M. Hewson: Pmi atteso debole, riflettori puntati sulla Fed

Scritto il alle 10:19 da cmcmarkets

Forex Morning Comments a cura di  Michael Hewson (Senior Market Analyst)  e di Tim Waterer (Senior Trader) di CMC Markets

Alla vigilia della riunione e della successiva conferenza stampa della Bce di domani i rischi di vedere nuovi ribassi sembrerebbe prevalere rispetto ai flussi di acquisto registrati negli ultimi giorni. Si consideri che i mercati stavano salendo sulle attese di un intervento immediato da parte della banca centrale europea e che nell’incertezza molti hanno provveduto ad incassare i guadagni ; mentre per quanto rigarda la Fed, si dà quasi per assodato che la decisione sul QE3 possa essere presa a settembre (il massimo che si potrà ottenere sarò una dichiarazione sull’estensione dei tassi eccezionalmente bassi fino al 2015) ,oggi invece sono analizzate più attentamente le ipotesi in base alle quali potremmo assistere anche ad un vero e proprio D-Day per l’Eurozona qualora l’Eurotower non faccia seguire immediatamente le azioni alle già annunciate intenzioni.
Che i leader europei siano disposti ad ammetterlo o no, il combinato disposto crescita zero e disoccupazione in salita rappresentano le vere cause dell’allontanamento degli investitori dall’Europa, a prescindere da quanto farà nel breve la Bce. SullEurollaro solo una rottura al ribasso di 1,2220 ci ouò riportare a 1,2150  mentre si mantengono intatte le possibilità di un rimbalzo a1,26. Sul cambio DollaroUSA Dollaro Australiano l’Aussie potrebbe ripartire verso 1,06 nei prossimi due giorni qualora la FED dichiarasse che il QE3 fosse ad un passo di distanza. In caso contrario, tornerebbe a 1.0370-1.0420.

Manufacturing PMI’s set to remain weak, as FOMC awaited

(Comments below have been provided by CMC Markets Senior Market Analyst Michael Hewson)

Europe will once again hog the limelight this morning following on from yesterday’s abysmal unemployment data. This time the data in question is the final manufacturing PMI data for July from across Europe, with all readings expected to come in below the 45 level. Spanish and Italian PMI are expected to come in the worst with the last reading of Spanish PMI coming in at 41.1 while Italian PMI is expected to slip further from 44.6 to 44.1. French, German and Eurozone manufacturing PMI’s are expected to remain unchanged at 43.6, 43.3 and 44.1 respectively; highlighting perfectly the problems Europe is buckling under.

No growth and rising unemployment are a toxic mix, which irrespective of what happens tomorrow at the ECB rate meeting is the key issue facing European leaders whether they want to admit it or not.

Both Italian Prime Minister Monti and French President Hollande both reiterated yesterday that they both stood ready to “do everything” to protect the euro.  Unfortunately markets tend to treat such comments with the indifference they deserve given that previous actions have rarely lived up to such statements. Their words might carry more weight if they were prepared to give up the necessary sovereignty and oversight on fiscal discipline required to make the euro work better, which would then make a banking union more likely.

In the UK the latest data on the British economy isn’t much better after last weeks disappointing GDP number and this morning’s manufacturing PMI is expected to remain weak, though it is only expected to weaken slightly from the June reading of 48.6 to 48.4. The main event of the day, however setting aside this afternoon’s ADP payrolls and US ISM manufacturing number is the latest US Federal Reserve FOMC rate meeting.

Markets have been building up expectations as to the timing of further policy easing measures for a while now in the wake of recent weakening US economic data. Unfortunately after yesterday’s better than expected Chicago PMI and consumer confidence numbers for July, markets are likely to have to wait a little longer for their stimulus fix, as the likelihood of any indications of further QE in the near term, remain a little further into the distance.

Even allowing for the recent weakness in US non-farm payrolls, the data hasn’t yet been weak enough to justify further easing, as Friday’s slightly better read on Q2 GDP will testify.  Today’s ADP employment report for July is expected to post 120k new jobs, down from 176k in June, while ISM manufacturing is expected to rebound slightly from June’s 49.7 to 50.2.

As long as these data items don’t deteriorate markedly, and there is no evidence so far that they will then the best markets are likely to get is an extension of the low rate guidance into 2015, along with a statement that the Fed remains prepared to act, if economic conditions merit it. Any further indications of further QE are likely to have to wait until after Friday’s payrolls data and the annual Kansas City Fed central bank symposium at Jackson Hole at the end of August. 

EURUSD – after Monday’s decline the single currency managed to rebound but it still remains below trend line resistance at 1.2390 from the May highs at 1.3285, and the 55 day MA at 1.2455. We need to see a break below support around the 1.2220/30 area, to retarget the 1.2150 area. We remain mindful of last week’s bullish weekly candle as well as the support at the 200 month MA at 1.2060, the July lows, which means the risk of a short squeeze towards 1.2600 remains. 

GBPUSD – yesterday’s pullback from the 200 day MA at 1.5745 found support at 1.5625 before a rebound keeping the recent broad range intact. This region between 1.5740/80 also coincides with June and July highs so is important resistance in order to prevent a break towards 1.5910. There is also trend line support at 1.5450 from the 1.5270 lows and this could conceivably hold any further downside pressure.  Only a close below 1.5240 signals a risk of a return to the July 2010 lows at 1.4950. 

EURGBP – yesterday’s move back above 0.7800 towards last week’s high at 0.7870 wasn’t too much of a surprise given the fairly bullish candle last week. Nonetheless while below the 0.7880 level the risk remains for further losses. Below 0.7755 targets the October 2008 lows at 0.7695, a break of which could well see a test of the 2008 lows at 0.7390. Only a break above resistance at 0.7880 suggests further gains towards the 55 day MA and the 0.8000 level.

USDJPY – the US dollar continues to find support below the 78.00 level, with cloud support and the May lows 77.60 remaining a key level. As long as this holds the downside, the risk of a rebound remains quite high. A move above the 79.30 level brings the 80.00 level back into play and then by definition the main resistance at the top of the weekly cloud at 80.45.


Traders Circumspect Ahead of Central Bank Meetings

(Comments below have been provided by CMC Markets Senior Trader Tim Waterer)

The unified sentiment expressed by EU leaders that initially signalled a Green Light for traders has now turned to more of a flashing amber colour as we await outcomes from the FOMC and ECB meetings. While September seems a more plausible timeline for the announcement of QE3 by the Federal Reserve, in the case of the ECB traders will be demanding some immediacy regarding central bank action. 

Given the run higher by risk assets generally since Mario Draghi signalled his defence of the Eurozone last week, heading into the ECB press conference on Thursday the downside risks seem to outweigh risk to the upside by some degree. The premise for the push higher in equities, commodities and the Euro was that the ECB will step up its game, pronto. Hence the Thursday ECB press conference is shaping as a D-Day of sorts for the Eurozone if good intentions are not backed up by decisive actions.

The Australian Dollar had a brief dip after the Chinese number came in just shy of expectations at 50.1, with the currency slipping from the 1.0490’s down to the 1.0460’s. But this was just a blip with the AUDUSD rate bouncing back to just below 1.05. The initial negative reaction to the data was understandable however on reflection any Chinese PMI reading above 50 will be gladly taken in the current environment, and on this basis the AUD’s initial dip was short-lived. 

Given where the AUDUSD rate stands, anything from the FOMC which is suggestive that QE3 is one step closer to seeing daylight will have the Greenback sold off and potentially open the door for the AUD to hit 1.06 by the end of the week if the Fed show a willingness to act in coming months with further stimulus. However if Bernanke and co start to suggest QE3 is more on the backburner then we would see some USD strength and the AUD would likely recede to the 1.0370-1.0420 range.

Circumspect trading was the order of the day on the Australian market, with some
apprehension creeping in amongst investors on the doorstep of key FOMC and ECB
meetings. This naturally led to range-bound conditions on the ASX today, while some
traders took the opportunity to lock in some profit after the recent winning
streak on the local bourse. How the Australian market rounds out the week over
the next two days will be largely subject to how the FOMC and ECB meetings are
received by the broader global market.

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