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Maintain To Trade OnlyTitle:
Another Day, Another New Correction Low For EUR/USD
Sunrise Market Commentary
- Fixed Income: Hunt for yield
- Following horrible French and German PMI readings, core bonds set new highs. The German 10-yr yield set an all time low at 1.35% and this initiated for the first time a “hunt for yield” trade into Belgian, Austrian and French bonds. The trade was most visible at the longer end of the curve, resulting in a bull flattening.
- Currencies: Another day, another new correction low for EUR/USD
- On Thursday, the decline of EUR/USD was extended. However, given the flood of negative news, the damage could have been worse. EUR/GBP struggles to hold above the 0.8000 barrier. Today, the calendar is thin. However, one can expect investors to stay cautious going into a long weekend. This is no help for the euro
The Sunrise ...
Title:
Greek Debt Crisis: Answers to Frequently Asked Questions
Highlights
- An acceleration in deposit withdrawals, combined with the prospect of an anti-austerity party winning the next election, has brought to the fore concerns about a potential Greek exit from the euro zone.
- Our base case assumption is that under the most likely scenario, the Greek election will lead to a government that sticks to an EU/IMF program, even if the terms are renegotiated.
- However, we do believe that Greece needs a further restructuring of its debt and we do think the country will ultimately exit the euro - we're just not convinced that Europe is ready for this to happen at the moment.
- If an accident does occur and Greece does leave the euro in the near term, it would have global financial ramifications that could range from severe to catastrophic. ...
Title:
Risky trade getting hammered
Higher yielders remained under pressure as uncertainty continues to surround markets. The lack of assurance of an Imperative action on Greece from the euro leaders in their informal summit today makes things further vague for the destiny of the risky trade. While markets lack a conclusive expectation for the outcome of the summit majors look skeptical around key support levels.
During a teleconference earlier today, the Eurogroup Working Group (EWG); which consists of the officials preparing the meetings of finance minister, and form the board of the ESF as well, agreed that euro zone countries must consider and prepare for the consequences of a Greece exit. The move could have further negative impact on the common currency.
While Later today, the finance ministers are expected to unveil ...
Title:
Fitch Fires Another Round
Forex News and Events:
Fitch downgraded Japan by two notches yesterday afternoon from AA to A+ with outlook negative. The agency justified the credit rating cuts by saying that the Japanese government isn’t reactive enough in tackling its “high and rising public debt ratios”. The move came in a few hours after the OECD urged Japan to prioritize the implementation of a fiscal consolidation plan, as debt-to-GDP ratio exceeds 200 percent, and budget deficits are forecast at 10 percent of GDP for the current year. PM Yoshihiko Noda has staked his political career on a law to increase sales tax to 10% with the goal of offsetting rising social security costs mainly due to the fast ageing of the population. But the opposition that controls the upper house is refusing to negotiate and is ...
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Asian Market Update : 23/05/2012
Yen gains after BOJ stands pat; World Bank cuts China outlook, April lending looks weak; EUR falls on Papademos "grexit" mention
Economic Data
(JP) BANK OF JAPAN (BOJ) LEAVES TARGET RATE RANGE UNCHANGED BETWEEN 0.0% TO 0.10% (AS EXPECTED); Keeps economic assessment unchanged; Maintains asset purchase fund at ¥70T
(JP) JAPAN APR MERCHANDISE TRADE BALANCE TOTAL: -¥520B V -¥471BE; ADJUSTED: -¥480B V -¥617BE
(US) NORTH AMERICA SEMI EQUIPMENT INDUSTRY APR SALES BOOK TO BILL RATIO: 1.10 V 1.13 PRIOR (3RD CONSECUTIVE MONTH ABOVE PARITY, 1st decline in 7 months)
(AU) AUSTRALIA APR DEWR INTERNET SKILLED VACANCIES M/M: -0.8% V -0.5% PRIOR (4-month low)
(AU) AUSTRALIA MAR WESTPAC LEADING INDEX M/M: 0.4% V 0.0% PRIOR
(AU) AUSTRALIA MAR CONFERENCE BOARD LEADING INDEX M/M: +0.2% V 0.0% PRIOR
(SG) ...
Title:
EUR/USD Rebound On Profit Taking
Sunrise Market Commentary
- Fixed Income: limited profit taking on core bond markets
- Global core bond markets fell prey to some profit taking in a thin, dull trading session. However, given the strength of equities, bond losses were very limited and occurred at the onset of trading. Today, the eco calendar remains thin and the profit taking might go some further in the run-up to tomorrow's informal EU Summit.
- Currencies EUR/USD rebound on profit taking
- The correction in EUR/USD was prolonged, but the euro gains were modest and mostly technical in nature. The UK inflation report is the eye-catcher of the day as it may influence sterling. However, overall trading might again be thin ahead of tomorrow's euro Summit.
The Sunrise Headlines
- US Equities rose for a second ...
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Exclusive: U.S. lets China bypass Wall Street for Treasury orders
(Reuters) - China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury's first-ever direct relationship with a foreign government, according to documents viewed by Reuters.
The relationship means the People's Bank of China buys U.S. debt using a different method than any other central bank in the world.
The other central banks, including the Bank of Japan, which has a large appetite for Treasuries, place orders for U.S. debt with major Wall Street banks designated by the government as primary dealers. Those dealers then bid on their behalf at Treasury auctions.
China, which holds $1.17 trillion in U.S. Treasuries, still buys some Treasuries through primary dealers, but since June 2011, that route hasn't been necessary.
...
Title:
Windsor Brokers - Short Term Technical Analysis for Majors (07:00 GMT)
EUR/USD
Extends the near-term recovery above initial barriers at 1.2750 zone, after temporary footstep was found at 1.2640, last Friday. Bounce from here briefly broke above 1.2800 barrier, also Fib 23.6%, where descending trendline, connecting 1.3282/1.3177 tops, limited gains at 1.2811, with corrective easing on overbought hourly studies under way. Dips need to be contained at 1.2760/40 zone, to maintain positive near-term tone for possible fresh attack at upper barriers. Lift above 1.2800, to face significant resistances at 1.2886, Fib 38.2% and 1.2900 zone, clearance of which to confirm near-term base and open way for stronger retracement of 1.3282/1.2641 downleg, with 1.2950/80 seen next. On the downside, loss f 1.2740 and psychological support at 1.2700, would turn focus lowercase ...
Title:
Euro Succeeds Short Squeeze
Sunrise Market Commentary
- Fixed Income: Global core bonds take a breather
- Investors remained mostly sidelined in an uneventful session on Friday. The G-8 meeting stressed the need for growth, besides fiscal consolidation and sees Greece staying inside EMU. This shouldn’t surprise markets today. With a razor thin calendar, trading might start the week in a lackluster mode.
- Currencies: Euro succeeds short squeeze
- On Friday, the decline of the euro halted and EUR/USD succeeded a cautious rebound, even as uncertainty on the EMU debt crisis persisted. Technical considerations will also dominate trading today as the G8 meeting provided no high profile measures to address the debt crisis.
The Sunrise Headlines
- US Equities rose for a second consecutive session on ...
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