Market Overview | Written by ActionForex.com | Jan 09 08 14:52 GMT |
Sterling tumbles again today and made another record low against Euro on increased speculation for rate cut from BoE tomorrow. UK rate futures tilted toward pricing around 60% change of a rate cut, up from 50%, after Marks & Spencer, the countries largest clothing retailer, reported a 2.2% falling like-for-like sales. Technically speaking, GBP/USD is now pressing an important support zone of 1.9550/600 level and seems to be regaining downside momentum. Sustained break of this support zone will confirm that the medium term up trend that started at 1.7047 in 2005 has already completed and much deeper decline should then be seen.
Elsewhere, dollar's recovery against Euro resumes in early US session on rumors of a tax break plan for households and businesses from Bush administration. After all, the consolidation in dollar against Swissy and yen are also still in progress and more choppy trading will likely be seen in general.
Data from Eurozone saw Q3 GDP growth finalized at 2.7% yoy. German industrial production unexpectedly dropped -0.9% mom in Nov, dragging yoy rate down to 3.5%. Canadian housing starts dropped more than expected to 187.5k in Dec.
EUR/USD
Daily Pivots: (S1) 1.4678; (P) 1.4709; (R1) 1.4738; More
EUR/USD's correction from 1.4823 resumes in early session and is now pressing 4 hours 55 EMA (now at 1.4661). At this point, intraday bias will remain on the downside as long as 1.4741 minor resistance holds. Further decline could still be seen. But still, downside is expected to be contained by 1.4581 support (near to 50% retracement of 1.4309 to 1.4823 at 1.4566) and bring rally resumption. Above 1.4741 will shift intraday bias back to the upside for retesting 1.4823 high. Also, the rally from 1.4309 is expected to extend further to retest 1.4966 high and 1.5 psychological resistance after finishing the current consolidation.
In the bigger picture, with 1.3581 resistance turned support remains intact, medium term up trend from 1.1639 is still in force. Regardless of internal structure, it is treated as resumption of long term up trend from 0.8223 (00 low) to 1.3668 (04 high) and has just failed 61.8% projection of 0.8223 to 1.3668 from 1.1639 at 1.5004 target which overlaps with 1.5 psychological resistance. With subsequent correction completed with three waves down to 1.4309, rise from there is tentatively treated as resumption of such up trend but sustained trading above 1.5 key resistance is needed to confirm this case and bring rally to next projection target of 100% projection at 1.7048. On the downside, below 1.4468 support will argue that correction from 1.4966 is still in progress for another fall to below 1.4309 before completion.
Forex News Digest
Yen Declines Most in Two Weeks as Japanese Investors Seek Higher Returns
ANZ Bank Cuts Australian Dollar Forecasts on View Global Growth to Slow
Canada's Dollar Approaches Three-Week Low After Housing Slows in December
Dollar Index May Rise to 77.85 on Candle, Fibonacci Charts, Citigroup Says
Pound Falls to Record Against Euro as U.K. Consumer Confidence Declines
Dollar edges up to upper 109 yen in Tokyo
Wed, 9 Jan 2008 10:37:00 GMT from Xinhua News Agency
Dollar Steadies vs Euro on US Tax-Cut Hopes
Wed, 9 Jan 2008 10:22:00 GMT from CNBC
DJ WORLD FOREX: Dollar Range-Bound Vs Key Rivals Tuesday
Wed, 9 Jan 2008 09:43:00 GMT from Stockhouse Canada
Sterling extends losses to 6-month low vs dollar
Wed, 9 Jan 2008 09:01:00 GMT from Reuters UK
FOREX-Prospect of US tax cuts boosts FX risk appetite
Wed, 9 Jan 2008 08:52:00 GMT from Reuters UK
Economic Indicators Update
| GMT | Ccy | Events | Actual | Consensus | Previous | Revised |
|---|---|---|---|---|---|---|
| 00:01 | GBP | U.K. N'wide Consumer Confi. Dec | 85 | 84 | 86 | |
| 00:30 | AUD | Australia Retail sales M/M Nov | 0.80% | 0.50% | 0.20% | 0.30% |
| 07:00 | EUR | Germany Retail sales M/M Nov | -1.30% | 1.10% | -3.30% | -2.30% |
| 07:00 | EUR | Germany Retail sales Y/Y Nov | -3.20% | -1.50% | -0.60% | 0.00% |
| 07:00 | EUR | Germany Trade balance (euro) Nov | 19.3B | 17.5B | 18.7B | 18.9B |
| 07:00 | EUR | Germany Current account Nov | 20.0B | 14.3B | 13.7B | 14.4B |
| 07:00 | EUR | Germany Export M/M Nov | -0.50% | 0.50% | 0.60% | 0.50% |
| 07:00 | EUR | Germany Import M/M Nov | -3.00% | 2.00% | 0.20% | 0.00% |
| 10:00 | EUR | Eurozone GDP Q/Q Q3 | 0.80% | 0.70% | 0.70% | |
| 10:00 | EUR | Eurozone GDP Y/Y Q3 | 2.70% | 2.70% | 2.70% | |
| 11:00 | EUR | Germany Industrial prod'n M/M Nov | -0.90% | 0.50% | -0.30% | 0.10% |
| 11:00 | EUR | Germany Industrial prod'n Y/Y Nov | 3.50% | 4.60% | 6.00% | 6.40% |
| 13:15 | CAD | Canada Housing starts Dec | 187.5K | 223.5K | 227.9K | 233.3K |
| 15:30 | GBP | U.K. Leading indicators M/M Nov | N/A | 0.20% |
Source : Actionforex
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