internationallove

"UBS: comments on USD/CHF"(2011-06-08) Technical analysts at UBS have slightly bearish outlook for the greenback versus Swiss franc in the short term. In their view, it’s necessary to watch support at 0.8300. If the pair USD/CHF drops below this level, it will be poised down to 0.8165. According to the bank, resistance for US dollar is situated at 0.8453. Chart. Daily USD/CHF Comment here http://www.fbs.com/analytics/news_markets/view/7543

"Bernanke’s comments. US rates will remain low"(2011-06-08) Yesterday Federal Reserve Chairman Ben Bernanke called US economic recovery “frustratingly slow”. According to the policymaker, monetary policy still has to be loose as the country’s economy is still underperforming and the unemployment level remains very high. At the same time, the Fed pledged to make all effort to keep inflation under control. As a result, the interest rates in the US will likely remain extremely low during the extended period of time. However, the Fed’s chief gave no hint about the prospects of the third round of quantitative easing the markers were expecting so desperately. Bernanke thinks that American growth will accelerate in the second half of the year as fuel prices moderate and disruptions of parts supplies ease as factories in Japan recover from an earthquake and tsunami. All in all, Bernanke sees the central bank’s goal in providing good fundamentals for US currency in the medium term. To do this, the Fed, in his view, has firstly to keep inflation low and stable and then to support the economy. In addition, Bernanke underlined the necessity to reduce budget deficits to ensure long-term growth without too quick spending cuts as it would derail the recovery. The pair USD/JPY fell to 1-month minimum getting below 80 yen. Support for the greenback is found at 9.55 (May 5 minimum), while resistance levels are situated at 80.35/40 (June 6/7 maximums) and 80.60/70 (May 29/31 minimums). Chart. Daily USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/7541

"Citigroup expects both US economy and dollar to fall"(2011-06-08) Analysts at Citigroup studied the correlation between the performance of US dollar and the nation’s economic data during the two years after Lehman Brothers’ bankruptcy in 2008. According to the specialists, the greenback rose and fell inversely to American economy gaining in times of its weakness as investors were buying dollar as a refuge. Then the demand for US currency fell as the Fed’s monetary stimulus programs encouraged the market’s risk appetite. However, such relationship may be over as the as prospects for additional economic stimulus diminish, claims Citigroup. The economists believe that despite unemployment above 9% and other woes, there may be no next round of easing or other measures such as 2009 American Recovery and Reinvestment Act. In their view, the market may start to think that US economic slowdown is a positive factor for others and dollar will fall together with American economy. Citigroup strategists have developed US Surprise Index that shows that US economic data is bringing the worst results since December 2008. Chart. Daily EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/7539

"Commerzbank: comments on EUR/USD"(2011-06-08) The single currency bounced yesterday from the 1.4564 area representing 61.8% Fibonacci retracement of May's decline consolidating just below 1.4700. Technical analysts at Commerzbank claim that the pair EUR/USD is now poised to 1.472 that's the78.6%retracement level. In their view, euro will likely fail at that point and retreat downwards. Chart. H4 EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/7537

"Ichimoku. Weekly forecast. USD/CHF"(2011-06-06) Weekly USD/CHF On the weekly USD/CHF chart one can see a clear downtrend. The bearish Cloud remains rather wide. All lines of the Indicator are directed sideways (1, 2, 3, 4 and 5). Tenkan-sen and Kijun-sen and Senkou Span A and B have lined up. Chart Weekly USD/CHF Daily USD/CHF On the daily chart the outlook according to the Indicator is also bearish: the descending Cloud (3), the “dead cross” (2), the falling lines (1). The only hope of the bulls is the support of the downtrend line. Chart. Daily USD/CHF Comment here http://www.fbs.com/analytics/news_markets/view/7522

"Ichimoku. Weekly forecast. USD/JPY"(2011-06-06) Weekly USD/JPY The prices fell below the Standard line. Resistance now will be provided by both Tenkan-sen and Kijun-sen. In addition, yen is still under pressure of the bearish Ichimoku Cloud that, however, tends to narrow gradually. At the same time, there’s the “inverted hammer” formed on the weekly candle chart that leaves space for some rebound of the rate. Chart. Weekly USD/JPY Daily USD/JPY From the first view on the daily USD/JPY chart the outlook seems more pessimistic: all the lines of the Indicator are directed downwards (1, 2), Chinkou Span (4) recoiled down from the price chart, while the Ichimoku Cloud (3) turned negative. At the same time, it’s necessary to note that the “golden cross” formed by Tenkan-sen and Kijun-sen is still in place and the market will have a certain incentive to return inside the Cloud. In addition, US dollar has approached the key support levels. Chart. Daily USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/7521

"Ichimoku. Weekly forecast. GBP/USD"(2011-06-06) Weekly GBP/USD As it was expected, GBP/USD market’s consolidating. During the last week the prices once again returned to the Turning line (1) that acted as a support. The “golden cross” formed by Tenkan and Kijun above Kumo is still in place (3). The increasing Ichimoku Cloud remains rather wide (4) that means that the bulls are still rather strong. The Standard line remains horizontal (2) that points to a flat. The prices may push off from Tenkan-sen (1) and move higher. The next support level will be at Kijun-sen (2). Chart. Weekly GBP/USD Daily GBP/USD The thin Ichimoku Cloud (3) keeps supporting the prices: despite the decline in the first half of the week, the prices that got inside of Kumo and even touched the Turning line (2) lying below, managed to turn up and overcoming the upper border of the Cloud. In addition, it’s necessary to note that on Friday the pair closed above the long-term Standard line (1) – bullish signal. All lines of the Indicator are horizontal. It’s possible to assume that after the consolidation within the triangle formation is over, the bulls will be able to resume the uptrend. At the moment neither bulls, nor bears dominate the market. Chart. Daily GBP/USD Comment here http://www.fbs.com/analytics/news_markets/view/7520

Current ranking of Participants of Demo 999 Contest !!! From the last few days trader from Belarus (Account#170839) going very well and leading with over 145K capital and on the other hand Indonesian and Ukrainian are (Account#171533)(Account#171982) also progressing well and maintained 2nd and 3rd positions with over 77K capital and 71K capital respectively ..... So let see who will win the contest. We are hoping for a close healthy competition. Wish you all the FBS 999 contestants good luck in the contest. . . Account#170839 Position: 1st Country: Belarus Balance:145851.59 USD Account#171533 Position: 2nd Country:Indonesia Balance:77011.64 USD Account#171982 Position: 3rd Country: Ukraine Balance:71039.58 USD Check other contestants ranking Go to the scoreboard: http://www.fbs.com/contest/999/participants?type=cur

"RBC Capital Markets: advised on how to trade EUR/USD"(2011-06-03) Currency strategists at RBC Capital Markets note that while trading euro it’s very important to choose right time frame. According to RBC, if the agreement on Greece’s bail out is reached the concerns about the restructuring of the nation’s debt in the short-term will be eliminated and the pair EUR/USD may bounce by 300 pips. As a result, there will be a buying opportunity for short-term investors. However, many analysts regard some kind of debt restructuring for Greece as inevitable claiming that this will eventually hit euro. So, for longer term investors RBC recommends using euro’s rally as an opportunity to set up longer term EUR shorts. In addition, as the pair EUR/USD is strongly by the overall shifts in risk sentiment, the analysts say it would be better to trade euro versus a currency such as New Zealand’s dollar that tends to perform similarly in similar risk environments. Chart. Daily EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/7516

"UBS: positive outlook for GBP/USD"(2011-06-03) Technical analysts at UBS claim that the outlook for British pound versus the greenback is positive. In their view, the pair GBP/USD is poised up to resistance in the 1.6418 area. If sterling manages to rise above these levels, it will get chance to advance to 1.6495. According to the bank, key support for the pair is situated at 1.6302 – while pound’s trading higher UBS stick to the optimistic view on UK currency. Chart. Daily GBP/USD Comment here http://www.fbs.com/analytics/news_markets/view/7511

"Commerzbank: Swiss franc crosses today"(2011-06-03) EUR/CHF: the analysts note that the pair has found interim tehnical support in the 1.2050 area and may advance to resistance at 1.2320 (March minimums). The key resistance for euro is situated at 1.2404 – while it’s trading below this level, the outlook for the pair will remain negative. Chart. H4 EUR/USD USD/CHF: the specialists advise to buy US currency at 0.8425 adding at 0.8270 and stopping below 0.8250. In their view, it’s necessary to take profit at 0.8550. Chart. Daily USD/CHF Comment here http://www.fbs.com/analytics/news_markets/view/7507

"Well Fargo: US dollar may resume growth versus euro"(2011-06-03) Strategists at Wells Fargo compare the situation in Greece in May of 2011 with what was a year ago. In their view, there are both common points and differences. As for the similarities, the source of investors’ fears remains the same, the Fed’s quantitative easing program is approaching its end and there are a lot of short USD positions. As a result, it’s possible to expect that the greenback’s weakness will be limited and that US currency will once again start strengthening in the coming weeks and months. Though last summer the Fed began signaling the second round of quantitative easing, the specialists don’t think there will be QE3 this year, so the chance of dollar’s fall as in the second half of 2010 is also lower. According to Wells Fargo, the most likely outcome in Europe is that Greece will keep conducting austerity measures in exchange for further financial aid. The analysts say that though this would harm euro less than debt restructuring, European authorities may be accused of avoiding more decisive and fundamental steps in resolving the crisis. However, the economists admit that the US is also facing important risks such as weak economic data and the debate on raising the debt ceiling. Never the less, taking into account short US dollar positions, the impending end of Fed easing and European woes the analysts still think that the greenback may resume advance. Well Fargo kept the 3-month forecast for the EUR/USD at 1.4200 and the 12-month at 1.3400. Chart. Daily EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/7504

"Jean-Claude Trichet proposes the single euro zone’s government"(2011-05-02) European Central Bank President Jean-Claude Trichet claimed today that the governments of the European nations should consider the possibility of creating euro zone’s finance ministry. Trichet underlined that the euro area already has the single market, the single currency and the single central bank, so establishing the single ministry of finance seems to be both natural and vital step taking into account the current problems of the region. According to the ECB head, though such body as the single finance ministry wouldn’t necessarily administer a large federal budget, it would act in 3 spheres: firstly, supervise both fiscal policies and competitiveness policies and direct responsibilities for countries in fiscal distress; secondly, it would carry out all the typical responsibilities of the executive branches as regards the union’s integrated financial sector, so as to accompany the full integration of financial services; thirdly, it would represent the union confederation in international financial institutions. Analysts at Daiwa Capital Markets draw investors’ attention to the fact that Trichet didn’t propose to enable the institution to issue common bonds and have a budget, so it won’t actually be a proper treasury. As for bailing out indebted euro zone’s nations, particularly Greece, Trichet said that financial aid is justified only when the country makes real efforts to conduct severe austerity measures. All in all, the necessity of some sort of fiscal governance in Europe is becoming more and more evident. Famous billionaire investor George Soros warned about the lack of a common European fiscal authority as far back as in 2009. Comment here http://www.fbs.com/analytics/news_markets/view/7502

"Analysts about the possibility of QE3 in the US"(2011-05-02) As US labor market and housing data is quite discouraging many analysts start wondering whether American monetary authorities will extend monetary stimulus to promote the rebound of the nation’s economy in form of the third round of quantitative easing. The greenback was under pressure this year as the QE2 made the interest rates in the United States decline, while the other nations in the world were tightening monetary policy. So, the market has been looking forward to the end of the Fed’s $600-billion bond purchase program to see some relief in US currency. However, the weak macroeconomic data made brought serious doubts to the market. Analysts at MF Capital think that declining bond yields point at the weakness of American economy. In their view, the Federal Reserve will find it necessary to act and continue buying Treasuries. Economists at Citigroup note that the fact that US stocks are bringing better revenues than bonds. The specialists reminded that the last time it happened in a sustained way was when markets were pricing in the current round of easing. That time dollar was also weakening. Although the greenback’s trading not as weak as at the end of April, the pace of its depreciation during the last week was high enough, so it’s possible to assume that forex markets is preparing to the new stimulus program. According to the bank, Federal Reserve’s chairman Ben Bernanke will be able to persuade the FOMC to support QE3 only if US GDP posts negative dynamics in at least one quarter. As a result, Citi estimates the probability of new round of QE as low. Economists at JPMorgan Chase are sure that the QE2 will be the last as additional monetary stimulus will lead to rather bad political consequences. Chart. Daily EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/7500

FBS has received “Forex News Award” FBS is entitled as the best Forex-news provider by the large independent financial project – Forex Forum. com. We thank Forex Forum administration and all the members of the project for the estimation of the work of our analytical department. We promise to maintain the high level of our financial news, articles, daily commentaries and analytics. «Forex News Award» for FBS is one more proof that FBS analytics is an authoritative source of financial information, that daily helps traders from all over the world be successful in Forex. Analytics and market news from FBS

Dear traders! There are only 2 days left till the end of “Predict NFP” contest. Hurry up and take part in this exciting contest. You all have an opportunity to win a stylish prize for summer from FBS. We would like to remind you that you need to right your guess about non-farm payroll no later than at 12:30 GMT on 03.06.11 in our Facebook special topic: http://www.facebook.com/topic.php?uid=137183862987521&topic=442 Contest rules: http://www.fbs.com/contest/nfp

Australian dollar gained on less negative GDP data""(2011-05-01) Australian dollar rose today to the 3-week maximum versus the greenback in the 1.0750 area gaining nearly 1%. Aussie was encouraged by the news that the nation’s GDP fell in the first quarter only by 1.2% from the previous 3 month – though it was the biggest quarterly drop in 20 years, some economists were looking to much more dramatic figures. For example, analysts at Goldman Sachs expected the slump of more than 2%. Support for the pair AUD/USD is situated at $1.0637, while resistance is found at $1.0757. The Reserve Bank of Australia’s meeting is taking place on June 7. The central bank will likely keep the benchmark rate unchanged at the current level of 4.75%. Chart. Daily AUD/USD Comment here http://www.fbs.com/analytics/news_markets/view/7496

"Rating agencies warn about Japan’s problems"(2011-05-01) Yesterday Moody's Investors Service began reviewing Japan’s Aa2 credit rating as the negative consequences of March 11 earthquake may turn out to be greater than expected and the measures to reduce the nation’s huge budget deficit aren’t efficient enough because of the political tensions between the opposition and the current government. According to the ratings agency, Japanese debt will keep rising unless spending is cut or revenue’s increased. It’s necessary to note that Japan's gross debt burden is already above 200%, that’s the highest level among major economies. On February 22 Moody’s changed the outlook for Japan's bond rating to negative. The last time the country’s rating was changed on May 18, 2009. Currently Japan is at the same step in rating as Italy and Spain. The opposition has refused to support Prime Minister Naoto Kan’s government decision to issue deficit-covering bonds for the fiscal year that began April 1. As a result, there’s a more than 40% gap in revenue in relation to planned spending even before extra spending related to the devastating disaster is taken into account. Other major ratings agencies are as well pessimistic about the situation in Japan: Fitch Ratings said last week that it was assigning a negative outlook to its AA- rating, which is one notch below Moody's level. Standard & Poor's also has a negative outlook on its AA- rating. Chart. Daily USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/7492

"UBS: short-term bullish outlook for euro"(2011-05-01) Technical analysts at UBS claim that euro’s rebound versus the greenback from last week’s minimum at 1.3970 paused ahead of resistance in the 1.4455 area. In their view, the pair EUR/USD will manage to break above this zone. In this case the bullish pressure on the single currency will increase encouraging it for an advance to 1.4569. Chart. H4 EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/7490

"Commerzbank: EUR/JPY is moving up to 123.33"(2011-05-01) The single currency surged yesterday versus Japanese yen. Today the pair EUR/JPY is testing resistance of the 55-day MA at 117.45. Technical analysts at Commerzbank claim that if euro manages to get above this level it will be poised up to 119.11 and then to the recent maximum at 123.33. According to the bank, support for the pair is situated at the 200-day MA at 113.23 and 55-week MA at 112.91. The outlook for euro is neutral/positive. Chart. Daily EUR/JPY Comment here http://www.fbs.com/analytics/news_markets/view/7488

"BMO, J.P.Morgan: trading on the hurricanes"(2011-05-01) The Atlantic hurricane season has begun today and will last traditionally till the end of November. Weather experts in US National Weather Service’s Climate Prediction Center expect an above-normal hurricane season this year with 12 to 18 named storms, of which 6-10 could become hurricanes. Analysts at BMO Capital gave investors a piece of advice on how to trade on hurricane news. In their view, the best strategy in such case is buying oil-exporting country's currencies versus US dollar. Oil prices will go up once the storms hit areas like the Gulf of Mexico. The specialists say that the greenback lost 3% versus its Canadian counterpart after hurricanes Katrina and Rita. Strategists at J.P.Morgan Asset Management share this opinion. According to them, it may be sensible enough to start building positions in such currencies as Canadian dollar, Russian ruble and Norwegian krone now in order to be ready when a storm hits. The economists think that oil prices could move up even before a specific storm warning is issued. Chart. Daily USD/CAD Comment here http://www.fbs.com/analytics/news_markets/view/7486

"BoA-Merrill Lynch: China’s economic growth forecast"(2011-05-01) According to the data released today, China’s official PMI fell for the second month in a row declining from 52.9 in April to 52.0 in May. HSBC China Manufacturing PMI went down to from 51.8 in April to 10-month minimum of 51.6 in May. Economists at Bank of America-Merrill Lynch claim that although Chinese PMI figures were lower, economic slowdown will be a “soft landing”: the nation’s economic growth rate will be slowly declining after strong advance seen earlier. In their view, the nation’s annual GDP growth will ease from 9.7% in the first 3 months of the year to 9.4% in the second quarter and to about 9.0% in the second half of 2011. The specialists neither expect further monetary tightening in China, nor think that monetary policy will be eased this year. Comment here http://www.fbs.com/analytics/news_markets/view/7484

"Citigroup about US debt and dollar’s rate"(2011-05-01) Analysts at Citigroup think that if US debt overcomes the critical level, the greenback will be affected much more than Treasuries as international holders of American debt may regard potential losses as greater than domestic ones. The specialists think that the foreign exchange reaction to a debt ceiling breach would be sharper and probably more permanent. As a result, foreign investors will use every chance to sell dollars. US Congress has to find a way to avoid default before August 2. The amount the government can borrow was reached May 16. Today the House of Representatives is voting on the $14.3 trillion threshold by $2.4 trillion. Republicans demand high spending cuts and no tax increases as a condition for raising the limit. According to Citigroup, if there’s US sovereign debt crisis, dollar will ultimately lose value. Taking into account the fact that the euro area is also facing great difficulties, the analysts recommend turning to such currencies as Canadian, Australian and New Zealand’s dollars, Norwegian krone and Swedish krona as these nations don’t have the same fiscal problems. Comment here http://www.fbs.com/analytics/news_markets/view/7482

"BofA Merrill Lynch expects loonie to decliner"(2011-05-31) Canadian dollar may decline as it’s widely thought that the Bank of Canada will decide today not to raise its benchmark interest rate that’s currently at 1.00% level. The overnight rate will be released today at 1.00 pm GMT. On the one hand, Canada has very strong fundamentals such as decreasing unemployment, shrinking budget deficit and faster growth than in the United States. On the other hand, loonie reached the maximal level versus the greenback since November 2007 on April 29 at 0.9445. Canadian currency has become too strong and is affecting the nation’s exports that are already curbed by low demand from the US, Canada’s main trading partner. Canada’s central bank’s governor Mark Carney dampened the expectations of rate hike in his May 16 speech citing the risks created by CAD’s appreciation. That made loonie drop by the end of the month to 0.9800. According to Bank of America Merrill Lynch, Canadian currency will fall against its US counterpart to $1.03 by the year-end and to $1.07 by the end of 2012. The specialists think that CAD is overvalued by 20%. Analysts at Wells Fargo say, however, that investors may be underestimating the potential for rate rises as inflation in Canada is rather high and the country’s economic growth’s gaining momentum. In their view, the pair USD/CAD will finish the year at 0.90. Chart. Daily USD/CAD Comment here http://www.fbs.com/analytics/news_markets/view/7476

"BlackRock: euro zone's financial sector’s in danger"(2011-05-31) Analysts at BlackRock, the world's largest asset manager that’s in charge of about $3.65 trillion in assets in its stock, bond and hedge funds, believe that euro zone’s financial problems don’t amount to only Greek ones, though, of course, Greek issue is the most urgent to deal with. The specialists note that if the terms of Greek debt repayment are changed the same will become inevitable for Irish and Portuguese debt. The company underlines that European banks own the major part of the region’s debt, so restructuring in one country will put euro area’s bank under pressure. As a result, before restructuring national debts it’s necessary to restructure the banking system in Europe. According to BlackRock, Europe will need a giant TARP that stands for the Troubled Asset Relief Program like one that was conducted in the United States to rescue financial firms. Comment here http://www.fbs.com/analytics/news_markets/view/7474