M. Hewson: l’euro sfrutta le ricoperture in vista del meeting di giovedì
• Dollaro, previsto un rimbalzo oggi in attesa di dati migliorativi sulle vendite al dettaglio e sulle indicazioni di una Fed decisa a non incrementare il QE2
• Euro supportato dalle ricoperture dei traders in vista del meeting europeo di giovedì
• Principali cross-spot valutari
FOREX MORNING COMMENT
London –14th December 2010
Yesterday’s announcement by credit ratings agency Moody’s that the latest US tax package increased the likelihood of a negative outlook on the US AAA rating in two years, put the skids under the dollar yesterday afternoon and sent it back near to its range lows against a basket of currencies. This fact, combined with some broad US dollar weakness as a result of renewed risk appetite after China held interest rates, saw the US dollar slip back. Today’s US advance retail sales and PPI data for November could go some way to arresting that decline, as could today’s FOMC meeting, which will in all likelihood see the Fed maintain its current course with respect to QE2. After Fed Chairman Bernanke’s comments on CBS’s “60 minutes” on December 5th, there is some skittishness with respect to the Fed actually increasing the $600bn package, however that seems very unlikely at this stage, given the recent improvement in economic data. Advance retail sales are expected to have increased by 0.6%.
The euro has also been helped by the fact that the European Central Bank purchased nearly €2.7bn worth of peripheral sovereign bonds last week, well above the previous week’s figure, which prompted traders to cover short positions ahead of this Thursday’s EU summit as thin trading conditions prompted sharp price moves. The euro also gained against the pound for the same reasons, though we could see the single currency weaken again if today’s UK CPI and RPI figures come out in line, or in excess of expectations. Year on year CPI for November is expected to come in at 3.2%, but given the recent rise in commodity prices it wouldn’t be unexpected if the figure came in higher, while RPI is expected to come in around 4.5%, year on year.
EURUSD – the failure to break below the support level at 1.3170/80 yesterday provoked a sharp rally higher yesterday, taking out resistance at 1.3320, but failing again at last weeks highs around 1.3435/40. While the euro remains below these highs and the 1.3470 level, which is 38.2% retracement of the down move of 1.4280/1.2965 the momentum remains firmly anchored towards the down side. A sustained break below the recent lows between 1.3170/80 remains the catalyst for a retest of the 1.3000 level and the previous lows around 1.2965.
GBPUSD – yesterday’s US dollar weakness saw the pound rebound from the low 1.5700’s and again try and test the key resistance at the 1.5890 level, which is 50% of the down move from 1.6300/1.5485. This time the pound was able to reach the resistance but was unable to close above it, though if it were to do so we could well see 1.5985 which would be the 61.8% retracement of the same move. Until the pound is able to close above 1.5900 it would seem that the recent choppy range could well continue with the key support remaining around the 1.5655/60 level, and last weeks lows. Below that the major support remains above trend line support at 1.5550/60 from the 1.4230 lows, and the 38.2% retracement level at 1.5510. The 1.5265 50% retracement level remains the longer term target on a break below 1.5500.
EURGBP – the inability of the single currency to push below the recent lows at 0.8330 saw the single currency succumb to its susceptibility to squeeze the short positions yesterday, and subsequently we got a squeeze back above 0.8445/50, and slightly beyond that. However until such times as the market is able to take the euro back above 0.8500 and the 200 day MA at 0.8530, the downside pressure looks likely to remain intact. A break below the November lows would then open up the possibility of a move towards trend line support from the 0.8065 lows at 0.8295.
USDJPY – the failure to break above resistance at 84.20/40 saw the US dollar sell off quite sharply and saw the dollar slightly overshoot support at 83.30. Any rally needs to overcome the 83.70 area to establish a move back to 84.20, or we could see a deeper sell-off back towards the 50 day MA and support around 82.35/45. The potential for a move to test the 85.80 level on a break above 84.20/40 remains intact for now, and would only be negated by a fall through the 50 day moving average, and support around the 82.35/45 level, which would then target 81.80. FTSE100 is expected to open 5 points higher at 5,865.