19/3/2013 - The Current Market Sentiment

[walid]

بينما شهد الدولار و الين دعم اليوم مع تراجع شهية المُخاطرة لايزال الجنية الإسترليني تحت ضغط بعد أن أظهرت وقائع الإجتماع الأخير للجنة بنك إنجلترا المُحددة لسياسة النقدية في بريطانية في السادس من الشهر الماضي توافق بين جميع الأعضاء حول إستمرار الإحتفاظ بسياساتها التحفيزية دون تغيير لتظل خطة شراء الإصول دون تغيير عند 375 ألف جنية إسترليني منذ يوليو 2012 مع إستمرار سعر الفائدة هو الأخر دون تغيير عند 0.5% كما هو منذ فبراير 2009
فبينما يشهد النمو تحسن ملحوظ مع تحسن ظروف العمل يشهد التضخم تراجع لمعدل المُستهدف لبنك إنجلترا سنوياً عند 2% في ديسمبر الماضي حيثُ المُستور الادنى منذ يوينو 2009 كما لاتزال هناك طاقات غير مُستغلة داخل الإقتصاد البريطاني يريد أن يعمل البنك على دفعها لتشغيل قبل أن يتجه لرفع سعر الفائدة الذي لن يكون إلا بشكل تدريجي كما أظهرت الوقائع إستمرار إحتفاظ بنك إنجلترا في الإشارة إلى أنه سيظل مُستمر بهذا الموقف التحفيزي الحالي مع وجود مؤشر الILO لمعدل البطالة فوق ال 7% و الذي إستحدثه كارني بعد توليه قيادة البنك خلفاً لكينج في يوليو الماضي.
بينما أظهرت بيانات اليوم إرتفاع هذا المُعدل ل 7.2% عن الثلاثة أشهر السابقة لديسمبر بينما كان المُتوقع إستمراره عند 7.1% كما كان عن الثلاثة أشهر السابقة لنوفمبر مع إضافة 27.6 ألف وظيفة في يناير من 27.7 ألف في ديسمبر بينما كان ينتظر السوق إضافة 20 ألف فقط كما سبق و أشار مارك كارني الإسبوع الماضي في هذا الشأن خلال عرضه لتقرير التضخم الربع سنوي لبنك إنجلترا إلى أن البنك سيتجه إلى النظر إلى بيانات و مؤشرات أكثر إتساعاً في التعبير عن أداء سوق العمل مع إستمرار تراجع مؤشر الILO لمعدل البطالة و هبوطه لما دون ال 7% بينما تظل المنطقة العادلة لمعدل البطالة ما بين 6% ل 6.5% كما توقع ان يكون تراجع مُعدل البطالة في الفترة القادة أقل سرعة عنه في الأشهر الماضية.
كما جاء مُعدل التضخم في بريطانية بلأمس ليُظهر تراجع ل 1.9% سنوياً في يناير بينما يظل المُعدل المُستهدف لبنك إنجلترا عند 2% ما يُشير إلى إستمرار إنخفاض الضغوط التضخمية ما يُسهل على بنك إنجلترا من جانب أخر الإحتفاظ بكمه التحفيزي الحالي بينما يُعزى هذا التراجع لإرتفاع قيمة سعر صرف الجنية الإسترليني في هذة الفترة مما أدى لضغط على الأسعار.
ذلك و قد شهد الجنية الإسترليني تراجع اليوم أمام الدولار دون أن يتمكن من إختراق مستوى مقاومته السابق عند 1.6741 بعد تذبذب أعقب صدور بيانات اليوم عن سوق العمل و وقائع الإجتماع الأخير لبنك إنجلترا بينما ينتظر الجنية الإسترليني أمام الدولار بإذن الله في حال إستمرار هذا التراجع ملاقاة نقطة دعم عند 1.6619 التي يليها مستوى ال 1.65 النفسي الذي تمكن الإسبوع الماضي من إختراقه مع ذخم شرائي أعقب صدور تقرير التضخم الربع سنوي لبنك إنجلترا الذي جاء أكثر تفاؤلاً عما كان متوقعاً ليدفع هذا الزوج مع بداية هذا الإسبوع بعد أن أظهرت البيانات إستمرار تواصل إرتفاع أسعار العقارات في بريطانية بمجيء مؤشر Right move لأسعار المنازل على إرتفاع شهري في فبراير ب 3.3% بعد إرتفاع في يناير ب 1.1% ليصل ل 1.6821 بعد صعوده فوق مقاومته السابقة عند 1.6667 التي كانت أعلى نقطة وصل إليها هذا العام في الرابع و العشرين من يناير الماضي قبل أن يلحق به الضغط مع جني لأرباح و بيانات هذا الإسبوع التي أظهرت تراجع التضخم و إرتفاع مُعدل البطالة في حين يُنتظر في حال مواصلة هذا الهبوط لما دون ال 1.65 ملاقاة نقطة دعم أخرى عند 1.6380 ثم عند 1.6249 بينما ينتظره في حال العودة للإرتفاع مرة أخرى مواجهة 1.6741 التي فشل عندها اليوم يليها 1.6821 مرة أخرى.


خبير أسواق العملات/ وليد صلاح الدين محمد
م/00201224659143
البريد الإلكتروني/ mail@fx-recommends.com

[walid]

Are we ahead of new unprecedented easing measures by the ECB?

The ECB president Mario Draghi has tried to tell the market that the picture of the European economy is really mixed currently and he has repeated this message during the weekend by another way saying that I have to be cautious as we are not seeing strong unambiguous developments but we are seeing first signs of a development can be protracted in time and strong in another time.
Draghi has tried to join the pro-growth atmosphere in the G20 meeting in Sydney during the weekend saying that the ECB will act in the case of seeing any medium-term setback over price stability but until now the ECB does not watch emerging deflation risks drive the buyers to set back waiting for lower prices in the future and if it is to see so, it will not hesitate to add more stimulating measures.

So, The ECB has tied the next easing step to the movement of the prices as usual to maintain the inflation below but close to its yearly target at 2% but the inflation is now well below 1% yearly for the fourth consecutive month by coming today at 0.8% y/y in Jan and that makes the market vigilant and uncertain in the same time about the next movement of the ECB.
The ECB language following its interest rate cutting on the 7th of last November could not direct the market to nothing but the ECB ability to watch and endure lower prices power in this period of time with no easing action from its side and it has highlighted this stance by lowering its inflation expectation in a time and in another time by referring to the extension of the easing prices upside risks on the current slow growth pace, while there is no tightening of the money markets occur or worsening of the inflation outlook over the medium term.
It has tried to tell the market that it will be less sensitive to the down ward prices pressure, it has avoided saying that it is watching the prices easing over the medium term and also it has tried to not mention the name of deflation in EU.
The recent ECB bulletin release has said that 2014 EU HICP has been revised down to 1.1% from 1.5% in the previous forecast which was in the last queerer of last year and for 2015, it has reduced it to be 1.4% from 1.6% and for 2016, it is expected start projecting about it in the next meeting of it telling that it is to be close to 1.7% by God’s will.
While the preliminary readings of EU manufacturing and services PMI have shown slower pace of expansion in Feb and however Q4 EU GDP flash reading growth came better than expected at 0.3% q/q while the market was waiting for 0.2% from 0.1% in the fourth quarter, It is also looking in need to be pushed up at least to produce higher number of jobs while the unemployment rate is still standing close to 12%.
From another side, I can say that this faster than expected real growth rate can be a nature result of the lower than expected pace of prices increasing in the fourth quarter.
The ECB has maintained its forward guidance which propose having the interest rate at this current level or may be lower for stimulating the economy but it has tried also to avoid talking about the nature of the next easing step if it is to be imposed saying just everything is possible of the treaty mandates.

But is it to be by another cutting of the interest rate? and if it is so, can the ECB drive the deposit rate down also to be below zero as it has mentioned several times by its president draghi that it is ready technically to take this step?
The head of Bank of Italy and the ECB Member Visco has said today that the ECB would consider introducing negative deposit rates at the upcoming monetary policy meeting but he added that he is not certain whether any action would be taken.
Last week also, the ECB Governing Council member Luc Coene said ECB is prepared to take policy action, if the inflation to drop further but he said too that it was still too early to make any movements at the moment.
Before that and by the end of last year, the ECB Governing Council member and Malta's central bank head Josef Bonnici sent a similar message telling that the ECB is prepared to introduce the negative deposit rate, although such movement could have adverse implications.
He is right too, as it can lower the banks profits putting more pressure on the banking system which is still in recapitalization path and it may be in need to another LTRO.
So, another round of LTRO with different easier conditions can be also the next easing step of the ECB and as its governing council member Ewald Nowtony has also figured out previously in his talking at CNBC as his favorite option to stimulate the economy as LTRO3 can help also the EU banking sector and bring more stability back it and offer better crediting conditions.

Anyway, the main market worry about the EU economy is that to be in an early stage of facing deflation cycle can persist taking it into recession like what has happened in Japan and persisted in the past 15 years and lead it to adopt last year ultra easing policy for targeting 2% inflation rate yearly which caused massive falling of the Japanese yen value by 18% versus the greenback.
The single currency appreciation can be also criticized at this current stage by the ECB members as it is not welcomed to them with the current weak prices power and the need for higher EU exporting activity to push the economy forward.
So, The ECB member Christian Noyer came recently to follow Nowtony’s stance saying that it is clear now that the high single currency exchange rates hurt the EU exports and such comments can be repeated weighing on the single currency by God’s will.

The single currency has fallen again today after peaking at 1.377 well below its previous resistance at 1.3772 and God willing, it can meet now in the case of falling further supporting level at 1.3684 can be followed by 1.3560 before 1.35 psychological level which can be penetrated to pave the way to 1.3476 again which can be followed by 1.3397 before its recent formed bottom at 1.3294 which has been reached on the 7th of last November while the expected standing supporting levels below it are still existing at 1.3229, 1.3104 before 1.30 psychological level while going up again from here surpassing 1.3772 can be met by resisting level at 1.3818 before its recent high at 1.3893 which has been reached on the 27th of last December following gaining upside momentum after breaking its previous resistance at the 61.8% Fibonacci correction level of the falling from 1.4938 to 1.2042 at 1.3834 which could hold the pair back last October.

Kind Regards

FX Market Strategist
Walid Salah El Din
Mob: +20 12 2465 9143
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com

[walid]

The commodities are still able to maintain the beginning of the week gain on the back of the Russian intervention in Crimea.
The conflict could have a direct impact on the energy as the crisis can easily tackle the oil and gas supplies from Russia.
The gold could be supported from a side as a hedge against inflation with the current considerable rising oil prices and from another side as a safe haven on the current named act of war by the Ukrainian government.
The commodities currencies which can be also supported as a safe haven especially the Canadian dollar which can be fueled by the rising of the oil prices directly could get over the shock of the beginning of the week with the general rising of the commodities prices despite the risk aversion sentiment which underpinned the greenback broadly.
AUDUSD is trading currently little changed from last week closing after opening the week on a down gap waiting for the RBA interest rate decision of the first Tuesday of the month as usual to come in the Asian session which is mostly to come with no change keeping the interest rate unchanged at 2.5% however it is not totally ruled out to have another easing action after the release of the Australian labor report of January which has shown rising of the unemployment rate to 6% as the employment change has show losing of 3.7k of jobs while the market was waiting for adding 15k after losing 23k in December.
The UST 10YR yield is now at 2.6% with combined falling of the US blue chips as the equities markets have come under continued pressure since the beginning of the week across the globe while the bonds yields outside the eastern European countries were under pressure on demand for safer investment.
But the yields in those countries which are close to the conflict have seen rising cross the broad with rising demand of the greenback versus their currencies and their securities generally while Russia managed to raise the interest rate to 7% from 5.5% to support the rubble which has fallen to the lowest level since 2009 against the greenback which equals right now 36 rubbles while it looks ahead of US and EU sanctions can drive the inflation inside of it up further.
The single currency came also under pressure versus the greenback negatively impacted by the risk aversion down although the worries about the crisis in Ukraine which drive the commodities prices up can calm down the fear of reaching weaker yearly inflation rates in EU supporting the current ECB stance of waiting for seeing a clearer picture. The fear of watching lower inflation upside risks have already receded by last Friday release of Feb EU HICP flash reading which came at 0.8% as the same as January while the market was waiting for easing to 0.7%.
God willing, the market will be waiting for new ECB’s growth and inflation projections to come next Thursday in appreciation of these current geopolitical developments are containing the market sentiment currently to ignore today’s data which have shown decline of Feb EU Manufacturing PMI to 53.2 while the market was waiting for 53 from 54 in January.
Anyway, the investors and pundits will be waiting the ECB reading of this new event which can be a reason to raise the inflation outlook initially over the short term and can be also read as new undermining element can be added to the obstacles faced by current struggling EU economic growth to be in much need of further stimulating steps.
UK Feb EU Manufacturing PMI have come also better than expected by rising to 56.9 while the consensus was referring to 56.5 from 56.6 in Jan but the cable could not endure the greenback pressure with investors’ tendency to unwind risks to fall below 1.67 trading currently around 1.666 while the FTSEE 100 was trading around 6700 before ending its first session sessin of the week losing 101 points at 6708.

Kind Regards

FX Market Strategist
Walid Salah El Din
Mob: +20 12 2465 9143
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com

[walid]

الأسواق في إنتظار موقف المركزي الأوروبي بعد تطور الأذمة الأوكرانية

عادت شهية المُخاطرة للأسواق لتدفع أسعار الأسهم و تعود بالسندات لتراجع صعد بعوائدها لإرتفاع مع تراجع أيضاً في الطلب على الذهب كتحوط ضد المخاطرة و كتحوط ضد التضخم بعد تراجع أسعار الطاقة بعد أن أشار بوتين إلى أنه لا توجد حاجة لإرسال مذيد من القوات من قواعدها في روسيا لأوكرانيا بينما تنتظر الأسواق نتائج المباحثات بين الناتو و روسيا بشأن التدخل العسكري الروسي في أوكرانيا و الذي يصفه الناتو بأنه تجاوز لمبادئ الأمم المُتحدة لإرساء الأمن و السلام العالمي.
كما جائت زيارة وزير الخارجية الأمريكي جون كاري لكييف بعرض مُساعدة عاجل بقيمة مليار دولار لإظهار الدعم الأمريكي لحكومة الجديدة التي يصفها بوتين بلمُناوئة للروس و المُتحدثين بلروسية في أوكرانيا بينما يرى كاري كما جاء على لسانة خلال زيارتة بأنه لا يوجد تخوف في الشارع الأوكراني إلا من الغزو الروسي.
على أي حال لا تبدو الأذمة في طريقها لحل قريب إلا أن الأسواق وجدت طريقها لعودة لمخاطرة بلأمس بعد ان بدى أنه هناك إتجاة لعدم التصعيد مع فرص لتهدئها لتحجيم الأذمة التي قد يؤدي تفاقمها لمذيد من الضغوط على إقتصاد منطقة اليورو الذي لايزال يُعاني من بُطء في النمو مع ضعف في الإنفاق الحكومي لدعم مواقفها المالية و تخفيض عجزها المالي في مواجهة أذمة الديون.
ذلك و تنتظر الأسواق غداً بإذن الله إجتماع المركزي الأوروبي و ما سيصدر عنه من توقعات لتضخم و النمو في منطقة اليورو بعد هذة الأذمة التي أدت بلفعل لإرتفاع في أسعار المواد الأوالية و الطاقة قد يرفع من توقعات المركزي الأوروبي بشأن التضخم خاصةً على المدى القصير بعد ان كان يؤرق المركزي الاوروبي تراجع الأسعار كما قد يؤدي إستمرار الاذمة في نفس الوقت لمذيد من الضغط على الإقتصاد الأوروبي ما قد يدفع المركزي الأوروبي لمذيد من الخطوات التحفيزية لذلك ينتظر المثتعاملين في الأسواق معرفة إتجاة المركزي الأوروبي من هذين الإتجاهين.
فعلى الرغم من مجيء مؤشر أسعار المستهلكين المُنسق لدول الإتحاد المبدئي لشهر فبراير على إرتفاع سنوي ب 0.8% بينما كان المُتوقع إستقرار عند 0.7% سنوياً كما حدث في يناير إلا أن هذة المُعدلات تظل دون نصف المُعدل المُستهدف سنوياً من قبل المركزي الأوروبي خلال الأشهر الخامسة الماضية حيثُ يستهدف البنك 2% سنوياً بينما لايزال يعزي المركزي الأوروبي تراجع الأسعار لضعف النشاط الإقتصادي في ظل القيود المالية التي تفرضها الحكومات على إنفاق لتحسين مركزها المالي بينما يدعمها الظرائب التي تفرضها هذة الحكومات في نفس الوقت للهدف نفسه بينما يقف داعمً للأسعار إرتفاع أسعار المواد الأوالية التي يُنتظر أن تُعير إهتمام المركزي الأوروبي بعد صعودها الأخير في ظل الأذمة الأوكرانية.
بينما يظل أيضاً النمو داخل منطقة اليورو يتسم بلبطء فعلى الرغم من مجيئ الناتج القومي على نمو ب 0.3% بشكل ربع فصلي بينما كان المُنتظر نمو ب 0.2% في الربع الرابع من العام الماضي إلا انه يظل مُعدل بطيء بلمقارنة بلولايات المُتحدة و اليابان و حتى المملكة المُتحدة بينما يظل مُعدل البطالة داخل منطقة اليورو مُستقر عند 12% أو ما فوقها بقليل منذ فبراير من العام الماضي كما أظهر هذا الإسبوع مؤشر مديرين المُشترايات عن القطاع الصناعي توسع بدرجة أقل في فبراير فعلى الرغم من أنه قد جاء أعند 53.2 فضل من القراءة البدئية التي أشارت ل 53 إلا أنها دون ال 54 التي قد وصلت إليها في يناير حيثُ القيمة الأعلى منذ مايو 2011.
ذلك و يُنتظر أن يؤكد المركزي الأوروبي من خلال إجتماعه هذا الإسبوع كما فعل في تقريره الشهري و كما جاء على لسان رئيسه عقب الإحتفاظ بسعر الفائدة على اليورو دون تغيير عند 0.25% في فبراير على بطء لنشاط الإقتصادي مع توقع إستمرار تراجع الأسعار في ظل هذا البطء بشكل قد يطول أمده قبل العودة لإستقرار عند 2% أو أقل قليلاً منها مع إلتزام البنك بسياسة تحفيزية قد تنخفض معها مُعدلات الفائدة عن هذة المُستويات إلا أنه لم يُعين خطوة المركزي الأوروبي التحفيزية القادمة في حال الإحتياج لقيام بها في ظل الصلاحيات المُخولة له في هذا الشأن لتظل كل الإحتمالات مطروحة أمامه إن شاء الله.
ذلك و قد ترددت على لسان أعضاء من المركزي الأوروبي إحتمال قيام المركزي الأوروبي بخطوة تحفيزية أخرى قد تكون في صورة خفض لسعر الفائدة على الإيداع لما دون الصفر فقد قال مؤخراً رئيس بنك بلجيكا و عضو المركزي الأوروبي كوين ان المركزي الأوروبي مُستعد لقيام بخطة تحفيزية اخرى في حال إستمرار تراجع التضخم كما صرح الإسبوع الماضي فيسكو رئيس بنك إيطاليا أن هذا الخيار أحد الخيارات المُتاحة لكنه أشار إلى عدم تأكده من القيام بهذة الخطوة كما سبق و أشار جوزيف بونتشي عضو المركزي الأوروبي و رئيس بنك مالطا أن البنك مُستعد لقيام بخفض لسعر الإيداع لما دون الصفر إلا ان هذة الخطوة قد يكون لها أثر سلبي على القطاع البكي في منطقة اليورو.
فمن المعروف أم هذا القطاع لا يزال يحاول التعافي من أذمة الديون مع قيامه بإعادة هيكلة لرأسمالة لدعم موقفه المالي في صالح مذيد من السيولة داخله مع تقليل المخاطر مع عمله على إصلاح أوضاعه في ظل معاهدة بازل الثالثة لذلك قد تأتي خطوة المركزي الأوروبي التالية داعمة لهذا القطاع أيضاً في شكل خطوة غير إعتيادي من خلال عرض جديد لإعادة التمويل طويل الأجل بعد ان قانت بتدعيم هذا القطاع مُسبقا بأكثر من ترليون يورو على جولتين سابقتين في 2012 و هو الإحتمال الذي سبق و أشار إليه في حديثه لقناة CNBC ادولاد ناوتني عضو المرزي الأوروبي و رئيس البنك الأهلي النمساوي كما أشار أيضاً إلى ما سبق و أشار إليه رئيس بن فرنسا نوير من أن إرتفاع سعر صرف اليورو يُسهم في إضعاف القدرة التافسية لصادرات الاوروبية التي يحتاجها الإتحاد بينما يذيد من تراجع الأسعار.
أما رئيس المركزي الأوروبي فقد جاء عنه خلال لقائه في سيدني بوزراء مالية و محافظين البنوك المركزية لمجموعة ال 20 أن الصورة مازالت مُختلطة بشأن الإقتصاد الاوروبي في هذة المرحلة من التعافي التي تشهد تحسن احيانً و تراجع أحياناً أخرى بينما يظل الركزي الاوروبي كما أعلن من قبل مُلتزماً بتحفيزه كما أكد مرة أخرى انه لايزال لا يرى علامات من حالة التراجع في الأسعار المُصاحبة بتراجع في النمو التي يُخاف من تكرارها في منطقة اليورو بعد أن ضغطت على الإقتصاد الياباني لحوالي 15 عاماً لتدفع القوى الشرائية داخل منطقة اليورو للإحجام على الإنفاق في إنتظار أسعار أقل.
بينما ينتظر اليورو الأن بإذن الله أمام الدولار بعد إفتتاحه هذا الإسبوع على تراجع بعد التدخل الروسي في أوكرانيا إستمر به للوصول ل 1.3720 قبل أن يعود لإرتداد لأعلى مرة اخرى و الإستقرار بلقرب من 1.3740 أن يجد في حال الصعود مقاومة عند 1.3791 ثم عند 1.3823 يليها 1.3893 التي وصل إليها في السابع و العشرين من ديسمبر الماضي قبل الحاجز النفسي عند 1.40 الذي قد يتبع سقوطه فتح المجال لملاقاة 1.4245 مرة أخرى بينما ينتظره حالياً في حال التراجع و الهبوط دون 1.3720 ملاقاة قاعه الذي جاء فوق متوسطه المُتحرك على الأربع ساعات عند 1.3642 ثم عند 1.3560 قبل مستوى الدعم النفسي عند 1.35 الذي يليه 1.3476 ثم عند 1.3397 قبل 1.3294 التي قد هبط إليها مع قرار خفض سعر الفائدة الذي بدى غير متوقع لبعض من خلال إجتماع السابع من نوفمبر الماضي بينما يُنتظره في حال الهبوط دون ال 1.3294 مستوى دعم أخر عند 1.3229 ف 1.3104 ف 1.3065 قبل مستوى ال 1.30 النفسي.

خبير أسواق العملات/ وليد صلاح الدين محمد
م/00201224659143
البريد الإلكتروني/ mail@fx-recommends.com

[walid]

The gold is still trading near 1350$ but it is still unable to go up further penetrating its 23.6% Fibonacci retracement of its falling from 1920$ to 1180$ at 1354$ while there can be another standing resisting level over it at 1362$ which can be followed by 1376$ before the psychological resistance at 1400$ before 1433$ which has been reached on previous worries about imposing US military action against the Syrian regime fueled the energy prices while going down again from here can be met by supporting level at 1318$ before 1306$ which can be followed by 1300$ psychological level while there are below it other standing supporting levels have been formed in its way to rebound to the current level at 1283$, 1231$, 1218$ before 1200$ psychological level which can be followed by its lowest level of last year at 1180$ which could hold supporting it again at the end of it to rebound from 1182$.
The gold could be well supported to reach the current levels following the worries about the tension developments in Ukraine despite its small economy, it can be the most threat to the European stability since the end of the cold war.
The ECB president Mario draghi has mentioned this same meaning last week when he talk about this crisis following the ECB’s decision to maintain its interest rate at 0.25% saying that EU is not closely tied to Ukraine, So, there is no strong contagion however the geopolitical risks from the Ukrainian situation could become substantial while the Ukrainian crisis impact on the Russian economy is actually sever but anyway it is early to talk about the long term impact of this crisis.
The markets could not totally get rid of their fears to load more risky assets because of this crisis which can persist again containing the market sentiment, after it could push up significantly in the beginning of last week the demand for bonds driving their yields down across the broad making the gold more attractive while it was gaining more demand from another by the rising of the commodities following the Russian intervening in Ukraine as a hedge against inflation beside its nature property as a safe haven.
From another side, it has become concluded now to most of the market participants that we are to have by God’s will, no pause of the Fed’s pace of incremental gradual QE tapering with the current harmonized agreement about it among its governors of the Fed who have not found in the bad whether impact on the labor market an excuse to stop tapering last meeting after December labor report has shown adding only 74k of jobs out of the farming sector while the next reports to it have shown improving by adding 129k in Feb and 175k in March consecutively.
So, the markets are mostly pricing now on ending of the Fed’s QE by the end of this year and starting of interest rate hiking in the first quarter of 2015 and the gold is also pricing currently on that, after its collapse last year by this way which has not been seen since 1981 on the worries about the beginning of Fed’s tapering which has started to be materialized to the markets by the end of it by a gradual way calmed the golden metal holders fear and encouraged other to buy it after its 28% collapse last year which has been staved off over its crucial supporting level at 1180$ per ounce.

Kind Regards

FX Market Strategist
Walid Salah El Din
Mob: +20 12 2465 9143
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com

[walid]

With the risk aversion sentiment extension to the Asian session, the gold could penetrate its 23.6% Fibonacci retracement of its falling from 1920$ to 1180$ at 1354$, while the coming resisting level is expected to be at its previous formed peak on 29th of last October at 1360$ which can be followed by 1376$ before the psychological resistance at 1400$ before 1433$ which has been reached on previous worries about imposing US military action against the Syrian regime fueled the energy prices while going down again from here can be met by supporting level at 1318$ before 1306$ which can be followed by 1300$ psychological level while there are below it other standing supporting levels have been formed in its way to rebound to the current level at 1283$, 1231$, 1218$ before 1200$ psychological level which can be followed by its lowest level of last year at 1180$ which could hold supporting it again at the end of it to rebound from 1182$.
The gold could be well supported to reach the current levels following the worries about the tension developments in Ukraine despite its small economy, it can be the most threat to the European stability since the end of the cold war.
The ECB president Mario draghi has mentioned this same meaning last week when he talk about this crisis following the ECB’s decision to maintain its interest rate at 0.25% saying that EU is not closely tied to Ukraine, So, there is no strong contagion however the geopolitical risks from the Ukrainian situation could become substantial while the Ukrainian crisis impact on the Russian economy is actually sever but anyway it is early to talk about the long term impact of this crisis.
The markets could not totally get rid of their fears to load more risky assets because of this crisis which can persist again containing the market sentiment, after it could push up significantly in the beginning of last week the demand for bonds driving their yields down across the broad making the gold more attractive while it was gaining more demand from another by the rising of the commodities following the Russian intervening in Ukraine as a hedge against inflation beside its nature property as a safe haven.
From another side, it has become concluded now to most of the market participants that we are to have by God’s will, no pause of the Fed’s pace of incremental gradual QE tapering with the current harmonized agreement about it among its governors of the Fed who have not found in the bad whether impact on the labor market an excuse to stop tapering last meeting after December labor report has shown adding only 74k of jobs out of the farming sector while the next reports to it have shown improving by adding 129k in Feb and 175k in March consecutively.
So, the markets are mostly pricing now on ending of the Fed’s QE by the end of this year and starting of interest rate hiking in the first quarter of 2015 and the gold is also pricing currently on that, after its collapse last year by this way which has not been seen since 1981 on the worries about the beginning of Fed’s tapering which has started to be materialized to the markets by the end of it by a gradual way calmed the golden metal holders fear and encouraged other to buy it after its 28% collapse last year which has been staved off over its crucial supporting level at 1180$ per ounce.

Kind Regards

FX Market Strategist
Walid Salah El Din
Mob: +20 12 2465 9143
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com

[walid]

The Gold is still undermined by higher interest rate outlook in US has been prompted in the markets following last week Fed’s hints which suggested having the first interest rate hike within 6 months following ending the Fed’s QE which can continue be tapped by the current measured pace to be ended this year.
Despite it tells that there can be a pause between ending of the Fed’s QE and the beginning of dependence on the interest rate in directing the monetary policy, the markets have seen in the Fed’s members voting on reaching 1% federal funds target rate at the end of 2015 and 2% in 2016 clear stronger exported rates by the Fed than what has been priced in the money markets before that meeting and telling that it is to be dependent on a broader range of data and indicators than the 6.5% unemployment rate to figure out the economic stance shows that there can be much potential care of the inflation on the account of the growth as you can see on following that voting that the Fed was referring to starting of hiking the interest rate again in the second half of 2015 when it has managed to adopt this voting policy with Ben Bernanke for guiding the markets.
These shifts are still weakening the demand for the US treasuries supporting their yields and making the gold less attractive as a safe haven option, despite their negative impacts on loading risks in the equities markets in the same time and also despite the tension between Russia from a side and US and EU from another side which can be escalated by growing sanctions can depress the Russian economy and in return can cause problems of the energy supply in EU can be added to the weights on the European struggling economy.

The Gold is still able to exist over its previous supporting level at 1307$ per ounce after getting below 1320$ which supported it last week before failing to get over 1342$ again to be traded now below its 4h 200 moving average now and God willing in the case of retreating further below 1307$ whereas it has formed previously on 20th of last month a bottom over its 4h 200 moving average, it can face the psychological level at 1300$ while there are other standing other standing supporting levels below it have been formed in its way of rebound this year at 1283$, 1231$, 1218$ before 1200$ psychological level which can be followed by its lowest level of last year at 1180$ which could hold supporting it at the end of it to rebound from 1182$ while going up again from here can be met by resisting level at 1342$ which could not be taken out again after easing below it last week to be its obvious lower high after peaking on 1392$ which has been reaching in the beginning of last week on the back of Crimea referendum to be capped from getting over 1400$ which can be followed by 1433$ which has been reached on previous worries about imposing US military action against the Syrian regime fueled the energy prices
.
Kind Regards

FX Market Strategist
Walid Salah El Din
Mob: +20 12 2465 9143
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com

[walid]

Nikkei 225 has managed not to follow the US equities indexes rising this time to highlight the worries about the Japanese economy in the new financial year with new rising of sales taxes by 3% which can dampen the consuming spending and also the investment spending while Q1 Tankan large all industry capital spending has shown rising today by 0.1% in the first quarter while the market was waiting for rising by 0.3% after rising by 4.6% in 2013 Q4 showing actual retreat of the tendency for taking risk and spend more money in investment while the first rising of sales taxes since 1997 by 3% may cause shrinking of the Japanese GDP by 3% next quarter as it had caused before depression in 1998 came also with what is like what we see now of rising the pressure of the energy prices while the yen is suffering from the abenomics in the current time of Japanese dependence on oil importing for producing energy.

The outlook of the large non-manufacturing index has shown also declining in the first quarter to 13 while the market was waiting for 16 from 17 in 2013 Q4 but the large non-manufacturing index which expresses about the current market sentiment came as expected at 24 from 20 in Q4.

USDJPY retreated to be traded around 103.2 after failure to break its previous resistance at 103.43 while the data which came out from Japan have shown rising of the current confidence in the manufacturing sector and decline of the expectations as Q1 BOJ Tankan large manufacturing index rose to 17 which is the highest reached figure since the fourth quarter of 2007 from 16 in 2013 Q4 while the median forecast was referring to 18 but its outlook index set back to 8 while the market was waiting for 13 from 14 in the fourth quarter of last month.

While the risk appetite could be supported by the softer talking between US and Russia from a side and also by Yellen’s comments which have highlighted stronger than expected care from the Fed to the labor market as she has mentioned the labor market many times yesterday in her community development conference in Chicago. It looked like a try to take the opposite direction for calming down the markets after her signal of hiking the interest rate within 6 months following the ending of the Fed’s QE and also after omitting from last month Fed’s assessment it’s 6.5% unemployment rate target of keeping the interest rates at the current exceptional low levels in favor of adopting a broader range of indicators to figure out the economic performance and the inflation direction.

She has said that the Fed’s has not done what enough to combat unemployment even after holding the interest rate near zero since 2008 and for more than 5 years widening the Fed’s balance sheet to $4.23tr until now. She said that the drop in the unemployment rate is still gradual but steady and the continuation of Fed's low rate policy is necessary to boost employment while the scars from the recession remain and reaching our goals will take time. She said clearly that the extraordinary commitment is still needed and will be for some time.

.

Kind Regards




FX Market Strategist

Walid Salah El Din

Mob: +20 12 2465 9143

E-Mail: mail@fx-recommends.com

http://www.fx-recommends.com

[walid]

The gold could rise further in the beginning hour of the new week breaking its previous resistance at 1324$ per ounce.

The gold which has been by the oil rebound last week could be underpinned too strong falling of the US treasuries yields with persisting retreat of the US equities made the gold more attractive.

UST 10YR is now at 2.62% and also UST 2YR yield is now trading at 0.35% after it had reached last month 0.47% which was the highest rate it could have since May 2011.

As the expectations of having higher interest rates in the money markets rose after the Fed signaled that it tend to be based on the interest rate changing in conducting its monetary policy sooner than later, before the release of the Fed’s last meeting minutes on 19th of last month which put all of the US yields in defensive positions as the minutes have shown a possibility to mention Fed’s worries about the low inflation rates saying also that the interest rate projections out of the committee look lower than them inside of it.

The gold could get use of this sentiment but the US stocks to start another round of falling following another strong jobs figure as the same as what they have done following the release of US labor report of March, as the current improving if the US labor figures seem enough to the Fed to continue its measured pace of tapering driving the federal fund rate up really within 6 months following the end of the QE as Yellen has mentioned after that meeting.

It looks that the inflation data to come out from US will be much more important to the markets than before, as the talking about the inflation direction has increased recently, after the Fed drop its 6.5% unemployment rate previous target of keeping the interest rates at the current exceptional low levels preferring adopting a broader range of indicators to figure out the economic performance and it said that these indicators will include the inflation data in what could reflect the rising worries about its low rate persisting comparing with 2% inflation yearly target of the Fed.


.

Kind Regards




FX Market Strategist

Walid Salah El Din

Mob: +20 12 2465 9143

E-Mail: mail@fx-recommends.com

http://www.fx-recommends.com

[walid]

The Fed tried to ignore yesterday feeble rate of growth in the first quarter saying as the same as what it has said following the meeting of 19th of March that the growth has picked up recently. However it has not surely happened because of the bad weather last winter which cooled the US economic activity.
The Fed said again everything that it will maintain rates unchanged for a 'considerable time' after the QE ends keeping its accommodative stance depending on wide range of economic indicators containing inflation which is still persisting below 2% yearly target of the Fed.
So, the Fed is watching the inflation developments carefully while the labor market is still growing by its same balanced way of recovery.
The Fed’s Decision came unanimously this time as Narayana Kocherlakota who is the chief executive officer of the Federal Reserve Bank of Minneapolis did not find what to oppose against this time as everything was expected and the Fed has mentioned its concern about having low inflation over the medium term targeting the 2% yearly in line with working on reaching the highest possible employment capacity.
The greenback which has been harmed by Q1 GDP annualized growth by 0.1% came under pressure too with the Fed’s emphasis on maintaining its current high accommodative stance by this same way which came clearer than last meeting.
The cable could renew its 4 years high reaching 1.69 yesterday and it could come over it too today with the release of Apr UK manufacturing PMI which rose to 57.3 while the market was waiting for 55.4 from 55.8 in March.
The British pound has been actually supported last month by falling of ILO unemployment rate which counts the number of unemployed workers divided by the total civilian labor force got down to 6.9% in the previous 3 months to February.
But it could not gather the required momentum to make one of its real rallies as it is still capped by the low inflation pressure in UK generally while the preliminary release of UK Q1 GDP came to show lower than expected rate of growth reached highest rate since 2007 at 3.1% yearly but it was below the consensus which was referring to 3.2% yearly after rising by 2.7% in Q4.
God willing, The cable which could form a higher low over its 200 hours moving average at 1.6805 can face in the case of rising further the psychological level at 1.7 psychological level which can be followed by 1.7041 while going down again on failing to gather up momentum again can be met by supporting level at 1.6859, 1.6805, 1.6776, 1.6760 before 1.6659 which has been reached on weaker than expected inflation data came out from UK on Last March.


Kind Regards

FX Market Strategist
Walid Salah El Din
Mob: +20 12 2465 9143
E-Mail: mail@fx-recommends.com
http://www.fx-recommends.com