Nov 10, 2011

Forex Crunch USD/JPY:Trading the University of Michigan Consumer Sentiment

Forex Crunch USD/JPY:Trading the University of Michigan Consumer Sentiment

USD/JPY:Trading the University of Michigan Consumer Sentiment

Posted: 10 Nov 2011 04:15 AM PST

The University of Michigan Consumer Sentiment Index surveys consumer attitudes and expectations about the US economy. An increase in consumer confidence is a positive sign about the health of the economy and can help strengthen the US dollar. Thus, a reading that is higher than predicted by the markets will be bullish for the dollar.

Here are all the details, and 5 possible outcomes for USD/JPY.

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EUR/USD Nov. 10 – Finds a Bottom on ECB Buying Rumors, Early Italian Vote

Posted: 10 Nov 2011 02:39 AM PST

Euro dollar is making a nice comeback after falling into the abyss. The Italian parliament has brought forward the austerity measure vote, and this may send Berlusconi out sooner. In addition, there are are rumors that the ECB will get serious about its intervention in buying Italian bonds. Whether it’s the ECB or not, yields are finally relaxing. Economic indicators aren’t shining on a busy day.

Here's a quick update on technicals, fundamentals and what's going on in the markets.

Read the rest of the article EUR/USD Nov. 10 – Finds a Bottom on ECB Buying Rumors, Early Italian Vote

EUR/USD Breaks to the Downside; “It may get really ugly”

Posted: 10 Nov 2011 01:10 AM PST

The US dollar moved significantly higher in recent sessions, as Risk trade fell sharply, driven by fears over the euro zone crisis! It was the worst day in six weeks for the US stocks market which lost more than 3%. It was also one of the worst days for Eur/Usd pair which lost more than 300 pips from its daily highs, and found the recent support just above 1.3500.

Well, this appears to be just a temporary low for the pair, because based on the 4h chart we can see that downtrend has just started, if we consider a broken neckline of a head and shoulders pattern that we paid attention for some time.

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Options are slipping through Italy’s grasp

Posted: 10 Nov 2011 12:57 AM PST

On paper at least, Italy moved beyond the point of no return on Wednesday.  Yields above 7% would require Italy to run consistently high primary budget surpluses (ex. interest rate payments) of 3% to 4% of GDP just to stabilise interest rate costs and prevent them ballooning out of control.  Since the start of EMU, Italy's primary surplus has averaged just under 2%.  The passing of the budget bill will not bring in the austerity that will overcome the rise in yields. 

What markets have to decide is whether this is primarily an economic or political crisis in Italy.  It's certainly true that the dynamics are different for Italy.  Greece has not run a primary budget surplus for eight years; Italy has for all but the last two years of the single currency.

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Forex Daily Outlook November 10 2011

Posted: 09 Nov 2011 02:00 PM PST

Trade Balance in the US and Official Bank Rate in the UK are the major events this day. Here is an outlook on the market-movers awaiting us.

In the US, Unemployment Claims, important sign of overall financial health that measures the unemployment insurance filed on the last week, rise is expected from 397K up to 401K this week

Read the rest of the article Forex Daily Outlook November 10 2011

Already 5 Banks at the Mercy of the ECB for Dollars

Posted: 09 Nov 2011 06:33 AM PST

The number of European banks that got US dollar liquidity from the European Central Bank rose to 5: there is one bank on dollar funding since September, needing $500 million, and now 4 more have joined with $395 million.

The total funding is still low in banking standards: $895 million, but it’s important to remember two things:

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German Exporters’ Organization: No Need for the Euro

Posted: 09 Nov 2011 06:04 AM PST

Anton Börner, head of Germany’s BGA organization, said that German exporters can “live without the euro”. BGA represents mostly small and medium sizes companies. Börner’s alternative for the current euro framework is a bloc of the richer euro-zone countries.

This statement is quite surprising. The Deutschmark would be of a much higher value if it weren’t for the euro. Until 2005, Germany was considered to be “the sick man of Europe”.

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