AUD/USD Forecast February 24, 2012, Technical Analysis

 

AUD/USD rose on Thursday as the bottom of the recent consolidation area held true. The 1.06 level looks very constructive at the moment, and the market simply couldn’t break down through it. The continued weakness of the US dollar is to be blamed at this point, and the strength in the commodities markets certainly will help the Aussie as the central banks around the world continue to print fiat currencies.

The need and desire to own “stuff” continues to help all commodity currencies, and the Aussie is by far the most liquid of them all. The recent break out above the 1.04 level was a significant one as the level was the top of a triangle. The triangle measured up to a target of 1.12, and the way this pair has acted does little to distract from the possibility.

The 1.08 level has been a lid on this pair lately, but the truth is that the pair has been higher in the not so distant past, and the area should eventually give way as the economic picture continues to improve for the US. The continued pushback in this pair just shows how pro-Aussie the Forex markets are at the moment. Every time this pair falls, it simply bounces back up.

The breaking of the highs from Thursday should lead to the 1.08 level, and it is there that we will see the real struggle start. The daily close above that level will signal a bigger move up for the bulls, and this is something we fully expect to happen before it is all said and done. With this in mind, we don’t like selling at all now, and especially if we remain above the 1.04 level.

If the daily charts close sub-1.04, then we would have to rethink our thesis at that point. However, this looks very unlikely in the near-term, and as far as we can tell – there are few reasons to think that the flooding of liquidity into the markets is going to stop anytime soon. We buy the Aussie on dips, and on a break of the Thursday highs.

AUD/USD Forecast February 24, 2012, Technical Analysis
AUD/USD Forecast February 24, 2012, Technical Analysis

AUD/USD Forecast February 23, 2012, Technical Analysis

AUD/USD fell on Wednesday as the risk appetite fell for the session. The pair has enjoyed a strong run up, and at this time looks like it could be taking a rest. The 1.08 level above still offers strong resistance, and the 1.06 level seems supportive although we did pierce the level earlier in the session. With this entire mind, a pullback could be coming, and we would welcome that as a buying opportunity. The 1.04 level is the breakout point that we need to see the market stay above to continue the run higher, and we will not sell until a sub-1.04 daily close is posted. 

AUD/USD Forecast February 23, 2012, Technical Analysis
AUD/USD Forecast February 23, 2012, Technical Analysis

AUD/USD Fundamental Analysis February 24, 2012 Forecast

Economic Events:  (GMT)

It is a quiet day for economic data throughout the world.

Feb 23GMT

22:30                    AUD                                                      RBA Governor Stevens Speaks

Reserve Bank of Australia (RBA) Governor Glenn Stevens (September 2006 – September 2013) is to speak. As the head of the RBA, which sets short term interest rates, he has a major influence over the value of the Australian dollar. Traders watch his speeches closely as they are often used to drop subtle hints regarding future monetary policy and interest rate shifts. After surprising the markets last week and holding rates, today’s comments might have some effects on the Aussie

Analysis and Recommendation: ( close of Asian session )

AUD/USD was trading at 1.0643 opening at 1.0647. The Australian dollar was lower at noon as equity markets softened and uncertainty surrounded the leadership of the Australian Labor Party.

By noon  the Australian dollar was trading at 106.06 US cents, down from 106.71 cents on Wednesday.

Nomura head of foreign exchange Kurt Magnus said the Australian dollar was moving on these two trends, but would not stay down for long. And declined in afternoon trading to end at 1.0643

Wednesday February 22, 2012 Economic Reports     actual v. forecast

 

 AUD

 

 

 

Wage Price Index (QoQ)

1.0%

 

0.8%

 

0.7%

 

 

 

NZD

 

 

 

Credit Card Spending (YoY)

3.1%

     

5.9%

 

 

 

EUR

 

 

 

French CPI (MoM)

-0.4%

 

0.3%

 

0.4%

 

 

 

EUR

 

 

 

French Manufacturing PMI 

50.2

 

48.7

 

48.5

 

 

 

EUR

 

 

 

French Services PMI 

50.3

 

51.9

 

52.3

 

 

 

EUR

 

 

 

German Manufacturing PMI 

50.1

 

51.5

 

51.0

 

 

 

EUR

 

 

 

German Services PMI 

52.6

 

53.8

 

53.7

 

 

 

TWD

 

 

 

Taiwanese GDP (YoY)

1.9%

 

1.9%

 

1.9%

 

 

 

EUR

 

 

 

Italian CPI (MoM)

0.3%

 

0.3%

 

0.3%

 

 

 

EUR

 

 

 

Manufacturing PMI 

49.0

 

49.4

 

48.8

 

 

 

EUR

 

 

 

Services PMI 

49.4

 

50.7

 

50.4

 

 

 

GBP

 

 

 

MPC Meeting Minutes

         

 

 

 

EUR

 

 

 

Industrial New Orders (MoM)

1.9%

 

0.6%

 

-1.1%

   

 

EUR

 

 

 

German 2-Year Schatz Auction

0.250%

       

 

 

 

USD

 

 

 

MBA Mortgage Applications

-4.5%

     

-1.0%

 

 

 

EUR

 

 

 

Spanish Trade Balance

-4.50B

 

-3.10B

 

-2.70B

 

 

 

EUR

 

 

 

Belgium NBB Business Climate

-7.7

 

-8.5

 

-9.5

 

 

 

MXN

 

 

 

Mexican Retail Sales (YoY)

3.5%

 

6.5%

 

7.5%

 

 

 

USD

 

 

 

Existing Home Sales

4.57M

 

4.67M

 

4.38M

   

 

Sovereign Bond Auction Schedule

Feb 24  10:10  Italy   Auctions CTZ/BTP

In The Eyes of the Experts – 22/2/2012

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:

  • USD
  • EUR
  • CHF

 

Currencies watch for Short:

  • GBP
  • NZD
  • AUD

 

Today’s important times (GMT+2):

  • 17:00 USD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD    1.3135    1.3191    1.3241    1.3297    1.3347   
GBPUSD 1.5715 1.5752 1.5808 1.5844 1.5900
USDJPY 79.43 79.63 79.74 79.94 80.05
USDCHF 0.9048 0.9081 0.9114 0.9148 0.9181
USDCAD 0.9901 0.9932 0.9953 0.9984 1.0005
AUDUSD 1.0582 1.0629 1.0687 1.0732 1.0793

AUD/USD Forecast February 22, 2012, Technical Analysis

AUD/USD fell hard on Tuesday as the risk appetite of the markets seems to be fading slightly. Perhaps it is the fact that the participants already expected the Greeks to be bailed out, but the fact is that the “pop” we got in riskier currencies as a result of that deal has all but faded in most pairs. The Aussie is very strong, but it looks like we are going to retest the 1.0650 level as support at this point. If this level gives way, we could see a test of 1.06, 1.05, and lastly and more importantly, the 1.04 level. The 1.04 level should be massive support, and it isn’t until that level being smashed through that we could consider selling this pair. In this scenario, we are buying pullbacks and breakouts – and aren’t interested in selling until we are below 1.04 at the least.

AUD/USD Forecast February 22, 2012, Technical Analysis
AUD/USD Forecast February 22, 2012, Technical Analysis

AUD/USD Fundamental Analysis February 23, 2012 Forecast

Economic Events:  (GMT)

13:30     USD      Initial Jobless Claims                                    354K                      348K                     

13:30     USD      Continuing Jobless Claims                          3460K                    3426K     

Initial Jobless Claims and Continuing Jobless Claims measure the number of unemployed individuals who qualify for benefits under unemployment insurance.

A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.               

 22:30                   AUD                                                      RBA Governor Stevens Speaks

Reserve Bank of Australia (RBA) Governor Glenn Stevens (September 2006 – September 2013) is to speak. As the head of the RBA, which sets short term interest rates, he has a major influence over the value of the Australian dollar. Traders watch his speeches closely as they are often used to drop subtle hints regarding future monetary policy and interest rate shifts. After surprising the markets last week and holding rates, today’s comments might have some effects on the Aussie

Analysis and Recommendation: (close of Asian session)

AUD/USD was trading at 1.0668, The Australian dollar was lower today, failing to gain ground despite the approval of a Greek bailout package.

On Tuesday, euro zone ministers approved the delivery of a second aid package to help prevent Greece from defaulting on its debts.

Markets have had a lukewarm reaction to the much-awaited decision because economists only give the deal a small chance of sufficiently helping the Greek economy and alleviating its financial crisis.

Data released today for the Wage Price Index which measures the change in the price businesses and the government pays for labor, excluding bonuses. It is a leading indicator of consumer price inflation. The report showed an unexpected increase which was positive for Aussie; markets were expecting an increase of 0.8% while the report showed an increase to 1.0%.

The Aussie is just waiting for something to set it on fire; it is due to rise, on the back of the Chinese reserve drop and overall strong economic signs from Oz.

February 21, 2012 Economic Reports actual v forecast

NZD

Inflation Expectations (QoQ) 

2.5%

     

2.8%

 

 

AUD

RBA Governor Stevens Speaks 

         

 

 

JPY

All Industries Activity Index (MoM) 

1.3%

 

1.5%

 

-1.0%

   

CHF

Trade Balance 

1.55B

 

2.50B

 

2.01B

   

GBP

Public Sector Net Borrowing 

-10.7B

 

-9.1B

 

11.1B

   

TRY

Turkish Interest Rate Decision 

5.75%

 

5.75%

 

5.75%

 

 

CAD

Core Retail Sales (MoM) 

0.0%

 

0.2%

 

0.4%

   

CAD

Retail Sales (MoM) 

-0.2%

 

-0.2%

 

0.4%

   

CAD

Wholesale Sales (MoM) 

0.9%

 

0.5%

 

-0.3%

   

USD

Chicago Fed National Activity 

0.22

 

0.22

 

0.54

   

EUR

Consumer Confidence 

-20

 

-20

 

-21

 

 

USD

2-Year Note Auction 

       

0.250%

 

 

ARS

Argentinian Unemployment Rate 

   

7.3%

 

7.2%

 

 

 

Sovereign Bond Auction Schedule

Feb 23  10:10  Sweden  Sek 0.75bn I/L bond auction

Feb 23  16:30  Italy   Details BTP/CCTeu on Feb 28

Feb 23  18:00  US  Auctions 7Y Notes

Feb 24  10:10  Italy   Auctions CTZ/BTP

AUD/USD Forecast February 21, 2012, Technical Analysis

AUD/USD gapped at the open during Monday trading in Asia. The pair finds itself in the 1.08 area, and this area is one that will attract a lot of attention at this point. The pair has been strong lately, and has been used as a proxy for yield, safety, and “risk on” appetite in general. Because of this, the pair has been one that selling is very difficult.

The gap has filled already, but the reaction at the bottom of it has been muted. This is probably in part due to the fact that the Americans were off celebrating President’s Day, and as a result the volume was quite think in the latter hours of the session. The move in the earlier day was interesting as it flies in the face of a bailout agreement coming. The pair should have shot straight up, but perhaps the market is growing tired of the constant Greece turmoil in Europe, and as a result is much muted in its reactions.

The Chinese have also cut reserve rates for domestic banks, and as a result flooded the economy with liquidity. The Chinese buy a lot of raw materials from Australia, and as a result this is a strong sign for the Aussie in general. With that being said, the 1.08 barrier is one that traders will have to be aware of going forward. It has been resistive a couple of times now, and even though the recent action suggests that the market is going to go much higher, a pullback looks very possible at this point in time.

With all of this in mind, we are buying the Aussie on pullbacks, and most certainly if the pair can close above the 1.08 level on a daily close. The Australian dollar got a bit of a boost recently when the central bank didn’t cut rates. The markets had anticipated a cut, and when it didn’t come – the Aussie gained. With all things being equal – we still stand by our prediction of a 1.12 print in the pair based off of the triangle breakout form 1.04 earlier.

AUD/USD Forecast February 21, 2012, Technical Analysis
AUD/USD Forecast February 21, 2012, Technical Analysis

AUD/USD Fundamental Analysis February 22, 2012 Forecast

Economic Events: (GMT)

00:30     AUD                      Wage Price Index (QoQ)                                              0.8%                      0.7%

The Wage Price Index measures the change in the price businesses and the government pay for labor, excluding bonuses. It is a leading indicator of consumer price inflation. 

A higher than expected reading should be taken as positive/bullish for the AUD, while a lower than expected reading should be taken as negative/bearish for the AUD.                          

15:00     USD                     Existing Home Sales                                                     4.67M                     4.61M  

Existing Home Sales measures the change in the annualized number of existing residential buildings that were sold during the previous month. This report helps to gauge the strength of the U.S. housing market and is a key indicator of overall economic strength.

A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.

Analysis and Recommendation: ( close of Asian session )

AUD/USD was trading at 1.0735. In early trading, the Australian dollar is lower as cautious traders slowly sell off the currency ahead of a decision on the release of Greece’s second bailout package.

At noon, the Australian dollar was trading at 107.29 US cents, down from 107.71 cents on Monday.

When the EU announced that a deal with Greece was concluded, the markets began to rally with the pair moving up to 1.0735. The news from the EU overlapped the end of todays trading session, it should have a larger effect in after hours trading.

 

Monday February 20, 2012 Economic Reports actual v. forecast

US markets closed today for holiday

 

 

Actual

 

Forecast

 

Previous

 

 

GBP

Rightmove House Price Index (MoM)

4.1%

     

-0.8%

 

 

THB

Thai GDP (YoY)

-9.0%

 

-4.3%

 

3.7%

   

EUR

French Business Survey

92

 

92

 

92

   

EUR

Italian Industrial New Orders (MoM)

5.5%

 

-0.5%

 

0.2%

   

RUB

Russian Retail Sales (YoY)

6.8%

 

10.2%

 

9.5%

 

 

RUB

Russian Unemployment Rate

6.6%

 

6.3%

 

6.1%

   

 

Sovereign Bond Auction Schedule

Feb 21  09:30  Spain  3 & 6M T-bill auction

Feb 21  15:30  UK  Details gilt auction on Mar 01

Feb 21  18:00  US  Auctions 2Y Notes

Feb 22  10:10  Sweden  Nominal bond auction

Feb 22  10:30  Germany  Eur 5.0bn Mar 2014 Schatz

Feb 22  16:30  Italy   Details CTZ/BTPei on Feb 24 & BOT on Feb 27

Feb 22  18:00  US  Auctions 5Y Notes

Feb 23  10:10  Sweden  Sek 0.75bn I/L bond auction

Feb 23  16:30  Italy   Details BTP/CCTeu on Feb 28

Feb 23  18:00  US  Auctions 7Y Notes

Feb 24  10:10  Italy   Auctions CTZ/BTP

AUD/USD Fundamental Analysis February 21, 2012 Forecast

Economic Events: (GMT: + 10:00)

10:30     AUD      Monetary Policy Meeting Minutes

The Reserve Bank of Australia (RBA) Monetary Policy Meeting Minutes are a detailed record of the bank’s most recent policy-setting meeting, containing in-depth insights into the economic conditions that influenced the rate decision.

More dovish than expected minutes could be taken as negative/bearish for the AUD, while more hawkish than expected minutes could be taken as positive/bullish for the AUD.                                                                

12:00     NZD       Inflation Expectations (QoQ)                                                                    2.8%

Inflation Expectations measures the percentage that business managers expect the price of goods and services to change annually during the next two years. The data is released quarterly.

A higher than expected reading should be taken as positive/bullish for the NZD, while a lower than expected reading should be taken as negative/bearish for the NZD.                          

12:30     AUD       RBA Governor Stevens Speaks                  

Reserve Bank of Australia (RBA) Governor Glenn Stevens (September 2006 – September 2013) is to speak. As the head of the RBA, which sets short term interest rates, he has a major influence over the value of the Australian dollar. Traders watch his speeches closely as they are often used to drop subtle hints regarding future monetary policy and interest rate shifts.

His comments may determine a short-term positive or negative trend.

Analysis and Recommendation: ( close of Asian session )

AUD/USD was trading at 1.0744 having risen to one-week highs as traders become more optimistic about the global economy and the delivery of a second aid package to Greece.

The Aussie had a positive move after the decision by the Chinese central bank to lower the ratio of funds that commercial banks must hold as reserves. The cut, which will free up more money for commercial banks to lend, is aimed at helping to improve economic growth.

Eurozone finance ministers will meet in Brussels tonight, and are expected to decide whether to approve the delivery of a second bailout package for debt-laden Greece.

 

Monday February 20, 2012 Economic Data actual v forecast

US markets closed

NZD

 

PPI Input (QoQ) 

0.5%

 

0.4%

 

0.6%

 

JPY

 

Trade Balance 

-0.61T

 

-0.85T

 

-0.57T

 

 

Sovereign Bond Auction Schedule

Feb 21  09:30  Spain  3 & 6M T-bill auction

Feb 21  15:30  UK  Details gilt auction on Mar 01

Feb 21  18:00  US  Auctions 2Y Notes

Feb 22  10:10  Sweden  Nominal bond auction

Feb 22  10:30  Germany  Eur 5.0bn Mar 2014 Schatz

Feb 22  16:30  Italy   Details CTZ/BTPei on Feb 24 & BOT on Feb 27

Feb 22  18:00  US  Auctions 5Y Notes

Feb 23  10:10  Sweden  Sek 0.75bn I/L bond auction

Feb 23  16:30  Italy   Details BTP/CCTeu on Feb 28

Feb 23  18:00  US  Auctions 7Y Notes

Feb 24  10:10  Italy   Auctions CTZ/BTP

AUD/USD Weekly Fundamental Analysis February 20-24, 2012, Forecast

Economic Events: (GMT)

Major Economic Reports due this week. Please refer to the daily reports for explaination and forecast

US Markets closed on Monday for Presidents Day Holiday

Feb. 21

00:30

 

AUD

 

 

 

Monetary Policy Meeting Minutes 

 

13:30

 

CAD

 

 

 

Core Retail Sales (MoM) 

Feb. 22

09:30

 

GBP

 

 

 

MPC Meeting Minutes 

 

15:00

 

USD

 

 

 

Existing Home Sales 

Feb. 23

09:00

 

EUR

 

 

 

German Ifo Business Climate Index 

 

13:30

 

USD

 

 

 

Initial Jobless Claims 

Feb. 24

07:00

 

EUR

 

 

 

German GDP (QoQ) 

 

09:30

 

GBP

 

 

 

GDP (QoQ) 

 

15:00

 

USD

 

 

 

New Home Sales 

 

Rule:

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 is trading at 1.0706 over the weekend.  The Aussie climbed to a weekly high of USD1.0797 on Friday on optimism over a rescue package for Greece, but gains were capped below the 1.0800 figure before a key meeting on Monday that my produce an official an agreement. This has been a crazy week for all the USD trading partners as economic data in the US was strong as well as positive data in Australia, but the market flow was controlled by Greece all week long with the euro surging and falling. Monday US markets are closed and news is expected from Greece and the EU.

The RBA surprised markets and held rates.

Strength

  • Greek bailout and PSI deal looking more likely AGAIN, at least that’s what markets think as Greek stocks rally 3.4% on week, European credit CDS narrower, European banks bounce and US stocks continue their march. Merkel and Monti assure the markets.
  • German ZEW investor confidence figure rises to best since April
  • Initial Jobless Claims fall to lowest since 2008 at 348k, well below estimates of 365k
  • Philly and NY manufacturers  surveys up but components mixed as headline #’s are not sum of parts
  • Housing starts continue to grow for multi-units (apt/condo)
  • NAHB home builder index up 4 pts, 3 pts better than expected and highest since May ’07
  • India’s wholesale inflation rises at slowest pace since Nov ’09, leaves open room to cut rates
  • Australia central bank surprises with a hold on interest rates
  • UK announces new round of QE
  • Australia and NZ have positive economic reports
  • China reduces bank reserves
  • ECB deposit facility falls
  • Japanese exporters see some breathing room with weaker yen to lowest since July after BoJ embarks on even more QE

 

Weakness

  • Greek saga never ending, ECB wants special treatment old bond new bond swap
  • Euro zone GDP in Q4 contracts .3% q/o/q, although touch better than estimates of .4%
  • Portugal’s unemployment rate rises to 14% in Q4 from 12.4%, the highest since at least ’98
  • Singapore confirms Jan estimate of Q4 GDP contraction
  • Japanese economy shrinks more than expected in Q4, BoJ can’t help itself with more QE
  • Chinese FDI in Jan falls .3%, 3rd month in a row of declines
  • US Jan Retail Sales ex auto’s weaker than expected (but Dec revised up)
  • CPI rate of change a below estimate m/o/m, core rate rises to highest since Sept ’08 y/o/y. Overall index at another record high.

 

Economic Highlights Feb 13-17 actual v. forecast

Feb. 14

 

JPY

 

 

 

Interest Rate Decision 

0.10%

 

0.10% 

 

0.10% 

 

 

 

 

JPY

 

 

 

BoJ Press Conference 

 

 

 

 

 

 

 

 

 

EUR

 

 

 

German ZEW Economic Sentiment 

5.4

 

-11.6 

 

-21.6 

 

 

 

 

GBP

 

 

 

BOE Inflation Letter 

 

 

 

 

 

 

 

 

 

USD

 

 

 

Core Retail Sales (MoM) 

0.7%

 

0.6% 

 

-0.5% 

   

 

 

USD

 

 

 

Retail Sales (MoM) 

0.4%

 

0.8% 

 

0.0% 

   

Feb. 15

 

EUR

 

 

 

German GDP (QoQ) 

-0.2%

 

-0.3% 

 

0.6% 

   

 

 

GBP

 

 

 

Claimant Count Change 

6.9K

 

3.2K 

 

1.9K 

   

 

 

GBP

 

 

 

BoE Inflation Report 

 

 

 

 

 

 

 

 

 

GBP

 

 

 

BoE Gov King Speaks 

 

 

 

 

 

 

 

 

 

USD

 

 

 

FOMC Meeting Minutes 

 

 

 

 

 

 

 

Feb. 16

 

USD

 

 

 

Initial Jobless Claims 

348K

 

364K 

 

361K 

   

 

 

USD

 

 

 

Fed Chairman Bernanke Speaks 

 

 

 

 

 

 

 

Feb. 17

 

GBP

 

 

 

Retail Sales (MoM) 

0.9%

 

-0.2% 

 

0.6% 

 

 

 

 

CAD

 

 

 

Core CPI (MoM) 

0.2%

 

0.1% 

 

-0.5% 

 

 

 

 

USD

 

 

 

Core CPI (MoM) 

0.2%

 

0.3% 

 

0.1% 

 

 

 

 

USD

 

 

 

CPI (MoM) 

0.2%

 

0.3% 

 

0.0% 

   

 

Sovereign Bond Auction Schedule

Feb 20-24 n/a  UK  0.375% 2062 I/L Gilt syndication

Feb 20  10:10  Norway  Nok 3bn 4.5% May 2019 DSL

Feb 20  10:10  Slovakia  Eur 0.15bn Apr 2014 & Eur 0.05bn Nov 2016 bonds

Feb 21  09:30  Spain  3 & 6M T-bill auction

Feb 21  15:30  UK  Details gilt auction on Mar 01

Feb 21  18:00  US  Auctions 2Y Notes

Feb 22  10:10  Sweden  Nominal bond auction

Feb 22  10:30  Germany  Eur 5.0bn Mar 2014 Schatz

Feb 22  16:30  Italy   Details CTZ/BTPei on Feb 24 & BOT on Feb 27

Feb 22  18:00  US  Auctions 5Y Notes

Feb 23  10:10  Sweden  Sek 0.75bn I/L bond auction

Feb 23  16:30  Italy   Details BTP/CCTeu on Feb 28

Feb 23  18:00  US  Auctions 7Y Notes

Feb 24  10:10  Italy   Auctions CTZ/BTP

AUD/USD Forecast February 20, 2012, Technical Analysis

AUD/USD fell after initially rising during the Friday session as the 1.08 level has held as resistance yet again. The level seems to be extremely durable, and one simply cannot help but feel that a pullback could be coming. The level could see continued weakness, but a longer-term fall isn’t in the cards until we get sub-1.04 at least.

The 1.05 level should also be supportive, and even the 1.06 could be. The levels are buying points on hammers and nice long green candles as well. We look at this potential fall as a buying opportunity more than a serious fall in the works. We are buying the pullbacks at handles that produce supportive candles.

AUD/USD Forecast February 20, 2012, Technical Analysis
AUD/USD Forecast February 20, 2012, Technical Analysis

AUD/USD Forecast for the Week of February 20, 2012, Technical Analysis

The AUD/USD pair had a fairly quiet week over the last 5 sessions as the 1.08 level continues to keep a bit of a cap on this pair. The candle shape is of a doji, and this shows how tentative the markets are at the moment. The candle from the previous week was a bit of a shooting star, and this shows that perhaps the market is ready to pullback. However, we don’t necessarily want to get overly short of this pair, as it will more than likely be a pullback and not a meltdown. A sub-1.04 level print will more than likely send this pair crashing, but until then – we think a trade to the down side on a break of the lows from this past week gets us short, but we don’t expect a massive drop. A break above the 1.0850 level would have us long and aiming for the 1.10 level.

AUD/USD Forecast for the Week of February 20, 2012, Technical Analysis
AUD/USD Forecast for the Week of February 20, 2012, Technical Analysis

AUD/USD Forecast February 17, 2012, Technical Analysis

 

AUD/USD rose during the session with all of the other risk related currency pairs as the ECB announced it would be swapping Greek bonds it owns for longer dated ones over the weekend. This helps the process along with the Greek debt markets, and this is seen as bullish by the market overall.

The pair has recently found support at the 1.0650 area, and it looks like we are going to reenter consolidation at the current level. The pair has a lot of resistance t the 1.08 level, but the market is decidedly bullish, so a breakout isn’t a surprise if it happens. The triangle that we were following a while back broke out at 1.04, and measured a move to 1.12 or so. It appears that sooner or later – it might actually happen. A daily close above the 1.0830 level has us long again. Selling isn’t a thought until sub-1.04 or so.

AUD/USD Forecast February 17, 2012, Technical Analysis
AUD/USD Forecast February 17, 2012, Technical Analysis

AUD/USD Fundamental Analysis February 20, 2012 Forecast

Economic Events: (GMT)

US Markets are closed for the Presidents Day Holiday

Feb. 19 21:45     NZD      PPI Input (QoQ)

Producer Price Index (PPI) Input measures the change in the price of goods and raw materials purchased by manufacturers. The index is a leading indicator of consumer price inflation.

21:45     NZD      PPI Output (QoQ)

Producer Price Index (PPI) Output measures the change in the price of goods sold by manufacturers.

 Feb. 20  00:01     GBP       Rightmove House Price Index (MoM)

                07:00     EUR       German Import Price Index (MoM)

                07:00     CHF        Trade Balance

                 08:15    CHF       Employment Level

                23:50     JPY         Trade Balance

The Trade Balance measures the difference in value between imported and exported goods and services over the reported period. A positive number indicates that more goods and services were exported than imported.

A higher than expected reading should be taken as positive/bullish for the JPY, while a lower than expected reading should be taken as negative/bearish for the JPY.

Analysis and Recommendation: ( close of Asian session )

AUD/USD was trading at 1.0779 up .023% The Australian dollar is almost one US cent higher after strong American economic data and positive sentiment in Europe caused a global rally in equities and risk currencies.

At mid day, the Australian dollar was trading at 107.54 US cents, up from 106.68 cents on Thursday.

The number of U.S. workers making new applications for unemployment benefits fell last week to the lowest level in nearly four years. 

The government reporting initial claims for unemployment benefits fell by 13,000 to a seasonally adjusted 348,000 last week, the lowest since March 2008.

Other reports had housing starts up 1.5% last month, while wholesale prices climbing 0.1% in January.

Reports just received say that the ECB will exchange their currently existing old Greek bonds for new ones to avoid any legislative action issued by the Greek government to force bondholders to take a settlement.

Thursday February 16, 2012 Economic Reports forecast vs. actual

 

GBP

 

Nationwide Consumer Confidence 

47

 

40

 

38

 

 

 

AUD

 

Employment Change 

46.3K

 

10.9K

 

-35.6K

   
 

AUD

 

Unemployment Rate 

5.1%

 

5.3%

 

5.2%

   
 

SEK

 

Swedish CPI (YoY) 

1.9%

 

1.9%

 

2.3%

   
 

SEK

 

Swedish Interest Rate Decision 

1.50%

 

1.50%

 

1.75%

   
 

EUR

 

ECB Monthly Report 

             
 

USD

 

Building Permits 

0.68M

 

0.68M

 

0.67M

   
 

USD

 

Core PPI (MoM) 

0.4%

 

0.1%

 

0.3%

   
 

CAD

 

Foreign Securities Purchases 

7.38B

 

7.98B

 

14.64B

   
 

USD

 

Housing Starts 

0.70M

 

0.68M

 

0.69M

   
 

CAD

 

Manufacturing Sales (MoM) 

0.60%

 

0.50%

 

1.90%

   
 

USD

 

PPI (MoM) 

0.1%

 

0.3%

 

-0.1%

   
 

USD

 

Initial Jobless Claims 

348K

 

364K

 

361K

   
 

USD

 

Continuing Jobless Claims 

3426K

 

3550K

 

3526K

   
 

USD

 

Fed Chairman Bernanke Speaks 

             
 

MXN

 

Mexican GDP (YoY) 

3.7%

 

3.9%

 

4.5%

   
 

USD

 

Philadelphia Fed Manufacturing Index 

10.2

 

8.4

 

7.3

   

 

Sovereign Bond Auction Schedule

Feb 20-24 n/a  UK  0.375% 2062 I/L Gilt syndication

Feb 20  10:10  Norway  Nok 3bn 4.5% May 2019 DSL

Feb 20  10:10  Slovakia  Eur 0.15bn Apr 2014 & Eur 0.05bn Nov 2016 bonds

Feb 21  09:30  Spain  3 & 6M T-bill auction

Feb 21  15:30  UK  Details gilt auction on Mar 01

Feb 21  18:00  US  Auctions 2Y Notes

Feb 22  10:10  Sweden  Nominal bond auction

Feb 22  10:30  Germany  Eur 5.0bn Mar 2014 Schatz

Feb 22  16:30  Italy   Details CTZ/BTPei on Feb 24 & BOT on Feb 27

Feb 22  18:00  US  Auctions 5Y Notes

Feb 23  10:10  Sweden  Sek 0.75bn I/L bond auction

Feb 23  16:30  Italy   Details BTP/CCTeu on Feb 28

Feb 23  18:00  US  Auctions 7Y Notes

Feb 24  10:10  Italy   Auctions CTZ/BTP

In The Eyes of the Experts – 16/2/2012

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:

  • GBP
  • USD
  • CAD

Currencies watch for Short:

  • EUR
  • CHF

Today’s important times (GMT+2):

  • 15:30, 16:00,17:00 USD

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD 1.2948 1.3001 1.3095 1.3148 1.3243
GBPUSD 1.5630 1.5656    1.5696 1.5722 1.5761
USDJPY 77.95 78.22 78.43 78.70 78.91
USDCHF 0.9119 0.9181 0.9215 0.9277 0.9311
USDCAD 0.9914 0.9958 0.9981 1.0026 1.0049
AUDUSD 1.0600 1.0642 1.0708 1.0750 1.0816

AUD/USD Forecast February 16, 2012, Technical Analysis

AUD/USD had a rough session as the bulls initially pushed the pair higher after comments out of China that the Chinese may be interested in stepping into the fray of the European Union’s debt crisis and helping out. The Chinese have said this in the past, and no action has ever been taken. Because of this – that announcement had a very short shelf life in the markets.

The resulting shooting star is just below the recent consolidation area, and looks very weak. However, the daily candle from Tuesday was a hammer, so this suggests that we are about to see a real fight in this area overall. With this in mind, we are bulls overall in this pair, but are willing to step aside until we either get a nice pullback to the 1.05 or 1.04 level that shows support, or a break higher and above the recent highs at the 1.0825 area. Until then, we are very leery about getting involved in this pair.

AUD/USD Forecast February 16, 2012, Technical Analysis
AUD/USD Forecast February 16, 2012, Technical Analysis

 

AUD/USD Fundamental Analysis February 17, 2012 Forecast

Economic Events: (GMT) Feb 16th

13:30     USD      Building Permits                                             0.68M                   0.67M

Building Permits measures the change in the number of new building permits issued by the government. Building permits are a key indicator of demand in the housing market.                    

 13:30    USD       Core PPI (MoM)                                              0.1%                      0.3%     

13:30     USD       PPI (MoM)                                                        0.3%                      -0.1%    

The Core Producer Price Index (PPI) measures the change in the selling price of goods and services sold by producers, excluding food and energy. The PPI measures price change from the perspective of the seller. When producers pay more for goods and services, they are more likely to pass the higher costs to the consumer, so PPI is thought to be a leading indicator of consumer inflation.                

13:30     USD       Housing Starts                                                   0.68M                   0.66M    

Housing starts measures the change in the annualized number of new residential buildings that began construction during the reported month. It is a leading indicator of strength in the housing sector    

13:30     USD      Initial Jobless Claims                                        364K                      358K                     

13:30    USD       Continuing Jobless Claims                           3550K                    3515K

Initial and Continuing Jobless claims measures the number of individuals who filed for unemployment insurance for the first time or renewed during the past week. This is the earliest U.S. economic data, but the market impact varies from week to week.

A higher than expected reading should be taken as negative/bearish for the USD, while a lower than expected reading should be taken as positive/bullish for the USD.               

14:00     USD      Fed Chairman Bernanke Speaks

Federal Reserve Chairman Ben Bernanke (February 2006 – January 2014) is to speaky on the economic outlook and recent monetary policy actions, in Washington DC                                                        

15:00     USD      Philadelphia Fed Manufacturing Index                 8.4                         7.3                                                         

The Philadelphia Federal Reserve Manufacturing Index rates the relative level of general business conditions in Philadelphia. A level above zero on the index indicates improving conditions; below indicates worsening conditions. The data is compiled from a survey of about 250 manufacturers in the Philadelphia Federal Reserve district.

Analysis and Recommendation: ( close of Asian session )

AUD/USD was trading at 106.61, falling from a high in earlier trading of 1.0793. The Aussie was strong today on economic data out on unemployment dropping to 5.1% and the employment change surged above forecasts. It was all positive news down under today. More worries about Greece, began pushing to greenback higher towards the end of the session, seeing the AUD lose the battle

Thursday Economic Data ( asian session )

AUD

 

MI Inflation Expectations 

2.5%

 

 

 

2.8% 

 

 

GBP

 

Nationwide Consumer Confidence 

47

 

40 

 

38 

 

 

AUD

 

Employment Change 

46.3K

 

10.9K 

 

-35.6K 

   

AUD

 

Unemployment Rate 

5.1%

 

5.3% 

 

5.2% 

 

 
                   

 

Wednesday Economic Data actual v. forecast

AUD

 

New Motor Vehicle Sales (MoM)

1.3%

     

-2.7%

 

 

KRW

 

South Korean Trade Balance

-2.03B

     

-1.96B

 

 

JPY

 

BoJ Monthly Report 

         

 

 

SGD

 

Singaporean Retail Sales (YoY)

4.2%

 

7.0%

 

6.2%

   

EUR

 

French GDP (QoQ) 

0.2%

 

-0.2%

 

0.3%

 

 

EUR

 

German GDP (QoQ) 

-0.2%

 

-0.3%

 

0.6%

   

EUR

 

Spanish CPI (YoY)

2.0%

 

2.0%

 

2.4%

 

 

SEK

 

Swedish GDP (QoQ) 

3.4%

 

2.1%

 

3.0%

 

 

HUF

 

Hungarian GDP (YoY) 

1.4%

 

0.5%

 

1.4%

 

 

CZK

 

Czech GDP (QoQ) 

0.5%

 

0.7%

 

1.2%

 

 

EUR

 

Austrian GDP (YoY)

1.2%

     

2.5%

   

EUR

 

Netherlands GDP (YoY) 

-0.7%

 

0.3%

 

1.1%

 

 

EUR

 

Italian GDP (QoQ) 

-0.7%

 

-0.6%

 

-0.2%

 

 

GBP

 

Average Earnings Index +Bonus

2.0%

 

1.8%

 

2.0%

   

GBP

 

Claimant Count Change

6.9K

 

3.2K

 

1.9K

   

GBP

 

Unemployment Rate

8.4%

 

8.4%

 

8.4%

 

 

EUR

 

GDP (QoQ) 

-0.3%

 

-0.4%

 

0.1%

 

 

EUR

 

Trade Balance

7.5B

 

4.7B

 

6.1B

 

 

CHF

 

ZEW Expectations

-21.2

     

-50.1

 

 

MYR

 

Malaysian GDP (YoY) 

5.2%

 

4.5%

 

5.8%

 

 

GBP

 

BoE Inflation Report

         

 

 

GBP

 

BoE Gov King Speaks

         

 

 

USD

 

MBA Mortgage Applications

-1.0%

     

7.5%

 

 

PLN

 

Polish CPI (YoY)

4.1%

 

4.3%

 

4.6%

   

USD

 

NY Empire State Manufacturing Index

19.5

 

14.2

 

13.5

 

 

USD

 

TIC Net Long-Term Transactions

17.9B

 

62.3B

 

61.3B

   

 

Sovereign Bond Auction Schedule Feb 13-17

Feb 16  09:30  Spain  Obligacion auction

Feb 16  10.30  UK  Auctions 4.5% 2034 conventional Gilt

Feb 16  10:50  France  BTA/OATi auction

Feb 16  16:00  US

Announces auctions of 2Y Notes on Feb 21, 5Y Notes on Feb

22 & 7Y Notes on Feb 23

Feb 16  18:00  US  Auctions 30Y TIPS

In The Eyes of the Experts – 15/2/2012

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
  • CAD

 

Currencies watch for Short:

  • GBP
  • JPY
  • EUR

 

Today’s important times (GMT+2):

  • 16:00,21:00 USD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD 1.3004    1.3066    1.3140    1.3201    1.3276   
GBPUSD 1.5574 1.5631 1.5700 1.5757 1.5825
USDJPY 77.11 77.55 78.14 78.78 79.17
USDCHF 0.9102 0.9149 0.9188 0.9236 0.9275
USDCAD    0.9948 0.9967 0.9996 1.0015 1.0044
AUDUSD 1.0582 1.0640 1.0668 1.0744 1.0790

AUD/USD Forecast February 15, 2012, Technical Analysis

The AUD/USD pair had a volatile day on Tuesday. The pair continues to hover just below the 1.08 level, and the headlines around the world continue to be a drag on the upward momentum. The pair has rallied in a strong move lately, and the failure at the 1.08 level seems to be more of one that is restful, not weakness. The pair needs to rest at this level, and a pullback could be coming as well. The 1.06, 1.05, and 1.04 levels all could offer support on that pullback, and we are more than willing to buy the market at these levels will supportive candles. We are not thinking of selling the market at this point.

AUD/USD Forecast February 15, 2012, Technical Analysis
AUD/USD Forecast February 15, 2012, Technical Analysis