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FOREX Newsletter
April 14, 2011
Pulse of the Market
Dollar fell against Cable and advanced against the Euro and Yen on Beige Book and budget
proposal
Euro edged lower as Greek, Irish and Portuguese troubles come under greater analysis
British Pound heavily dependent on its interest rate potential with positive employment data
Aussie bounced off trend line support to move above 1.0500 before easing into the U.S close
Recent Interest Rates & The Greenback ended yesterday’s trading session lower against most
US Treasury Yields of the major currencies but rose against the Single Currency. The
latest consumer spending and Beige Book reports indicate that the
USD 0.00~0.
25%
U.S recovery remains on track, but regardless of these positive
reports, investors are still uncertain about buying U.S Dollars. The
EUR 1.25% recent decline in commodity prices has reduced the pressure on

GBP 0.50%
other central banks to raise rates but the reality is that central banks
in Europe and Asia are still more aggressive than the Fed and for that
JPY 0.10% reason the gains in the Greenback have been limited. According to
the latest Beige Book report, the U.S economy is improving thanks to
CAD 1.00%
the pickup in job growth and acceleration in manufacturing activity.
AUD 4.75% Consumer spending rose 0.4 percent last month, down from 1.1
percent in February. This marked the ninth consecutive month of
NZD 3.00%
positive retail sales growth but also the smallest gain in nine months.
Chan Yield Euro traded lower against the U.S Dollar pressured by profit taking.
ge Economic data from the Euro Zone was better than expected with
2-yr 0.73%
Yield -0.01
France and Germany reported stronger inflationary pressures.
Consumer prices in France rose 0.9 percent, driving the annualized
5-yr -0.03 2.17% pace of growth up 2.2 from 1.8 percent. Germany wholesale prices
Yield
rose another 1.3 percent. Industrial production also increased 0.4
percent. Yet weaker growth forecasts from the Italian government
and S&P’s warning of a possible downgrade has prevented the Euro
from extending its gains. Slower growth in Italy could mean slower
growth for the entire region as it is the third largest economy in the
Euro Zone. The Italian government cut its 2011 GDP forecast. Cable
ended the session unchanged against the Greenback and slightly
stronger against the Euro. U.K labor data for March printed mixed
leaving currency markets uncertain as to the state of the U.K
economic recovery. U.K claimant count was worse than forecast
increasing to 0.7K from -3.6K originally expected. On the other hand
Time(G Forec
Economic Release IM Actual Prior
MT) ast

01:00 AUD Consumer Inflation Expectation Low 3.5% 3.6%

600.0
07:00 CNY New Yuan Loans (MAR) High 535.6B
B
08:00 EUR ECB Publishes Monthly Report Medium

09:00 CHF ZEW Survey (Expectations) Medium -13.5

12:30 USD Producer Price Index (YoY) (MAR) Medium 6.4% 5.6%

12:30 CAD Manufacturing Sales (MoM) (FEB) Low -0.5% 4.5%

12:30 USD Continuing Claims (APR 2) Low 3705K 3723K

12:30 USD Initial Jobless Claims (APR 9) Low 380K 382K

Euro
The Single Currency tested resistance above
1.4500 but this was redundant and the market
tracked U.S stocks lower in the New York
trading session. February Industrial Production
rose 0.4% vs. 0.7% forecast m/m. The
Euro remains near its 15 month high set
against the U.S Dollar earlier this week as
investors expect the interest rate gap between
the Euro Zone and the U.S to further widen.
Overall, the EUR/USD traded with a low of
1.4412 and a high of 1.4519 before closing the
day around 1.4442 in the New York session.

Yen
The Japanese Yen fell against all 16 of its
major counterparts as global stocks gained,
encouraging investors to seek riskier, but
higher yielding assets. The USD/JPY move to
day highs at the start of the U.S session on
some EUR/JPY buying but this was reversed
later as analysts downgraded U.S GDP
forecasts and U.S Bond yields fell in response.
USD/JPY moves are closely linked with U.S
bonds yields which are used by investors to
predict the timing of U.S FOMC Rate Hikes.
Overall, the USD/JPY traded with a low of 83.49
and a high of 84.25 before closing the day
around 83.82 in the New York session.

British Pound
The British Pound was extremely contained
against the U.S Dollar and Yen but made gains
against the Single Currency as the markets
waited for fresh catalysts. U.K March Claimant
count was +0.7k vs. -10k previously. The
Jobless Rate fared better dropping to 7.8% vs.
8.0% previously. Bets of higher rates faded
fast after a report showed that CPI, actually
contracted last month. Overall the GBP/USD
traded with a low of 1.6236 and a high of
1.6308 before closing the day at 1.6266 in the
New York session.

Canadian Dollar
The Canadian Dollar held steady against the
Greenback. Loonie recovered from early losses
as a strong retail sales report in the U.S, the
primary destination for Canadian exports,
offset waning interest in the Canadian Dollar
after the Bank of Canada left interest rates on
hold and invalidated expectations of imminent
hikes. Overall the USD/CAD traded with a low
of 0.9583 and a high of 0.9653 before closing
the day at 0.09622 in the New York session.
Euro-Yen
EUR/JPY is trading above 14, 50 and 100 days
moving average. Fast stochastic is giving a
bearish tone and MACD is issuing a bullish
stance. The RSI is above 64 and lies above the
neutral zone. Overall, the cross has gained
0.06%.

Sterling-Yen
Currently GBP/JPY is trading above 14, 50 and
100 days moving average. Fast stochastic is
issuing bearish and MACD is indicating a bullish
stance. The RSI is above 56 reading and lies
above the neutral zone. The pair has gained
0.32%.

Aussie-Yen
Currently, the cross is trading above 14, 50 and
100 days moving average. Fast stochastic gives
bearish and MACD is indicating a bullish stance.
The RSI is above 60 reading and lies above the
neutral region. The cross has gained 0.94%.

Euro-Sterling
This cross is trading above 14, 50 and 100 days
moving average. Fast stochastic is indicating a
bullish and MACD is also issuing a bullish signal.
The RSI is above 64 reading and lies above the
neutral region. The pair has lost 0.29%.

Sterling-Swiss
This cross is trading below 14, 50 and 100 days
moving average. Fast stochastic is issuing a
bearish stance and MACD is also indicating a
bearish tone. The RSI is above 38 and lies
below the neutral region. The pair has lost
0.03%.
 Appendix

FOREX Closing Prices for April 13, 2011

Currency Open High Low Close Net Chg
EUR/USD 1.4475 1.4519 1.4412 1.4442 -0.0035
USD/JPY 83.60 84.25 83.49 83.82 0.2400
GBP/USD 1.6253 1.6308 1.6236 1.6266 0.0006
USD/CHF 0.8966 0.8990 0.8927 0.8962 -0.0006
USD/CAD 0.9625 0.9653 0.9583 0.9622 -0.0005
EUR/JPY 121.04 122.15 120.75 121.06 0.0700
GBP/JPY 135.93 137.19 135.69 136.35 0.4400
CHF/JPY 93.24 93.89 93.11 93.50 0.3200
AUD/JPY 87.23 88.50 87.21 88.05 0.8200
EUR/GBP 0.8904 0.8922 0.8870 0.8876 -0.0026
EUR/CHF 1.2980 1.3042 1.2914 1.2944 -0.0040
GBP/CHF 1.4574 1.4630 1.4538 1.4578 -0.0004

Daily Pivot Points

Trading Range
Contract S3 S2 S1 Pivot R1 R2 R3
EUR/USD 1.4289 1.4351 1.4396 1.4458 1.4503 1.4565 1.4610
USD/JPY 82.70 83.09 83.46 83.85 84.22 84.61 84.98
GBP/USD 1.6160 1.6198 1.6232 1.6270 1.6304 1.6342 1.6376
USD/CHF 0.8866 0.8897 0.8929 0.8960 0.8992 0.9023 0.9055
USD/CAD 0.9516 0.9549 0.9586 0.9619 0.9656 0.9689 0.9726
EUR/JPY 119.09 119.92 120.49 121.32 121.89 122.72 123.29
GBP/JPY 134.13 134.91 135.63 136.41 137.13 137.91 138.63
CHF/JPY 92.33 92.72 93.11 93.50 93.89 94.28 94.67
AUD/JPY 86.05 86.63 87.34 87.92 88.63 89.21 89.92
EUR/GBP 0.8805 0.8837 0.8857 0.8889 0.8909 0.8941 0.8961
EUR/CHF 1.2763 1.2839 1.2891 1.2967 1.3019 1.3095 1.3147
GBP/CHF 1.4442 1.4490 1.4534 1.4582 1.4626 1.4674 1.4718

Sources: News, Charts & Quotes (Courtesy: Reuters, US Department Of Treasury)

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