AUDUSD: The Australian dollar was slightly higher late Friday as investors nervously awaited the start of European trading amid fears of more bad news from the region’s banks and the sovereign debt crisis crippling many of its member countries.
If market volatility returns, attention locally will again focus on the prospect of an emergency interest rate cut by the Reserve Bank of Australia. A number of banks moved this week to call the next move in interest rate down, with Goldman Sachs forecasting Thursday a 50 basis point cut before the end of the year.
We expect a range for today in AUDUSD rate of 1.0370 to 1.0490. (We expect the pair continue to move toward north areas, and possible hitting 1.0490)
EURUSD: European Union Energy Commissioner Guenther Oettinger cautions that the euro zone wouldn’t be able to cope should Italy default
Debt-stricken Greece and Portugal are struggling to implement Eurozone and International Monetary Fund-mandated reforms, by slashing spending and raising taxes in exchange for financial aid.
Both Greece and Portugal, along with Ireland, have been granted multi-billion EU-IMF rescue loans to prevent them from defaulting on their huge debts.
We expect a range for today in EURUSD rate of 1.4260 to 1.4370 (Short term Bullish. We set to short the pair at 1.4380, stop loss at 1.4450, target at 1.4310 to 1.4260)
USDJPY: Speaking in the wake of this week’s fractious Federal Reserve policy meeting, a top central bank official said he saw financial markets offering some tentative support to the economy amid unsettled trading conditions.
Tuesday, the FOMC said it expects to keep its 0% interest-rate policy in place until the middle of 2013, in a move that caused three voting members of the body to dissent. Many in financial markets continue to wonder whether the weak state of growth and continued high levels of unemployment will eventually drive the Fed to restart asset purchases along the lines of the recently ended $600 billion Treasury buying program known to most as QE2, the second round of quantitative easing.
Still, central bankers are confronting an economy that is proving a good deal weaker than what they had expected. Policy makers now believe the malaise is rooted in deeper factors than Japan’s natural disaster and the commodity-price surge of earlier in the year.
We expect a range for today in USDJPY rate of 76.50 to 77.40 (We continued to hold our trade since we bought the pair at 76.80, stop loss at 76.20, target upside 77.20 and 77.80)
