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"Mizuho: EUR/JPY will rise to 126.00 yen in April"(2011-03-30) Technical analysts at Mizuho Corporate Bank note that the all elements of the daily Ichimoku chart point at the long positions for the pair EUR/JPY. According to the bank, euro rose above the top of the “pennant” formation, while the 9-day MA went up almost vertically. The specialists expect the single currency to appreciate to 126.00 yen in April. Chart. Daily EUR/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6758

"Barclays Capital: comments on USD/CHF"(2011-03-30) US dollar reached today 2-week maximum versus Swiss franc at 0.9250 and then eased down to 0.9220. Technical analysts at Barclays Capital claim that that the advance of pair USD/CHF is limited by the Fibonacci retracement resistance and the old range minimums between 0.9200 and 0.9260. In their view, the greenback’s decline will extend to the 0.9105/0.9090 zone. The specialists note, however, that if US currency manages to overcome 0.9260, it will be able to rise to the early March maximums in the 0.9370 area. Chart. Daily USD/CHF Comment here http://www.fbs.com/analytics/news_markets/view/6756

"German Deputy Finance Minister: comments on euro zone"(2011-03-30) German Deputy Finance Minister Joerg Asmussen claimed that euro zone is ready to face any violent moves of the financial market caused by the region’s debt problems. The policymaker underlined that the European authorities strengthened Stability and Growth Pact, approved the Euro-plus pact for competitiveness and worked out the permanent crisis-resolution mechanism – the ESM. Standard & Poor’s cut today Portugal’s sovereign credit rating from BBB to BBB-. According to Asmussen, Portuguese government will decide for itself whether the country needs any financial help. The EU and the IMF will support Portugal if necessary but only if the nation pledges to conduct the required austerity measures. Portuguese 10-year bonds fell, pushing the yield above 8%t for the first time. Economists at Rabobank estimate that Portugal needs to raise 1.35 billion euro to fund itself to the end of April, including the April 15 redemption spike. G20 leaders will assemble in Nanjing (China) tomorrow for a one-day seminar on the international monetary system. Chart. H4 EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/6752

"Commerzbank: EUR/JPY will rise to 120.00 yen per euro"(2011-03-30) Technical analysts at Commerzbank note that the single currency broke through resistance at 115.69 yen completing the major base. In their view, the pair EUR/JPY will now move up to the 119.65/120.00 zone limited by the February 2010 minimum and the psychological resistance. The specialists believe that in the longer term euro will manage to climb to 126.00. According to the bank, the European currency will be able to make such advance as long as it stays above the key support in the 114.40/113.55 area limited by the 20-day MA and last week’s minimum. Chart. Daily EUR/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6750

"Yen’s under pressure due to the rate differentials"(2011-03-30) It’s very likely that the Bank of Japan will fall behind when the world’s major central banks begin normalizing monetary policy. Japanese yen fell today to 11-month minimum versus the European currency at 117 yen per euro. Analysts ANZ National Bank note that euro keeps getting support from the interest rates differentials. The ECB council member Jozef Makuch claimed yesterday that the possibility of the ECB rate hike next week seems to be high. Euro strengthened versus yen even despite Standard & Poor’s cut Portugal’s sovereign credit ratings from BBB to BBB- and Greece’s – from BB+ to BB- with negative outlooks. Strategists at UBS claim there can be 2 reasons for such dynamics: either investors were pricing in a lot of the bad news or this pushes Portugal closer to asking for aid that’s regarded as positive. US dollar managed to get above 83 yen level for the first time since Japan’s earthquake on March 11. Yen got under pressure due to the rising Treasury yields and the recent hawkish comments of the Fed’s members. Chart. Daily EUR/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6748

"Standard Life Investments are bearish on EUR/USD"(2011-03-30) Analysts at Standard Life Investments believe that the single currency is currently overvalued. In their view, the pair EUR/USD may drop to the undervalued levels before the sovereign debt crisis is resolved. The specialists note that although the marker is pricing in 100 basis points of the interest rates hike for euro in 12 months, they expect no more than 75 points increase in the ECB rates. According to Standard Life Investments, EUR/USD fair long term value for indebted countries like Greece, Portugal, and Ireland is found somewhere between $1.00 to $1.10 range and for the euro area as a whole – between $1.20 and $1.25. The strategists underline that the European authorities need weak euro to cope with the debt crisis, slow trend growth and the necessity of fiscal consolidation. As for the United States, the economic fundamentals, on the contrary, will be gradually improving, says Standard Life Investments. The analysts think that dollar’s decline won’t last long. Chart. H4 EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/6744

"TD Securities: Aussie gains versus dollar and yen"(2011-03-30) Australian dollar climbed today to 1.0332, the maximal level versus its US counterpart since 1983 when it began floating freely. The currency climbed to 85.68, the highest since May 5, 2010. Analysts at TD Securities believe that Aussie will rise to 88 yen by the end of June helped by Chinese growth and surging commodity prices. The pair AUD/JPY gained 6.8% since March 18. Related data releases (based on Bloomberg surveys): March 31: Australia’s retail sales (forecast +0.4%); March 31: Australia’s building permits (forecast +4%); March 31: US factory orders (forecast +0.5%); April 1: China’s PMI (forecast: 54 from 52.2 in February). Chart. H4 AUD/USD Chart. Daily AUD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6742

"Barclays Capital raised yen’s forecast"(2011-03-29) Analysts at Barclays Capital raised their forecasts for Japanese yen: 3 months: from 85 to 82 yen per dollar; 6 months: from 86 to 83 yen per dollar; 12 months: from 90 to 85 yen per dollar. The specialists note that Japan’s current-account surplus remains large, while net private capital outflows may decline. According to Barclays Capital, yen will begin weakening only from the third quarter and it will happen more slowly than expected before. Chart. Daily USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6737

"BNP Paribas: pound under bearish pressure"(2011-03-29) Analysts at BNP Paribas and Barclays Capital claim that British pound seems to be under bearish pressure trading versus the greenback. The pair GBP/USD dropped below the key support level at 1.5980 and may now fall to 1.5750. The specialists note that US economic data that will be released this week is going to be potentially negative for sterling. Chart. Daily GBP/USD Comment here http://www.fbs.com/analytics/news_markets/view/6735

"BMO Capital: factors negative for euro"(2011-03-29) Analysts at BMO Capital Markets draw investors’ attention to the fact that last week the Federal Reserve announced the beginning of the series of press conferences after policy meetings as it usually happens in the European Central Bank. The specialists regard this as a sign that the US monetary authorities are preparing the ground for the monetary policy change. According to BMO, the risks for euro could be from more hawkish Fed’s stance and the possibility that the ECB stays on hold longer than the market is anticipating. However, the comments the ECB President Jean-Claude Trichet made on Monday are setting strong market expectations for the rate hike. Trichet claimed that inflation rates are now durably above the common definition of price stability in the euro zone. The analysts also say that European currency may get under some downward pressure if the US employment data due on Friday, April 1, is better than expected. Chart. H4 EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/6733

"Mizuho keeps advising to sell USD/JPY"(2011-03-29) US dollar is slowly moving up to the 82.00 area trading versus Japanese yen. Analysts at Mizuho Corporate Bank note that the pair USD/JPY returned above the broken support line of the triangle pattern that held for the previous 5 months. The specialists, however, claim that weekly and daily Ichimoku charts still suggest short position despite the short-squeeze that started on Friday. According to the bank, resistance levels for US currency are found at 81.79/81.85, 82.00 and 82.35, while support levels are situated at 81.30, 80.87 and 80.50. Chart. H4 USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6731

"BNP Paribas: bullish outlook for AUD/USD"(2011-03-29) Australian currency advanced yesterday versus its US counterpart renewing the absolute maximum at 1.0313. Then the pair AUD/USD corrected dipping to 1.0225 and recoiled up from this level. Analysts at BNP Paribas think that the pair's dynamics is determined more by the greenback's weakness than by Aussie's strength. In their view, Australian dollar will remain high helped in the short term by Japan’s elevated demand for coal and by rising demand for iron ore in the longer perspective that will be needed for post quake reconstruction. According to the bank, AUD/USD is going to retest Friday’s maximum at 1.0295. Chart. H4 AUD/USD Comment here http://www.fbs.com/analytics/news_markets/view/6728

"UBS: bullish outlook for EUR/CHF"(2011-03-29) Technical analysts at UBS are still betting on the single currency’s advance versus Swiss franc. In their view, if the pair EUR/CHF breaks above 1.3004, it will manage to climb to the 1.3138 zone. The bank claims that support for the pair is found at 1.2788. The specialists say that Portugal has low systemic relevance for the euro area as a whole and the fact that the country can count on bailout in case it can’t solve it debt issues on its own, so the country’s problems, according to UBS, won’t have very lasting and strong impact on euro. Chart. Daily EUR/CHF Comment here http://www.fbs.com/analytics/news_markets/view/6726

"Japan’s unemployment rate fell in February"(2011-03-29) Japan’s February data released today was surprisingly good: the unemployment rate dropped from 4.9% in January to 4.6% last month (+370,000 jobs, figures don’t include data from Iwate, Miyagi and Fukushima prefectures). The job-to-applicant ratio rose to 0.62 that means there were 62 positions for every 100 candidates in February, the highest since January 2009. Retail sales showed annual increase by 0.1%, while the economists were looking forward to 0.5% drop. As a result, it’s possible to conclude that the country’s economy was on the improvement path before the March 11 earthquake that damaged northeastern regions. However, it widely believed that such data is not enough for the bright outlook. Analysts at Goldman Sachs expect that Japanese GDP will contract in the second quarter. The specialists revised downwards their growth forecast for the fiscal year starting April 1 from 1.3% to 0.7%. The Nikkei 225 Stock Average lost about 10% since the temblor. Economists surveyed by Bloomberg News expect that industrial production that will be published tomorrow declined by 0.1% in January. The government estimates damage from the disaster by 25 trillion yen ($306 billion). Chart. Daily USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6723

"IMF: Switzerland will be able to start hiking rates soon"(2011-03-28) The International Monetary Fund said that the Swiss National Bank will be able to start raising interest rates in the foreseeable future, provided there are no further economic shocks. The IMF forecasts that Switzerland’s GDP will add 2.4% this year and 1.8% in 2012. The country’s economic growth is expected to slow down as its exports will suffer due to the strong national currency. Chart. Daily EUR/CHF Comment here http://www.fbs.com/analytics/news_markets/view/6721

"Commerzbank: comments on EUR/USD"(2011-03-28) Technical analysts at Commerzbank claim that euro’s 0.7% decline last week versus US dollar may be the part of a failure pattern. In their view, the pair EUR/USD may ease down to 1.3975. The specialists claim that support for euro is situated at 1.4000 (20-day MA) and $1.3975 (the uptrend line from January 10 minimums). Below these levels the single currency will fall to the 1.3752/13718 zone (38.2% retracement) and eventually to 1.3430. The analysts said that if the pair breaks above 1.4285 it will get chance to climb to the long term double Fibonacci retracement at 1.4425 and then the 1995 maximum at 1.4535. Chart. H4 EUR/USD Comment here http://www.fbs.com/analytics/news_markets/view/6719

"G7 intervention: reasons and amount"(2011-03-28) There are different estimates of the size of the G7 currency intervention conducted this month to weaken Japanese yen that reached postwar maximums. According to Financial Times, traders think that the central banks sold yen buying $25 billion. Analysts at Nomura and JPMorgan, however, believe that the Bank of Japan itself sold only 530 billion yen ($6.7 billion) that’s less than the record BOJ 2,100-billion yen unilateral intervention seen in September. If the lower figure is confirmed, it would suggest that the announcement of joint intervention was used to send strong message to the market without using as much money as the Japanese central bank has to mobilize before. Analysts at Scotia Capital note that the G7 stepped in to weaken the yen, not because the value of the Japanese currency was too volatile, but mainly because the USD/JPY trading had become disorderly and threatened global economic and financial stability. Chart. Daily USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6717

"Fed’s Bullard offered to end QE earlier than planned"(2011-03-28) St. Louis Federal Reserve Bank President James Bullard claimed on Friday that US economy is successfully recovering, so it doesn’t need much stimulus anymore and the country’s monetary authorities have to decide whether to stop or reduce their $600-billion Treasury purchase program. As for the Federal Reserve’s chairman Ben Bernanke, he has given no indication the central bank will deviate from its plan to buy bonds through June. During his 2-day testimony to Congress this month Bernanke noted that he still wants to see a sustained period of stronger job creation. The central bank’s head also didn’t unveil what the Fed’s next step will be after the end of QE2. The US GDP added 3.1% in the fourth quarter helped by the jump in consumer spending. At the beginning of this year, however, it will be very difficult for the United States to maintain this growth rate as rising oil prices may erode consumers’ purchasing power, while supply is constrained due to Japan’s earthquake and its aftermath. Bullard thinks that the process of stimulus withdrawal should be started with selling bonds. Then the Ted will have to change its wording about keeping interest rates near zero for an “extended period” and raise interest rates. In November, Bullard voted in favor of the second round of QE and has rotated this year into an annual non-voting position. Comment here http://www.fbs.com/analytics/news_markets/view/6715

"Mizuho recommends selling USD/JPY"(2011-03-28) Technical analysts at Mizuho Corporate Bank claim that the pair USD/JPY once again closed the week below the triangle base that has held for the last 5 months. The specialists note that all the elements of the daily and weekly Ichimoku charts still point to a short position despite the short-squeeze seen on Friday. According to the bank, it’s necessary to sell US dollars at 81.80 stopping above 82.05. The target levels are at 80.50 and 79.75. Chart. Weekly USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6712

"JPMorgan: franc remains the only safe haven"(2011-03-28) Analysts at JPMorgan Chase claim that there is now only one safe haven currency left – Swiss franc that has benefited from Switzerland’s image a stable and neutral financial center and the exporter of precision machinery products and famous watches. Yen lost this status as the G7 nations intervened to weaken its rate, while the greenback isn’t regarded as refuge anymore as the Federal Reserve has dramatically increased dollar supply though its QE program. Franc was the best performing major currency last year as it gained 7.68%. Even as the Swiss National Bank sold the national currency to prevent it from excessive appreciation, it added more than 18% trading versus euro, its main counterpart. According to the Organization for Economic Cooperation and Development (OECD), franc is still over-valued by 39% versus US dollar and by 32% versus euro. John Taylor, the head of FX Concepts, the world’s largest foreign-exchange hedge fund, says there is no sign that investors’ demand for franc will decline. In his view, Swiss currency may strengthen to 1.10 per euro. Data from Commodity Futures Trading Commission showed that bets by futures traders on further gains against the dollar reached maximal level since 2004 at 27,640. Chart. Daily EUR/CHF Comment here http://www.fbs.com/analytics/news_markets/view/6710

"Commerzbank: USD/CHF may go up"(2011-03-28) Analysts at Commerzbank claim that as the greenback managed to break above 0.9205 trading versus Swiss franc, the pair USD/CHF seems to be strong enough to climb to 0.9370 and then to 0.9465. The specialists note that US currency has ruined the resistance line from the February maximum at 0.9774, closed above its 20-day MA and begun to destroy Fibonacci retracement at 0.9205. These 3 factors are all in favor of dollar and encourage its strengthening. Chart. H4 USD/CHF Comment here http://www.fbs.com/analytics/news_markets/view/6708

"MIG Bank: comments on USD/JPY"(2011-03-25) Technical analysts at MIG Bank claim that the V-shaped recovery of the pair USD/JPY from the postwar minimum at 76.25 hit last week is showing signs of weakness as the greenback didn’t manage to approach resistance at 81.70. The specialists say that US dollar can correct downwards to March 21 minimum at 80.69 and the psychological level of 80.00. According to the bank, longer-term upside reversal will become evident only if US currency overcomes March 18 maximum at 81.99 and March 11 maximum at 83.30. Chart. H4 USD/JPY Comment here http://www.fbs.com/analytics/news_markets/view/6706

"SNB quarter report released"(2011-03-25) The Swiss National Bank has released today its quarterly report. The central bank announced that the tensions in the Middle East led to the new strengthening of Swiss franc versus the European currency and US dollar. According to the central bank, franc’s appreciation has so far had only a moderate effect on the import price index. The Swiss franc prices of some import goods react with a time lag to the exchange rate’s moves, as the companies adjust them at irregular intervals. Switzerland’s monetary authorities also said strong national currency made the country’s exports lose considerable momentum. The SNB expects that Swiss GDP will gain about 2% in 2011. Chart. Daily USD/CHF Comment here http://www.fbs.com/analytics/news_markets/view/6703

"Barclays Capital: Australian dollar may rise to 1.09"(2011-03-25) Analysts at Barclays Capital note that Australian dollar is under bullish pressure versus its US counterpart as long as it holds above 1.01. In the near term the pair AUD/USD is likely to fluctuate near the post-float maximums in the 1.0260 area. If Aussie decisively breaks up through these levels, it will get chance to climb to 1.0650 and 1.09 in the medium term. Chart. Daily AUD/USD Comment here http://www.fbs.com/analytics/news_markets/view/6701

"Commerzbank: EUR/GBP eroded long term resistance"(2011-03-25) Technical analysts at Commerzbank note that the single currency bounced yesterday versus British pound breaking above the key resistance in the 0.8758 area eroding the long term downtrend. The specialists say that as long as the pair EUR/GBP is trading above the mentioned trend line it has potential to advance to the 0.8935/45 area representing the 50% retracement of the decline from 2009 and the October 2010 maximum. According to the bank, bullish pressure on euro will ease only below the short term uptrend at 0.8672 and the pair will be poised lower to 0.8605 then 0.8560. Chart. Weekly EUR/GBP Comment here http://www.fbs.com/analytics/news_markets/view/6699