AUDUSD: The Australian dollar surged Monday along with other risk-sensitive assets across the globe, including equities, helped by signs of improving stability in Europe.
Further helping the Australian dollar, Japan’s third-quarter gross domestic product rose for the first time since the March 11 earthquake and tsunami, an important improvement for one of Australia’s largest trading partners.
We expect a range for today in AUDUSD rate of 1.0180 TO 1.0330. (
Set Limit BUY order for AUDUSD at 1.0200 ranges
Stop loss at 1.0150
Target at 1.0320
EURUSD: On Monday, Euro zone’s bailout fund pulled in only weak demand at a high cost for the bond it sold last week, showing its limited ability to support European government bond markets in its current form.
The ratings company said the uncertainty surrounding the proposed plans to leverage the European Financial Stability Facility contributed to a lack of interest in the EUR3 billion worth of bonds sold last week.
The deal suffered due to the tough market conditions and persistent uncertainty about the future mission of the fund. The success of the EFSF as a tool to stabilize sovereign debt prices and the success of the current euro area-wide support mechanism comes into doubt if that ability is compromised.
We expect a range for today in EURUSD rate of 1.3570 to 1.3720
Set Long for EURUSD above 1.3600 ranges
Stop loss at 1.3550
Target at 1.3720, 1.3780
USDJPY: Canada and Mexico announced plans Sunday to move toward joining negotiations to form a Pacific Rim trade zone, adding significant momentum to U.S.-led trade talks already bolstered by a similar decision by Japan.
Together, the addition of three of the top four trading partners would elevate the pact from a modest regional grouping to a pact packing heavy global weight, allowing the U.S. to counter China’s rising power in the Asia-Pacific region.
Current participants in the talks include four countries that already have signed free-trade agreements with the U.S.–Australia, Singapore, Chile and Peru–along with New Zealand, Malaysia, Brunei and Vietnam. Together, they represent just 6% of total U.S. trade.
We expect a range for today in USDJPY rate of 76.00 to 77.50 (We continued to hold our trade where we bought last 77.15)
Long USDJPY at 77.15 (already bought)
Stop loss at 76.50
Target at 77.70, 78.30
