Euro: The main driver of the positive trading dynamics of the Euro currency was, in general, weak dollar. The published data by the Center for Economic Research ZEW on the index of economic expectations in Germany and the euro zone were slightly better than expected and added some optimism. In details: Wednesday The euro exchange rate rose on continued uncertainty ahead of tomorrow's “Deadline “of the budget issue in USA. The support for the euro had also data, submitted which showed that by the end of August trade surplus euro area increased substantially as a modest rebound in exports outpaced import growth. According to the report, the seasonally adjusted trade surplus rose in August to the level of 12.3 billion Euros, compared with a profit in the amount of $ 11 billion in July, which was revised down from 11.1 billion Euros. Despite sharp increase in the surplus was slightly less than expected growth to 12.4 billion Euros. The exports in August amounted to 157.4 billion Euros, which was 1.0% more than in July, while imports amounted to 145.1 billion Euros, an increase of only 0.2% compared with the previous month. The EUR /USD pair rose to $ 1.3565 during the European session. Thursday The euro jumped to a new 8 - month high against the dollar, despite announced agreement on the U.S. budget, in which the government will be funded until January 15, and the extension of the debt ceiling will be increased until February 7. The EUR / USD pair rose to $ 1.3665 during the European session.
US Dollar: The U.S. dollar came under significant pressure closer to the end of the week after the resolution of the fiscal drama in Washington, which revealed the future of monetary policy of the U.S. Federal Reserve. The Open Market Committee would not decrease the volume of purchases at next meeting, which will be announced on October 30. Against this background, the Dollar Index lost about 1.2 % by the end of the week.
In details: Wednesday: The pressure on the U.S. currency had a decision of the rating agency Fitch Ratings, which downgraded the outlook for the highest rating of the U.S. to "negative." Agency refers to the inability of the government to increase the borrowing limit, the deadline of which is approaching quickly. The U.S. dollar rose against most major currencies, after Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell, the Senate announced an agreement on raising the debt limit and the end of the period of shutdown of work of the government. Reid called the agreement "historic cross-party agreement." It will fund the government through mid-January, and increases the government debt ceiling until February 7. It also provides a mechanism for reaching an agreement on the budget for the long-term budget issues, which should be completed no later than December 13. Thursday: In addition, the pressure on the U.S. currency also had a message saying that the Chinese rating agency Dagong announced its decision to downgrade the U.S. credit rating by one position to A- from A, leaving a negative outlook. The agency, in its decision, referred to concerns about the country's ability to solve the problem of the debt crisis, as well as the damage done to the economy by long government’s “shutdown ". The U.S. dollar got hammered by the strong downward pressure after the U.S. signed an interim agreement on the budget, it has agreed the day before. This has forced traders and investors to reconsider their predictions as to when the U.S. Federal Reserve will begin to phase out its program to stimulate the economy - at least in 2014. The market participants considered this decision as short-lived, because as less than 3 months later the Americans will have to solve the fundamental problem of the new spending and the budget deficit.
British Pound: The Retail sales data released on Friday once again turned out to be better than expected and accelerated the growth of the British currency, which by taking advantage of the weakening of the dollar, gained against it about 1.7 % and reached the $1.6230 level. Sterling was very confidential supported by positive macroeconomic statistics and the monetary policy of the Bank of England. It became clear that the British regulator not rushing to implement monetary incentives in nearest future.
In details: Wednesday: The pound rose sharply against the U.S. dollar, which was associated with access better-than -expected data for unemployment benefits on Britain. The Office for National Statistics said that by the end of last month the number of people claiming, significantly decreased, in the month of September, the number of applications for unemployment benefits fell by 41,700, reaching 1,350,000 at the same level. It is worth noting that according to the average forecasts of experts the value of this index was reduced by 24.3 thousand and added that in September 2012 the number of applications for benefits dropped by 214,500. The analysts forecasted the level of applications to remain unchanged. Meanwhile, data showed that the unemployment rate for the three-month period, calculated by the standards of the International Labour Organization, has remained constant - at around 7.7 percent, which was in line with the forecasts of experts, but less than 0.1 percentage points than the three-month period from March to May. The GBP / USD pair rose to $ 1.6065 during the European session. Thursday: The pound rose sharply against the dollar, which was helped by the publication of data by the Office for National Statistics. Accordingly report, the volume of retail sales of last month rose moderately, helped by higher sales and thereby exceeded the forecasts of experts. According to the report , the September volume of retail sales increased by 0.6 % ( on a monthly basis ), which followed a decline of 0.8 % in the previous month. Many experts believed that this figure will rise to 0.5 %. In addition, the annualized retail sales rose last month by 2.2 %, compared with a gain of 2.1 % in August, and the experts' forecasts were at 2% increase. The Office for National Statistics reported that the sales of furniture accounted for half of the total monthly rise, making it possible to add about 0.3 percentage points. The data also showed that with the exception of fuel, total sales rose by 0.7 % between August and September and by 2.8 % compared with September 2012. The GBP / USD pair rose to $ 1.6120 during the European session.
Japanese Yen: In the absence of important macroeconomic news the dynamics of the USD / JPY pair was determined by the behavior of the dollar along the whole of the market. The Japanese yen strengthened against the dollar last week. In details: Wednesday: The yen fell for the first time in three days after Senate leaders resumed talks, which lasted for 15 days in order to avoid a U.S. default, which reduced demand for safe-haven currencies like Japanese Yen. The USD / JPY pair fell to Y98.28during the European session. Thursday: The yen fell after the U.S. Senate voted 81 - "for", and “18" - against the order to stop the 16 -day shutdown of government and raise the U.S. debt ceiling. The USD / JPY pair fell to Y97.80 during the European session. New Zealand dollar: The New Zealand's currency rose , after the release of the inflation report, recorded growth. The level of consumer prices in the third quarter increased by 0.9 % compared to the second quarter, when the index rose by 0.2 %. The data exceeded the forecasts of economists expect the growth rate to 0.8 % and increases the likelihood that the central bank may raise interest rates.
WEEKLY TECHNICAL ANALYSIS FOR 21 - 25.10, 2013
EURUSD
The pair is trading between resistance 1.37441 and support 1.33427.
Resistance: 1.37441, 1.41130, 1.44835
Support: 1.33427, 1.30579, 1.28800
GBPUSD
The pair couldn’t break median line at 1.61607 and aiming to 1.59962.
Resistance: 1.64274, 1.68504, 1.72652
Support: 1.59962, 1.52523, 1.48532
USDCHF
The pair has declined below 0.91074. The pair is aiming to the median line at 0.89686.
Resistance: 0.91074, 0.93264, 0.96597
Support: 0.88022, 0.85633, 0.82723
USDJPY
The pair is trading in the Triangle. Upper level is 99.563, lower level is 95.128. The pair is testing the upper level. If the pair stays above 98.718 the pair will workout the Triangle, the aim might be at 105.649. If the pair stays below 98.718 the pair will decline to the lower level at 94.705.
Resistance: 98.718, 101.657, 105.649
Support: 94.705, 90.909, 86.838
AUDUSD
The pair is aiming to the Moving Average (200) at 97.177.
Resistance: 0.97889, 1.00031, 1.01873
Support: 0.94417, 0.89581, 0.85561
