The euro came under selling pressure today against the U.S. dollar after European Industry Commissioner Tajani tried to talk down the currency. As the head of an agency whose goal is to protect the export sector, Tajani complained that the euro is too strong and called on the central bank to manage the currency in a way that would help exports. Considering that the euro has been in a downtrend since the beginning of the month and has lost over 5% since the beginning of February, some investors may be surprised by the timing of Tajani's comments. However it is clear that underperformance of the Eurozone economy, which is currently in recession is a big motivation for industry officials, politicians and central bankers to make overtures to weaken the euro now versus February. In addition, with the currency in a downtrend, comments such as these will have a greater impact on the euro. As the ECB considers whether to introduce negative deposit rates or purchases of asset backed securities, a weaker currency will provide additional support to the region's economy.
Yesterday, the Eurozone reported a record trade surplus for the month of March. Thanks to a rise in exports, the region's trade balance rose to 18.7B, up from 12.7B. Unfortunately there was very little enthusiasm after the report because the details showed imports falling 1%. Domestic demand is a major problem for the Eurozone and a key factor in the 0.2% contraction the region endured in the first quarter so while the trade numbers improved, the impact on the euro was limited. Non-farm payrolls in France also fell 0.1% in the first quarter, a sign that the region's second largest economy continues to struggle. No Eurozone economic reports are scheduled for release tomorrow so all eyes will be on comments from ECB officials - Coeure, Asmussen, Praet and Mersch are scheduled to speak. If these 4 policymakers confirm that negative deposit rates or ABS purchases are on the table, the EUR could extend its slide. -FXstreet.com
2013-05-17 09:00 GMT
EMU. Construction Output w.d.a (YoY) (Mar)
2013-05-17 12:30 GMT
Canada. Consumer Price Index (YoY) (Apr)
2013-05-17 13:55 GMT
USA. Reuters/Michigan Consumer Sentiment Index (May)
2013-05-17 15:00 GMT
USA. CB Leading Indicator (MoM) (Apr)
2013-05-17 04:58 GMT
Nomura's survey on USDJPY suggest higher quotes
2013-05-17 04:26 GMT
Technical picture continues to become more bearish for EUR/USD
2013-05-17 03:57 GMT
AUD/USD, how far can it go? 0.9750/10 next demand
2013-05-17 02:40 GMT
USD/CHF inching toward hourly resistance trend line at 0.9675
Upwards scenario: 20 SMA acts as next resistance level at 1.2886 (R1). Penetration above that mark might trigger upside pressure and expose our next resistive mean at 1.2911 (R2) en route towards to final target for today at 1.2937 (R3). Downwards scenario: On the other hand, successful retest of our next support level at 1.2843 (S1) Market would create a signal of bearish sentiment and enable our interim target at 1.2819 (S2). Final support for today locates at 1.2794 (S3).
Resistance Levels: 1.2886, 1.2911, 1.2937
Support Levels: 1.2843, 1.2819, 1.2794
GBPUSD
HIGH1.52822
LOW1.52366
BID1.52521
ASK1.52533
CHANGE-0.1%
TIME08:26:30
OUTLOOK SUMMARY
Down
TREND CONDITION
Downward penetration
TRADERS SENTIMENT
Bullish
IMPLIED VOLATILITY
Medium
Upwards scenario: A bearish tone dominates during the Asian session however further buying interest might arise above the resistance at 1.5281 (R1). Clearance here would suggest next intraday target at 1.5315 (R2) and if the price holds its momentum we can expect an increase towards to 1.5351 (R3). Downwards scenario: If the price failed to establish further positive bias today, likely we will see retest of our key support level at 1.5228 (S1). Break here is required to enable initial lower targets at 1.5194 (S2) and 1.5163 (S3) in potential.
Resistance Levels: 1.5281, 1.5315, 1.5351
Support Levels: 1.5228, 1.5194, 1.5163
USDJPY
HIGH102.371
LOW102.08
BID102.291
ASK102.295
CHANGE0.04%
TIME08:26:31
OUTLOOK SUMMARY
Neutral
TREND CONDITION
Sideway
TRADERS SENTIMENT
Bullish
IMPLIED VOLATILITY
Medium
Upwards scenario: Neutral channel formation remains in play on the hourly chart. Our next resistance level is placed at 102.47 (R1). Strengthening above it would point to resistive structure at 102.81 (R2) onto 103.14 (R3). Downwards scenario: Possible downtrend evolvement might occur below the immediate support level at 102.05 (S1). Clearance here is required to enable our next targets at 101.70 (S2) and 101.36 (S3) in potential.
Disclaimer
The analysis we provide is based on the average estimate of price movements in one day. Does not guarantee what we deliver is actually a proper and correct. Everything that happens in the decisions you make on your trading transaction is to be Your responsibilities.
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