Euro tumbles below 1.23, USD strong on hopes of stimulus
This was an eventful week in terms of expectations and its resultant outcome. Starting with the American markets, stocks gave mixed endings as US added just 80,000 jobs in June, darkening the outlook for the US recovery and dashing some of the political momentum President Obama gained after the Supreme Court upheld his healthcare law last week. The lackluster pace of job creation, which left the unemployment rate unchanged at 8.2%, adds to mounting evidence that the American economy is feeling the effects of both the Euro-zone debt crisis and slower growth in large emerging markets such as China. The benchmark index is less than 0.1% above where it was two months ago. Among the marquee indices, NASDAQ remained the only index that gained weekly by 0.1%. However, Dow got lower by 0.8%, followed by S&P 500 (-0.6%). On the European side, stocks extended declines for a third day as payrolls in the world’s biggest economy increased less than forecast in June. German industrial output rebounded more than economists forecast in May as construction buttressed Europe’s largest economy against the sovereign debt crisis. The price of goods leaving UK factories fell the most in more than 3 1/2 years. The FTSE 100 rose by 1.6%. However, DAX and CAC 40 fell by 0.1% and 0.9% respectively. Asian stocks rose this week, with the indices capping its fourth advance in five weeks, on anticipation central banks would ease monetary policy to spur growth. Hang Seng rose by 1.8%, followed by Nikkei, which rose by 0.2%.
Wall Street has been running in circles for the past two months, and the pattern may continue despite the upcoming start of the earnings seasons. After three major central banks eased monetary policy this week, investors will comb through the minutes of the latest Federal Reserve policy meeting, which will be released on Wednesday, to see what officials said about a further round of asset purchases. Europe remains on traders' minds despite an agreement last week that opens the door for troubled banks to receive rescue funds. In Asia, China is set to report YoY GDP growth. Other Chinese data next week include inflation, loan growth, trade balance and retail sales.
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UPCOMING EVENTS :
2012-07-09 N/A | UK - BOE Deputy Governor Paul Tucker speaks
2012-07-09 12:30 GMT | EMU - ECB President Draghi's Speech
2012-07-09 15:55 GMT | US - FOMC Member Williams speech
2012-07-09 19:00 GMT | US - Consumer Credit Change (May)
FOREX NEWS :
2012-07-09 04:38 GMT | GBP/USD unchanged after 1% drop, starting week at 5-week lows
2012-07-09 03:30 GMT | China CPI hints more PBoC cuts to come - UBS
2012-07-09 03:16 GMT | BoJ easing expansion unlikely this week - UBS
2012-07-09 01:37 GMT | China: CPI increased only 2.2% in June
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EURUSD : 1.22863 / 1.22869
DAILY WEEKLY MONTHLY
1.2496 | 1.2439 | 1.2360
1.2250 | 1.2175 | 1.2095
SUMMARY : Neutral
TREND : Sideway
MA10 : Bearish
MA20 : Bearish
STOCHASTIC : Neutral
MARKET ANALYSIS - Intraday Analysis
Technicals remain bearish as additional downside momentum is building. Risk/return is better elsewhere. There is support at 1.2150 which was a pivot in June 2010 and is joined by the 161.8% extension at 12142. The 61.8% extension comes in at 12068. On the near term charts we see supports at 1.2288, 1.2190 and then at 1.2132 whereas resistance levels are seen at 1.2365, 1.2401 and then at 1.2450.
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GBPUSD : 1.54909 / 1.54919
DAILY WEEKLY MONTHLY
1.5584 | 1.5552 | 1.5517
1.5457 | 1.5420 | 1.5384
SUMMARY : Neutral
TREND : Sideway
MA10 : Bearish
MA20 : Bearish
STOCHASTIC : Neutral
MARKET ANALYSIS - Intraday Analysis
Technicals are bearish and indicators suggest a decline, 1.5485 (June 28 low) is key level to watch as the GBP found new resistance levels at 1.5563, if the price moves below these levels it supports a new downward trend. Supports are seen at 1.5500, 1.5485 and then at 1.5473, whereas resistance levels are seen at 1.5598, which is the 21-DMA line and then at 1.5601, which is the 10-DMA.
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USDJPY : 79.692 / 79.697
DAILY WEEKLY MONTHLY
80.22 | 80.02 | 79.80
79.42 | 79.23 | 79.04
SUMMARY : Down
TREND : Down trend
MA10 : Bearish
MA20 : Bullish
STOCHASTIC : Neutral
MARKET ANALYSIS - Intraday Analysis
Technicals are bullish with the uptrend set to continue as support from 21 day MA (79.59) is solid. The pair settled the week little changed, supports are seen at 79.60/41 and then at 79.23. On the other hand, resistance levels are seen at 80.02/10 and then at 80.56.
Source: FX Central Clearing Ltd, (http://www.fxcc.com)