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EUR/USD: technical update"(2012-10-01)

 

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EUR/USD: technical update

 

 

 

EUR/USD was drifting down since the second half of September. The pair has been continuously testing support of the 200-day MA at $1.2825.

 

Technical analysts at Commerzbank think that the top at $1.3173 will be confirmed if EUR/USD closes below the trend line support at $1.2661. In this case, the pair will fall to $1.2475/65.

 

The next support for the single currency lies at $1.2745/40 (June maximums, 38.2% retracement of advance from July lows to September highs). If euro slides to this area, it will likely jump up after the initial test of this support.

 

Note that there’s bearish convergence on H4 MACD – a positive signal. For now EUR/USD jumped to $1.2870 as euro zone’s September PMI was revised a bit up and Italian unemployment turned out to be less than expected.

 

Still, bearish outlook will be changed only if EUR/USD rises above $1.2900. There will be more events today which may encourage investors to sell.

 

Resistance for euro lies at $1.3050, $1.3150/80 and $1.3466/1.3541 (2012 maximum, 50% retracement of the move in 2011-2012, 38.2% retracement of the move down from 2008 and the 200-week MA).

 

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Chart. Daily EUR/USD

 

 

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Chart. H4 EUR/USD

 

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"GBP/USD: a bunch of weak data"(2012-10-01)

 

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GBP/USD: a bunch of weak data

 

 

 

GBP/USD is struggling at the bottom of its recent sideways range ($1.6270/6150). All indicators released today in the UK are below the forecasts. British Manufacturing PMI slid from 49.5 in August to 48.4 points in September. The reading below 50 points means that manufacturers are looking forward to industry’s contraction. Net lending to individuals and mortgage approvals also disappointed the markets.

 

Support: $1.6110 (recent lows, 23.6% retracement of August-September advance), $1.0680 (trend line support) and $1.6000 (38.2% retracement, psychological level, top of the weekly Ichimoku Cloud). The latter is going to be rather strong.

 

Resistance: $1.6190/6200 (MAs at H1), $1.6300 (psychological level), $1.6480 (resistance line connecting 2009 and 2011 highs).

 

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Chart. Daily GBP/USD

 

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"BoE will ease policy, but not this week"(2012-10-01)

 

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BoE will ease policy, but not this week

 

 

 

The first Thursday of the month will be as usual market by the Bank of England’s meeting. According to the consensus forecast, the regulator will leave its policy unchanged this week with interest rates at 0.5% and the targeted size of the QE at 375 billion pounds.

 

At the same time, analysts still expect more easing from the BoE later this year, probably already in November. According to the poll conducted last week of more than 100 economists, the central bank will increase its asset purchase program by 50 billion pound.

 

The recent economic data from the UK was mixed: Q2 GDP contraction was revised down from 0.5% to 0.4% and labor market seems to be holding up pretty well adding 236K jobs in 3 months to July, the most in 2 years. However, all in all British economy still is in a poor state and the government is unlikely to curtail tough austerity measures.

 

Though the decision to leave policy unchanged was unanimous in September, some MPC members felt that additional stimulus would be needed in the future, and one said there was a good case for it now. Last month economist Ian McCafferty took over from Adam Posen – a great advocate of QE – the market will be speculation about the position of this new MPC member.

 

Inflation is not an obstacle for more QE: it dropped to 2.5% in August, is expected to decline more slowly but is seen close to the BoE’s 2% target.

 

In addition, the Fed and the Bank of Japan have already moved further down the easing path.

 

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Image from telegraph.co.uk

 

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"AUD/USD: technical picture"(2012-10-01)

 

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AUD/USD: technical picture

 

 

 

AUD/USD opened the week with a gap and tested the levels below the 200-day MA. The pair touched $1.0325 (lowest since September 11), but then bounced back to the $1.0375 levels. AUD/USD remains in a downward channel and far below the Friday’s maximum ($1.0468).

 

In our view, strong support for the pair is concentrated in the $1.0345/15 area (100- and 50-week MAs, 200-day MA, 61.8% Fib. retracement of September uptrend and today’s minimum). A break below these levels would confirm the bearish trend. The next support is seen at $1.0310 (trend line connecting June and August minimums), $1.0300, $1.0230 (100-day MA and April 2012 minimums) and $1.0176 (July 25 minimum). Further decline could bring the pair to $1.0165 (September minimums). The Aussie, therefore, could completely retrace the September gains and one could see a double top reversal pattern (August 9 and September 14 highs).

 

On the upside AUD/USD is contained at $1.0394 (50% Fib. retracement), $1.0430 (50-day MA and September 13 minimum) and at $1.0445 (38.2% retracement and upper boundary of the downward channel). Further Aussie’s growth could trigger a rise to $1.0623 (September 14 maximum and a trend line connecting 2011 and 2012 maximums) and then to $1.0843 (2012 maximum).

 

 

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Chart. Daily AUD/USD

 

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    "NZD/USD: technical picture"(2012-10-01)

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NZD/USD: technical picture

NZD/USD trades on the upside, but still remains far below the Friday’s maximum ($0.8354). The pair has been trading sideways in the $0.8180/8354 range as the QE3 rally ended on September 13. The pair remains in an upward channel, existing since June. The pair is supported by the up-directed 50-, 100- and 200-day MAs.

In our view, kiwi has enough room for growth as in September the pair managed to break above the trend line resistance, connecting 2011 and 2012 maximums. If NZD/USD manages to break above the $ 0.8351/54 resistance (September 14 and 28 highs), a further increase to $0.8470 (2012 high and the upper boundary of an upward channel) would become possible.

NZD/USD is trading right above the strong support area $0.8290/8050: the pair moved sideways in this range before a drop to $0.7453 in May 2012. Support for the kiwi is seen at $0.8230 (April 27 and 3 maximums), $0.8200, $0.8125/8025 (50-day MA, trend line connecting 2011 and 2012 highs, 200-day MA and the lower boundary of the upward channel), $0.8018 (50-week MA) and $0.7960 (100-week and 100-day MA). A drop below $0.7912 (September 5 minimum) would confirm a bearish reversal and pave the ground for new kiwi losses.

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Chart. Daily NZD/USD

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    "USD/JPY: potential for some gains"(2012-10-01)

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USD/JPY: potential for some gains

USD/JPY is struggling below the resistance of 78 yen. The pair’s trading very close to the opening levels after gaining about 45 pips on Friday.

Analysts at Nomura claim that from the technical point of view, USD/JPY prospects are bullish. In their view, the pair will strengthen to 78.40 (50-day MA) – not a big deal, but still some improvement as the bulls have to fight for every pips here.

Resistance: 78.00, 78.15 (Kijun-sen on daily chart), 78.40. 78.80.

Support: 77.51 (June 1 minimum), 77.12 (September 13 minimum).

Analysts at MIG Bank claim that USD/JPY is likely in a long-term bottoming process and is oversold in the medium-term. In their view, one may try longs at 78.18 targeting 79.47/80.62/83.00 (short-term, medium term and long-term) with stop at 76.89.

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Chart. Daily USD/JPY

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"October 2: forex news"(2012-10-02)

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October 2: forex news

 

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Demand for the risky currencies remains rather high with the exception of the Australian dollar. AUD/USD broke below the 200-day MA and touched $1.0300 after the RBA announced a 0.25% rate cut to 3.25%. Australian policymakers pointed at a weakening economic growth in Australia, Europe and China, the overestimated Aussie and the uncertain near-term prospects. Strategists at Standard Chartered expect AUD/USD to decline to $1.0250 over the next few days. Meanwhile, NZD/USD moves up and trades below $0.8300. The ANZ commodity price index printed a 3.5% rise in September, strongest monthly gain in 1.5 years.

 

US dollar has somewhat weakened by words of the Fed’s Chairman Ben Bernanke who defended yesterday the central bank’s unprecedented bond buying and promised to sustain monetary stimulus that tends to debase the greenback even as US economy recovers.

 

EUR/USD climbed to the levels around $1.2910. Today the European calendar is chary of important releases, but later this week there are plenty of important events: euro zone’s retail sales (Oct. 3), the ECB meeting (Oct. 4), German factory orders (Oct. 5). This prospect limits demand for euro. In US the highlights are also on tomorrow with ADP employment report and ISM non-manufacturing PMI, on Thursday’s unemployment claims & finally on Friday with its NFP and unemployment rate.

 

GBP/USD trades on the upside, but remains below the $1.6200 mark. Today watch for UK construction PMI release at 8:30 GMT. This week’s key event risk for the sterling will come on Thursday with the BoE interest rate announcement (currently at 0.50%). The bulls are trying to make USD/JPY overcome resistance at 78.15 yen. USD/CHF has once again failed to hold above 0.9400. USD/CAD continues a sideways trade and consolidates around 0.9820. Loonie was supported by rather positive US manufacturing data released yesterday.

 

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"Moody’s: Spanish banks may need more capital"(2012-10-02)

 

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Moody’s: Spanish banks may need more capital

 

 

 

Moody’s Investors Service thinks that the upcoming 59.3 billion euro ($76 billion) recapitalization of Spanish banks is credit positive, but ultimately may be “insufficient.” According to the agency, Spain’s banks face a capital shortfall that could climb to 105 billion euro ($135 billion).

 

“If market participants are skeptical about the stress test, negative sentiment could undercut the government’s efforts to fully restore confidence in the solvency of Spanish banks,” warned Moody’s.

 

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"How US plans deal with fiscal cliff?"(2012-10-02)

 

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How US plans deal with fiscal cliff?

 

 

 

As the year-end approaches, US fiscal cliff becomes more and more threatening. You’d be surprised, but American lawmakers decided to try solving the issue.

 

“Fiscal cliff” is the popular term used to describe the conundrum that the U.S. government will face at the end of 2012, when the terms of the Budget Control Act of 2011 are scheduled to go into effect. At the magical midnight of December 31, 2012, temporary tax cuts will expire, while spending cuts agreed upon as part of the debt ceiling deal of 2011 will begin to go into effect. No doubt this implies a great amount of stress for US economy.

 

US senators, Democrats and Republicans, share the view that they should use the postelection session of Congress to reach agreement on a comprehensive deficit reduction deal rather than a short-term solution.

 

The senators believe that they should proceed in 3 steps:

 

1) Agree on a deficit reduction target (likely to be around $4 trillion over 10 years).

2) Vote on expedited instructions to relevant Congressional committees to draft the details over 6-12 months.

3) Vote to put off the automatic spending cuts, known as sequestration, and tax increases scheduled to hit all at once in January — but with some deficit reduction down payment to signal how serious Congress is.

 

In other words, the idea is to cancel the automatic cuts, but then conduct four times bigger measures. Still in Senate they have far different opinions on the details. As for the House of Representatives, Republicans there don’t want to discuss tax increases at all. Democrats, on the other hand, won’t accept any deal that extends Bush-era tax cuts for the rich, even for 6 months.

 

 

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"October 3: forex news"(2012-10-02)

 

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October 3: forex news

 

 

 

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Demand for the high-yielding currencies is low amid increased global growth concerns. AUD/USD fell to $1.0210 (monthly low) after a report showed the country’s trade deficit reached the widest since 2008 (August trade balance: -2.03B; cons.: -0.69B). Widening trade gap heightens expectation for additional interest-rate cuts by the RBA. What’s more, the Aussie came under pressure as China’s non-manufacturing PMI confirmed the economic slowdown. NZD/USD slid to $0.8214, but still remains in a sideways range.

 

EUR/USD is down back below $1.2900 after reaching $1.2967 yesterday. The buyers were blown away after Spain’s Prime Minister Mariano Rajoy said that Spain isn’t ready to request a euro zone bailout for its public finances as early as next weekend. Another constraint for euro is the rumors that the China Investment Corp (CIC) won’t be investing in periphery debt until fundamental issues are resolved. Demand for EUR is also limited ahead of the ECB meeting tomorrow (no steps are expected) and retail sales release (cons.: -0.1%).

 

Watch for the headlines about Greece which is still negotiating with the Troika and news from Moody's rating agency that is assessing Spanish financial system – its decision on the nations credit rating may come anytime this month.

 

GBP/USD keeps weakening and is now trading around $1.6120. Watch out for the UK services PMI report at 8:30 GMT. The BoE will likely leave policy unchanged on Thursday. USD/CAD consolidates around 0.9840. USD/JPY is slowly pushing higher – resistance at 78.15 is successfully passed. USD/CHF remains indecisive, still close to 0.9400.

 

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"Key options expiring today"(2012-10-03)

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Key options expiring today

 

 

 

Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (2 p.m. GMT).

 

Here are the key options expiring today:

 

EUR/USD: $1.2800, $1.2850, $1.2925, $1.3000, $1.3100;

 

GBP/USD: $1.6300;

 

USD/JPY: 77.40, 77.60, 78.00, 78.25;

 

AUD/USD: $1.0300, $1.0385, $1.0400, $1.0425;

 

USD/CAD: 0.9900;

 

EUR/JPY: 100.25, 101.50.

 

 

 

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"AUD/USD extends losses"(2012-10-03)

 

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AUD/USD extends losses

 

 

 

 

AID/USD drop from $1.0624 accelerates: today the pair broke below the 100-day MA and the daily Ichimoku cloud and touched $1.0200. The pair is heading towards the $1.0165 support (September low). A break below this level will confirm a double top reversal pattern (August and September highs) and open the way to parity and lower. The next resistance is seen at $0.9994.

 

From a fundamental point of view, the Australian currency is under pressure because of the China's weak data and further RBA rate reduction expectations. What's more, demand for the Aussie should remain weak if Spain's government doesn’t make the aid request.

 

Specialists at RBS recommend going short on AUD/USD at current levels and targeting $1.0165. In their view, yesterday’s break below the 200-day MA and the trend line of support paves the ground for further losses.

 

 

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Chart. Daily AUD/USD

 

 

 

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"USD/CHF: technical picture"(2012-10-03)

 

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USD/CHF: technical picture

 

 

 

USD/CHF consolidates in a tight 0.9438/9330 range for a week after its rebound from 0.9237 slowed down. The pair keeps moving down for a third day in a row. As can be seen from the H4 chart, the pair is cramped between the 100- and 50-day MAs.

 

There are no signals of a clear bearish reversal, but the upside is limited by the 0.9395/9437 resistance area (200-day MA, 23.6% Fib.retracement of a Q3 decline, June minimums and October 1 maximum). The next strong resistance is seen at $0.9502/14 (July 31 minimum and 38.2% Fib.retracement). A break above the 0.9502/633 resistance area would open the way for further dollar gains.

 

On a downside a breach of a short-term 0.9331 support could lower the pair to 0.9237. The next support is 0.9146 (100-day MA) and 0.8930 (2012 minimum).

 

 

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Chart. Daily USD/CHF

 

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"FBS Quarterly Report"(2012-10-03)

 

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FBS Quarterly Report

 

 

We will remember Q3 2012 for another round of stimulus conducted by the major central banks. The ECB introduced Outright Monetary Transactions, the unlimited sterilized buying of distressed government bonds. The Fed has finally come up with QE3 and will buy $40 billion in mortgage-backed securities each month until the situation at US labor market improves – there’s no date set. The Bank of Japan also announced further stimulus. In other words, the policymakers provided a great deal of monetary support to the economies and the market’s risk appetite revived.

 

US S&P 500 gained 5.75% in Q3 climbing to 4-year high; MSCI Asia-Pacific Index added 12.5%. Gold added 14.2% during these 3 months: investors bought it as an alternative to the weakening forex instruments.

 

Meanwhile, global economic outlook deteriorates. In September the OECD slashed its growth forecasts for the Group of Seven (G7) most developed economies, putting the blame squarely on the shoulders of the euro zone. The IMF cut its forecast for global growth from 3.6% to 3.5% for this year and from 4.1% to 3.9% for 2013.

 

Moreover, one has to remember that right at the year-end the fiscal cliff is going to explode in the US. The nation’s economic figures haven’t been very encouraging in the recent month with anemic job growth and stagnating consumer spending at the center of attention. At the other side of Atlantics Europe is deep in recession. Only UK has a chance to grow, though after three quarters of contraction sustainable improvement is still out of the question.

 

You can get the economic insight from the table below.

 

 

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Events to watch in Q4:

 

• US presidential elections (November 6). The odds are that Obama is re-elected, while the Republicans hold the House of Representatives.

 

• FOMC meetings (October 24 and December 12). Recent comments of Ben Bernanke suggest that the Fed’s really determined to keep its policy accommodative for a long time, even as US economy strengthens.

 

• ECB meetings (October 4, November 8 and December 6). Analysts think that the ECB will ease its policy – not in October, but later this year. Chartered Economists expect the central bank to cut rate in Q4 and are bearish on EUR.

 

• EU leaders’ summit (October 18-19), the first of three summits in the next 3 months. EU President Herman Van Rompuy called this meeting “crucial”.

 

• Spanish regional elections (October 21, November 25). The political turmoil will continue creating severe risks as Catalonia, the richest and the most indebted region of Spain wants more independence, particularly in collecting taxes.

 

• Japanese elections may be called in coming months. Prime Minister Yoshihiko Noda, who took office in September 2011, promised in August to call general elections “soon” in return for the backing his contentious sales tax plan by the opposition. Opinion polls show the main opposition Liberal Democratic Party, ousted in 2009 after half a century of almost non-stop rule, will likely come first in the election.

 

• The course of Greek negotiations with Troika. Greece and its creditors are now trying to bridge differences over 2 billion euro of disputed austerity cuts. Failure to get a deal by Monday will be another setback for Greece’s efforts to quickly unlock its next installment of aid, without which it faces bankruptcy and the prospect of an exit from the euro zone.

 

• Transition of leadership in China (November 8). The ruling Communist Party will hold a congress to appoint a new generation of leaders.

 

• Italian election campaign in late Q4. In April 2013 the current Prime Minister Mario Monti has to leave. The technocrat Monti has said recently that he would be willing to head the government again if there is no outright winner in elections next year, as opinion polls now suggest.

 

Note that the result of the US presidential elections itself is not as important as the approaching fiscal cliff – the expiration of tax cuts and the automatic spending cuts which will occur as December 31 turns into January 1, 2013. Only the Congress may deal with the issue and postpone the cuts. The members of US Senate, the upper house of American parliament, plan to start discussions of the matter after elections. So, even if Obama is reelected, unless he has a strong majority in Congress, there’s not enough time for a formal grand sweeping agreement to be reached. When the elections are over, smaller deficit reduction measures will most likely be announced and followed by a new deadline for tax cuts to expire in Q1 or Q2, 2013. So, even if the issue of the fiscal cliff is avoided for a time being, it may raise serious concerns about US credit rating (USD-negative).

 

Also bear in mind that if China announces new monetary stimulus after the leadership change to ensure confidence in the new government, this will give a boost for the risk sentiment (USD-negative).

 

What can actually make USD stronger these days? The answer is: problems in the euro area. The longer Spain resists the necessity of a full sovereign bailout, the more concerned will be the markets’ about its budget. Risk aversion may start increasing amid such concerns. The same will happen if EU authorities don’t show efficient and coordinated approach to fighting the crisis and euro’s future will once again become the central spot of the market’s attention (USD-positive).

 

Currency pairs

 

As you may see from the table below, the greenback weakened versus all other major currencies. The situation is quite opposite from what we saw in Q2 when US currency lost only to Japanese yen. US dollar index (DXY) lost 2.1% showing the worst performance since Q1, 2011.

 

The value of the dollar's net short position rose to $17.96 billion in the week ended September 25 from a net short of $10.05 billion the previous week (CFTC). That was the largest negative dollar bet since early August 2011.

 

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US dollar

 

It’s necessary to note that the QE debasing US dollar is somewhat spoiling the game. Though now we are free from the torturing uncertainty of trying to guess whether there will be QE3 or not, the forecasting has become an even more complicated business. Though here and there the technical picture suggests that US dollar peers approached serious resistance levels, it’s hard to become bullish on US dollar taking into account the Fed’s excessive stimulus.

 

 

 

 

 

 

 

 

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October 4: forex news!

 

 

 

 

 

 

 

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US elections: Ronmey rules the debate

 

 

 

After the first round of presidential debate, the Republican Mitt Romney managed to breathe new life into his struggling campaign with a solid performance. Romney who took part in 19 debates during the primary season appeared more prepared and stood on the offensive, while the Democrat Obama who last time participate in debates nearly 4 years tended to give long wordy explanations and consult his notes.

 

The two candidates clashed over tax policy, healthcare and the role of government. Romney criticized Obama for high unemployment and weak economic growth. Obama underlined that he took office amid an economic crisis and pointed out to the progress made by the nation since that time. According to the current President, Romney’s approach would derail this achievement.

 

However, Obama failed to mention issues which his campaign has previously used to damage Romney’s goodwill in the polls such as the Republican’s now infamous video in which he said that 47% of the people out there pay no income taxes, his business record at Bain Capital and previous hard line on immigration.

 

Obama and Romney will debate twice more, on October 16 and October 22.

 

 

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Win McNamee / Getty Images

 

 

 

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October 4: FBS Market Analytics!

 

 

 

 

 

 

 

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NZD/USD: technical picture

 

 

 

NZD/USD bounces after declining for four days in a row. The pair trades above $0.8200 after touching $0.8172 yesterday. NZD/USD remains in an upward channel, existing since the end of June, but consolidates in a $0.8180/8354 range since September 12. Kiwi is also supported by the 200-, 100- and 50-day MAs and by the trend line, connecting 2011 and 2012 highs.

 

According to specialists at BNZ, a close below $0.8180 would provoke a deeper correction back towards $0.8000.

 

 

nzdusd_12-11.gif

 

 

 

 

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October 4: FBS Market Analytics!

 

 

 

 

 

 

 

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RBS: some longer-term currency prospects

 

 

GBP: Sterling will likely correct down against EUR and USD in Q4. EUR/GBP will meet resistance at 0.85, but its year-end target is lifted up from 0.78 to 0.80. GBP/USD advance will lose momentum and pound will spend most of 2013 below $1.6000.

 

AUD: AUD/USD will slide to 0.90s from the second half of next year as the US economy may start gaining traction and further QE policy easing may not be necessary. The condition for such forecast is the solution of US fiscal cliff and US ability to ensure its fiscal credibility. In Australia approaching peak in the resource investment cycle affects the outlook for the nation’s economy and Aussie.

 

CAD: Loonie vulnerable to weaker global growth and softer commodity prices. However, USD/CAD is unlikely to sustain a move above parity in the near-term. Market expectations for BoC policy tightening have been reduced, but an unchanged policy rate in 2013 could still relatively benefit CAD.

 

 

 

rbs_1777858b.jpg

 

 

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October 4: FBS Market Analytics!

 

 

 

 

 

 

 

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RBS: trading AUD/JPY

 

 

Technical analysts at RBS recommend selling AUD/JPY on the pair’s decline below 79.71 with stop around 81.40 and target at 76.00. The reason is the “head and shoulders pattern”. The bank adds that Japanese yen was the best-performing currency in October as the data for the last 6 years show, while commodities and commodity currencies performed badly.

 

 

daily_audjpy_15-42.gif

Chart. Daily AUD/JPY

 

 

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"NZD/USD: technical picture"(2012-10-04)

 

fbsana.png

 

 

 

 

 

NZD/USD: technical picture

 

 

 

NZD/USD bounces after declining for four days in a row. The pair trades above $0.8200 after touching $0.8172 yesterday. NZD/USD remains in an upward channel, existing since the end of June, but consolidates in a $0.8180/8354 range since September 12. Kiwi is also supported by the 200-, 100- and 50-day MAs and by the trend line, connecting 2011 and 2012 highs.

 

According to specialists at BNZ, a close below $0.8180 would provoke a deeper correction back towards $0.8000.

 

nzdusd_12-11.gif

 

 

 

 

 

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"EUR/USD: sideways ahead of the NFP"(2012-10-04)

 

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EUR/USD: sideways ahead of the NFP

 

 

 

So, EUR/USD is moving sideways in the $1.2800/3000 range and is likely to remain there until US NFP release tomorrow. Today’s ECB meeting is unlikely to bring something new.

 

In the near-term the dynamics of the pair will be determined by the greenback’s performance: it seems that euro has already priced in all good news and we don’t expect to hear about Spain’s request for bailout in a week from now. On the contrary, Moody’s still hasn’t announced its decision about the nation’s credit rating – this will limit EUR/USD.

 

JP Morgan: Support area of $1.2817/1.2775 is very important. If the pair breaches it, it will slide to $1.2600. As for resistance, only a break above $1.3200 “would classically confirm a game change on big scale.”

 

Commerzbank: “We should see failure at $1.2974/1.3000 and retest of trend line support currently at $1.2700.”

 

Note that solid stops are set around the boundaries of EUR/USD’s current range, so the pair’s move will accelerate once it gets out of it.

 

 

h4_eurusd_12-13.gif

 

 

 

 

Chart. H4 EUR/USD

 

 

 

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"USD/CAD: growth stalled?"(2012-10-04)

 

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USD/CAD: growth stalled?

 

 

 

 

USD/CAD trades on a downside around 0.9860 after opening a one-month high at 0.9883 on Wednesday. Bulls broke through the 0.9858 resistance yesterday and tried to continue the uptrend, but the pair stalled after meeting the 50-day MA and a descending trend line connecting June 28 and July 25 peaks.

 

According to specialists at TD Securities, the 50-day MA resistance (0.9871) may pause growth for some time, but the bullish impulse is strong enough. In their view, USD/CAD is likely to break higher and to move towards the 0.9950 resistance (July 22-24 highs).

 

 

usdcad_12-49.gif

 

 

 

 

Chart. Daily USD/CAD

 

 

 

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"Key options expiring today"(2012-10-04)

 

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Key options expiring today

 

 

 

 

Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (2 p.m. GMT).

 

Here are the key options expiring today:

 

EUR/USD: $1.2800, $1.2879, $1.2900, $1.2950, $1.3000;

 

USD/JPY: 78.15, 78. 35, 78.50, 78.80;

 

AUD/USD: $1.0120, $1.0150, $1.0170, $1.0215;

 

EUR/JPY: 100.00, 102.00;

 

EUR/GBP: 0.8000, 0.8050.

 

 

flatline.jpg

 

 

 

 

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"EUR/JPY: technical levels"(2012-10-04)

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EUR/JPY: technical levels

 

 

 

EUR/JPY stalled in front of resistance in the 101.60/80 area (200-day MA, top of the Ichimoku Cloud at H4).

 

Resistance: 102.10, 102.40 and 103.30.

 

Support: 100.70, 100.20, 99.60, 99.00.

 

 

 

h4_eurjpy_13-26.gif

 

 

 

Chart. H4 EUR/JPY

 

MIG Bank: EUR/JPY is going to test long-term downtrend line and rise to 103.85 and then to 107.50.

 

In our view, the outlook for EUR/JPY will remain positive as long as it stays above 100 yen.

 

 

daily_eurjpy_13-38.gif

 

 

 

 

Chart. Daily EUR/JPY

 

 

 

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"RBS: some longer-term currency prospects"(2012-10-04)

 

fbsana.png

 

 

 

 

RBS: some longer-term currency prospects

 

 

 

GBP: Sterling will likely correct down against EUR and USD in Q4. EUR/GBP will meet resistance at 0.85, but its year-end target is lifted up from 0.78 to 0.80. GBP/USD advance will lose momentum and pound will spend most of 2013 below $1.6000.

 

AUD: AUD/USD will slide to 0.90s from the second half of next year as the US economy may start gaining traction and further QE policy easing may not be necessary. The condition for such forecast is the solution of US fiscal cliff and US ability to ensure its fiscal credibility. In Australia approaching peak in the resource investment cycle affects the outlook for the nation’s economy and Aussie.

 

CAD: Loonie vulnerable to weaker global growth and softer commodity prices. However, USD/CAD is unlikely to sustain a move above parity in the near-term. Market expectations for BoC policy tightening have been reduced, but an unchanged policy rate in 2013 could still relatively benefit CAD.

 

 

rbs_1777858b.jpg

 

 

 

 

Have a profitable trade with FBS!

If you have any questions to our analysts, you're welcome to ask them in comments to this article!

Recent market news from FBS

 

 

 

Comment here http://www.fbs.com/analytics/2012-10-04/19422-rbs-some-longer-term-currency-prospects

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"RBS: trading AUD/JPY"(2012-10-04)

fbsana.png

 

 

 

 

RBS: trading AUD/JPY

 

 

 

 

Technical analysts at RBS recommend selling AUD/JPY on the pair’s decline below 79.71 with stop around 81.40 and target at 76.00. The reason is the “head and shoulders pattern”. The bank adds that Japanese yen was the best-performing currency in October as the data for the last 6 years show, while commodities and commodity currencies performed badly.

 

 

daily_audjpy_15-42.gif

 

 

 

Chart. Daily AUD/JPY

 

 

 

Have a profitable trade with FBS!

If you have any questions to our analysts, you're welcome to ask them in comments to this article!

Recent market news from FBS

 

 

 

 

Comment here http://www.fbs.com/analytics/2012-10-04/19423-rbs-trading-audjpy

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