and re-open 77.42 and 77.12 lows.
Res: 78.40, 78.59, 78.71, 78.86
Sup: 78.20, 78.07, 78.00, 77.78
USD/CHF
Penetration through 0.9350 barrier that kept the upside capped from yesterday, as well al Ichimoku cloud top at 0.9380, sees potential for attack at key resistance zone at 0.9400/36, 200 day MA / 01 Oct top, to confirm near-term base and allow for stronger recovery of larger 0.9970/0.9237 descend. With positive hourly studies that started to point higher and 4h indicators emerging above the centrelines, break and close above 0.9400 would be a good signal for further extension higher. Only break below day’s low at 0.9320, would delay bulls.
Res: 0.9383, 0.9400, 0.9416, 0.9436
Sup: 0.9343, 0.9320, 0.9300, 0.9273
Daily Market Commentary: (Evening Report)
London close: Growth concerns sink stocks for second straight day
Market Movers
- techMARK 2,128.68 -0.81%
- FTSE 100 5,810.25 -0.54%
- FTSE 250 11,911.76 -0.53%
- Miners gain, but Footsie finishes firmly lower
- IMF cuts forecasts; investors nervous ahead of Alcoa
- UK economic data paints gloomy picture
With the International Monetary Fund (IMF) cutting its growth forecasts and Wall Street starting on the back foot ahead of third-quarter earnings season, the Footsie slid to an intraday low by the close in London on Tuesday.
"European financial markets dropped today, as global growth concerns prompted caution ahead of the upcoming US 3Q earnings season. Traders demonstrated nerves over faltering global economic contraction feeding through into the corporate sector before Alcoa kicked off the season later this evening," said market strategist Ishaq Siddiqi from ETX Capital.
However despite the slump, the heavyweight mining sector held up relatively well today, as hopes for economic stimulus in China lifted shares in afternoon trade.
China's central bank injected 265bn yuan (£26bn) into the world's second-largest economy in reverse repurchase agreements overnight. Meanwhile, Zhou Xiaochuan, the governor of the People's Bank of China, said that while the external environment for China's economic growth is "very grim", the central bank will keep the continuity and stability in monetary policy and will "make policy more pre-emptive, targeted and effective".
The IMF has cut global economic growth forecasts for this year and next because "prospects have deteriorated further and risks increased". According to its "World Economic Outlook", the IMF now expects the world economy to grow 3.3% in 2012 compared to the prior 3.5% July estimate and just 3.6% in 2013, down from the previous 3.9% forecast. Forecasts for the Eurozone, UK and emerging markets were all cut.
Economic figures from the UK also added to the gloom today. The British deficit in visible goods widened from £7.3bn to £9.8bn in August, according to the Office for National Statistics (ONS). The consensus estimate had been for a smaller increase to £8.5bn.
The ONS also said that domestic industrial output fell 0.5% in the same month, in line with forecasts. However, analysts at Barclays Research said the data is consistent with its view that industrial and manufacturing output is likely to rebound during this period after the Jubilee holiday-related weakness observed during the second quarter."
German Chancellor Angela Merkel flew to Greece today - her first trip to the country in five years – to keep the pressure on Athens to stick with its harsh austerity measures. Merkel expressed her support for Greece, signalling that the country has gone a long way. Her arrival was met with protests by an estimated 25,000 people today.
IMF Managing Director Christine Lagarde said today that Greece must do more "on all fronts" before the IMF could consider paying out the next tranch of aid worth €31bn.
- IMF cuts forecasts; investors nervous ahead of Alcoa
- UK economic data paints gloomy picture
With the International Monetary Fund (IMF) cutting its growth forecasts and Wall Street starting on the back foot ahead of third-quarter earnings season, the Footsie slid to an intraday low by the close in London on Tuesday.
"European financial markets dropped today, as global growth concerns prompted caution ahead of the upcoming US 3Q earnings season. Traders demonstrated nerves over faltering global economic contraction feeding through into the corporate sector before Alcoa kicked off the season later this evening," said market strategist Ishaq Siddiqi from ETX Capital.
However despite the slump, the heavyweight mining sector held up relatively well today, as hopes for economic stimulus in China lifted shares in afternoon trade.
China's central bank injected 265bn yuan (£26bn) into the world's second-largest economy in reverse repurchase agreements overnight. Meanwhile, Zhou Xiaochuan, the governor of the People's Bank of China, said that while the external environment for China's economic growth is "very grim", the central bank will keep the continuity and stability in monetary policy and will "make policy more pre-emptive, targeted and effective".
The IMF has cut global economic growth forecasts for this year and next because "prospects have deteriorated further and risks increased". According to its "World Economic Outlook", the IMF now expects the world economy to grow 3.3% in 2012 compared to the prior 3.5% July estimate and just 3.6% in 2013, down from the previous 3.9% forecast. Forecasts for the Eurozone, UK and emerging markets were all cut.
Economic figures from the UK also added to the gloom today. The British deficit in visible goods widened from £7.3bn to £9.8bn in August, according to the Office for National Statistics (ONS). The consensus estimate had been for a smaller increase to £8.5bn.
The ONS also said that domestic industrial output fell 0.5% in the same month, in line with forecasts. However, analysts at Barclays Research said the data is consistent with its view that industrial and manufacturing output is likely to rebound during this period after the Jubilee holiday-related weakness observed during the second quarter."
German Chancellor Angela Merkel flew to Greece today - her first trip to the country in five years – to keep the pressure on Athens to stick with its harsh austerity measures. Merkel expressed her support for Greece, signalling that the country has gone a long way. Her arrival was met with protests by an estimated 25,000 people today.
IMF Managing Director Christine Lagarde said today that Greece must do more "on all fronts" before the IMF could consider paying out the next tranch of aid worth €31bn.
Europe Market Report
Europe midday: Stocks recover partially
-IMF cuts global growth forecasts
-Portugal receives one year extension on adjustments
-Greek Finance Minister says lenders may give country more time
-Germany and France pushing for financial transactions tax
-Spanish 10 year benchmark bond changes today
-Italian 10 year bond yields flat at 5.09%
-China CB injects 42.2bn dollars in reverse repos
FTSE-100:-0.22%
Dax-30: -0.40%
Cac-40: 0.19%
FTSE-Mibtel 30: 0.44%
Ibex 35: -0.83%
Stoxx 600: -0.07%
European equity markets have recovered partially, after having teetered lower at mid-morning.
That after yesterday´s meeting of Eurozone finance ministers, which saw them grant Portugal an extra year to carry out its adjustment, although economic authorities –Greece´s lenders- are being described as still at loggerheads over how to tackle the country´s crisis.
As if to underline the risks which the world economy is currently facing, the International Monetary Fund (IMF) yesterday forecast that global growth will only rise by 3.3% this year and 3.6% next year. The Washington based lender´s 2012 forecast is the lowest since 2009. Furthermore, the IMF is now said to see "alarmingly high risks" of a steeper slowdown, with a one-in-six chance of the rate of expansion dropping south of 2% (commonly accepted to be the threshhold for recessions at the global level).
Particularly worth highlighting, at first glance, are the Fund´s new estimates of the peak levels which Greece and Spain´s public debt piles are now expected to hit. Many observers see them as proof that excessive austerity may backfire.
Acting as a backdrop, China´s central bank last night injected $42.2bn into the country´s money markets via so-called reverse repos, in what some consider a bid to stimulate growth.
-Portugal receives one year extension on adjustments
-Greek Finance Minister says lenders may give country more time
-Germany and France pushing for financial transactions tax
-Spanish 10 year benchmark bond changes today
-Italian 10 year bond yields flat at 5.09%
-China CB injects 42.2bn dollars in reverse repos
FTSE-100:-0.22%
Dax-30: -0.40%
Cac-40: 0.19%
FTSE-Mibtel 30: 0.44%
Ibex 35: -0.83%
Stoxx 600: -0.07%
European equity markets have recovered partially, after having teetered lower at mid-morning.
That after yesterday´s meeting of Eurozone finance ministers, which saw them grant Portugal an extra year to carry out its adjustment, although economic authorities –Greece´s lenders- are being described as still at loggerheads over how to tackle the country´s crisis.
As if to underline the risks which the world economy is currently facing, the International Monetary Fund (IMF) yesterday forecast that global growth will only rise by 3.3% this year and 3.6% next year. The Washington based lender´s 2012 forecast is the lowest since 2009. Furthermore, the IMF is now said to see "alarmingly high risks" of a steeper slowdown, with a one-in-six chance of the rate of expansion dropping south of 2% (commonly accepted to be the threshhold for recessions at the global level).
Particularly worth highlighting, at first glance, are the Fund´s new estimates of the peak levels which Greece and Spain´s public debt piles are now expected to hit. Many observers see them as proof that excessive austerity may backfire.
Acting as a backdrop, China´s central bank last night injected $42.2bn into the country´s money markets via so-called reverse repos, in what some consider a bid to stimulate growth.
US Market Report
US open: Investors step back ahead of results season
- Market movers
Dow Jones: -55 at 13,528
S&P 500: -3 at 1,453
NASDAQ Composite: -43 at 3,089
According to its "World Economic Outlook", the IMF now expects the world economy to grow 3.3% in 2012 compared to the prior 3.5% July estimate and just 3.6% in 2013, down from the previous 3.9% forecast. Forecasts for the Eurozone, UK and emerging markets were all cut.
Stateside, confidence among small businesses eased off in September, according to the results of a survey by the National Federation of Business.
The Federation's optimism index retreated to 92.8 from 92.9 in August, the fourth time in the last five months that the index has moved lower.
Other markets
As tensions rise between Syrian and Turkey, the price of oil is heading higher. The November contract for West Texas intermediate is up $1.16 to $90.49 a barrel.
Gold for December delivery is down again today, however, at $1,773.30 an ounce, $2.40 lower on the day.
US Treasuries are firmer, with 10-year Treasuries up 3/16 of a dollar, pushing 10-year yields down to 1.70% from 1.74% overnight.
As tensions rise between Syrian and Turkey, the price of oil is heading higher. The November contract for West Texas intermediate is up $1.16 to $90.49 a barrel.
Gold for December delivery is down again today, however, at $1,773.30 an ounce, $2.40 lower on the day.
US Treasuries are firmer, with 10-year Treasuries up 3/16 of a dollar, pushing 10-year yields down to 1.70% from 1.74% overnight.
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