[brownsfan019]

nice to see you back - maybe this will start to appear weekly? careful, b/c you are starting a trend.

[Office rat]

Currency Market Review 3/8/10 - 3/12/10.

Currency Market Review 3/8/10 - 3/12/10.
Flight into the Commodity Currencies Continues.
Regardless of US and EU macroeconomic statistics’ interpretation, buying of commodity currencies remains the major trading factor. Market participants are not sure, that the current high prices of raw materials and equities have a solid ground, this uncertainty is enhances by doubts concerning further changes in USD value. UE financial perils as well as hesitant economic recovery in the US slow down USD and EUR buying activity. Uncertainty about currency and raw materials market prospects, conversely, boosts AUD, CAD, NOK and NZD buying.
Results and Current Situation
Expectations for increased USD buying on positive economic data failed, by the end of the week EUR and USD value against the 8 currencies basket went down. For the past week, AUD has gained 1.3% against USD and 0.3% against EUR. AUD/USD settled at 0.9075. CAD also appreciated against EUR and USD. CAD added 2.09% against both USD and EUR. NZD and NOK strengthened against USD and EUR as well. EUR, USD have only managed to grow against JPY and GBP.
By the end of the week GBP/USD has declined to 1.5130, USD gained 0.8%. EUR/GBP settled at 1.8990, which reflected 0.7% EUR appreciation. EUR and USD showed equal growth against JPY. On Friday USD/JPY exchange rates closed at 90.30, which makes up 1% dollar appreciation for the week. EUR gained 1.65% against JPY. EUR/JPY cross rate pair has grown from 121.0 to 123.00.
Thus, by the end of the week currency market has come to the impasse choosing a further direction for the second 2010 quarter.
Expectations, Prognosis
All told, market participant mood is likely to shift towards increased USD buying during the current week. USD is used for international commodity trade, it cannot be substituted by a different currency, and therefore USD buying is predestined. EUR trading above 1.35 also speaks in favor of USD growth, as it makes it more profitable to open dollar longs from this important level. Still this week’s trade can go on without a clear direction within narrow ranges.
Major currency pairs range:
EUR/USD – 1,3531-1,3669, consolidation
GBP/USD – 1,4931-1,5269, consolidation
USD/CHF – 1,0669-1,0769, consolidation
USD/JPY – 0,8969-0,9131, consolidation, growth
AUD/USD – 0,9012-0,9131 consolidation
USD/CAD – 1,0231-1,0343, consolidation
Brent – 80,69-78,12 consolidation, possible decline

[Office rat]

Preliminary Half-Year Results don't Inspire Much Confidence in Euro
Preliminary half-year results look sad for Euro. For the incomplete period of 6 months EUR has already lost 5.6% against USD. Although USD cannot boast great achievements either. It has lost 6.4% against AUD and 5.6% against CAD. Whereas EUR lost even more against CAD, and AUD. Since the start of trade in October 2009 EUR lost 11.4%, against CAD and 11.2% against AUD. Financial problems in Europe still deserve some attention, but investors' concerns have largely waned. US economy needs to keep interest rates low, and in the near future there is no reason to expect a hike. Although commodity currencies dominate the market, that is the end of financial year in Japan (March 31) that becomes the most influential factor. In the end of the past week analysts have finally thought of possible interventions, that Bank of Japan can conduct to stop JPY appreciation. There were talks, that Japan's Central Bank can lower the interest rate. The BoJ meeting will take place March 16-17.
Results and Current Situation
EUR EUR/USD growth on Thursday and Friday reflected increased USD buying and weaker buying interest in EUR. As a result, the weekly EUR/USD trading cycle finished below 1.3769 Friday and therefore the 37-th market pattern remained untouched. The trading range formed during the past 5 weeks in the 1.35-1.37 area is still in place.
GBP. The GBP downward movement continued, it has lost 4.4% from the start of the fiscal half-year. Trade finished at 1.52 Friday. Thus, GBP/USD heading towards 1.48-1.4850 does not raise doubts.
JPY. USD/JPY stays near 90.0 area. On Friday USD/JPY closed at 90.50, and from the start of the fiscal half-year dollar appreciation comprised 70 points. The pair stands still awaiting the BoJ report of the annual financial results.
CAD and AUD. CAD and AUD appreciation remain the major factor in the market. Strengthening of Canadian and Australian currencies displays, that objective commodities assets growth and economic recovery as a whole are yet to come. USD/CAD settled at 1.0189 Friday, March 12 and AUD/USD closed at 0.9150.
The market is dominated by technical indicators of exchange rates' moves for the 5 months period.
Expectations, Prognosis
During the starting week's trade USD buying is likely to increase. CAD and AUD appreciation trend will also remain valid. Some short-term changes in the market are likely to appear by Wednesday, March 17th, when Bank of Japan’s meeting closes, in case USD/JPY get hold in the 91.31-91.69 area, which is very likely.
Major currency pairs range:
EUR/USD – 1,3531-1,3812, consolidation, possible decline
GBP/USD – 1,4931-1,5269, consolidation
USD/CHF –1,0512-1,0769, consolidation, possible growth
USD/JPY – 90,12-91,31, consolidation, growth
AUD/USD – 0,9012-0,9212 consolidation, decline
USD/CAD –1,0512-1,0769, consolidation, possible growth
Brent – 80,69-78,12 consolidation, possible decline
Broco Group chief analyst Vladislav Gurov

[Office rat]

Buy USD before it gets expensive
Bank analysts are telling a bare faced lie about their intention to buy USD Quite to the contrary. Banks are buying EUR as long as it has a potential for further decline. Banks are suggesting that the whole market should break the laws of trading logics and buy the appreciating dollar. That is exactly why l banks have started to revise down their forecasts for EUR/USD in the end of the previous week. For example, in the end of the week considerations appeared on the market, that Fed may raise its discount rate and Peoples Bank of China may further tighten reservation conditions. Anticipation of such steps by the Fed and the PBC is enough for USD to grow and for EUR to weaken. Banks being the only professional market participants will chose the most profitable middle term instrument. What will the banks choose? EUR of course, and they will sell appreciating dollar to us and to the rest of the market. The market is ready to obey the rules of this game.
Results and Current Situation
The major indicator of the last week was the preparation for the fiscal half year end, as well as the end of the first 2010 quarter. By the end of the week banks were reassured that the financial crises is coming to its end and Fed is ready to start withdrawing cheap dollar from circulation. The period of dollar accumulation, spurred by anti-crisis measures, which started in the 2nd. quarter of 2009 is over soon. The time of commodity currencies buying for a high and obviously not particularly favorable price is also finishing. We are at the onset of the actual end-phase of the world financial crisis.
CAD, AUD, and NOK. CAD и AUD growth has slowed down considerably for the past week, whereas NOC lost 0.14% against USD. Still, commodity currencies continued to grow against EUR. AUD/USD closed at 0. 9151 on Friday, March 19th. and the week before, March 12th. - at 0.9155 USD/CAD closed at 1.0162, and the week before at 1.0179; USD/NOK grew from 5.83 to 5.90.
EUR EUR/USD trade finished at 1.3530. For the week EUR lost 0,2% against USD.
GBP British pound finished 1.1% lower. The trade closed at 1.5015 Friday.
JPY USD/JPY did not change noticeably, staying within 90.12- 90.69 area. Trade finished at 90.51 Friday.
For the past week conversion operations on the market and the major currencies liquidity have diminished.
Expectations, Prognosis
For the starting week the number of customer orders to buy USD prevails on the market. Most probably more CAD и AUD longs will be closed. Trading volume is likely to lessen, which can cause contradictory movements within 50-100 points range.
Major currency pairs range:
EUR/USD – 1,3412-1,3588, consolidation
GBP/USD – 1,4931-1,5088, consolidation
USD/CHF – 1,0569-1,0669, consolidation
USD/JPY – 90,12-90,88, consolidation
AUD/USD – 9088-9188, consolidation, decline
USD/CAD –1,0131-1,0269, consolidation, possible growth
Brent – 80,31-78,69, possible decline

[Office rat]

Buy USD before it goes up
Last March trading week did not uncover any surprises. Optimistic forecasts for the US economy proved false. Economic growth ratio for the forth quarter was reviewed down. Preliminary data showed DGP growth of 5.9%, the reviewed reading was cut to 5.6% annual rate. University of Michigan consumer sentiment index dropped 0.6% against February. Financial crisis in Greece will be resolved with IMF involvement, but this does not solve general problems of the EU as a whole. European and American stock indexes growth does not inspire much confidence among professional market participants, neither do current energy prices. By the end of the first fiscal half year and first quarter of 2010 there are just as many problems as before, and hopes for the near end of crisis remain hopes.
Results and Current Situation
USD buying volume has grown during the past week and EUR buying has lessened noticeably. Commodity currencies however remained at high levels, which does not guarantee steady growth of commodities and stock markets. For the past week EUR gained 0.8% against the six currencies' basket. USD appreciation against the portfolio comprised 5.7% for the week, still this figure does not point at serious increase in USD buying volume. Japan's Central Bank will release its annual report on March 31st. Professional market participants will not be taking any trading decisions before the report is out.
CAD, AUD, and NOK. For the past week currencies dependant on raw materials export - CAD and AUD - declined against the US dollar. AUD/USD has gone two figures down and closed at 0.9035; USD/CAD went one figure up, to the level 1.0265. USD/NOK closed above an important 6.00 level at 6.03.
Commodities currencies' decline signals unstable conditions for oil, gold and copper markets.
EUR EUR/USD settled 120 points lower at 1.3405. 1.35 range remains intact and attempts to trade EUR/USD around 1.3250-1.3350 did not last. Prices stayed only one day in the $3250-3350 area.
GBP GBP/USD could not break out of strategic 1.50 area either, the pair declined to 1.49 from 1.5012. The week's trade finished at 1.4900.
JPY USD/JPY has grown. Still it closed at 92.50, which gives equal chances for growth towards 95 as well as for decline to 90.
The last trading week before BoJ report of the financial year results was marked by considerably weaker trading volumes on major currency pairs on the interbank market.
Expectations, Prognosis
The starting week will conclude trading cycles of March, the first quarter and the fiscal half year. Conversion operations and liquidity of major currency pairs is expected to increase on the interbank market, this can result in higher volatility. There will not be a definite trading direction this week, whereas short-term speculation risks increase considerably.
Major currency pairs range:
EUR/USD – 1.3388-1.3543, consolidation, out of the market
GBP/USD – 1.3388-1.3543, consolidation, out of the market
USD/CHF – 1.3388-1.3543, consolidation, out of the market
USD/JPY – 92.12-93.31, consolidation, out of the market
AUD/USD – 0.8969-0.9069, consolidation, out of the market
USD/CAD – 1.3388-1.3543, consolidation, out of the market
USD/JPY – 79.12-80.31, consolidation, out of the market

[Jana Jackson]

This is a very nice analysis.

[brownsfan019]

No posts in all of April from the weekly analysis guy.

He must be back to that special trader's calendar that some of us do not have access to.

[macdfx]

Must be using the Russian Orthodox calendar....seems to be a forex guy working for some firm called Broco.