USD
Brief:
1.Yesterday's US economic releases, -actual- US Initial jobless claims -May16- (631k), US Philadelphia Fed index -May- (-22.6) and US Leading indicators -Apr- (1.0%).
2.USD fell to a 4-month low against the euro president of Fed Boston, said the US recovery may be slow and Standard & Poor's threat to strip Britain's AAA debt rating stoked concern about other countries bond downgrades.
3.USD declined to the near the lowest level against the euro since January yesterday despite US stocks declined and a report posted after higher than forecast jobless claims as optimism on US economy returning to growth in late year grows.
4.The dollar remained weak yesterday as the index of US leading economic indicators rose more than forecast and a manufacturing gauge improved in signs the deepest recession in five decades could end later this year.
On the upside:
•Some recovery after recent retreat.
On the downside:
•Further selling pressure on outlook that recession in US and Europe may be stabilizing.
To monitor:
•Fed Chairman Bernanke speaks.
•Fed/Treasury members' statements/comments.
•US Indexes movement.
•News/statements related to major corporate.
•Other Central bank member’s statements/comments.
•Cross currency strength and weakness. (GBP, EUR, AUD, NZD, CAD and JPY –Main-)
Suggested pairs of the day:
Short: EUR/USD – GBP/USD – AUD/USD – NZD/USD -
Long: USD/CAD - USD/CHF - USD/JPY –
Possible main pairs are: EUR/USD – GBP/USD – USD/CHF – AUD/USD – NZD/USD -
-According to 11.20GMT price-
JPY
Brief:
1.Today's Japan economic releases, -actual- Japan Leading index -Mar- (76.3) and Japan Coincident index -Mar- (85.1).
2.JPY strengthens against most currencies today despite stocks in Europe and US futures index rose as earlier BOJ raised its view of the economy for the 1st time in almost 3 years on signs that a record contraction in the 1st quarter is the worst of the recession.
3.JPY is rose against most currencies yesterday as US stocks fell after higher than forecast jobless claims spurred concern a weakening labor market will delay an economic recovery.
On the upside:
•Stocks may retreat as outlook on non-banking sectors' companies earnings remain weak.
On the downside:
•The yen may weaken on speculation Japan's government will offer more stimulus package.
•Stocks may advance on economic data which indicates global economy is recovering.
To monitor:
•Fed Chairman Bernanke speaks.
•US Indexes movement.
•Corporate fiscal report.
•Fed/Treasury members' speech.
•BOJ Members' statements/comments.
•News related to major institution.
•Other central bank member’s statements/comments.
•Economist comments on US/Japan economy, economic releases or sector growth.
Suggested pairs of the day:
Short: GBP/JPY – EUR/JPY – AUD/JPY – USD/JPY -
Possible main pairs are: EUR/JPY – USD/JPY – AUD/JPY - GBP/JPY
-According to 11.20GMT price-
EUR
Brief:
1.Today's Euro-zone economic releases, -actual- Italy Retail sales -Mar- (0.1%).
2.EUR strengthens against most currencies today as stocks in Europe rose, reduces demand for the dollar as inflation hedge and as a report showed Italy retail sales unexpectedly rose in March as credit access in the region eases, boosting spending.
3.EUR rose to near the highest level against the euro since January yesterday despite US stocks fell as an increase in Treasury yields and previous economic figures indicated inflation may accelerate, preventing Fed from raising its interest rate from record low.
4.The euro remained strong versus the dollar yesterday on speculation Fed will boost purchases of assets to counter the global slump, increasing supply of the dollar on the market, and a report showed Italy retail sales unexpectedly rose in March as credit access in the region eases.
On the upside:
•Speculation on additional stimulus/fiscal package for Americans.
On the downside:
•Stocks may retreat further on selling pressure.
To monitor:
•Fed Chairman Bernanke speaks.
•Fed/Treasury members' statements/comments.
•US Indexes movement.
•News related to major corporate.
•ECB Member's statements/comments.
•Cross currency movement. –Main- (USD)
•Other central banks member’s statements/comments.
Suggested pairs of the day:
Short: EUR/JPY – EUR/CHF – EUR/USD – EUR/AUD –
Possible main pairs are: EUR/JPY - EUR/USD – EUR/AUD -
-According to 11.20GMT price-
Crude oil
Brief:
1.Crude oil rose today as the dollar fell to a 4-month low against the euro, drawing investors to crude as an inflation hedge and analysts said OPEC is likely to keep output quotas unchanged at next week's meeting as recovering oil prices forestall the need for new supply cuts.
2.Crude oil dropped from a 6-month high yesterday despite the dollar fell versus the euro as Fed cut its forecast for the economy of the US, raising concerns that fuel consumption will remain weak despite figures shows economy is stabilizing.
3.Oil prices remained weak yesterday as US stocks declined and a report showed higher than forecast jobless claimsspurred concern a weakening labor market will delay an economic recovery and demand for oil will weaken.
On the upside:
•Speculation on additional stimulus package.
On the downside:
•Further selling pressure as investor exit positions ahead of weekend.
To monitor:
•Fed Chairman Bernanke speaks.
•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:
“Short” Crude oil around high $61 and low $62 (US indexes movement, USD movement)
-Exit all positions before market closes-
-According to 11.20GMT price-
Time lapse prediction: (according to current situation)
Present (11.20PM) – 14PM GMT:
•USD slightly strengthens in early trading session.
•US capital markets slightly retreats 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 slightly weakens in mid trading session.
•US stock markets slightly advances in mid trading session.
•JPY slightly weakens in mid trading session.
•EUR slightly weakens in mid trading session.
•Crude oil slightly strengthens in mid trading session.
16PM – 21PM GMT:
•USD strengthens in late trading session.
•US capital markets advances in late trading session.
•JPY weakens in late trading session.
•EUR strengthens in late trading session.
•Crude oil advances in late trading session.
Loh Chang Yuen,
Junior Strategist
All rights reserved: Admiral Markets Ltd
