AUDUSD: The remarks are a strong hint that Australia wants the G-20 group to resume the crisis mode it adopted when it steered the world through the aftermath of the 2008 financial crisis. On Monday the G-20 released a statement saying it would work to achieve strong, sustainable and balanced growth.
Australian exporters are feeling the pinch of unfavorably high exchange rates, the 2011 DHL Australian Export barometer shows. According to the DHL report, 81% of Australian exporters say the high Australian dollar is challenging their business and 72% of those surveyed say it’s affecting their ability to compete with rivals overseas.
Currency and natural disasters such as floods in Queensland state have impacted export levels, with only 42% of exporters reporting increased orders in the last 12 months against a predicted 69%.
We expect a range for today in AUDUSD rate of 0.9900 to 1.0230 (The market current in a slaughter mode, where selling spree and panic button. It is best interest to avoid the market for short term. If the pair fails to support at 1.000 parity will likely head toward 98.00 regions)
EURUSD: The recent decision by the European Central Bank to buy bonds of euro-zone countries, together with Italy’s and Spain’s decision to reinforce fiscal discipline measures, will contribute to the strengthening of financial stability in the countries using the euro
The euro was broadly weaker against other major currencies during European trading hours Monday as the European Central Bank’s actions to restore calm to the markets fell short of traders’ expectations.
Early in European trading, the ECB stepped into the market to buy more than EUR1 billion of Spanish and Italian government bonds, according to traders’ estimates. That helped put a temporary floor under peripheral euro-zone bonds and European.
We expect a range for today in EURUSD rate of 1.04030 to 1.4235 (Once again, we should avoid trading the pair, however a minor support around 1.4030 region. If the pair fail to support, then we might find the pair heading toward 1.3900.
USDJPY: In Friday’s announcement, S&P said its downgrade “reflects our view that the effectiveness, stability and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenges to a degree more than we envisioned when we assigned a negative outlook to the rating on April 18, 2011.
Despite an 11th-hour deal last week between Obama and Congress to raise the U.S. debt limit and cut government spending, S&P said “the difficulties in bridging the gulf between the political parties over fiscal policy” had made it “pessimistic about the capacity” of leaders to leverage their agreement into a broader deal on deficit reduction anytime soon.
That’s exactly what our rating action is based on also in this case–the rising debt levels and the willingness and the process in Congress and the administration to come to some game plan on reducing these debt levels. So really the two points that we have based our rating decision on was exactly what the president called for
We expect a range for today in USDJPY rate of 76.80 to 77.80 (We set limit BUY order for USDJPY at 76.80, stop loss at 76.20, target upside at 77.80, 78.20 and 78.80.)
