CFD Markets News and Forecasts — 25-08-2011

EUR/USD holds $1.4375 area, challenging the $1.4380 area (earlier support). Resistance remains at $1.4400 (50% Fibo of today's range). Flows
limited as markets await Bernanke.

USD/CHF draggs down. Rate currently holds around Chf0.7944, retreating after it earlier failed to break above Chf0.8000 (session high on Chf0.7988). Strong resistance is around recent high on Chf0.8010/15. Support comes at Chf0.7910 (daily low), below - at Chf0.7870 (Aug 24 low).

The euro weakened against the dollar and pared gains versus the yen on concern regulators will need to extend a ban on short-selling in European equity markets to prevent the region’s sovereign-debt crisis from worsening.
Better-than expected durable-goods orders and home-price data from the U.S. curbed speculation Fed Chairman Ben S. Bernanke will announce a third round of bond purchases that boost the supply of dollars, known as quantitative easing, when he speaks tomorrow at a symposium at Jackson Hole, Wyoming.
“Expectations for QE3 have been pared down because the recent economic data isn’t conclusive” enough to warrant urgent action, said Sim Moh Siong, a foreign-exchange strategist at Bank of Singapore Ltd. The dollar’s strength “is consistent” with those expectations, he said.

U.S. house prices rose 0.9% in June from the month before, the biggest increase since September 2005, a report showed yesterday. Durable-goods orders jumped 4% in July from a year earlier, following a revised 1.3% contraction the previous month.
The pound fell to the lowest level in more than two weeks against the euro as a report showed U.K. consumer confidence dropped in July, fueling concern the economic recovery will falter.
Sterling reached its lowest against the dollar since Aug. 17. Nationwide Building Society said its index of sentiment declined 2 points to 49 from June, the lowest reading since April. A gauge of consumers’ expectations for the economy in the next six months slipped 3 points to 67, the customer-owned lender said in an e-mailed report today. The pound declined as stock-market gains across Europe sapped demand for the nation’s bonds as a haven from the euro area’s debt crisis.

EUR/USD recovered to current $1.4376, holding around the 100-daily MA. Rate earlier fell to the lows around $1.4325. Euro remains within the $1.4300/$1.4500 range. Stops remain below $1.4320.

EUR/USD $1.4255, $1.4300, $1.4330, $1.4480, $1.4485, $1.4500
USD/JPY Y76.05, Y76.50, Y77.00, Y77.50
EUR/JPY Y112.50
GBP/USD $1.6290, $1.6390
USD/CHF Chf0.7800
AUD/USD $1.0335, $1.0600
AUD/JPY Y80.40, Y80.85

Oil was little changed near its highest in a week  on speculation that the Federal Reserve may announce new measures to stimulate the economy, and after U.S. crude inventories declined.Corrently oil futures  for Oktober delivery are at $85.56 per barrel (+0.5%).

EUR/USD
Offers: $1.4470, $1.4490/00
Bids: $1.4400, $1.4390/70

GBP/USD
Offers: $1.6350, $1.6310/00

Saw highs of stg0.8835, but momentum quickly faltered with rate dropping back in line with euro-dollar's failure above $1.4470. The cross currently trades around stg0.8818, with support expected between stg0.8815/10.

Data released:
06:00     Germany     Gfk Consumer Confidence Survey     September     5.4     5.2     5.2

The dollar weakened against the euro and the yen slid versus most of its major counterparts amid speculation Federal Reserve Chairman Ben S. Bernanke will tomorrow announce further stimulus for the U.S. economy.
Norway’s krone and Sweden’s krona were the best performers against the dollar and yen as stock market gains in Asia and Europe spurred demand for higher-yielding assets. Speculation has intensified that Bernanke will signal a willingness to embark on a third round of so-called quantitative easing, or QE3, in a speech at Jackson Hole, Wyoming, as the U.S. economy shows signs of faltering. The euro strengthened even after an industry report predicted German consumer confidence will fall.
“The market is treating Bernanke’s speech tomorrow almost like a policy meeting,” said Steve Barrow, the London-based head of Group-of-10 currency research at Standard Bank Plc, wrote in a client note today. “If he signals QE3, it could supports higher-yielding assets like stocks, the Scandinavian currencies and the Aussie and Kiwi dollars at the expense of the U.S. dollar.”

EUR/USD reached $1.4475 in recovering from overnight lows on $1.4380.
GBP/USD holds within the range, limited by $1.6355/95.
USD/JPY traded around Y77.00.

In the UK, at 1000GMT, CBI Distributive Trades data is due, which is followed at 1100GMT when Bank of England MPC member Martin Weale delivers a speech at the Doncaster Chamber of Commerce. Weale has already given a fairly full explanation of his reasons for dropping his rate hike call at the August MPC meeting, but his comments will still be closely-watched.

Majors close
Nikkei 225 -93.40 -1.07% 8,639.61
FTSE 100 +76.43 +1.49%     5,205.85
CAC 40     +55.18     +1.79%     3,139.55
DAX +148.70 +2.69% 5,681.08
Dow     +143.95 +1.29% 11,320.71
Nasdaq     +21.63     +0.88% 2,467.69
S&P 500 +15.25     +1.31% 1,177.60
10 Year Yield     2.26%     +0.12

Japanese stocks fell ahead of a meeting of central bankers this week as investors questioned whether any stimulus announced by Federal Reserve Chairman Ben S. Bernanke would be enough to prop up a weakening U.S. economy.
Toyota Motor Corp. (7203), the world’s biggest carmaker, dropped 1.6 percent. Sony Corp., Japan’s No. 1 exporter of consumer electronics, slid 2.9 percent. Mitsubishi UFJ Financial Group Inc. (8306) led banking shares lower after Moody’s Investors Service downgraded the debt ratings of Japan’s biggest lenders. Moody’s also lowered its rating on Japanese sovereign debt.
The Nikkei 225 Stock Average dropped 1.1 percent to 8,639.61 at the 3 p.m. close of trading in Tokyo after weaker weaker-than-estimated U.S. economic data eroded investor confidence ahead of a meeting this week in Jackson Hole, Wyoming, where Bernanke is expected to signal new stimulus.
Japanese shares extended declines in afternoon trading after measures announced by Finance Minister Yoshihiko Noda to protect Japanese exporters failed to weaken the yen. The Topix index dropped 1.1 percent to 742.24.


European stocks climbed for a third day after a report on U.S. durable-goods orders beat forecasts amid ongoing speculation that the Federal Reserve will act to bolster the economy.
Daimler AG (DAI) and Fiat SpA (F) led a gauge of automakers to the biggest gain in 13 months. Ageas, the majority owner of Belgium’s largest life insurer, surged 21 percent after announcing a buyback. WPP Plc (WPP), the world’s largest advertising company, advanced 7.4 percent as profit beat estimates. Heineken NV (HEIA), the world’s third-biggest brewer by volume, tumbled the most since 2003 after saying earnings are unlikely to grow this year.
The Stoxx Europe 600 Index rose 1.4 percent to 229.79 at the 4:30 p.m. close in London, extending the advance from the two-year low reached at the end of last week to 3 percent. The gauge has still fallen 21 percent from this year’s peak on Feb. 17 as European and U.S. economic data that trailed economists’ forecasts added to concern the global recovery is at risk.
“Everyone is waiting for Friday’s meeting of the Federal Reserve,” said John Plassard, a director at Louis Capital Markets in Geneva. “Until then, every bit of good news, such as the strong durable-goods numbers, will support the markets.”


U.S. stocks rose, extending the biggest rally for the Standard & Poor’s 500 Index in a week, after reports on durable-goods orders and home prices beat forecasts and financial companies advanced.
Bank of America Corp. (BAC) surged 9.2 percent after Meredith Whitney, who predicted Citigroup Inc. (C)’s dividend cut three years ago, said it has no urgent need to raise capital. A gauge of 12 homebuilders in S&P indexes increased 1.7 percent. Newmont Mining Corp. (NEM) slumped 2.4 percent after gold futures plunged the most since 2008 as demand for haven waned.
The durable-goods data wiped out a 1.4 percent retreat in futures on the index. The Dow Jones Industrial Average added 72.13 points, 0.7 percent, to 11,248.89.
“Any time you see life in the walking dead, it certainly makes you feel a lot better,” Bruce McCain, who helps oversee $22 billion as chief investment strategist at the private- banking unit of KeyCorp in Cleveland, said in a telephone interview. “There’s so much pessimism priced into the market that if we get any decent news, it’s going to buoy investors’ spirits. If investors can be reassured that a disaster is not imminent, that’s good for the market.”
With traders awaiting a speech on Aug. 26 by Federal Reserve Chairman Ben S. Bernanke in Jackson Hole, Wyoming, trading is being affected more than usual by levels monitored by analysts who base forecasts on price and volume history.

Nudging higher again in recent trade to $1.0476 and looking tore-test the session highs $1.0482. Offers nearby at $1.0490/00 where the 200 day MA sits at $1.0499.

Data released:
08:00     Germany     IFO business climate index (August)    108.7    111.0    112.9
09:00     EU(17)     Industrial orders (June)    -0.7%    0.5%    3.6%
09:00     EU(17)     Industrial orders (June) Y/Y     11.1%    11.9%    15.5%
12:30     USA     Durable goods orders (July)    4.0%    2.0%    -1.3 (-2.1)%
12:30     USA     Durable goods orders excluding transportation (July)    0.7%    -    0.1%
12:30     USA     Durable goods orders excluding defence (July)    4.8%    -    -1.8%
23:01     UK     Nationwide consumer confidence (July)    49    45    51

European data for Thursday starts at 0600GMT with German construction orders data for June. Later, France registered jobseekers data is due at 1600GMT. The most anticipated event of the week is the speeches Jackson Hole, which gets underway this evening. European speakers at the event include ECB President Trichet, where he will have chance to reflect on the euro zone's current economic weakness and maybe vent some frustration at the continuing failure of euro zone politicians to come up with a solution to the crisis. He will be joined by ECB
Executive Board Members Peter Praet and Gonzalez Paramo. Since he joined in June, Praet has had only a few public outings and this will be an opportunity to guage where this ECB member stands in terms of dovishness/hawkishness.In the UK, at 1000GMT, CBI Distributive Trades data is due, which is followed at 1100GMT when Bank of England MPC member Martin Weale delivers a speech at the Doncaster Chamber of Commerce. Weale has already given a fairly full explanation of his reasons for dropping his rate hike call at the August MPC meeting, but his comments will still be closely-watched.

EUR/USD $1.4255, $1.4300, $1.4330, $1.4480, $1.4485, $1.4500
USD/JPY Y76.05, Y76.50, Y77.00, Y77.50
EUR/JPY Y112.50
GBP/USD $1.6290, $1.6390
USD/CHF Chf0.7800
AUD/USD $1.0335, $1.0600
AUD/JPY Y80.40, Y80.85

Resistance 3: Y78.20

Resistance 3: Chf0.8140
Resistance 2: Chf0.8010/15
Resistance 1: Chf0.7960
Current price: Chf0.7950
Support 1: Chf0.7790
Support 2: Chf0.7660
Support 3: Chf0.7540

Comments: Rate was in a narrow range in Asia resistance is around session's highs on Chf0.7960, stronger - at Chf0.8010/15 (Aug 17 highs). Further rise may extend Chf0.8140 (channel line from the mid-Feb). Strong support comes at Chf0.7790 (23.6% Fibo of Chf0.7070 - Chf0.8020). Below losses may widen to Chf0.7660 (38.6%) and Chf0.7540 (Aug 12 lows).

Resistance 3: $1.4580
Resistance 2: $1.4520         
Resistance 1: $1.4500
Current price: $1.4413
Support 1: $1.4380
Support 2: $1.4340/45
Support 3: $1.4260

Comments: Support remains at $1.4380 (overnight lows). Below there is a chance for a test of $1.4340/45 (Aug 22 lows). Stronger level - at $1.4260 (Friday's low). Further resistance comes at $1.4520 (Aug 17 high). Further rise may extend to $1.4580 (Jul 04 high).

Nikkei 225 -93.40 -1.07% 8,639.61
FTSE 100 +76.43 +1.49%     5,205.85
CAC 40     +55.18     +1.79%     3,139.55
DAX +148.70 +2.69% 5,681.08
Dow     +143.95 +1.29% 11,320.71
Nasdaq     +21.63     +0.88% 2,467.69
S&P 500 +15.25     +1.31% 1,177.60
10 Year Yield     2.26%     +0.12

06:00     UK     Nationwide house price index (August)         -0.4%    0.2%
06:00     UK     Nationwide house price index (August) Y/Y         -0.2%    -0.4%
10:00     UK     CBI retail sales volume balance (August)         -10%    -5%
12:30     USA     Jobless claims (week to 20.08)         416K    408K
20:30     USA     M2 money supply (15.08), bln         -    +43.1
23:30     Japan     Nationwide CPI (July)         -    -0.1%
23:30     Japan     Nationwide CPI (July) Y/Y         -    0.2%
23:30     Japan     Nationwide CPI ex fresh food (July) Y/Y         0.0%    0.4%
23:30     Japan     Tokyo-area CPI (August)         -    0.0%
23:30     Japan     Tokyo-area CPI (August) Y/Y         -    0.5%
23:30     Japan     Tokyo-area CPI ex fresh food (August) Y/Y         -0.2%    0.4%