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22.10.201312:42 Forex Analysis & Reviews: Currencies: review and outlook for October 22, 2013

Dlouhodobá prognóza
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EUR/USD. The Monday’s major event was publication of the data on US Existing home sales, which was negative. It was 5.29 million (annually) vs. expectations for 5.31 million; the figure from August was revised from 5.48 million to 5.39 million. When the news was released the US dollar counterparts started to regain losses of the day. However, we suppose the growth as a temporary market reaction (however, the close of the day was marked by decline). If the topical issue on the US is solved, the first negative may be observed when report on losses caused by government shutdown; the first data will be released in November. On the contrary, negative data is issued in Europe constantly. Yesterday three Italian labor organizations warned about the preparations before the strike and other protest movements claiming to reconsider the 2014 budget and the Minister of Economy, Innovation and Development of Portugal announced about search for new credits (but without the ECB help).

Today the major event is data on US Non-Farm Employment Change in September (at 18:30 UTC+4). It is forecast to be 180K vs. 169K in August. If data surpass the forecast, we expect the consolidation of the US dollar as the invertors’ reaction to the possibility of QE3 cut from December. 

Exchange Rates 22.10.2013 analysis

GBP/USD. Yesterday the Royal Bank of Scotland Plc stocks lost 5% amid the government decision to split the bank to “bad” where the risk assets will be accumulated and a good one. As far as the government stake in RBS equals 81%, the British pound was under pressure.

 

Today at 14:30 UTC+4 data on Public Sector Net Cash Requirement in September is revealed. Forecast 8.2 billion pounds vs. -3.0 billion in August, which is along with strong data on Nonfarm Payrolls creates prerequisites for a drop.

Exchange Rates 22.10.2013 analysis


AUD/USD. Making forecast for further movement of the Australian dollar, we should take into account yesterday’s report of the Swiss bank UBS AG on ore extraction in Australia. Shipments of ore from the Pilbara region in Western Australia increased from 290 million tons to 360 million tons annually in Q3. The bank expects the increase of the deliveries and respectively its prices drop up to $160 per ton in 2014 and $95 in 2015. At the moment the ore price is stable at the maximum levels of the current autumn ($133 per ton), which supported indirectly the rate of the Australian dollar at the local highs. The production of the refined copper in China in September increased 21% annually. In the next couple of days we expect the cycle of price decline on the natural resources (oil has lost more than 4% for the last 10 days) and the decline of the Aussie.

 

Bearish targets are clearly seen on the daily chart, 0.9530 and 0.9300. 

Laurie Bailey
analytik InstaForexu
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