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November/07/2011- Comments and forex-analytics from FBS

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November/07/2011- Comments and forex-analytics from FBS

Postby vanvirtue » Mon Nov 07, 2011 3:59 pm

Ichimoku. Weekly forecast. GBP/USD

Weekly GBP/USD

British currency still remains within Ichimoku Cloud: a week earlier the bulls had brought prices to the upper border of Kumo – Senkou Span A (4) – from which sterling has recoiled and reversed down.

It’s necessary to note that as the Turning line is directed down it’s possible to expect pound’s decline to continue (2). In addition, the bears seem to gain strength: bearish Cloud is widening.

The lines Kijun-sen (1) and Tenkan-sen (2) as well as Senkou Span B will act as support for pound.

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Daily GBP/USD

On the daily chart the bulls have managed to make good advance in the second half of October as they have found the narrow place in the Ichimoku Cloud and pushed the pair’s rate above it. At the moment pound is fluctuation around support provided by the Turning line (1). The next support for the British currency will be Senkou Span B (3).

At the same time, sterling’s appreciation may be only a correction: in the $1.6335 area the pair met resistance line connecting September and October maximums.

Although the Ichimoku Cloud has switched to the rising mode (4), it is still too tiny to speak about bulls’ strength.

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Re: November/07/2011- Comments and forex-analytics from FBS

Postby vanvirtue » Mon Nov 07, 2011 4:00 pm

Ichimoku. Weekly forecast. USD/JPY

Weekly USD/JPY

The third intervention conducted this year in Japan lifted the pair USD/JPY from the record minimum at 75.56 yen hit on October 31 to the levels above the Turning line, slightly higher than 78 yen.

At the same time, Japan’s move didn’t much change the outlook at the weekly Ichimoku chart: the Turning line (1) and the Standard line (2) still hold the strong “dead cross” in place (5), the descending Cloud maintains its width together with Kijun-sen acting as resistance for the prices.

The Channel between Tenkan-sen (1) and Kijun-sen has narrowed. This week the greenback is likely to remain within it.

Despite the efforts of Japanese monetary authorities to curb the national currency investors’ demand for yen as a refuge is still high.

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Daily USD/JPY

After the intervention US dollar has been holding in the 78 yen area supported by Senkou Span B (2).

The market is in the state of uncertainty: the lines Tenkan-sen and Kijun-sen have merged in one moving horizontally (1). The same happened with the borders of the Cloud which has turned into a straight line (3).

Neither bulls, nor bears have courage to act. The pair is likely to consolidate at the current levels.

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Re: November/07/2011- Comments and forex-analytics from FBS

Postby vanvirtue » Mon Nov 07, 2011 4:03 pm

Ichimoku. Weekly forecast. USD/CHF

Weekly USD/CHF

On the weekly chart the pair USD/CHF remains below the weekly Ichimoku Cloud, though the bulls aren’t going to give up the attempts to move the greenback up overcoming resistance provided by Kumo.

The Turning line which is supporting the prices is directed sharply up (1). Tenkan-sen (1) and Kijun-sen (2) hold weak but anyway “golden cross” on place (5). In addition, the descending Cloud has significantly narrowed – the bulls have all chances to make it switch up and reverse the general downtrend.

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Daily USD/CHF

On the daily chart the greenback is trading within Tenkan-Kijun channel: the Turning line acts as support (1), while the Standard line provides resistance (2).

The rising Ichimoku Cloud is still a good support for the prices.

It’s necessary to note that all lines of the chart are directed horizontally that points at the pair’s consolidation.

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Re: November/07/2011- Comments and forex-analytics from FBS

Postby vanvirtue » Mon Nov 07, 2011 4:07 pm

Commerzbank: negative outlook for EUR/USD

Technical analysts at Commerzbank claim that as long as the single currency is trading versus the greenback below resistance in the $1.3855/1.3930 area, the outlook for it will remain negative.

The specialists expect EUR/USD to decline to $1.3381/60 (September 26, October 7 minimums) and then to $1.3145 (October 4 minimum). According to the bank, in the longer term the pair will drop to $1.2000.

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J.P. Morgan: trading in case of risk aversion

Currency analysts at J.P. Morgan believe that in the long term the efforts of European authorities to solve the region’s debt crisis will be repaid.

At the same time, there are still plenty of risks, so the specialists advise traders to watch for the events this week. If the news turns out to be more negative, it will be necessary to sell Australian dollar versus its US counterpart.

As the reasons for choosing this type of trade in the risk-off situation the bank cites the fact that the Reserve Bank of Australia has so far started reducing its benchmark interest rate. In addition, there are some concerns about Australian economic growth and the currency is correlated with euro and its ability to reflect the risk sentiment and the state of the things in the euro area.

So, the recommendation is to open shorts at AUD/USD in the $1.0360 area stopping above $1.0500 and taking profit at $0.9950. The strategists also warn investors that the market seems to be extremely volatile and one should put place the stops close.

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Re: November/07/2011- Comments and forex-analytics from FBS

Postby vanvirtue » Mon Nov 07, 2011 4:08 pm

Morgan Stanley: comments on the European crisis

Analysts at Morgan Stanley warn that as the European leaders have officially raised the possibility of Greece leaving the euro area, the consequences may be very dangerous (see the http://www.fbs.com/analytics/news_markets/view/9022).

The specialists underline that until last week such idea was a taboo but now it seems likely the currency union will use the threat of exclusion against its recalcitrant members.

In their view, the crisis may get much more severe, for example, there may be runs on sovereigns and banks in the indebted peripheral nations.

Greece: Papandreou agreed to step down

Greek Prime Minister George Papandreou agreed to step down for the new national unity government to be formed. Its creating was agreed after the negotiations of Papandreou, the head of socialist Pasok party, Antonis Samaras, the leader of the main opposition party and President Karolos Papoulias.

The main goal of this government is to assure that the nation gets bailout money and help the nation’s economy survive.

The elections will take place right after the decisions of European Council made on October 26 are implemented. According to finance ministry’s statement, the most suitable date is February 19.

Analysts at Standard Chartered Bank note that the markets have become a bit more confident about Greece and investors’ attention has moved to Italy where Prime Minister Berlusconi is under pressure to step down.

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