Switzerland: Libor Interest Rate stays unchanged.

Market Leader informed

On Dec 16^th at 8.30GMT Libor released its Interest Rate Decision.

Previous value 0.25% Forecast 0.25%.

The LIBOR Rate (or the London Interbank Offered Rate) is a daily reference rate based on the interest rates at which banks borrow unsecured funds from other banks in the London wholesale money market (or interbank market).

The LIBOR rate is calculated by the British Bankers' Association (BBA) for different terms from 1 day up to 12 months for various currencies.

The British Bankers' Association (BBA) offers the rate as a daily service.

The Swiss National Bank (SNB) may keep the interest rate close to zero trying to restrain the Swiss Franc currency rate after the outbreak of the EU debt crisis threatening the economic recovery of Switzerland.

AUDUSD: Euro session forecast

Market Leader informed

Today (Dec16th) at the Asian session the British Pound strengthened its positions against the US Dollar.

AUDUSD is being traded around 0.9865 gaining 0,3% on average.

Experts suppose that the currency pair has already found its support at 0.9850, last Wednesday’s low. The resistance level is believed to be Tuesday’s high at 0.9875.

It should also be noted that the Australian Dollar (AUD) has gained against JPY and EUR. GBPJPY reached 131,02 (gaining 0,6%) while EURGBP came up to 0.8496 (losing 0,04%).

Movement scenarios: markup. Daily-H1. AUDUSD. Dec 16^th 2010.

1. Upward scenario (CP1-CP2-CP3)

Support level: 0.9840 is critical for this variant of movement. The scenario will be canceled if the level is overcome.

Resistance levels:

Volatility indicator “Saks Channel”: 0.9868 - 0.9934 - 1.0000.

Local highs: 0.9954 - 1.0029. Buy target grid of the basic indicator: 0.9961 - 0.9989 - 1.0035.

 

Strong US dollar presses crude oil.

Market Leader informed

The USD strengthening has been pressing the prices on crude oil over the last few days.

The Euro-zone’s debt problem and the Fed Reserve’s recent report indicate a decline in the global economic development, which affects the demand for energy carriers. Yesterday’s preliminary reports showed the reduction of imports. The refineries are getting ready for the end of the year and trying first of all to exhaust their reserves in order to reduce the machinery taxes.

The OPEC members have recently agreed to hold another emergency meeting in case the prices exceed $90 per barrel as they can significantly restrain the pace of the global economic recovery and growth. In general, these factors press the crude oil prices.

In terms of tech analysis, the situation is negative. There are no aggressive purchases. The buyers cannot hold the levels.

Inflation in UK remains high.

Market Leader informed

In connection with the growth of the world prices on crude oil and raw materials, the UK consumer price inflation remains at a high level. Such a tendency (3% growth) has already been seen for a couple of months. However, various discounts offered by numerous retailers smoothen over the impact. The Unemployment Rate news-release expected this week is likely to confirm the results of numerous opinion polls saying that the employment rate growth in the UK has slowed down. The Retail Sales report, which is to come out this week as well, is expected to see growth in the light of the New Year holidays. However it won’t considerably improve the overall economic picture.

In the meantime at Forex the British Pound currency rate is trying to decide on the destination of its further mid-term movement. According to the Department of studying Masterforex-V trading system , by breaking through the defensive MF pivot and coming out of the MF sloping channel the price has recently terminated the entire wave started from 1.5510. The newly-formed bearish wave needs its own “moment of truth” to define in what direction GBPUSD will go further. It can be either correctional wave “B” followed by a downward FZR or another breakout of the high, increasing the wave level of the bullish wave.

USA suggests lifting some sanctions off Iraq. What influence to expect on USD currency rate?

Market Leader informed

Today at the UN Security Council meeting the US delegation has offered lifting some sanctions off Iraq. It should be noted that the offer is unexpected for everyone.

U.S. Ambassador Susan Rice said in a letter to Secretary-General Ban Ki-moon circulated Tuesday that the goal of the session is “to recognize and reinforce Iraq’s recent progress and to explore ways in which the United Nations can continue to support the Iraqi government and people.”

However, it is still unclear whether the US initiative will be approved by the others.

Movement scenarios: markup. H4-H1. EURUSD. Dec 15^th 2010.

1. Upward scenario (CP1-CP2-CP3)

Support level: 1.3336 is critical for this variant of movement. A breakout of it cancels the scenario.

Resistance levels:

Volatility indicator “Saks Channel”: 1.3394 - 1.3488-1.3582.

Local high: 1.3440. Buy target grid of the basic indicator: 1.3534-1.36571.

 

What will be the GBPUSD currency rate?

Market Leader informed

Today, on Dec 15^th, the British Pound declined against the US Dollar.

 

GBPUSD is currently being traded around 1,5763, losing 0,7% on average.

 

Currency analysts expect 1.5720 to act as support. Tuesday’s high at 1.5911 may become the closest resistance.

It should also be noted that the British Pound has recently gained versus the Yen and Euro.  GBPJPY reached 132,12 (gaining 0,11%) while EURGBP reached 0.8470 (losing 0,12%).

 

Movement scenarios: markup. Daily-H1-M15. GBPUSD. Dec 15^th 2010.

What are the Implications of Moody’s Possible Downgrading of US Rating?

Market Leader informed

On 13 December 2010 the investor and trader community that has recently calmed down was simply dumbfounded by the announcement made by one of the world’s most trustworthy rating agencies, Moody’s. It forecasted that it might decrease US investment rating in 2012. According to Moody’s analysts, the economic situation in the US is getting worse and ‘is suffering’ because of an extension of tax benefits adopted as a compromise by US Congress upon agreement reached between Republicans and Democrats. What forecasts about the US are behind such rather strange wording of Moody’s?

 

Today’s US rating and Moody’s forecast for ‘tomorrow’. According to Moody’s rating
* the US holds the so-called Aaa level or, simply put, ‘stable growth, positive outlook’;
* 2012 is within sight and might have the outlook downgraded to ‘negative’. This very unpleasant event might result in a rating downgrade within one or, maximum, one and a half years.

 

Why is Moody’s opposing the US so drastically?

Euro-crisis through the eyes of the East

Market Leader informed

The deepening crisis of the common European currency is political rater then economic one. It seems that Western Europe is about to face an epoch of “new” nationalism, but it is not about some hostility.

Everything is commonplace. The European Union has lost its confidence in the future.

Most countries of the world have always considered Europe as some monolith, entity. Now everything has radically changed. The authorities of the EU states have turned from the like-minded into those who defend their own national interests. Previously it was Great Britain that served as the symbol of sovereignty in Europe. Now it can be said about the entire European Union.  The EU governments are desperately trying to gain support at home.

Ireland, the last EU country that got under the pressure of the debt crisis, is in panic, being afraid of losing its independence and get under control of the IMF while Germany is showing its discontent as it has to pay for its spendthrift neighbors.

The so-called peripheral countries are trembling at the thought of Germany becoming the “owner” of the entire EU. Not long ago the EU used to be the guarantor of stability for its members. Now everything has changed. The EU membership causes extra problems for some countries. The EU starts yielding to the East.

Gold, platinum and silver marker overview. What will be the prices?

Market Leader informed

Partially worried about China’s intention to raise the interest rates, the market of gold saw a slight decline on Friday.

However, by the end of the trading day it was very likely that China was not going to change the rates, making the market react with an instant increase.

On Monday it became clear that China had postponed the interest rate increase. The upward tendency continued. Last Friday after the rapid decline some Indian traders started actively buying gold. Judging by the filigree rebound from the support level at 1372,5 on Friday, one may suppose that these were the same buyers.

Besides, the info coincides with the comments given by analysts of precious-metal market in Hong Kong, who mention a strong seasonal growth of the demand for gold shown by China and India. According to Comex, the gold reserves are equal to 11,570 million ounces. It should also be noted that the amount of partial long positions opened by various traders has increased by 9702 contracts. Of course, it is not a mere sign of some strong bullish perspective, but nevertheless, it indicates investors’ long-term preferences.

Crude Oil Market Overview: Will the futures continue its uptrend?

Market Leader informed

At this point there is impulse wave C (C ) developing from $80.24. The price on the WTI crude futures at NYMEX reached one of its target levels at 90.10 -50% of the bearish wave Amn. After that the market reacted to the price resistance with an increase in the wave level. These are the following possible scenarios of the forthcoming price movement:

·         Elongating the wave through “the Hound by Elder/MF” from the reference point ($87.04) followed by the formation of wave A( c);

·         Breaking through the defensive bullish pivot at $87.04, increasing the wave level up to D1-D2 in the form of wave B.

The Department of studying Masterforex-V trading system draws your attention to the fact that the bullish tendency is not over yet. However, the current situation offers partial profit-taking as the market has shown bearish signs around the resistance level, which prompts a possible retracement against the current uptrend.

AUDUSD: what will be its currency rate on Dec 13th?

Market Leader informed

Today, on Dec 13^th, the Australian Dollar declined against the US Dollar. AUDUSD is currently being traded around 0,9844, losing 0,11% on average.

Currency analysts note that the currency pair has already managed to find its support level at 0,9753 which corresponds to Wednesday’s low. It is also clear that the closest resistance level is 0.9897, Friday’s high. In the meantime AUD has gained in value versus EUR but has declined versus JPY. It means that EUR loses its leading positions, giving way to JPY and AUD.

Having lost 0,2% of its value AUDUSD reached 1,3398. AUDJPY reached 82,62 while losing 0,12% on average.

Movement scenarios: markup. H4-H1. AUDUSD. Dec 13^th 2010.

1.Upward scenario

0.9832, support, is critical for this variant of movement. A breakout of it cancels the scenario.

Resistance levels:

Volatility indicator “Saks Channel”: 0.9890 - 0.9965 - 1.0040.

Local highs: 0.9964 - 1.0002. Buy target grid of the basic indicator: 0.9885 - 0.9918 - 0.9971 - 1.0004 - 1.0057.

2.Flat scenario (Flat-zone):

Support level: 0.9832.

Resistance level: 0.9896.

For the flattish movement scenario these levels are critical. If there is flat widening, the levels may see false breakouts. However, the deviation shouldn’t exceed 161.8% - 0.9936. Therefore, in this case the price cannot come out of the buy-zone or sell-zone. The 161.8% support level inside the buy-zone and the 161.8% resistance level inside the sell-zone are critical for this scenario and cancel it once violated.

3.Downward scenario

0.9896, resistance, is critical for this variant of movement. A breakout of it cancels the scenario.

Resistance levels:

Volatility indicator “Saks Channel”: 0.9815 - 0.9740 - 0.9665.

Local lows: 0.9775 - 0.9752 - 0.9739.. Sell target grid of the basic indicator: 0.9816 - 0.9792 - 0.9752 - 0.9728 - 0.9688 - 0.9664.

 

 

 

Provided by the Department of mid-term trading and GTMT, Masterforex-V Academy.

 

 

 

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EURUSD: what will be the currency rate of EURUSD?

Market Leader informed

Today, on Dec 13 2010, currency market experts noticed thatthe common European currency significantly declined versus the US Dollar.

EURUSD is being traded around 1.3191 after losing 0,279% of its value.

Masterforex-V Academy analysts note that the currency pair has probably defined its support. It is located at 1.3166, Thursday’s low. The current resistance is at 1.3323, Thursday’s high.

Besides, EUR has declined a little against JPY and GBP. EURGBP reached 0,8360 after losing 0,11% of its value. EURJPY reached 110,97 (0,07% lost).

Movement scenarios: markup. H4-H1. EURUSD. Dec 13^th 2010.

1.Upward scenario

1.3176, support, is critical for this variant of movement. A breakout of it cancels the scenario.

Resistance levels:

Volatility indicator “Saks Channel”: 1.3268 - 1.3411.

Local high: 1.3442. Buy target grid of the basic indicator: 1.3250-1.3295-1.3268.

2.Flat scenario (Flat-zone):

Support level: 1.3163.

Resistance level: 1.3281.

GBPUSD: what will be its behavior at the forthcoming trading sessions?

Market Leader informed

GBPUSD has recently shown a significant decline.

Currency market analysts note that GBPUSD is being traded at 1,5783 while losing 0,13% on average.

Masterforex-V Academy experts say that the currency pair has probably found its support at 1.5669, which is Wednesday’s low. At this point the closest resistance level is 1.5861 – Friday’s high.

Besides, it should be noted that GBP has consolidated its positions versus EUR and JPY. EURGBP lost 0,14%, having reached 0,8358. GBPJPY gained 0,06% on reaching 132,74.

Movement scenarios: markup. H4-H1. GBPUSD. Dec 12^th 2010.

1.Upward scenario (Pic1)…

1.5755, support, is critical for this variant of movement. A breakout of it cancels the scenario.

Resistance levels:

Volatility indicator “Saks Channel”: 1.5850-15951.

Local high: 1.5861. Buy target grid of the basic indicator: 1.5924 - 1.5954 - 1.6003.

2.Flat scenario (Flat-zone):

Coffee yield will grow. Will it become cheaper?

Market Leader informed

This year analysts expect a record-breaking crop of coffee beans - 139,4 million sacks ( 1 sack = 132 pounds = 60 kilos).

It is 12% more than in 2009. Brazil shows the biggest production growth. It is the world’s biggest exporter of coffee. Brazilian farmers have already gathered 54,7 million sacks, which is a good figure as compared with the last years’ one (44,8 million). Columbia has also gathered a rich crop of 9,6 million sacks (against 8 million in 2009).

Only Indonesia indicates negative dynamics: this year’s crop is 9,4 million sacks against 10 million sacks in 2009. The reason is unfavorable weather conditions. That is why experts are concerned not only about the volume of the Indonesian crop but also about its quality.

Let’s see what benefit we can gain from the info when the coffee futures (KC) is concerned. The daily chart indicates a steady uptrend within the scope of a sloping channel. In early November it got into a range. The following movement will be determined by the direction in which the price comes out of the range, with further settlement above/below its borders. An increase in supply should favor a decline in price. In this case the price may make another effort to reach $198. If the price settles below it may decline down to 184-186$ (variant 1). On the other hand, the price may be influenced by the US policy of quantitative easing, which has already started influencing the global markets through causing an increase in the prices on numerous recourses, including energy carriers and foodstuffs. The futures of coffee may also get into the wave,

Gold and Silver: What Prices Should be Expected in the Medium Term?

Market Leader informed

The gold market is concerned to some degree that the Chinese will raise interest rates during the weekend. It is also reported that Indian buyers of gold that were present yesterday at the Asian and European trading sessions and pushed prices to $1.395 per ounce left the market in the evening. It seems the gold market got no support from the higher opening of the stock markets today unlike in the industrial metals (platinum and copper). There is an opinion that gold prices, at least to some extent, were undermined by news that IAMGOLD might substantially increase gold production in 2011. However, gold hasn’t been very sensitive recently to high and low tides of physical deliveries.

As expected, silver will get a fresh support from news regarding repeated launch of silver coins in the US. There are also rumors that Indian buyers shifted their interest to silver treating it as a cheap alternative to gold. These should have pushed prices up. But it wasn’t the case and silver follows in the footsteps of gold. Nevertheless, if Indian interest really turns to silver this will significantly affect the silver market in general.

Gordon Brown: Is Europe in for a New Spiral of Currency Crisis?

Market Leader informed

In his interview to BBC Business Editor Robert Peston, Great Britain’s former Prime-Minister Gordon Brown forecasted a new wave of crisis of the single European currency in early 2011. He believes that the first couple of months of the coming year promise the Euro a rapid growth till it reaches ‘its ultimate prime’ later to be followed by a substantial decline. This will involve more than simply problems of sovereign debt of Eurozone nations.

 

What are Gordon Brown’s estimates based on?

 

According to former Prime-Minister Gordon Brown, who also served as Great Britain’s Chancellor of the Exchequer for ten years, European banks should:
* get rid of the monstrous amount of debt as soon as possible (it includes loss-making assets and deficit of domestic capital for coverage of expenses);
* develop more structural flexibility as far as the single European currency is concerned.

The European Union: Divorce, Portuguese Style?

Market Leader informed

According to American analysts, troubled countries, including Portugal, Greece, Spain and, recently, Ireland should come to an independent decision to leave the Eurozone. They should do this as soon as possible because, otherwise, there might be a real threat of global crisis around the entire European banking system.

 

The report by one of the leading economists of the American Enterprise Institute, D. Lachman, points out that these countries cannot avoid such measures because currently a default by any EU country will trigger a domino effect at the periphery which may result in disastrous consequences.

 

According to the expert, these countries’ debt has been ‘chronic’ for a long time. It is the life buoy of bailout that stops their economies and the entire European banking system from crumbling down. Nevertheless, as soon as the stream of finance dries out the consequences are absolutely obvious.

 

Drastically restricted by the single currency space, these countries cannot resort to currency devaluation, a natural step in the current situation, as a way to reduce a sizable part of losses. They cannot expand exports, either, as a shock-absorber that cushions negative impact of the spending cut programs.

Experts: Why and How Much Will Food Prices Grow?

Market Leader informed

Based on November figures, the Russian Bureau of Statistics confirms that prices for major foods are growing at a faster pace in the Russian Federation, in particular, potato, cabbage, onion, millet, buckwheat and sugar. Annualized inflation grew by 8% in November with the relevant figure for October being at 7.5%, September - 7%, August – 5.5%. Price growth also affected vegetables and fruits with 4% of growth in November as compared to 1.8% of decline in October. For comparison: foods added five times less percentage-wise in November 2009 that this year.

 

What lies behind this sudden rise in prices?

 

Interesting price statistics in the regional breakdown:
1. Sugar has grown in all regions including by over 10% in 8 regions as Masterforex-V experts suggested in a feature: Why and How Much will Sugar Prices Grow?
* by 22% in Jewish Autonomous Oblast.