No Much Improvement Of 5 Major Currency Along This Week

On 15-21 may 2011, many factors had influenced 5 major currency mover along this week both fundamental and technical. If you see last week, the movement of currency had dropped because of bad result. Now, i would like to give a summary so that the trader know more detail before taking a buying or selling decision.

Technical

EUR/USD, CPI y/y remain unchanged about 2,8%, Core CPI y/y was good result from 1,5% to 1,6%, German ZEW Economic Sentiment dropped from 4,8 (forecast) to 3,1 (actual), ZEW Economic Sentiment also dropped from 17,9 to 13,6, German PPI m/m rose from 0,6% to 1,0%, Current Account reduced from -5,7B to -4,7B

AUD/USD, Home Loans m/m reduced from 2,3% (forecast)  to -1,5% (actual), New Motor Vehicle Sales m/m was bad from 3,9% to -3,5%, Westpac Consumer Sentiment dropped from 1,2% to -1,3%, Wage Price Index q/q was not good result from 1,2% to 0,8%, MI Inflation Expectations 3,5% to 3,3%

GBP/USD, Rightmove HPI m/m 1,7% to 1,3%, CPI y/y rose slightly from 4,2% (forecast) to 4,5% (actual) , it was more than expectation, RPI y/y dropeed slightly from 5,3% to 5,2%, Claimant Count Change plunged from 0,4K to 12,4K, MPC Meeting Minutes was the same with previous result about 3-0-6, Average Earnings Index 3m/y increased from 2,0% to 2,3%, Nationwide Consumer Confidence dropped from 48 to 43, Retail Sales m/m rose more than expectation from 0,9% (forecast) to 1,1% (actual), CBI Industrial Order Expectations had a positive sign which reduce time by time to the better result -5 to -2

USD/JPY, Core Machinery Orders m/m -9,7% to 2,9%, Tertiary Industry Activity m/m -5,4% to -6,0%, Prelim GDP q/q -0,5% to -0,9%, Prelim GDP Price Index y/y rose slightly from -1,9% (actual)to -1,6% (previous), Overnight Call Rate remain unchanged about <0,10%

USD/CHF, no have something high impact of indicator for this week

 

Fundamental

Firstly we look at what fundamental factor will influence EUR currency, the crisis in the eurozone and global economic imbalances, should be recognised," says ZEW President Prof. Dr. Dr. h.c. mult. Wolfgang Franz. the financial market experts consider a further increase of the economic momentum to be unlikely. Moreover, mixed signals regarding the state of the U.S. economy as well as a weaker outlook for the Chinese economy might have dampened expectations  

For AUD currency, the trader must look at what had been released from the Monetary Policy Meeting of the Reserve Bank Board

There have many fundamental factors which influence along this week for GBP pound like making higher sales tax and increase in energy as well as import prices. While King said inflation is likely to rise further in the next few months, he sees it easing toward the bank’s 2 percent target next year. The central bank signaled last week it may need to raise the key interest rate from a record low to control “uncomfortably high” price growth. bring inflation back to the target quickly risks generating undesirable volatility in output and would increase the chances of undershooting the target in the medium term,” King said. The price gains on the month and the year were led by costs for transport as well as alcohol and tobacco 

Some fundamental factors showed for (JPY)yen currency mover caused by Quake Tsunami, this disaster become the most influence for Japan economy disruptions like factory shutdowns, power shortages and supply-chain as well as consumers to cut back spending. Meanwhile, The BOJ board decided earlier on Friday to keep monetary policy steady in a sign that a first-quarter economic slump had not changed the central bank's view that growth will pick up around autumn . Deputy Governor Kiyohiko Nishimura dropped his proposal to loosen policy further with an expansion of the central bank's asset-buying scheme. However, overseas economic growth remains strong and supply constraints are easing at a pace that the central bank had forecast last month. 

No much data can be found for swiss franc (CHF) in this week, the factor that the trader must pay attention is the failure problem of big bank will negatively impact Switzerland economy. The state is trying to rescue a company by bail out some additional fund and balanced package of measures for Parliament's consideration can help reducing the problem in Switzerland.

As a result, if we look all 5 major currency in this week showed a good sign but the improvement was not too much, it was caused by some bad news of fundamental factor. The red color above show the trader must watch and pay attention because these kind of indicator had given a high impact to the currency mover. Hopefully, this summary can help you guys to determine in the coming week.

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5 Major Currency Plunged Toward USD

8-13 may 2011, if we look at last week, some of 5 major currency showed bad result which means that almost all major currency declined gradually toward USD. Today, I try to make summarize by choosing what indicators which have a high impact along this week, the trader must analyze what had been happened along this week, and these both technical and fundamental factor will definitely influence currency mover in the coming week. It is good for trader to prepare what decision will be taken next week. I divided into two part analysis, for more further information please look at forexfactory. 

Technical

EUR/USD, French Industrial Production m/m dropped from 0,55 to -0,9%. Industrial Production m/m was bad result from 0,4% to -0,2%. French Prelim GDP q/q had raised from 0,6% to 1,0%. German Prelim GDP q/q was also going up 0,95 to 1,5%. French Prelim Non-Farm Payrolls q/q growth from 0,2% (previous) to 0,4% (actual). Flash GDP q/q was good from 0,6% to 0,8%

AUD/USD, ANZ Job Advertisements m/m declined from 1,3% (previous) to 1,0%. NAB Business Confidence was down slightly from 9 to 7. Trade Balance rose from 0,49B to 1,74B. Employment Change showed a bad from 17,6K to -22,1K

Unemployment Rate still remain unchanged about 4,9%

GBP/USD, Halifax HPI m/m dropped from 0,2% to -1,4%. BRC Retail Sales Monitor y/y was good result from -3,5% to 5,2%. RICS House Price Balance good increased slightly from -22% to -21%. Manufacturing Production m/m rose slightly from 0,3% to 0,2%

NIESR GDP Estimate was not a good sign from 0,5% to 0,3%

USD/CHF, SECO Consumer Climate plunged significantly from 10 to -1. CPI m/m also dropped from 0,5% to 0,1%. PPI m/m was not like expected which dropped from 0,4% to 0,3%

USD/JPY, for yen currency is no much indicator can be analyzed, the screenshoot of yen currency showed below 

Fundamental

We started from EUR currency, some reasons which give big influence because the rise of the euro had a role in weakening industrial output. The higher costs for importers overseas made European exports less attractive. It’s becoming hard for Germany to carry all the Euro-zone on its shoulders, and this is true for the debt crisis as well. Moreover, what outlook for German in 2011 can be read about German economy starting into 2011 with momentum. ECB said "We should assure a sustainable contribution to [economic] growth by the financial sector. Spain has taken measures of an historic dimension to accommodate demand for credit once it recovers, Ordonez said.

How about AUD currency, some reason are the federal government also announced plans to alleviate labour shortages that threaten to fuel inflation as Australia rides an historic Asia-led resources boom. But most of the measures have already been leaked and there was little left to surprise investors. Analysts say the budget has little bearing on their interest rate outlook Another is because steep decline in full-time jobs, prompting markets to slice a full cent off the Australian dollar as markets lowered the risk of a near-term interest rate hike. The job gains have been led by health, construction, education and professional sectors. Bumper returns on key exports such as iron ore and coal are giving miners massive amounts of cash to invest, employ and pay a lot more. At the same time, the windfall to national incomes is driving strong growth in household demand for services, from health to education.

GBP factors also affect currency mover like trying to assess the precise degree of pass-through is obviously difficult. Our best estimate is around three-quarters of the increase in VAT was passed through which is likely to add a little more than 1 percentage point to the inflation rate. Some analysts have said with the wedge so wide, a hike in Bank Rate may make little difference to commercial banks, as the wedge could narrow, but King appeared to take the opposite view. Weak confidence amongst households, partly due to uncertainty over the economic outlook, is constraining housing demand, as signs of a fading economic recovery and tighter lending conditions dented property demand. Manufacturing was one of the drivers of the British economy until a few months ago, but also this sector significantly slowed down, as seen in the last two purchasing managers’ indices. For Japan currency, financial institutions were restoring their closed branches while at the same time shifting their operations from closed branches to neighboring ones as part of their efforts to maintain business operations at the windows. There was growing demand in the disaster areas at this point for cash to purchase daily necessities, and to meet such demand each.

Last one about CHF currency, this decline is almost exclusively due to a more negative assessment of households on their saving possibilities. By contrast, assessment on job security improved markedly. Significant changes were registered during the survey for households' assessments on price development over the last twelve months instead of droping in commodity prices, took some of the hot air out of the Swissy. Switzerland’s economy is doing great, but the falling commodity prices and the European weakness might be marking a long awaited turnaround

In summary, 5 major currency were stilll not good condition for this week, almost all major currency dropped. You should carefully consider some indicator above because those result gave a high impact as well as fundamental factors. Broadly analyze will help trader to make a right decision.

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Weekly Analysis of 5 Major Currency

Last week, 5 major currency had increased in a good position which is where some indicators fundamental gave tremendous impact. From 1-7 may 2011, I will summarize what had been happened along this week and help to trader by analyzing both technical and fundamental factors. To get more detail refer to forexfactory 

Technical

EUR/USD, Retail Sales m/m was bad from 0,25% (forecast) to -1,0% (actual), German Factory Orders m/m dropped sharply from 0,4% to -4,0%, Minimum Bid Rate was still the same 1,25%, ECB Press Conference , German Industrial Production m/m rose slightly from forecast 0,6% to actual 0,7%

AUD/USD, HPI q/q dropped from 0,3% to -1,7% , Cash Rate remain unchanged 4,75%, AIG Services Index was good 51,5 compare with previous 46,5, HIA New Home Sales m/m increased from 0,6% to 4,3% , Building Approvals m/m rose sharply 5,5% to 9,1%, Retail Sales m/m was bad from 0,6% to -0,5%, RBA

GBP/USD, BOE Gov King Speaks, Manufacturing PMI dropped from 57,0 to 54,6, CBI Realized Sales showed a good result about 21 compare with previous 15, Nationwide HPI m/m reduced from 0,3% to -0,2%, Construction PMI dropped from 55,6 to 53,3, Net Lending to Individuals m/m was not good from 1,7B to 0,5B, Services PMI was bad from 55,8 (forecast) to 54,3 (actual), Asset Purchase Facility was remain unchanged about 200B, Official Bank Rate still the same about 0,50%, PPI Input m/m rose from 1,7% to 2,6%,

USD/JPY, Average Cash Earnings y/y was not good from -0,1% to -0,4%, along this week there have no much indicator that can be used to gauge yen currency mover.

USD/CHF, Retail Sales y/y was still bad which dropped from 2,3% to 0,2%, SVME PMI fell slightly from 58,8 to 58,4, Unemployment Rate rose just a little from 3,2% to 3,1%

Fundamental

EUR, two important indicator ECB and minimum bid was the most influence in this week. President Jean- Claude Trichet today may indicate just how fast he’s prepared to raise interest rates over the coming months. Monetary policy elsewhere is becoming tight and for ECB stetment can be read here. Moreover, if we look AUD, The rising exchange rate will be helping to hold down prices for some consumer products over the coming few quarters. Senior economist at RBC Capital Markets in Sydney who predicts the central bank’s next rate increase will be in October (). At this time, diseaster in "Widespread flooding in the eastern states, particularly Queensland, and other recent natural disasters have not adversely affected participation by providers in the Building Approvals collection or the quality of estimates in this release," the ABS said in a statment. Reserve Bank of Australia Governor Glenn Stevens has paused raising interest rates for the past five meetings to help Queensland state recover from damage to properties, mines and crops from floods and a cyclone. There is a lot of uncertainty over households. RBA also Sees Need for Higher Rates ‘At Some Point’ to Slow Australia Inflation. For GBP, There is raft of evidence showing the UK housing market is suffering from historically low levels of activity. Mortgage approvals have been running around half long run averages. The economy stalled over the fourth and first quarters, and surveys this week showed services, manufacturing and construction growth moderated in April. Officials, who will publish new growth and inflation forecasts next week, are split on the threats from government spending cuts and inflation that’s double the central bank’s 2 percent target. “The outlook for growth is tepid and the committee may not do anything until November,” said David Tinsley, an economist at National Australia Bank in London and a former central bank official. Worsening economic data may ease pressure on the Bank of England to raise rates to curb inflation, which has soared to more than twice the central bank’s 2 percent target. "The service sector suffered a sharp loss of growth momentum at the start of the second quarter. The survey's measure of business activity showed the second-largest fall since October 2008, exceeded only by the sector's weather-related slide back into contraction in December," Chris Williamson, chief economist at Markit said. The rising cost of crude oil and imported goods pushed input price inflation to its highest level for two and half years in April. Instead of he impact of the rise in clothing and footwear prices. For JPY, no many fundamental factorthat we can analyze for yen currency, one of may impact yen currency mover is average cash earning which showed that Japan March wages fall first time in 13 months after quake instead of two other disaster tsunami and nuclear. These factors also affect crisis hurt jobs as well as income. Furthermore, factor that affect CHF currency are Sales of food, beverages and tobacco declined 1.3 percent, while non-food sales excluding fuel rose 2.6 percent  so that retail sales declined. In addition, falls in the output and backlog of orders subcomponents must be consider as well.

In conclusion, I strongly suggest to pay more attention in which where I give bold some important indicators above before making a decision, because those indicator will definitely influence of currency mover. Along this week, 5 major currency dropped gradually toward USD, this because of bad result of fundamental factors.

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5 Major Currency Showed Significant Result Both technical and Fundamental

25-30 April, Today, I would like to make a summary of 5 major currency mover toward USD both technical and fundamental factors. Along this week there had some important indicator which will influence trader to make right decision before “BUY” or “SELL”. 5 summary of indicators below can be used as a insight what had been happened.

Technical factors

EUR/USD, German prelim cpi m/m showed the same in what people expected about 0,2% (actual). Gfk german consumer climate was slightly dropped from 5,9 (forecast) to 5,7 (actual) .Industrial new order m/m dropped from 1,3% to 0,9%. French consumer spending m/m was in zone negative from 0,9% (previous) to -0,7% (actual). German Unemployment Change had reduced from previous (-55K) to actual (-37K) . M3 money supply rose slightly from 2,1% to 2,3%. Cpi flash estimate y/y was good which more than expected about 2,8%. German retail sales m/m was bad result from -0,4% to -2,1% . Unemployment rate was remain unchanged still about 9,9%

AUD/USD, Cb leading index m/m 0,1% to 0,6%. Cpi q/q rose from 1,2% (forecast)  to 1,6% (actual). Trimmed mean cpi q/q was good from 0,7% to 0,9% more than expected. Private sector credit m/m was more than expected about 0,6% the same with previous result.

GBP/USD, CBI Industrial Order Expectations dropped very bad from previous (5) to actual (-11). MPC Member Sentance Speaks. BBA Mortgage Approvals was good from 30,6K to 31,7K (actual) more than expected. GfK Consumer Confidence was bad from 28 to -31. Prelim GDP q/q -0,5% to 0,5%

USD/JPY, Retail Sales y/y was bad from -5,7% (forecast)  to -8,5% (actual). Household Spending y/y also dropped from -6,6% (forecast) to -8,5% (actual). Tokyo Core CPI y/y improved from -0,3% to 0,2%. Unemployment Rate raised 4,8% (forecast) to 4,6% (actual). Prelim Industrial Production m/m -10,5%  to -15,3% worse than expected. Overnight Call Rate was still the same about <0,10%.

USD/CHF, Trade Balance was not like people expected which dropped from forecast 2,27B to actual 1,09B. UBS Consumption Indicator rose from 1,45 to 1,66. SNB Chairman Hildebrand Speaks. KOF Economic Barometer improved and exceed forecast about 2,29 compared with forecast 2,20

Fundamental factor

Both French and German are two country that the most influence for EUR currency, this can be seen on consumer spending fell in march as bad as German retail sales especially for Food, drink and tobacco sales lower than in March 2010, while non-food turnover was down 2.4% over the same period. For Euro zone inflation rose further above the European Central Bank's target in April, increasing the chances of an interest rate rise in June, despite a weakening of economic sentiment and household demand. A GfK consumer climate report also pointed to growth in employment, which, along with the "excellent economic situation," was helping to ease employment worries and keep buying propensity at a high level. Meanwhile, decline in jobless fears in Germany in March will involve EUR currency. on this week economic of japan still in recession. At this time BOJ need to focus on downside risks to the economy from the quake's impact, BOJ Governor Masaaki Shirakawa said the central bank still needed time to examine the effects on the economy of its monetary easing last month. The BOJ is planning to take the decisive step of increasing asset buying in March. Looking at economic of aussie is still showing good sign. Today's figures show an unsurprising spike in inflation caused by summer floods and Cyclone instead of high food price. Moreover, the price increases would have been stripped out of the underlying inflation result. while the strength of the Australian dollar will continue to keep imported inflation low and curb Aussie export industries. read more here. If we look at Swiss franc,  the new car registrations were the main driver of the increase (up 34.3% compared to the previous month). This was the highest number of car registrations recorded in March since 2001. The trend in overnight stays of domestic visitors saw a reversal. Low interest rates, improvements in the labor market and ongoing immigration continue as pillars of private consumption and the broader economy. While investments are the main growth drivers, private consumption also represents an important mainstay. Hildebrand said price stability might be threatened by higher commodity prices, a weakening franc and the central bank’s expansionary policy. “Should the Swiss franc weaken again rapidly, rising commodity prices could also have an impact in our country,” Hildebrand said at the central bank’s annual general meeting in the capital Bern. “Furthermore, the expansionary monetary policy carries long-term risks for price stability.” "Budget for Growth" failed to soothe fears about looming spending cuts and squeezes on real incomes. Production costs have jumped markedly during the last 3 months, rocketing ahead after a full year of already rapid cost inflation. Beneath the headline figure, however, the figures reveal core areas of the economy growing healthily and bouncing back strongly from the weather affected Q4 downturn. Growth was led by transport, storage and communication output, as well as business services and finance. There was also strong growth in manufacturing. Weak trading activity is discouraging businesses from borrowing to expand and most are oriented towards repaying debt and reducing their operating costs; larger corporates are also using the capital markets less." and Householders also remain focused on paying down debt, leading to a net contraction of unsecured borrowing and low net mortgage lending, although new mortgage lending is holding up fairly well read more here. In other side, we look at this week of USD currency, some of high impact indicators showed good result, but it does not mean the US economic is in the good position right now. This can be seen on US currency was still low toward others currency in the past two years.

Generally, 5 major currency had raised along this week and showed a good result toward USD. This because of both fundamental and technical gave a positive indicators.

Source: Forexfactory

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