Market snapshot 13.07.09
USD
Brief:
1. Last Friday’s US economic releases, -actual- US Trade balance –May- (-$26.0B), US Import price index –June- (3.2%) and University of Michigan consumer confidence index –July- (64.6).
2. USD strengthens against most currencies today as stocks in Asia and Europe tumbled on concern the global economic recovery will be delayed as most global leaders had indicated that they will not propose additional stimulus package amid inadequate budget.
3. The dollar remained strong today as economists predicted that the Fed will begin to lift the benchmark interest rate in the 3rd quarter of next year amid economy recovery to prevent deflation.
On the upside:
•US stocks may retreat further on speculation global recession will linger.
On the downside:
•US stocks may slightly recover on short-covering.
To monitor:
•Speculation on this week’s US economic releases.
•Fed/Treasury members' statements/comments.
•Other Central bank member’s statements/comments.
•US Indexes movement.
•News/statements related to major corporate.
•Cross currency strength and weakness. (GBP, EUR, AUD, NZD, CAD and JPY –Main-)
Suggested pairs of the day:
Long: EUR/USD – GBP/USD – AUD/USD – USD/JPY –
Short: USD/CAD
Possible main pairs are: GBP/USD – USD/CAD - USD/JPY -
-According to 11.50GMT price-
JPY
Brief:
1. Today’s Japan economic releases, -actual- Japan Industrial production –YoY-MoM- (-29.5% - 5.7%) and Japan Consumer confidence –June- (38.1).
2. Tomorrow’s Japan economic releases, -forecast- Japan Rate decision (0.1%) and Japan Nationwide department store sales –June- (-9.8%)
3. The yen strengthened against most currencies today as stocks in Asia and Europe fell, while commodities decline, reducing demand for carry trade and increasing demand for the dollar as safe haven.
4. Stocks in Asia and Europe decline as global leaders indicated that they will not impose any additional stimulus package as government budget dried up, while speculation arose that Fed Chairman Bernanke will likely show how the central bank will exit the biggest monetary expansion when he reports to Congress next week.
On the upside:
•Stocks may retreat further on selling pressure.
On the downside:
•Stocks may experience some light rebound amid early trading session losses.
To monitor:
•Speculation on this week’s US economic releases.
•US Indexes movement.
•Other central bank member’s statements/comments.
•Corporate fiscal report.
•Fed/Treasury members' speech.
•BOJ Members' statements/comments.
•News related to major institution.
•Economist comments on US/Japan economy, economic releases or sector growth.
Suggested pairs of the day:
Long: GBP/JPY – EUR/JPY – AUD/JPY – USD/JPY -
Possible main pairs are: AUD/JPY - GBP/JPY – USD/JPY – EUR/JPY -
-According to 11.50GMT price-
EUR
Brief:
1.Today's Euro-zone economic releases, -actual- Germany ZEW Survey Economic sentiment –July- (47.8), Germany ZEW Survey current situation –July- (-88.0), Euro-zone ZEW Survey Economic sentiment –July- (44.0) and Euro-zone Industrial production –May- (1.5%).
2. Tomorrow’s Euro-zone economic releases, -forecast- Italy CPI –YoY-MoM- (0.5% - 0.1%) Italy CPI EU-Harmonized –YoY-MoM- (5.0% - 0.6%) and Euro-zone CPI –June- (0.2%).
3. EUR fell against most currencies today as stocks in Asia and Europe fell on concern global economy recovery will be delayed as global leaders give no hints that they will impose additional stimulus package to boost the economy.
On the upside:
•Stocks may slightly recover amid early losses.
On the downside:
•US stocks may retreat following Asia and Europe stocks on concern recession in the world’s largest economy will linger.
To monitor:
•Speculation on this week’s US economic releases.
•Fed/Treasury members' statements/comments.
•ECB Member's statements/comments.
•US Indexes movement.
•News related to major corporate.
•Cross currency movement. –Main- (USD)
•Other central banks member’s statements/comments.
Suggested pairs of the day:
Long: EUR/JPY – EUR/CHF – EUR/USD – EUR/CHF -
Possible main pairs are: EUR/JPY - EUR/USD – EUR/CHF -
-According to 11.50GMT price-
Crude oil
Brief:
1. Crude oil fell below $59 today as equities declined and the dollar strengthens, reducing demand for commodities as inflation hedge and raising speculation that the global recession will sap demand for fuel, boosting stockpiles.
2. Oil prices capped its biggest weekly decline since January last Friday as US consumer confidence index fell more than expected and fuel stockpiles rose for a 4th week.
On the upside:
•Oil prices may slightly rebound on buying interest and short-covering.
On the downside:
•Selling pressure on speculation prolonging global recession will sap demand.
To monitor:
•Speculation on this week’s US economic releases.
•Fed/Treasury members' statements/comments.
•US Indexes movement.
•OPEC members' comments/statements.
•USD movement.
•Geopolitical risk.
•Forecast on near term US economic releases and economic growth.
Trade suggestion: (Light)
“Long” Crude oil around mid $59 and high $59 (US indexes movement, USD movement)
-Exit all positions before market closes-
-According to 11.50GMT price-
Time lapse prediction: (according to current situation)
Present (11.50AM) – 14PM GMT:
•USD slightly strengthens in early trading session.
•US capital markets slightly weakens in early trading session.
•JPY slightly strengthens in early trading session.
•EUR slightly weakens in early trading session.
•Crude oil slightly weakens in early trading session.
14PM – 16PM GMT:
•USD weakens in mid trading session.
•US stock markets recover in mid trading session.
•JPY weakens in mid trading session.
•EUR strengthens in mid trading session.
•Crude oil rose in mid trading session.
16PM – 21PM GMT:
•USD slightly weakens in late trading session.
•US capital markets slightly advances in late trading session.
•JPY slightly weakens in late trading session.
•EUR slightly strengthens in late trading session.
•Crude oil slightly strengthens in late trading session.
Loh Chang Yuen,
Junior Strategist
All rights reserved: Admiral Markets Ltd
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