AUDUSD: The Australian dollar was lower late Tuesday, dragged down by a fresh wave of uncertainty flowing from Europe and comments from the Reserve Bank of Australia pointing to interest rates remaining on hold for some time.
Following an early policy meeting, the RBA kept interest rates on hold Tuesday at 4.75%, as expected by economists. Interest rates have been on hold since November, the longest period of policy stability for five years.
RBA Governor Glenn Stevens indicated the pause looks likely to stretch on given the lack of clarity in Europe and the U.S.
We expect a range for today in AUDUSD rate of 1.0500 to 1.0600 (Yesterday we have successfully closed the trade at 1.0580 as target. We expect the pair continue to head north after several day of lost. Those who wish to re-entry at the current market price 1.0540 ranges, stop loss at 1.0470, target at 1.0580, 1.0630 and 1.0670.)
EURUSD: Europe’s beleaguered banking sector has been battered over concerns about growth as well as lawsuits filed against 17 lenders Friday by the top U.S. federal housing regulator, alleging that the banks sold $196 billion of risky home loans over four years to mortgage providers Fannie Mae and Freddie Mac without adequately disclosing the risks.
The head of the industry group that represents more than 400 of the world’s largest private banks rejected calls by the International Monetary Fund chief for European banks to boost their capital buffers.
We expect a range for today in EURUSD rate of 1.3960 to 1.4080 (We re-entry the trade at the current market price 1.4020 ranges, stop loss at 1.4060, target at 1.4080, 1.4120, 1.4160 and toward 1.4230.)
USDJPY: Japan’s currency has become a haven amid financial turmoil, and Japanese exporters have been as horrified as their Swiss counterparts at their currency’s rise. The dollar has been crumbling against the yen since the financial crisis took hold. In the summer of 2007, a dollar bought more than Y120. Now, it is more like Y77.
But for the moment, it seems that Tokyo is primarily concerned with talk, not action. On Tuesday, Jun Azumi, Japan’s new finance minister, said he will try hard to convince his counterparts from the Group of Seven leading industrialized countries about the danger posed by the strong yen.
Japanese authorities have said its previous episodes of intervention in the foreign-exchange markets were efforts to smooth out what they call disorderly market adjustments. Partly because it has always sought to head off accusations of outright currency manipulation, it has avoided setting an outright target that it would have to defend. Tokyo also has a healthy respect for intervention’s limits. Events in August were just the latest reminder. Japan sold Y4.51 trillion ($58.65 billion) in August.
We expect a range for today in USDJPY rate of 77.00 to 77.90 (The USDJPY currently have a minor resistance at 77.60 ranges, Those who wish to short the trade at current market price 77.40 ranges, set stop loss at 77.70, target at 77.00 and 76.70.)
