The appetite for risk is very limited ahead of the US open amid concern over weak earnings, and debt crisis and overall economic weakness in Eurozone. Most European and commodity currencies open little changed, while the yen reversed from a 4-month low on profit taking. The Asian stock indexes were mostly lower. The European bourses are down and the US stock markets are lower in pre-open trading. Gold, oil and silver are down as well.
The short-term outlook for the European and commodity currencies is sideways. The medium-term outlook for most of the foreign currencies is still slightly bullish. The LGR short-term model is short on yen, sterling and Canadian dollar, and long euro, franc and Australian dollar.
Good luck!
Overnight
Japan: The national CPI eased 0.3% in September y-o-y after slipping 0.4% in August. The core CPI eased 0.6% from -0.5%. The Tokyo CPI fell 0.8% in October y-o-y following -0.7% in September. The core Tokyo CPI was -1.0%, up from -1.1%.
Germany: The Gfk consumer confidence index for November rose unexpectedly to 6.3 from an upwardly revised 6.1 in October. This is the highest reading since October 2007.
Eurozone: The leading economic index decreased 0.4% in September following a 0.5% increase in August.
France: Consumer confidence slipped to 84 in October from 85 in September.
Switzerland: The KOF Leading Indicator slipped to 1.67 in October from 1.68 in September.
Today's economic calendar
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US: Gross Domestic Product for the third quarter
US: Reuters/Michigan consumer sentiment index for October
EUR – December
Luca Model: Short since October 19
The December euro opens little changed below the 21-day exponential moving average. The euro peaked near a four-month high on September 17 and bottomed at an over two-year low in July.
The short-term outlook is sideways. The medium-term outlook is bullish but my model is short.
The 21-day exponential moving average resists at 1.2970. Further resistance is at 1.3050 and 1.3145.
The 200-day exponential moving average supports at 1.2911. Distant support is at 1.2844.
INDICATORS
Fast stochastics: Bearish
MACD: Sideways
Ichimoku: Sideways
OUTLOOK
NEAR-TERM: Sideways
MEDIUM-TERM: Bullish
LONG-TERM: Sideways
JPY – December
Luca Model: Short since September 28
The oversold December Japanese yen opens a little higher after reversing from a four-month low. It is trading well below the 21-day exponential moving average. The yen had peaked at a seven-month high on September 13.
The short-term outlook is sideways. The medium-term outlook is sideways my model is short.
Initial resistance is at 1.2555. The 21-day exponential moving average resists at a distant 1.2649.
A pivot low is at 1.2438. Further support is at 1.2300.
INDICATORS
Fast stochastics: Bearish
MACD: Bearish
Ichimoku: Bearish
OUTLOOK
NEAR-TERM: Sideways
MEDIUM-TERM: Sideways
LONG-TERM: Sideways
GBP – December
Luca Model: Short since September 26
The December pound opens flat after climbing to a one-week high on Thursday. It is trading above the 21-day exponential moving average. The pound marked a new high for the uptrend on September and bottomed at a 4 1/2-month low on June 1.
The short-term outlook is sideways. The medium-term outlook is sideways and my model is short.
Initial resistance is at 1.6175. Further resistance is at 1.6270.
The 21-day exponential moving average supports at 1.6068 and the 55-day exponential moving average supports at 1.5995.
INDICATORS
Fast stochastics: Bullish
MACD: Slightly bearish
Ichimoku: Slightly bearish
OUTLOOK
NEAR-TERM: Sideways
MEDIUM-TERM: Sideways
LONG-TERM: Sideways
CHF – December
Luca Model: Short since October 19
The December Swiss franc opens off an 11-day low after closing below the 21-day exponential moving average on Thursday. The franc peaked at a high for the uptrend on October 17 and bottomed at a 19-month low on July 24.
The short-term outlook is sideways. The medium-term outlook is bullish but my model is short.
Initial support is at 1.0680. Further support is at 1.0633.
Immediate resistance is at 1.0775. The next cap is 1.0805. The peak of the uptrend is 1.0861.
INDICATORS
Fast stochastics: Slightly bearish
MACD: Slightly bearish
Ichimoku: Slightly bullish
OUTLOOK
NEAR-TERM: Sideways
MEDIUM-TERM: Bullish
LONG-TERM: Sideways
CAD – December
Luca Model: Short since September 17
The December Canadian dollar remains under pressure in an inside range after marking a 2 1/2-month low on Tuesday. It has been trading in a channel rising since late July. The Canadian dollar had marked a high for the uptrend on September 14 and bottomed at a 5 1/2-month low on June 1.
The short-term outlook is sideways. The medium-term outlook is bullish but my model is short.
Tuesday’s low is 1.0012. The 200-day exponential moving average supports at 0.9991. Further support is at .9900.
Immediate resistance is at 1.0100. The 21-day exponential moving average caps at 1.0119. Distant resistance is at 1.0240.
INDICATORS
Fast stochastics: Sideways
MACD: Slightly bearish
Ichimoku: Sideways
OUTLOOK
NEAR-TERM: Sideways
MEDIUM-TERM: Bullish
LONG-TERM: Sideways
AUD – December
Luca Model: Long since October 16
The December Australian dollar opens slightly lower after closing off a one-month high on Thursday. The Aussie is trading above the 21-day exponential moving average. It has been advancing since June 4. The Aussie bottomed at a one-month low on October 8 and marked a high for the uptrend on September 14.
The short-term outlook is sideways. The medium-term outlook is bullish and my model is long.
The 21-day exponential moving average supports at 1.0262. The next support is at 1.0190.
A short-term top is at 1.0363. Further resistance is at 1.0442.
INDICATORS
Fast stochastics: Sideways
MACD: Slightly bullish
Ichimoku: Slightly bullish
OUTLOOK
NEAR-TERM: Sideways
MEDIUM-TERM: Bullish
LONG-TERM: Sideways
