Economic Indicators, Events and Market News Thursday April 12, 2012

As US markets begin to open, European markets are beginning to close and Asia is sleeping, lets take a quick look at the happening so far today.

The U.S. trade deficit narrowed to $46 billion in February from $52.5 billion in January for a 12.4% drop, the largest percent decline since May 2009, the Commerce Department reported.

The number of foreclosure filings in March fell to their lowest level since July 2007, according to a report from RealtyTrac, released on today.

U.S. wholesale prices were unchanged in March as a recent surge in energy prices was mostly reversed, the Labor Department. Excluding the volatile categories of food and energy, core wholesale prices rose a seasonally adjusted 0.3

The economy isn’t strong enough on a sustained basis to make a big dent in the unemployment rate, said William Dudley, the president of the New York Fed, in a speech in Syracuse. He anticipated first-quarter gross domestic product growth of 2.25%, which is around the economy’s potential growth rate. 

The number of Americans who filed requests for jobless benefits jumped by 13,000 last week to 380,000, the highest level since late January, the U.S. Labor Department said Thursday. Much of the increase in the week ended April 7 was related to spring break, when many school bus drivers and cafeteria workers are allowed to file claims. Claims from two weeks ago, however, were revised up to 367,000 from 357,000, an unusually sharp adjustment.

European equities moved slightly into the red following disappointing auction results out of Italy that further fanned concerns about the eurozone’s fiscal health.  Currency markets are not reflecting the mild pessimism that is being factored into European equities, as the USD is selling off against a fairly broad variety of crosses including a small rise in the Euro.  The A$ is the reigning champ of the day in response to a solid overnight jobs report. Dow futures are pointing to a lift at the 9:30amET open, and Treasuries are mostly flat with the 10 year issue trading at 2.04%.

Italy auctioned €4.88b of bonds. While market headlines are emphasizing that Italian 3-year bond yields increased compared to an auction last March, yields are actually lower than they were over the past two trading days, with the yield on the 3/1/2015 bond having fallen from 4.1% to 3.86%. While the bid-to-cover on smaller amounts of nearer-maturity bonds were low, auctions of longer maturity bonds (for instance a reopening of an 8/1/2023 bond) were better bid (bid-to-cover of 1.75) and their yields fell at auction (the yield on the 2023 bond was 5.81% two days ago, and is currently 5.55% according to Bloomberg). A comparable maturity Spanish bond is currently yielding 6.03%.

The European Central Bank reiterated that it can address upside risks to price stability in a “firm and timely manner.” It also said in the editorial to its Monthly Bulletin that inflation rates in the 17-nation currency bloc are likely to stay above 2% this year, with “upside risks” prevailing.

Industrial production across the 17-nation euro zone saw monthly growth of 0.5% in February and fell 1.8% compared to the same month last year, the European Union statistics agency Eurostat reported.

Spanish Prime Minister Mariano Rajoy reportedly said at a press conference on Thursday that his country will not need a bailout such as that was seen in Portugal, Ireland and Greece.

 Australia blew away expectations for job gains in March.  It gained 44k jobs versus consensus expectations for. 6.5k gain.  The A$ spiked about a half a US cent higher immediately following the report, and is up almost a full cent at the time of writing.

Much of the rise was in part-time jobs (+28k) but even just the full-time rise of 15.8k would have exceeded consensus expectations.  This may weigh against expectations for an RBA rate cut, but note that the RBA has signalled it is waiting for the next CPI report in any event, and that arrives only after next week’s rate decision.  Looking for a connection on commodity producers in the wake of Canada’s out-sized 82k job gain during the same month?  Not so fast.  Canada’s gains were skewed toward service industries, not natural resources, and overwhelmingly toward health care, information services, and the professional and scientific category

The UK had a fairly weak auction, selling £2.77b of paper maturing 6/7/2032 at an average yield of 3.01%. Bid-to-cover was 1.39.

The UK February trade deficit came in substantially wider than markets had forecast, growing to £3.4b compared to £2.5b last month (that £2.5b was itself £800m worse than the initially announced £1.7b January deficit). The upshot is that trade will probably drag on UK GDP during Q1 2012. The drop-off was largely attributable to weak exports while imports were fairly flat. The base-effect drop-off in automotive exports was a major factor.

French CPI for March was released overnight and came in higher than markets had anticipated but in line with Scotia’s 0.8% m/m forecast. The gain was focused on the ‘clothing and shoes’ category, which was up a very large 11.7% m/m. earlier in April. Energy prices were up as well. 

AUD/USD Fundamental Analysis April 13, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD  jumped by almost half a per cent after data showed the Australian unemployment rate remained steady in March. The AUD is currently trading at 1.0396 poised to break the 1.04 level.

The figures showed unemployment remained at 5.2 per cent in the month, while the total number of jobs created stood at 44,000. The forecast was for total employment to have risen by 5,000 in March with the unemployment rate at 5.3 per cent, according to the median of 12 market economists.

Prior to the release of the data, the Australian dollar was trading at $US1.0307. The Aussie jumped to $US1.0362 after the release of the data.

The Australian dollar opened at $US1.030.

Economic Reports for April 11-12, 2012 actual v. forecast

 

 

EUR

 

 

 

German 10-Year Bund Auction 

1.770%

 

 

 

1.830% 

 

 

 

 

CAD

 

 

 

Housing Starts 

216K

 

200K 

 

205K 

   

 

 

USD

 

 

 

Import Price Index (MoM) 

1.3%

 

0.8% 

 

-0.1% 

   

 

 

MXN

 

 

 

Mexican Industrial Production (YoY) 

5.9%

 

4.3% 

 

4.2% 

 

 

 

 

USD

 

 

 

10-Year Note Auction 

2.043%

 

 

 

2.076% 

 

 

 

 

USD

 

 

 

Beige Book 

 

 

 

 

 

 

 

 

 

USD

 

 

 

Federal Budget Balance 

-198.2B

 

-196.0B 

 

-232.0B 

 

 

Apr. 12

 

KRW

 

 

 

South Korean Unemployment Rate 

3.4%

 

3.5% 

 

3.7% 

 

 

 

 

AUD

 

 

 

Employment Change 

44.0K

 

6.0K 

 

-15.4K 

 

 

 

 

AUD

 

 

 

Unemployment Rate 

5.2%

 

5.3% 

 

5.2% 

 

 

 

 

EUR

 

 

 

French CPI (MoM) 

0.8%

 

0.6% 

 

0.4% 

 

 

 

 

INR

 

 

 

Indian Industrial Production (YoY) 

4.1%

 

6.6% 

 

1.1% 

   

Economic Events for April 13, 2012 that affect the AUD, NZD, JPY and CNY

00:50     JPY        Monetary Policy Meeting Minutes

The Monetary Policy Meeting Minutes are a detailed record of the Bank of Japan’s policy setting meeting, containing in-depth insights into the economic conditions that influenced the decision on where to set interest rates.                                                                                                              

03:00     CNY      Chinese Fixed Asset Investment      20.8%                   21.5%

Chinese Fixed Asset Investment measures the change in the total spending on non-rural capital investments such as factories, roads, power grids, and property.                      

03:00     CNY       Chinese GDP (YoY)                              8.3%                      8.9%

Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.

03:00     CNY       Chinese Industrial Production       11.5%                   11.4%     

Industrial Production measures the change in the total inflation-adjusted value of output produced by manufacturers, mines, and utilities.

03:00     CNY       Chinese Retail Sales (YoY)           15.0%                   14.7%   

Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.      

13:30     USD       Core CPI (MoM)                               0.2%                     0.1%

13:30     USD      CPI (MoM)                                          0.3%                      0.4%

The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.                            

 14:55    USD      Michigan Consumer Sentiment   76.2                        76.2

The University of Michigan Consumer Sentiment Index rates the relative level of current and future economic conditions. There are two versions of this data released two weeks apart, preliminary and revised. The preliminary data tends to have a greater impact. The reading is compiled from a survey of around 500 consumers.

 18:00    USD       Fed Chairman Bernanke Speaks

Federal Reserve Chairman Ben Bernanke (February 2006 – January 2014) is to speak. As head of the Fed, which controls short term interest rates, he has more influence over the U.S. dollar’s value than any other person. Traders closely watch his speeches as they are often used to drop hints regarding future monetary policy

Government Bond Auctions  (this week)

Apr 13  10:00  Belgium  OLO mini bond auction

Apr 16-30 n/a  UK Re-opened 3.75% 2052 Conventional Gilt syndication

Apr 16  09:10  Slovakia  Auctions floating rate Nov 2016 & 4.35% Oct 2025 & Bonds

Apr 16  09:10  Norway  T-bill auction

Apr 17  08:30  Spain  12 & 18M T-bill auction

Apr 17  09:30  Belgium  Auctions 3 & 12M T-bills

Apr 18  09:10  Sweden  Nominal bond auction

Apr 18  09:30  Germany  Eur 5.0bn 0.25% Mar 2014 Schatz

Apr 18  14:30  Sweden  Details T-bill auction on Apr 25

Apr 19  08:30  Spain  Obligacion auction

Apr 19  08:50  France  BTAN auction

Apr 19  09:30  UK  Auctions 0.125% I/L Gilt 2029

Apr 19  09:50  France  OATi auction

 

                                                                                     

 

AUD/USD Forecast April 12, 2012, Technical Analysis

 

The AUD/USD pair bounced from the lows on Wednesday in order to signify the support level at the 50% retracement level. The pair has been sold off significantly as of late, and the downward channel in this pair looks just like the channel in the gold markets. As a result, it looks like the Aussie is acting more as a proxy of gold itself than anything else at the moment. (This isn’t totally uncommon.)

The action for the session was bullish, but this pair looks weak and vulnerable at the moment, and as a result we are less likely to buy in it as the Kiwi. (The two tend to move in the same direction.) This is mainly because of the fact that the Kiwi has held up so well. Also, there could be a short AUD/NZD play setting up as well.

Sometimes the charts will give you a clear and concise signal as to how to trade, and other times it can tell you where else to look. This one seems to be the latter of those examples.

AUD/USD Forecast April 12, 2012, Technical Analysis
AUD/USD Forecast April 12, 2012, Technical Analysis

In The Eyes of the Experts – 11/4/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • CHF
  • EUR

 

Currencies watch for Short:

  • CAD
  • USD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD    1.2999    1.3035    1.3089    1.3125    1.3179   
GBPUSD 1.5740 1.5795 1.5862 1.5917 1.5984
USDJPY 79.79 80.23 81.04 81.48 82.29
USDCHF 0.9116 0.9152 0.9181 0.9217 0.9245
USDCAD 0.9916 0.9981 1.0014 1.0080 1.0113
AUDUSD 1.0139 1.0182 1.0269 1.0312 1.0398

AUD/USD Fundamental Analysis April 12, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD  is exchanging at 1.0290.

The Australian dollar has fallen on weakened euro zone markets.

CMC Markets chief market strategist Michael McCarthy said the local currency had been pushed down by moves in Europe, and as the US dollar regained some strength.

The overnight concerns about Spanish debt were not necessarily the cause of the weakness in European markets.

 

Economic Reports for April 10-11, 2012 actual v. forecast that affect the AUD, NZD, CNY and JPY

   

USD

 

 

 

FOMC Member Fisher Speaks 

 

 

 

 

 

 

 

 

 

NZD

 

 

 

NZIER Business Confidence 

13

 

 

 

 

 

Apr. 11

 

AUD

 

 

 

Westpac Consumer Sentiment 

-1.60%

 

 

 

-5.00% 

 

 

 

 

AUD

 

 

 

Home Loans (MoM) 

-2.5%

 

-3.5% 

 

-1.1% 

   

 

 

JPY

 

 

 

BoJ Monthly Report 

 

 

 

 

 

 

 

Economic Events for April 12, 2012 for AUD, NZD,CNY and JPY

02:30     AUD      Employment Change                                    6.0K                       -15.4K                  

02:30     AUD      Unemployment Rate                                    5.3%                      5.2%

Employment Change measures the change in the number of people employed. Job creation is an important indicator of consumer spending. The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month. 

Government Bond Auctions April 10-20, 2012

Apr 12  09:10  Italy   BTP/CCTeu auction

Apr 12  09:30  UK  Gbp 2.0bn 4.25% Jun 2032 Conventional Gilt

Apr 12  15:00  US  Announces auction of 5Y TIPS on Apr 19

Apr 12  17:00  US  Auctions 30Y Bonds

Apr 13  10:00  Belgium  OLO mini bond auction

Apr 16-30 n/a  UK Re-opened 3.75% 2052 Conventional Gilt syndication

Apr 16  09:10  Slovakia  Auctions floating rate Nov 2016 & 4.35% Oct 2025 & Bonds

Apr 16  09:10  Norway  T-bill auction

Apr 17  08:30  Spain  12 & 18M T-bill auction

Apr 17  09:30  Belgium  Auctions 3 & 12M T-bills

Apr 18  09:10  Sweden  Nominal bond auction

Apr 18  09:30  Germany  Eur 5.0bn 0.25% Mar 2014 Schatz

Apr 18  14:30  Sweden  Details T-bill auction on Apr 25

Apr 19  08:30  Spain  Obligacion auction

Apr 19  08:50  France  BTAN auction

Apr 19  09:30  UK  Auctions 0.125% I/L Gilt 2029

Apr 19  09:50  France  OATi auction

Apr 19  15:00  US Announces 2Y Notes on Apr 24, 5Y Notes on Apr 25 & 7Y Notes on Apr 26

Apr 19  17:00  US  Auctions 5Y TIPS 

Apr 20  15:30  Italy   Details CTZ/BTPei on Apr 24 & BOT on Apr 26

 

 

AUD/USD Forecast April 11, 2012, Technical Analysis

The AUD/USD pair fell hard in the latter hours of the Tuesday session. The market looks more and weaker over time, and as the market is sitting at the 50% Fibonacci retracement level it could be choppy in the immediate area. The global markets seem to be returning to the “risk off” attitude, and this pair will suffer. The commodity markets overall are falling, and as long as this is true this pair will fall. The 1.01 level is the 61.8% Fibonacci retracement level, and this could very well be our next stop. As a result – we aren’t buying or selling as this pair has far too much in the way of support and fundamental problems at the moment. 

AUD/USD Forecast April 11, 2012, Technical Analysis
AUD/USD Forecast April 11, 2012, Technical Analysis

In The Eyes of the Experts – 10/4/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • JPY
  • USD

 

Currencies watch for Short:

  • NZD
  • GBP

 

Today’s important times (GMT+2):

  • 19:45 USD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD 1.2990 1.3049 1.3091 1.3149 1.3191
GBPUSD 1.5805 1.5855 1.5884 1.5933 1.5962
USDJPY 81.06 81.34 81.50 81.78 81.94
USDCHF 0.9112 0.9141 0.9178 0.9207 0.9244
USDCAD 0.9929 0.9947 0.9974 0.9991 1.0018
AUDUSD    1.0222    1.0263    1.0297    1.0338    1.0372   

AUD/USD Forecast April 10, 2012, Technical Analysis

The AUD/USD pair fell for some of the session on Monday, but managed a bounce to form a doji. The pair has bounced at the 50% Fibonacci level, and it looks as if the buyers are starting to reenter the market. The pair was also at the bottom of a down trending channel, so it looks as if we are going to have a bounce, but the trend is still weak. 

In order to go long, we need to see the top of the Monday session candle broken, but we would only consider it a short-term trade at this point. The 200 day EMA is well above, and the pair looks vulnerable at the moment. In order to go long for a longer-term trade, we need to see the pair close above the top of the channel. Selling is difficult as there are many different minor support levels below. 

AUD/USD Forecast April 10, 2012, Technical Analysis
AUD/USD Forecast April 10, 2012, Technical Analysis

AUD/USD Fundamental Analysis April 11, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD  was trading at 103.40 US cents, up from 103.05 cents on Thursday, before the Easter public holiday.

The Australian dollar has moved higher, as US markets weakened in response to unimpressive jobs figures.

US non-farm payrolls data, released on Good Friday, showed that 120,000 jobs were created in March, well below the market expectation of 203,000 jobs.

The US stock market and currency dropped following the data’s release.

This is because with the labor market looking weaker, it looks like QE3 (quantative easing) is not completely off the table, at least for traders.

Chinese CPI rose 3.6 per cent in March from a year earlier, compared to a rise of 3.2 per cent in February.

Chinese balance of trade figures are expected on Tuesday, and gross domestic product data is due on Friday.

Economic Data for April 9-10, 2012 actual v. forecast

Apr. 09

 

JPY

 

 

 

Adjusted Current Account 

0.85T

 

0.66T 

 

0.14T 

   

 

 

CNY

 

 

 

Chinese CPI (YoY) 

3.6%

 

3.3% 

 

3.2% 

 

 

 

 

CNY

 

 

 

Chinese PPI (YoY) 

-0.3%

 

-0.2% 

 

0.0% 

 

 

 

 

JPY

 

 

 

Economy Watchers Current Index 

51.8

 

46.5 

 

45.9 

 

 

 

 

RUB

 

 

 

Russian Interest Rate Decision 

8.00%

 

8.00% 

 

8.00% 

 

 

 

 

TRY

 

 

 

Turkish Industrial Production (YoY) 

4.40%

 

3.50% 

 

1.50% 

 

 

 

 

TWD

 

 

 

Taiwanese Trade Balance 

2.36B

 

2.19B 

 

2.83B 

 

 

 

 

EUR

 

 

 

Greek CPI (YoY) 

1.70%

 

 

 

2.10% 

 

 

 

 

EUR

 

 

 

Greek Industrial Production (YoY) 

-8.30%

 

 

 

-5.00% 

 

 

 

 

EUR

 

 

 

Portuguese Trade Balance 

-2.88B

 

 

 

-3.08B 

 

 

 

 

USD

 

 

 

CB Employment Trends Index 

107.28

 

 

 

107.47 

   

 

 

USD

 

 

 

3-Month Bill Auction 

0.085%

 

 

 

0.075% 

 

 

 

 

USD

 

 

 

6-Month Bill Auction 

0.150%

 

 

 

0.140% 

 

 

Apr. 10

 

GBP

 

 

 

RICS House Price Balance 

-10%

 

-12% 

 

-13% 

 

 

 

 

USD

 

 

 

Fed Chairman Bernanke Speaks 

 

 

 

 

 

 

 

 

 

AUD

 

 

 

AIG Construction Index 

36.2

 

 

 

35.6 

 

 

 

 

AUD

 

 

 

NAB Business Confidence 

3

 

 

 

 

 

 

 

MYR

 

 

 

Malaysian Trade Balance 

10.58B

 

9.20B 

 

8.75B 

 

 

 

 

MYR

 

 

 

Malaysian Industrial Production (YoY) 

7.5%

 

6.5% 

 

0.3% 

   

 

Economic Events for April, 11, 2012

02:30     AUD      Home Loans (MoM)                                      -3.5%                     -1.2%                                    

Home Loans record the change in the number of new loans granted for owner-occupied homes. It is a leading indicator of demand in the housing market.

 

13:30     USD      Import Price Index (MoM)                          0.8%                     0.4%     

The Import Price Index measures the change in the price of imported goods and services purchased domestically.

 

19:00     USD      Federal Budget Balance                             -201.5B                 -232.0B

The Federal Budget Balance measures the difference in value between the federal government’s income and expenditure during the reported month. A positive number indicates a budget surplus; a negative number indicates a deficit. 

Government Bond Auctions April 10-20, 2012

Apr 11  09:10  Italy   BOT auction

Apr 11  09:30  Germany  Eur 5.0bn new Jul 2022 Bund

Apr 11  09:10  Sweden  Sek 5.0bn Jul 2012 & Sek 5.0bn Sep 2012 T-bills

Apr 11  09:30  Swiss  Bond auction

Apr 11  09:30  UK  Gbp 4.5bn 1.0% Sep 2017 Conventional Gilt

Apr 11  10:00  Norway  Details T-bill auction on Apr 16

Apr 11  14:30  Sweden  Details nominal bond auction on Apr 18

Apr 11  17:00  US  Auctions 10Y Notes

Apr 12  09:10  Italy   BTP/CCTeu auction

Apr 12  09:30  UK  Gbp 2.0bn 4.25% Jun 2032 Conventional Gilt

Apr 12  15:00  US  Announces auction of 5Y TIPS on Apr 19

Apr 12  17:00  US  Auctions 30Y Bonds

Apr 13  10:00  Belgium  OLO mini bond auction

Apr 16-30 n/a  UK Re-opened 3.75% 2052 Conventional Gilt syndication

Apr 16  09:10  Slovakia  Auctions floating rate Nov 2016 & 4.35% Oct 2025 & Bonds

Apr 16  09:10  Norway  T-bill auction

Apr 17  08:30  Spain  12 & 18M T-bill auction

Apr 17  09:30  Belgium  Auctions 3 & 12M T-bills

Apr 18  09:10  Sweden  Nominal bond auction

Apr 18  09:30  Germany  Eur 5.0bn 0.25% Mar 2014 Schatz

Apr 18  14:30  Sweden  Details T-bill auction on Apr 25

Apr 19  08:30  Spain  Obligacion auction

Apr 19  08:50  France  BTAN auction

Apr 19  09:30  UK  Auctions 0.125% I/L Gilt 2029

Apr 19  09:50  France  OATi auction

Apr 19  15:00  US Announces 2Y Notes on Apr 24, 5Y Notes on Apr 25 & 7Y Notes on Apr 26

Apr 19  17:00  US  Auctions 5Y TIPS 

Apr 20  15:30  Italy   Details CTZ/BTPei on Apr 24 & BOT on Apr 26

In The Eyes of the Experts – 9/4/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • JPY

 

Currencies watch for Short:

  • CAD
  • USD
  • GBP

 

Today’s important times (GMT+2):

  • 17:30 CAD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD 1.3022 1.3060 1.3085 1.3123 1.3149
GBPUSD 1.5796 1.5834 1.5862 1.5901 1.5928
USDJPY 80.54 81.03 81.78 82.27 83.03
USDCHF 0.9130 0.9147 0.9176 0.9193 0.9225
USDCAD 0.9884 0.9929 0.9957 0.9998 1.0025
AUDUSD    1.0241    1.0275    1.0305    1.0338    1.0368   

AUD/USD Fundamental Analysis April 10, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD is trading at 1.0287 on this Easter Monday. Elsewhere, the Aussie dollar remains weak in a downtrend against neighboring New Zealand dollar. The pair is likely to find support at 1.0231, the low of January 13 and resistance at 1.0377, the high of January 12. The USD regained some of its strength over the weekend.

The dollar fell against major global currencies on Friday after the U.S. government reported that the economy added a net 120,000 nonfarm payrolls in March, far below market expectations that renewed talk of Federal Reserve easing measures.

 AUD/USD has triggered a bearish trend-line breakout and is now holding beneath its 200-day average.

 Our cycle analysis remains bearish and favors further mean reversion back into 1.0231, then 1.0146 and the parity level.

A great smooth currency for Newbie’s! We are currently at 1.0310 in a very nicely built downtrend. Building a nice bear flag currently for the break of the S6 at 1.0246 to targets below. We expect continuation this week to the support at 1.0250 and maybe the -1.270 Fibonacci extension at 0.9960.  Watch the 1.0105 (-0.618 Fibonacci extension) for the bounce also. The average daily trading range (ATR) for the cross currently is 93 pips

China’s inflation edged up in March as the government shifted focus from containing politically dangerous price rises to stimulating its slowing economy.

The government said on Monday that consumer prices rose 3.6 per cent over a year earlier, up from February’s 3.2 per cent. That was driven by a 7.5 per cent rise in food costs, up from the previous month’s 6.2 per cent.

Economic Data April 9, 2012 actual v. forecast ( most European markets are closed )

Apr. 09

 

JPY

 

 

 

Current Account 

0.85T

 

0.66T 

 

0.14T 

   

 

 

CNY

 

 

 

Chinese CPI (YoY) 

3.6%

 

3.3% 

 

3.2% 

 

 

 

 

CNY

 

 

 

Chinese PPI (YoY) 

-0.3%

 

-0.2% 

 

0.0% 

 

 

 

Economic Events April 10, 2012 that affect the AUD,NZD,JPY and CNY

02:30     AUD      NAB Business Confidence                                                                          1                             

The National Australia Bank (NAB) Business Confidence Index rates the current level of business conditions in Australia. Changes in business sentiment can be an early signal of future economic activity such as spending, hiring, and investment. The index is based on data collected from a survey of around 350 companies. A level above zero indicates improving conditions; below indicates worsening conditions.

 

04:30     JPY        Interest Rate Decision                                                                                 0.10%                   

Bank of Japan (BOJ) policy board members come to a consensus on where to set the rate. Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation. 

 

06:45     CHF       Unemployment Rate                                                    3.1%                      3.1%                     

The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.

 

23:00     NZD      NZIER Business Confidence      

The New Zealand Institute of Economic Research (NZIER) Business Confidence Index rates the relative six-month business outlook. The index is a leading indicator of economic health. The data is compiled from a survey of about 2500 businesses.  

 

Government Bond Auctions April 10-20, 2012

Apr 10  08:30  Holland  Eur 2.5-3.5bn reopened Jan 2017 DSL auction

Apr 10  09:15  Austria  Eur 1.32bn 3.2% Feb 2017 & 3.4% Nov 2022 RAGBs

Apr 10  14:30  UK  Details I/L Gilt auction on Apr 19

Apr 10  17:00  US  Auctions 3Y Notes

Apr 11  09:10  Italy   BOT auction

Apr 11  09:30  Germany  Eur 5.0bn new Jul 2022 Bund

Apr 11  09:10  Sweden  Sek 5.0bn Jul 2012 & Sek 5.0bn Sep 2012 T-bills

Apr 11  09:30  Swiss  Bond auction

Apr 11  09:30  UK  Gbp 4.5bn 1.0% Sep 2017 Conventional Gilt

Apr 11  10:00  Norway  Details T-bill auction on Apr 16

Apr 11  14:30  Sweden  Details nominal bond auction on Apr 18

Apr 11  17:00  US  Auctions 10Y Notes

Apr 12  09:10  Italy   BTP/CCTeu auction

Apr 12  09:30  UK  Gbp 2.0bn 4.25% Jun 2032 Conventional Gilt

Apr 12  15:00  US  Announces auction of 5Y TIPS on Apr 19

Apr 12  17:00  US  Auctions 30Y Bonds

Apr 13  10:00  Belgium  OLO mini bond auction

Apr 16-30 n/a  UK Re-opened 3.75% 2052 Conventional Gilt syndication

Apr 16  09:10  Slovakia  Auctions floating rate Nov 2016 & 4.35% Oct 2025 & Bonds

Apr 16  09:10  Norway  T-bill auction

Apr 17  08:30  Spain  12 & 18M T-bill auction

Apr 17  09:30  Belgium  Auctions 3 & 12M T-bills

Apr 18  09:10  Sweden  Nominal bond auction

Apr 18  09:30  Germany  Eur 5.0bn 0.25% Mar 2014 Schatz

Apr 18  14:30  Sweden  Details T-bill auction on Apr 25

Apr 19  08:30  Spain  Obligacion auction

Apr 19  08:50  France  BTAN auction

Apr 19  09:30  UK  Auctions 0.125% I/L Gilt 2029

Apr 19  09:50  France  OATi auction

Apr 19  15:00  US Announces 2Y Notes on Apr 24, 5Y Notes on Apr 25 & 7Y Notes on Apr 26

Apr 19  17:00  US  Auctions 5Y TIPS 

Apr 20  15:30  Italy   Details CTZ/BTPei on Apr 24 & BOT on Apr 26

AUD/USD Forecast April 9, 2012, Technical Analysis

The AUD/USD pair has a slight bullish day for the second session in a row. The pair has started to show signs of support at the 1.0250 level – which just happens to be the 50% Fibonacci level from the most recent uptrend. The 200 day EMA level is above, so we aren’t excited by the idea of buying at this point. In fact, we need to see the top of the downtrend channel broken above in order to buy at this point. The 200 EMA would also be broken back above as well, and this would be a good sign for the bulls. The selling of this pair isn’t a thought quite yet – unless of course we see weakness at the top of the channel. 

AUD/USD Forecast April 9, 2012, Technical Analysis
AUD/USD Forecast April 9, 2012, Technical Analysis

AUD/USD Forecast for the Week of April 9, 2012, Technical Analysis

AUD/USD fell during the week as the risk off trade continued. The Chinese economy will be vital for the future of the Aussie, and with signs of a possible slowdown in that area – the Aussie will struggle from time to time as exports to that area are such a massive part of the demand for the Aussie dollar.

The pair did manage to bounce from the 50% Fibonacci level, and this could be the beginning of a return to the uptrend. Because of this, we are mildly bullish of this pair now, and will wait to see a green candle on the weekly before we go long. Selling isn’t an option at the moment, as there seems to be far too much in the way of support below the current levels. 

AUD/USD Forecast for the Week of April 9, 2012, Technical Analysis
AUD/USD Forecast for the Week of April 9, 2012, Technical Analysis

AUD/USD Monthly Fundamental Forecast April 2012

Outlook and Recommendation

The Australian dollar (AUD) will remain well supported over the forecast horizon. Firm external and improving fiscal account fundamentals, strong ties to Asia and exposure to highly bid commodities all work in favor of the AUD.

Concerns over the economic outlook in Australia and China, combined with worries that the RBA is shifting to a more dovish stance weighed materially on AUD in March. However, investors maintained their long position, with the CFTC reporting a net long of US$6.2 billion. Medium-term technical’s have remained in bullish territory. We expect AUD to shine in 2012 and hold a 1.07 Q212 target. 

Last month the AUD/USD traded in the range shown below:

Highest: 1.0817

Lowest: 1.0305

Difference: 0.0512

Average: 1.0540

Change %: -3.6496

 

The Australian dollar has been in correction mode (against the USD) since the beginning of the year after testing a yearly high level of 1.0856 at the end of February. Nevertheless, we do believe that a positive combination of relatively strong growth fundamentals and attractive interest rate differentials (10-year government bond yields trading at 4.1%) will re-inject an appreciating bias into the AUD in the months to come. AUDUSD is set to approach the 1.10 mark. Strongly influenced by trade with the Asian giants as well as by supporting commodity prices, the Australian economy is well positioned to post annual average growth rates of 3-3.5% over the next two years. Flow of funds will also remain supportive as Australian bond yields remain the highest within the universe of (only 11) AAA rated sovereign credits. It is worth noting that, for now, global market participants remain indifferent to a persistent twin (fiscal and current account) deficit position, a negative factor that may instill higher volatility in the medium term.

The Reserve Bank of Australia will likely leave the benchmark cash rate unchanged for now. While the latest indicators of labor market stress have been on the low side, with lower wage pressures likely prevailing during the current quarter.

Whereas, the US the dominant factor driving the North American currency forecast is the outlook for the US economy (and employment) in addition to oil prices, central bank policy and shifts at the long end of the US Treasury yield curve. The US dollar (USD) is supported by an improving economic backdrop, flows into US securities markets and a weakening outlook for both the yen and euro; however, US central bank policy and elevated oil prices are significant weights against the USD.

 

Central Bank

Central Bank:  Reserve Bank of Australia

RBA INTEREST RATE DECISION

Actual: 4.25%  Cons.: 4.25%  Previous:  4.25%

RBA Interest Rate Decision is announced by the Reserve Bank of Australia. If the RBA is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the AUD. Likewise, if the RBA has a dovish view on the Australian economy and keeps the ongoing interest rate, or cuts the interest rate it is seen as negative, or bearish.

FED INTEREST RATE DECISION

Previous:  0.25%

The Board of Governors of the Federal Reserve announces an interest rate. This interest rate affects the whole range of interest rates set by commercial banks, building societies and other institutions for their own savers and borrowers. It also tends to affect the exchange rate. Generally speaking, if the Fed is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the USD.

AUD/USD Weekly Fundamental Analysis April 9-13, 2012, Forecast

Introduction:  The Australian dollar still isn’t in its good old days, but the performance is definitely improving. Resistance lines tend to work in a smoother manner than support lines, but they also work well. The pair move well together, not much volatility, but easy to chart and easy to trade with low risk factors

Weekly Analysis and Recommendation:

The AUD/USD ended Friday’s session at 1.0321 picking up steam after falling from the high of 1.0466 mid week. The Aussie traded as low as 1.0244

A rally on Chinese equity markets has helped the Australian dollar to recover from a three month low.

Many Chinese markets were closed during the week for local holidays. The local currency was at 84.74 Japanese yen, down from Wednesday’s close of 85.04 yen 78.36 euro cents, up from 77.88 euro cents.

The currency had received some support from Chinese stock markets, which reopened after three days of public holidays.

The Australian dollar fell sharply this week on weaker than expected trade data and signs the country’s central bank will cut the official interest rate as early as next month.

Data released on Wednesday showed Australia’s trade balance remained in deficit in February, despite widespread expectations of a return to surplus.

Against the USD this week, it was a difficult battle as FOMC minutes showed the Fed was no longer interested in QE, which gave the greenback strength and also make investors have to look at real value of currencies instead of trading central bank monetary policy.

Date

Last

Open

High

Low

Change %

04/06/2012

1.0321

1.0295

1.0322

1.0287

0.25%

04/05/2012

1.0294

1.0278

1.0323

1.0253

0.16%

04/04/2012

1.0279

1.0306

1.0312

1.0244

-0.26%

04/03/2012

1.0306

1.0426

1.0466

1.0303

-1.15%

04/02/2012

1.0426

1.0425

1.0445

1.0367

0.01%

04/01/2012

1.0425

1.0451

1.0454

1.0425

-0.25%

 

 

Economic Data for the week of April 2-6, 2012 for the Yen, the Aussie and the Kiwi actual v. forecast

Apr. 02

 

KRW

 

 

 

South Korean CPI (YoY) 

2.6%

 

3.1% 

 

3.1% 

 

 

 

 

JPY

 

 

 

Tankan Large Manufacturers Index 

-4

 

-1 

 

-4 

 

 

 

 

AUD

 

 

 

Building Approvals (MoM) 

-7.8%

 

0.3% 

 

1.1% 

   

 

 

INR

 

 

 

Indian Trade Balance 

-15.2B

 

-13.0B 

 

-14.8B 

 

 

Apr. 03

 

AUD

 

 

 

Retail Sales (MoM) 

0.2%

 

0.3% 

 

0.3% 

 

 

 

 

AUD

 

 

 

Interest Rate Decision 

4.25%

 

4.25% 

 

4.25% 

 

 

 

 

AUD

 

 

 

RBA Rate Statement 

 

 

 

 

 

 

 

Apr. 04

 

AUD

 

 

 

Trade Balance 

-0.48B

 

1.00B 

 

-0.97B 

   

 

Economic Data from the USA for the week of April 2-6, 2012 actual v. forecast

Apr. 02

 

USD

 

 

 

ISM Manufacturing Index 

53.4

 

53.0 

 

52.4 

 

 

Apr. 03

 

USD

 

 

 

FOMC Meeting Minutes 

 

 

 

 

 

 

 

Apr. 04

 

USD

 

 

 

ADP Nonfarm Employment Change 

209K

 

200K 

 

230K 

   

Apr. 05

 

USD

 

 

 

Initial Jobless Claims 

357K

 

355K 

 

363K 

   

Apr. 06

 

USD

 

 

 

Nonfarm Payrolls 

120K

 

203K 

 

240K 

   

 

 

USD

 

 

 

Unemployment Rate 

8.2%

 

8.3% 

 

8.3% 

 

 

 

Economic Events: (GMT)

Economic Highlights of the coming week for the USA (only minor reports, a very light week)

Apr. 9 

15:00

 

USD

 

 

 

CB Employment Trends Index 

 

 

 

 

107.50 

 

 

Apr 10 

12:30

 

USD

 

 

 

NFIB Small Business Optimism 

 

 

 

 

94.3 

 

 

 

13:55

 

USD

 

 

 

Redbook (MoM) 

 

 

 

 

0.70% 

 

 

 

15:00

 

USD

 

 

 

Wholesale Inventories (MoM) 

 

 

0.5% 

 

0.4% 

 

 

 

15:00

 

USD

 

 

 

IBD/TIPP Economic Optimism 

 

 

 

 

47.5 

 

 

 

21:30

 

USD

 

 

 

API Weekly Crude Stock 

 

 

 

 

7.85M 

 

 

 

21:30

 

USD

 

 

 

API Weekly Gasoline Stock 

 

 

 

 

-4.46M

   

 

Economic Highlights of the coming week that affect the Yen, the Aussie and the Kiwi.

Apr. 10

02:30

 

AUD

 

 

 

NAB Business Confidence 

 

 

 

 

 

 

 

23:00

 

NZD

 

 

 

NZIER Business Confidence 

 

 

 

 

 

 

 

Apr. 11

02:30

 

AUD

 

 

 

Home Loans (MoM) 

 

 

 

 

-1.2% 

 

 

 Apr. 12 

02:30

 

AUD

 

 

 

Employment Change 

 

 

 

 

-15.4K 

 

 

 

02:30

 

AUD

 

 

 

Unemployment Rate 

 

 

 

 

5.2% 

 

 

In The Eyes of the Experts – 6/4/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • AUD
  • NZD
  • CAG

 

Currencies watch for Short:

  • JPY
  • CHF

 

Today’s important times (GMT+2):

  • 15:30 USD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD 1.2957 1.3009 1.3085 1.3138 1.3215
GBPUSD 1.5743 1.5785 1.5846 1.5888 1.5949
USDJPY 81.52 81.86 82.15 82.49 82.78
USDCHF 0.9108 0.9154 0.9187 0.9233 0.9266
USDCAD 0.9853 0.9892 0.9944 0.9983 1.0035
AUDUSD    1.0217    1.0255    1.0288    1.0326    1.0359   

AUD/USD Fundamental Analysis April 9, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

AUD/USD  was trading at 1.0312, up 0.11% at the close of the light volume Asian session.

The pair was likely to find support at 1.0244, Wednesday’s low, and resistance at 1.0466.

Meanwhile, the Australian Dollar was up against the Euro and the Japanese Yen, with EUR/AUD shedding 0.09% to hit 1.2674 and AUD/JPY rising 0.06% to hit 84.84.

A rally on Chinese equity markets has helped the Australian dollar to recover from a three month low.

Thursday, the Australian dollar was trading at 103.05 US cents, up from 102.82 cents on Wednesday.

The Aussie was at 84.74 Japanese yen, down from Wednesday’s close of 85.04 yen 78.36 euro cents, up from 77.88 euro cents.

The currency had received some support from Chinese stock markets, which reopened after three days of public holidays.

Tepid demand at a Spanish government bond auction spooked investors who had been upbeat about global growth prospects and sparked a sell-off in higher-yielding, or riskier, assets.

Reflecting the negative risk sentiment, the safe-haven US dollar and Japanese Yen strengthened against all of the major currencies pushing the kiwi dollar down.

Against the Japanese yen, the euro   fell 0.7% to ¥107.62. The dollar also slipped, buying ¥82.42, down from ¥82.57

Most Western Markets are Closed on Friday April 6, 2012 and many are Closed on Monday April 9, 2012.

Economic Events April 5, 2012 actual v. forecast

 

CHF

 

 

 

CPI (MoM) 

0.6%

 

0.4% 

 

0.3% 

 

 

 

EUR

 

 

 

Dutch CPI (YoY) 

2.50%

 

2.20% 

 

2.50% 

 

 

 

GBP

 

 

 

Industrial Production (MoM) 

0.4%

 

0.3% 

 

-0.6% 

   

 

GBP

 

 

 

Manufacturing Production

-1.0%

 

0.1% 

 

-0.3% 

   

 

GBP

 

 

 

Interest Rate Decision 

0.50%

 

0.50% 

 

0.50% 

 

 

 

GBP

 

 

 

BOE QE Total 

325B

 

325B 

 

325B 

 

 

 

BRL

 

 

 

Brazilian CPI (YoY) 

5.2%

 

5.4% 

 

5.8% 

 

 

 

CAD

 

 

 

Building Permits (MoM) 

7.5%

 

3.0% 

 

-11.4% 

   

 

CAD

 

 

 

Employment Change 

82.3K

 

10.0K 

 

-2.8K 

 

 

 

USD

 

 

 

Initial Jobless Claims 

357K

 

355K 

 

363K 

   

 

CAD

 

 

 

Unemployment Rate 

7.2%

 

8.0% 

 

7.4% 

 

 

 

USD

 

 

 

Continuing Jobless Claims 

3338K

 

3350K 

 

3354K 

   

 

CAD

 

 

 

Ivey PMI 

63.5

 

66.0 

 

66.5 

 

 

 

GBP

 

 

 

NIESR GDP Estimate 

0.1%

 

 

 

0.1% 

   

 

Economic Events scheduled for April 9, 2012

02:30     CNY      Chinese CPI (YoY)           3.3%                      3.2%

The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.                            

02:30     CNY      Chinese PPI (YoY)                                           -0.2%      

The Producer Price Index (PPI) measures the change in the price of goods sold by manufacturers. It is a leading indicator of consumer price inflation, which accounts for the majority of overall inflation.                                    

 10:00    EUR       Greek CPI (YoY)                                              2.10%

Consumer Price index is the most frequently used indicator of inflation and reflect changes in the cost of acquiring a fixed basket of goods and services by the average consumer. 

AUD/USD Forecast April 6, 2012, Technical Analysis

 

The AUD/USD pair rose during the Thursday session as the pair tested the 61.8% Fibonacci level. The shape of the daily candle was a doji, and this was formed after a hammer. The pair currently trades at the bottom of the descending channel, and as a result a bounce isn’t a major surprise. However, the 200 day EMA failed to hold, so we are a bit leery about getting involved to the upside at the moment. In fact, we think a pop will more than likely trigger selling in this pair, especially at the top of the channel. A break above the channel’s top would have us long as it shows real momentum to the upside. Until then, we are flat.

AUD USD Forecast April 6, 2012, Technical Analysis
AUD USD Forecast April 6, 2012, Technical Analysis

In The Eyes of the Experts – 5/4/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • JPY
  • USD

 

Currencies watch for Short:

  • GBP
  • EUR
  • CHF

 

Today’s important times (GMT+2):

  • 14:00 GBP
  • 15:30 USD
  • 15:30, 17:00 CAD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD 1.3034    1.3088 1.3160 1.3214 1.3286
GBPUSD    1.5803 1.5852    1.5880 1.5929 1.5957
USDJPY 81.63 82.03 82.47 82.87 83.31
USDCHF 0.9062 0.9108 0.9145    0.9190 0.9227
USDCAD 0.9882 0.9922 0.9947 0.9987    1.0010
AUDUSD 1.0209 1.0243 1.0276 1.0311 1.0344   

AUD/USD Forecast April 5, 2012, Technical Analysis

The AUD/USD pair fell on Wednesday as the risk off trade can back into play. The pair stopped falling at the 61.8% Fibonacci level. The 200 day EMA is above the pair now, and we are watching this pair with great interest now. The bottom of the descending channel is being tested, and we could see a bounce from here. Because of that, we feel a break below the lows on Wednesday would signal much more selling in this pair. We also think that the channel is proving too strong for the bulls. We are willing to fade a rally to the top of the channel as well, on signs of weakness. We aren’t selling this pair yet, but could be very soon. 

AUD/USD Forecast April 5, 2012, Technical Analysis
AUD/USD Forecast April 5, 2012, Technical Analysis