AUDUSD: The Australian dollar Tuesday continued to trade around its highest level since early September as hopes remained buoyed that euro-zone policy makers would announce significant measures later this week to bolster the region’s banks and Greece.
The RBA has held the cash rate target at 4.75% for almost a full year. Financial markets have priced in a cut for the near term, but economists are less convinced, saying the central bank can’t afford to take its gaze off the mining boom, while there is potential for recovery in the economy in 2012.
We expect a range for today in AUDUSD rate of 1.0350 to 1.0480 (Yesterday, we suggest to short the pair at 1.0490, the pair reached high at 1.0503 before knock down to 1.0423)
Sell at 1.0490 (previously set to short at)
Stop loss at 1.0530
Target at 1.430, 1.0380, 1.0340
EURUSD: Amid a push for banks to take a bigger hit on their Greek debt holdings, the Institute of International Finance Tuesday warned that tightening credit conditions in Europe would likely force the euro zone into an economic recession.
The group represents more than 440 of the world’s largest banks, insurance companies and other financial service firms, including those in negotiations over the private sector role’s in the Greek debt talks. The IIF has been actively opposing bigger writedowns on Greek debt and is campaigning against more stringent regulations they say would further crimp growth prospects in the U.S. and Europe.
We expect a range for today in EURUSD rate of 1.3800 to 1.3970 (Yesterday, we suggest to short the pair at 1.3920, the pair fell low to 1.3885 but manage to crawl back above 1.3900. We suggest to close the trade)
Short at 1.3920 ranges (Previously shorted, suggest to close the trade now)
Stop loss at 1.3970
Target at 1.3870, 1.3820
USDJPY: The trade gap with China represents nearly half of the U.S. trade deficit and is well on its way in 2011 to surpassing the $273 billion deficit with China last year. Theft of intellectual property is estimated to cost U.S. industries roughly $50 billion and state subsidies for Chinese companies are severely crimping competition
U.S. businesses are divided over the currency legislation. U.S.-based manufacturers complain that the low value of the yuan makes Chinese products unfairly cheaper. Other companies can take advantage of the currency policy with operations in China and worry that punishing Beijing through legislation would restrict further trade opportunities in the fast-growing nation.
We expect a range for today in USDJPY rate of 76.00 to 76.40 (We continued to hold our trade, since we last bought at 76.20)
We bought the pair at 76.20
Stop loss at 75.30
Target at 76.60, 76.90, 77.20
