USD
Brief:
1.USD is little change against the euro today despite stocks in Asia rose as the dollar was supported by buying interest as investors speculates last week's decline was excessive and too fast to sustain and economists predicted that the dollar this week will rose against most currencies after last week's tumble.
2.The dollar declined beyond $1.40 against the euro for the first time since January last Friday on concern US creditworthiness deteriorated and growing optimism that global economy recovering reduces appeal of the dollar as safe haven.
3.The dollar remained weak against most currencies last Friday as US stocks advanced, reduces demand for the dollar as safe haven and economists said US orders for durable goods and home sales probably rose in April.
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:
•Speculation on this week's US economic releases.
•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/JPY – AUD/USD – USD/CAD -
-According to 02.20GMT price-
JPY
Brief:
1.JPY advances against most currencies today despite Asian stocks gained, led by raw material producer as metal prices rose and investors speculates Europe's stocks will advance today on speculation a report will show Germany business confidence probably rose in May on governments' stimulus packages and central bank interest-rate cuts.
2.JPY touched a 9-week high versus the dollar last Friday despite US stocks advanced as Japan's Finance Minister said the government won't intervene in the currency market and the BOJ raised its economic assessment.
3.The yen remained weak versus the euro last Friday despite advancing against the dollar as investors speculates Fed will increase assets purchase to bolster the region economy, flooding the market with more dollar, while economic figures are showing signs of recovery.
On the upside:
•Stocks may retreat as outlook on non-banking sectors' companies earnings remain weak.
On the downside:
•Stocks may advance on economic data which indicates global economy is recovering.
•Some retreat after last week's decline.
To monitor:
•Speculation on this week's US economic releases.
•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: (Light)
Long: GBP/JPY – EUR/JPY – AUD/JPY – USD/JPY -
Possible main pairs are: EUR/JPY – USD/JPY – AUD/JPY - GBP/JPY
-According to 02.20GMT price-
EUR
Brief:
1.Today's Euro-zone economic releases, -actual- Germany Retail sales -YoY-MoM- (-7.7% - 0.2%), Germany IFO Expectation -May- (85.4), Germany IFO Business climate -May- (84.9) and Germany IFO Current assessment -May- (84.5).
2.Tomorrow's Euro-zone economic releases, -forecast- Germany GDP -1stQ- (-3.8%), Germany Private consumption -1stQ- (0.2%), Germany Imports -1stQ- (-2.4%), Germany Exports -1stQ- (-5.8%), Germany Gfk consumer confidence survey -Jun- (2.5%), France Consumer spending -Apr- (1.4%), Euro-zone Current account -Mar- (-7.5B Euros), Euro-zone Industrial new orders -Mar- (-1.0%).
3.EUR traded near the strongest level this year against the dollar today before a report economists say will show Germany business confidence extended a rebound from a 26-year low as government stimulus packages and interest-rate cuts boosted expectations that the worst of the recession will ease later in the year, boosting demand for the currency.
4.EUR strengthens against most currencies last Friday as US stocks rose, reduces demand for the dollar as safe haven and on optimism global economy is stabilizing and will recover in the 2nd half of the year, offsets economists forecast that the dollar may rebound after last week's decline.
On the upside:
•Speculation on additional stimulus/fiscal package for Americans.
On the downside:
•Stocks may retreat further on selling pressure.
•Some retreat after recent gains.
To monitor:
•Speculation on this week's US economic releases.
•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: (Light)
Short: EUR/USD – EUR/AUD –
Long: EUR/JPY – EUR/CHF -
Possible main pairs are: EUR/JPY - EUR/USD – EUR/AUD -
-According to 02.20GMT price-
Crude oil
Brief:
1.Crude oil rose today as advancing equities led commodities price higher, overshadowed analysts forecast OPEC is likely to keep output quotas unchanged at this week's meeting as recovering oil prices forestall the need for new supply cuts.
2.Crude oil rose last Friday as the dollar fell to a 4-month low against the euro and as advancing equities pushed commodities price higher, overshadowed analysts forecast that crude oil may decline this week as the global economic contraction reduces fuel demand.
3.Oil remained strong last Friday despite analysts said OPEC is likely to keep output quotas unchanged at this week's meeting as recovering oil prices forestall the need for new supply cuts.
On the upside:
•Speculation on additional stimulus package.
On the downside:
•Further selling pressure as investor exit positions ahead of weekend.
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)
“Short” Crude oil around mid $61 and high $61 (US indexes movement, USD movement)
-Exit all positions before market closes-
-According to 02.20GMT price-
Time lapse prediction: (according to current situation) Low fluctuation on Memorial day holiday
Present (02.20AM) – 14PM GMT:
•USD slightly weakens in early trading session.
•US capital markets slightly rises early trading session.
•JPY slightly weakens in early trading session.
•EUR slightly strengthens in early trading session.
•Crude oil slightly strengthens in early trading session.
14PM – 16PM GMT:
•USD slightly strengthens in mid trading session.
•US stock markets slightly retreats in mid trading session.
•JPY weakens in mid trading session.
•EUR slightly weakens in mid trading session.
•Crude oil slightly weakens 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
