.png "DailyForex logo")
Forex Trading Reviews & News 
Highlights:
AUD/USD - Possible increase in interest rate next week
EUR/USD - Fears of another Greek downgrade
NZD/USD - Business outlook improves
GBP/USD - Establishes a new low at 1.5320
Eurozone Economic Data For Today:
07:45 GMT: French consumer confidence indicator for February expected -28 from -29
07:45 GMT: French producer prices for January expected +0.3% m/m, +0.1% y/y
08:30 GMT: Italian business confidence for February expected 83.6 from 83.2
08:55 GMT: German unemployment change for February expected 16k from previous 6k, Unemployment rate unchanged at 8.2%
09:00 GMT: Euro zone M3 money supply for January expected (3M) -0.1%, flat y/y
09:30 GMT: UK total business investment for Q4 expected +0.1% q/q, -18.5% y/y
11:00 GMT: UK CBI distributive trades for February.
Earlier today, the 2-year note yields traded around 0.85% and German 2s are down to record lows of 0.89%, below the ECB’s 1% overnight rate, possibly signaling that Europe may be in for a double dip recession. Inverted yield curves signal an impending recession. The euro losses come with rating agencies warning of possible downgrade to Greece’s credit rating in very near future.
This opens up possibility of Greek bonds being ineligible for use as collateral at the ECB, making it more difficult for country to borrow. Traders talking about a barrier option at 1.3450 in EUR/USD, stops more then likely below that level.
Another note of concern hitting the markets is that Spain may be the next battleground not to far in the future. PIGS could be the catalyst that pushes Europe into a double dip recession. Given that Eurozone GDP barely grew at .1% in Q4 of 2009, I think the possibility of this occurring is high. AUD/USD initially rose on the back of RBA rate-rise speculation for next week at the start of todays Asian Session, the AUD/USD rallied to .8952. However, risk aversion eventually took a hold and medium term support for AUD/USD is around .8800.
Cable has given ground overnight, establishing a new low. Presently down at 1.5330 from a North American close Wednesday up around 1.5400. Support next at 1.5300/05 and 1.5275. Stops likely below both levels. The dollar should continue to post more gains, as traders perceive the Fed being more hawkish, compared to the ECB and BOE. The Fed is also perceived to have already taken steps to remove some excess stimulus from the economy, and the US is looking like it will recover faster then the other G-7 countries.
This opens up possibility of Greek bonds being ineligible for use as collateral at the ECB, making it more difficult for country to borrow. Traders talking about a barrier option at 1.3450 in EUR/USD, stops more then likely below that level.
Another note of concern hitting the markets is that Spain may be the next battleground not to far in the future. PIGS could be the catalyst that pushes Europe into a double dip recession. Given that Eurozone GDP barely grew at .1% in Q4 of 2009, I think the possibility of this occurring is high. AUD/USD initially rose on the back of RBA rate-rise speculation for next week at the start of todays Asian Session, the AUD/USD rallied to .8952. However, risk aversion eventually took a hold and medium term support for AUD/USD is around .8800.
Cable has given ground overnight, establishing a new low. Presently down at 1.5330 from a North American close Wednesday up around 1.5400. Support next at 1.5300/05 and 1.5275. Stops likely below both levels. The dollar should continue to post more gains, as traders perceive the Fed being more hawkish, compared to the ECB and BOE. The Fed is also perceived to have already taken steps to remove some excess stimulus from the economy, and the US is looking like it will recover faster then the other G-7 countries.
