FXstreet.com

21

0

Asian Session − Slight Rally in Risky Assets

Fri, Nov 21 2008, 09:53 GMT
by Peter Rosentreich

ACM - Advanced Currency Markets


Market Brief

The Usd was mixed in the Asian Session, as equities rallied and risk appetite increased. Markets are watching the potential divergence between Usd and stock markets. Yesterday, the S&P fell by more than 6%, while the EurUsd gained, just adding support to the divergence theory. For the last 4 months, the tight correlation has had significant effect on traders positioning and, should decoupling continue, it will leave markets without a perceived critical driver. In Asia, the EurUsd slid to 1.2424 before rallying back to 1.2546, while the UsdJpy collapsed to 93.57 and then climbed to 95.00. With the abrupt reversal in Jpy, carry trades were also revived with the AudJpy climbing from 56.88 to 59.79. The GbpJpy rose to 141.10. Asian regional indexes are broadly positive, with only Shanghai lower. European futures are point to a positive open. Crude prices continue to hover around the $50.0bll handle, as demand just hasn’t returned even at these attractive prices. Volatility is still a major player, with VIX trading at 80. Overall, it was another tough week for risky assets, with VIX rising above 70% again, credit spreads reaching new highs, stock indexes dropping to new lows and continued weakness in commodity prices. Given the pessimistic malaise now cover the financial markets we don’t anticipate any near term change in themes.

In Japan the BoJ held rates at 0.30%, which was widely expected despite confirmation this week that the economy has slid into a recession. The Bank core assessment in their Economic Assessment was the economy was still sluggish and recovery to take awhile. The statement from the BoJ’s November Monetary Policy Meeting held on to the wording "increasingly sluggish" growth as the economic assessment. Again, saying previous increases in energy and materials prices and decreasing export growth the culprit. Although the outlook still expects a gradual reduction to moderate growth, the BOJ again stated that "it will take some time for the necessary conditions for Japan ’s economic recovery to be satisfied….given the slowdown in overseas economies and turmoil in global financial markets".

The calendar today is on the light side, with no major events or data scheduled in the UK or US. ECB's President Trichet will contribute in a discussion on Bretton Woods II in Frankfurt , However, we don’t expect any comments on monetary policy or other market moving remarks. Euro-zone PMI surveys for November will probably indicate that output in the eurozone is continuing to contract in Q4.

Snap Shot

Global indexes Current level % Change
Nikkei 225 Index7,910.792.69
Hang Seng Index12,659.202.93
Shanghai Index1,969.30-0.72
FTSE 100 Index3,896.340.55
CAC 40 Index3,008.020.92
DAX Index4,250.130.7
DJIA futures7,771.003.79

World markets Current level % Change
Gold758.781.84
Silver9.242.99
VIX80.868.88
Crude wti49.560.28
USD Index87.84-0.14

Todays calender Estimates Previous Country / GMT
PMI Manufacturing (Nov Prov.)40.541.1EZ / 8.00
PMI Services (Nov Prov.)4545.8EZ / 8.00
PMI Composite (Nov Prov.)42.843.6EZ / 8.00
ECB’s Gonzalez-Paramo on Economic Uncertainty----EZ / 10.30
ECB’s Trichet in Panel Disc. on Bretton Woods II----EZ / 12.00
CPI Core (Oct) y/y1.91.7CA /12.00
CPI (Oct) y/y3.13.4CA / 12.00


Currency Tech

AUDUSD
R 3: 0.6696
R 2: 0.6596
R 1: 0.6416
CURRENT: 0.6238
S 1: 0.6077
S 2: 0.6009
S 3: 0.5875

EURJPY
R 3: 124.30
R 2: 121.17
R 1: 119.31
CURRENT: 119.27
S 1: 116.44
S 2: 115.00
S 3: 113.59

USDSGD
R 3: 1.5684
R 2: 1.5436
R 1: 1.5339
CURRENT. 1.5315
S 1: 1.5266
S 2: 1.5167
S 3: 1.5051

  • S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot


Archive

Advanced Currency Markets, S.A.  | 50 Rue du Rhone CH-1204 Geneva
http://www.ac-markets.com | support@ac-markets.com

Legal disclaimer and risk disclosure

This report has been prepared by AC Markets and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by AC Markets personnel at any given time. ACM is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.

Related reports

FX View - Headline unemployment rate creates dollar shocker by Interactive Brokers LLC
Fri, Nov 6 2009, 18:41 GMT

Forex Daily Overview - USD mixed, unemployment rises to 10.2% by Easy Forex
Fri, Nov 6 2009, 18:31 GMT

Forex Technical Report - Dollar Trading Lower Ahead of U.S. Jobs Data by ForexHound.com
Fri, Nov 6 2009, 13:19 GMT

FX Thoughts for the Day by Kshitij Consultancy Service
Fri, Nov 6 2009, 12:02 GMT

Daily FX Report - The USD climbed to 90.62 versus the JPY by Varengold Wertpapierhandelsbank AG
Fri, Nov 6 2009, 11:08 GMT

audusd, asia

View All

Related content


Interested in forex trading? forex brokerage firms!


FOREX.com
Contact the broker/FDM
Open a demo account
ACM Advanced Currency Markets SA
Contact the broker/FDM
Open a demo account
Saxo Bank A/S
Contact the broker/FDM
Open a demo account
FXDD
Contact the broker/FDM
Open a demo account
City Credit Capital (UK) Limited
Contact the broker/FDM
Open a demo account

GET CASH BACK FOR YOUR TRADES!   Learn more about the Pip Rebate Program

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.

Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. FXstreet.com has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.

Any opinions, news, research, analyses, prices or other information contained on this website, by FXstreet.com, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXstreet.com will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

©2009 "FXstreet.com. The Forex Market" All Rights Reserved.