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Market analysis and trade recommendations by FBS

MARKET NEWS

Aug. 11: Asian session


Asia_eng.jpg


USD/JPY is trading above 102.00 after spiking down to 101.50 on Friday. Yen weakened as concernы about tensions in Ukraine eased after reports last week that Russia is seeking to mediate between Kiev and rebel forces. MSCI Asia Pacific Index advanced 1.2%. Nikkei 225 is up by more than 2%.

Commodity currencies met a moderate demand in the session. AUD/USD recovered to $0.9285, but remains just a little bit above the recent 2-month lows. NZD/USD edged up to $0.8470. Kiwi remains supported by the 200-day MA. There are no significant releases on the agenda in Australia and New Zealand today. Gold price dipped to $1306.05.

EUR/USD is trading in the $1.3400 area. GBP/USD is trying to hold above $1.6770 after Friday’s sell-off.

More:
http://fxbazooka.com/en/news/show/1578
 
MARKET NEWS
11 August 2014

CFTC: USD longs increase again


According to the latest CFTC report, released on Aug. 8, large traders and speculators sharply raised their bullish bets in favor of the US dollar for a third straight week and to the highest total contracts level since March. Net bets on USD growth versus its major peers increased by 116K contracts to 129K contracts in the week ended Aug. 5. Net euro short position is the largest since Aug. 2012 (-128K contracts).

EUR.png

Source: CFTC

More:
http://fxbazooka.com/en/news/show/1579
 
MARKET NEWS

Key option levels (Aug. 11)


Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

Here are the key options expiring today:

EUR/USD: $1.3350 (large), $1.3370, $1.3400 (large), $1.3435 (large), $1.3450, $1.3500, $1.3535 (large);

USD/JPY: 101.50/60, 101.75/85 (large), 101.90/102.00 (large) 102.50 (large);

AUD/USD: $0.9250 (large), $0.9300/10, $0.9325, $0.9350;

USD/CAD: 1.0920 (large), 1.0970 (large);

EUR/CHF: 1.2165;

EUR/GBP: 0.8000, 0.8075.

More:
http://fxbazooka.com/en/news/show/1580
 
MARKET NEWS

Aug. 12: Asian session


Asia_eng.jpg


Asian shares rose amid optimism that geopolitical risks are receding. The MSCI Asia Pacific Index added 0.4% after surging 1.2% yesterday, the most since June 19.

Israeli and Palestinian negotiators staked out positions for a long-term agreement on the Gaza Strip. Ria Novosti said Russia is ready to mediate between Ukraine and separatist rebels, quoting Russian Security Council head Nikolai Patrushev. Ukrainian President Petro Poroshenko said yesterday there would be an international humanitarian mission to the city of Luhansk under the auspices of the Red Cross, involving the US, the European Union and Russia. In the Middle East, President Barack Obama gave full US support for Iraq’s president to form a new government hours after embattled Prime Minister Nouri al-Maliki rejected stepping aside for a successor.

USD/JPY edged up to 102.35. EUR/USD is trading in the $1.3370 area, a bit above yesterday’s low. GBP/USD slid to $1.6756, the lowest level since the beginning on June.

AUD/USD consolidates in a narrow $0.9240/70 range. Australia released a bunch of upbeat data in the session: NAB business confidence came out at 11 vs. prior 8, while HPI rose by 1.8% vs. expected 1.1%. NZD/USD was the biggest loser of the session, falling to $0.8410.Kiwi now holds just a bit above the May low. Gold price consolidates around $1307.40.

More:
http://fxbazooka.com/en/news/show/1582
 
MARKET NEWS

Key option levels (Aug. 12)


Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

Here are the key options expiring today:

EUR/USD: 1.3340/50 (large), 1.3400, 1.3425;

GBP/USD: 1.6900 (large);

USD/JPY: 101.25, 102.00/05 (large), 102.15 (large), 102.25 (large);

AUD/USD: 0.9240, 0.9300, 0.9370/75 (large);

USD/CAD: 1.0930/35, 1.0950 1.0975 (large), 1.1000 (large);

EUR/JPY: 136.20 (large), 136.50 (large);

EUR/GBP: 0.7940, 0.7965, 0.8050.

More:
http://fxbazooka.com/en/news/show/1583
 
MARKET NEWS
12 August 2014

Danske Bank: Ukraine in focus


Geopolitical tensions appear to be easing a little bit, but the international problems will stay in focus anyway, analysts at Danske Bank say.

“In Ukraine, the risk of an imminent Russian intervention appears to have eased after Russia yesterday announced that major military exercises along the Ukrainian border have ended. However, so far there are no signs that the Ukrainian government will stop its offensive in eastern Ukraine and it remains a major uncertainty how Russia will respond to the outlook for a possible Ukrainian victory”.
 
MARKET NEWS
12 August 2014

Derivative traders more pessimistic on AUD


Data from Bloomberg shows that derivatives traders turned the most pessimistic on Australian dollar since March. Futures positions on AUD saw last week the biggest bearish shift since January, according to the CFTC (Commodity Futures Trading Commission). Large speculators cut net wagers betting on Aussie gains by 6K to 33K in the week ended Aug. 5.

The premium on options to sell the Aussie against the US dollar in 3 months over those giving the right to buy rose to 1.64 percentage points on Aug. 8, the most since March 26.

Calculations based on overnight cash-rate futures show that the market is pricing in about 30% chance that the Reserve Bank of Australia will reduce the 2.5% benchmark rate by year-end compares with a 14% probability seen on Aug. 6. The median forecasts of the analysts surveyed by Bloomberg shows, however, that the majority of experts predict no change this year and an increase to 2.75% in the second quarter of 2015. So, the economists’ forecasts differ from what the market is pricing right now.

More:
http://fxbazooka.com/en/news/show/1585
 
MARKET NEWS
12 August 2014

Fed's Fisher: recovery disappoints


The US and global economic recovery has been "disappointing" so far and may signal a permanent downshift in global economic potential, US Federal Reserve Vice Chair Stanley Fischer said on Monday. According to Fischer, a slowing of US productivity, declining labor force participation and other factors may have hurt the United States' ability to generate economic growth.

The same thing may be happening in Europe and in major emerging economies like China, he said, forcing central bankers to review their understanding of inflation, employment and growth in general.
 
MARKET NEWS

Aug. 12: American session


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Tatiana Norkina, FBS analyst



American dollar was rising to new maximums of this year today, to 81.74, largely due to the weakening of European currencies, after the release of negative statistics for the euro area. It was followed by a correction to 81.60. Immediately on reaching new levels. However, the positive dynamics continues and, at the opening session of the US it’s more than 0.15%.

Stock trading opened quite calm. DJIA index adds about 0.02% and the S & P500 - 0.05%.

Closer to 22-00 UT, data on last month budget execution for the United States is expected.

Strengthening of the dollar in the foreign exchange market is different. For example, EUR / USD pair fell again to 1.3335 support area but then grew to around 1.3360. Currency pair USD / CHF tested the 0.9100 figure and then collapsed in the support area of 0.9080. GBP / USD pair is trying to find a bottom and begin corrective recovery. Indeed, the proximity of 1.6730 support can give reason to a reduction in short positions of players. Bulls did not punch resistance 102.40 : day consolidation ended just below depreciation of the currency pair to 102.10 support.

More:
http://fxbazooka.com/en/news/show/1588
 
MARKET NEWS

Aug. 13: Asian session


Asia_eng.jpg


Asian stocks swung between gains and losses as investors weighed earnings reports. Chinese shares fell after the nation’s measure of new local-currency loans came at 385.2B yuan vs. 780B expected. Appetite for riskier assets has also been undermined by violence in the Middle East. Investors were also wary of the developments in Ukraine as a convoy of 280 Russian trucks carrying humanitarian aid headed for eastern Ukraine, where government forces are closing in on pro-Russian rebels.

USD/JPY edged up to 102.30. Yen wasn’t affected much by the release of Japan’s GDP which shrank by 1.7% q/q in Q2. EUR/USD is trading in the $1.3360 area after spiking down to $1.3335 yesterday. GBP/USD is trading just above $1.6800.

AUD/USD strengthened to $0.9280, supported by the better-than-expected NAB business confidence figure (11 vs. prior 8). Housing price index increased by 1.8%. NZD/USD consolidates slightly above the Tuesday’s 2-month low of $0.8407. Gold price dipped to $1306.8.

More:
http://fxbazooka.com/en/news/show/1589
 
MARKET NEWS

Key option levels (Aug. 13)


Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

Here are the key options expiring today:

EUR/USD: $1.3325/35, $1.3340, $1.3350 (large), $1.3400/10 (large);

GBP/USD: $1.6850, $1.6915 (large);

USD/JPY: 102.05, 102.10, 102.15, 102.25/30, 102.50;

AUD/USD: $0.9175, $0.9225, $0.9300, $0.9350, $0.9375 (large);

USD/CAD: 1.0970/75;

NZD/USD: $0.8450;

EUR/GBP: 0.7950.

More:
http://fxbazooka.com/en/news/show/1590
 
MARKET NEWS
13 August 2014

US retail sales: preview


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Analysts at Credit Agricole expect lower readings than consensus: +0.3% and +0.1% for core retail sales. The specialists think that although chain store sales have probably increased last month, the auto and gas station sales will contribute negatively to overall retail sales: “Following two strong sales months, total light vehicle unit-sales in July fell 2.5% to a 16.5 million-unit rate. Retail gasoline prices dropped 2.2%, negatively impacting gas station receipts”.

More:
http://fxbazooka.com/en/news/show/1591
 
MARKET NEWS
13 August 2014

Credit Agricole: comments on UK wage growth


Despite the overall positive trend in UK economy, the weakness in wages growth has remained puzzling, analysts at Credit Agricole say.

"Two possible explanations have been advanced: higher slack in the labour market than previously thought, or alternatively temporary stickiness in wages growth due to the past period of prolonged stagnation. The various surveys tend to give credit to the latter, including the services PMI this week".

Analysts still believe in an early rate hike by the BoE - supposedly, in Q1 2015. They expect the Inflation report to contain improved forecasts on the economy and inflation. pushing the regulator to hike rates.

More:
http://fxbazooka.com/en/news/show/1593
 
MARKET NEWS
13 August 2014

The BoE cut 2014 wage growth forecast


The Bank of England sounded more dovish than expected, cutting wage growth forecasts and giving no timing on rate hikes. GBP/USD slipped to a fresh 2-month low of $1.6720 on the news.

Forecasts:

2014 wage growth forecast revised down from +2.5% to +1.25%
unemployment rate seen at 5.4% in two years
"market" sees first rate rise in Q1 2015 reaching 2% by Q4 2016
the 2% inflation target remains unchanged
Marc Carney:

MPC does not have a particular threshold for wage growth to trigger a rate hike
expensive GBP hurts British exports
slow and small rate hikes will mitigate risk that higher borrowing costs trigger slowdown
pick up in productovity slack will take longer than previously expected
slowdown on the housing market is due to new FCA mortgage rules and will be short-lived

More:
http://fxbazooka.com/en/news/show/1592
 
MARKET NEWS

Aug. 14: Asian session


Asia_eng.jpg


FXBAZOOKA.com - Asian stocks rose as a slowdown in the US retail sales fueled bets the Fed won’t raise interest rates earlier than expected. The expectations of lower rates in the US for a longer period of time make traders more optimistic. USD/JPY rose to 102.65. Yen fell for a fourth day as demand for safe havens declined.

EUR/USD slid to $1.3355 after spiking to $1.3415 yesterday. According to the data released today, France’s economic growth stagnated in Q2, while German GDP contracted more than expected – by 0.2%.Euro zone’s GDP is due at 09:00 GMT. GBP/USD tested $1.6669 on the downside after sliding by more than 120 pips yesterday.

Commodity currencies retraced a bit higher from the last week’s lows as risk sentiment improved a little. NZD/USD retraced to $0.8460 after a push $0.8490, but stays in the positive zone. New Zealand Business Manufacturing Index came a bit below the forecast (53.0 vs. 53.4 expected), while retail sales surprised to the upside (1.2% vs. 1.0% expected). AUD/USD trades under slight bearish pressure around $0.9295.

More:
http://fxbazooka.com/en/news/show/1596
 
MARKET NEWS

Key option levels (Aug. 14)


Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

Here are the key options expiring today:EUR/USD: $1.3350/60 (large), $1.3400 (large);

GBP/USD: $1.6635, $1.6850;

USD/JPY: 101.45/50 (large), 101.65/75 (large), 101.95 (large), 102.00 (large), 102.05;

AUD/USD: $0.9275 (large), $0.9320, $0.9333;

USD/CAD: 1.0880 (large), 1.0920/25 (large), 1.0990 (large);

NZD/USD: $0.8550;

EUR/CHF: 1.2150 (large);

EUR/GBP: 0.8045.

More:
http://fxbazooka.com/en/news/show/1597
 
MARKET NEWS
14 August 2014

Danske Bank: USD demand presists


USD remains very attractive despite softer than expected US retail sales yesterday, analysts at Danske Bank say. They point that portfolio flows continue to be supportive for the USD both into the equity and US Treasury markets.

Meanwhile, strategists are sceptic about the European and British currencies. EUR will likely remain under pressure following today’s euro-zone Q2 preliminary GDP, while GBP should correct lower after the yesterday's BOE disappointment.

US Dollar index is now on its highest level since October 2013.

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Chart: Bloomberg

More:
http://fxbazooka.com/en/news/show/1600
 
MARKET NEWS
14 August 2014

Euro area's economy stagnates


FXBAZOOKA.com - The euro area’s recovery halted in Q2, underlining the vulnerability of the region to weak inflation and the deepening crisis in Ukraine. This may increase pressure on the European Central Bank to expand stimulus.

German GDP contracted by 0.2% after gaining 0.8% in the first 3 months of the year, while French economic growth stagnated and Italy’s unexpectedly fell into recession.

Bloomberg reports that the decline in German economy was largely due to a warm winter that shifted production to earlier months. Still, the outlook is now clouded by the impact of international sanctions against Russia over its support of separatists in Ukraine.

As for France, the failure of its economy to grow for a second straight quarter made the government abandon its 2014 deficit targets. French authorities now believe that the nation’s full-year growth will account for 0.5% instead of 1%, while the deficit in 2014 will exceed the 4% limit of GDP agreed less than 4 months ago with the European Commission. Finance Minister Michel Sapin blamed European policy for the lack of expansion in Europe’s second-biggest economy.

More:
http://fxbazooka.com/en/news/show/1601
 
MARKET NEWS

Aug. 15: Asian session


Asia_eng.jpg


FXBAZOOKA.com - Asian shares pulled higher on Friday, on track for a winning week, while the euro remained close to nine-month lows after downbeat data. USD/JPY rose to 102.50, but is below yesterday’s high at 102.65.

EUR/USD is little changed in the $1.3365 area. French and German banks are closed for the bank holidays. GBP/USD is trading in the $1.6690 area after it found support at the 200-day MA yesterday. Pound is waiting for the UK GDP release (second estimate).

AUD/USD strengthened to $0.9325 – this is the yesterday’s high. NZD/USD recovered to $0.8480 following a dip to $0.8465. Gold price sits at $1312.10.

More:
http://fxbazooka.com/en/news/show/1603
 
MARKET NEWS

Key option levels (Aug. 15)


FXBAZOOKA.com - Market prices tend to move towards the strike price at the time large vanilla options (ordinary put and call options) expire. It happens (all things equal) as each side of the deal seeks to hedge its risk exposure. This action is most noticeable ahead of 10 a.m. New York time when the majority of options expire (14:00 GMT).

Here are the key options expiring today:

EUR/USD: 1.3400 (large) 1.3425 (large);

GBP/USD: 1.6740 (large);

USD/JPY: 101.80/85, 102.00, 102.25, 102.50, 103.00;

AUD/USD: $0.9275, $0.9315/25, $0.9375;

USD/CAD: 1.0850, 1.0875 (large), 1.0915/25 (large), 1.0950 (large);

NZD/USD: 0.8450;

EUR/GBP: 0.7940 0.8000 0.8100.

More:
http://fxbazooka.com/en/news/show/1604
 
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