Forex News | Currency News by Forexlive

• Spain forecasts 2011 deficit at 8% versus 6% target
• Spain announces € 8.9B in spending cuts
• EUR net short position falls to record in CFTC Commitments of Traders report
• IMF says USD share of global FX reserves +7.5% y/y in Q3; EUR loses ground
• Milwaukee PMI Dec 57.77 vs 56.7 prior
• US Congress delays vote on debt ceiling, citing scheduling
• EUR/JPY hits fresh 10-year low
• S&P 500 falls 5.5 points, or 0.4% — flat on the year
• AUD and JPY lead on the day; EUR and USD lag

The final session of the year was more volatile than expected with good-sized ranges and moves. EUR/USD was the laggard at the start of the session at 1.2934 but marched higher, including a pop to 1.2999 at the London fix. After Europe shut down it was a slow march back to opening levels.

USD/JPY awoke just in time to ring in the New Year. The pair  traded in its widest range since the Oct 30 intervention and fell 70 pips. It was basically a one-way trade lower until Europe closed and then the pair leveled out slightly below 77.00.

EUR/JPY briefly touched below the magic 100.00 line in Europe and then sank before the mark in the US. Afterwards the pair continued to decline, touching below 99.50 and closing out the year at a 10-year low.

AUD was the big winner, closing at the highest since Dec 6 in the second straight day of buying.

It has been a pleasure and a privilege to bring you news and analysis in 2011. Have a Happy New Year!

If you bought the S&P 500 at the close last year, you lost 0.43 points on the year. The close was 1257.21 compared to 1257.64 in 2010. That’s just incredible.

On the day, the index fell 5.5 points, or 0.4%. On the week, it lost 0.6%.

The yearly is a massive doji.

The AUD/USD and NZD/USD charts look very similar to the past three years, both closing this year nearly unchanged.

The head of Greece’s central bank says a return to the drachma would be disastrous; it would mean a 60-70% devaluation. He says he’s certain Greeks would not allow such a scenario.

The Commitments of Traders report shows the EUR net short positions falling to a record at -128K compared to -114K last week. The data is for the week ending Dec 27.

• JPY -2K to +22.6K
• GBP -3K to -29.1K
• CAD +5K to -21.8K
• AUD +7 to +37.2K
• NZD +1K to +1.4K

The resulting USD position is +$20.35B compared to +$17.65B a week earlier.

US stocks have turned lower heading into the final hour of trade. The S&P 500 is at 1258 compared to the 1257.64 close of 2010. Risk aversion is spilling into FX with EUR, AUD and GBP at the lowest since early in US trading.

Wait for a bounce, sell the euro, make money. Repeat.

That will be 2012 in a nutshell.

In the past two days, EUR has hit long-term lows against JPY, USD, GBP and a record low versus AUD. It’s a technical disaster.

The year ahead will be one crisis after another in Europe:

• The economy will contract.
• Greece is hopeless.
• The ECB will resort to increasingly risky, dovish moves.
• Today’s deficit numbers from Spain perfectly demonstrate the futility of austerity.

Any bounce of approx. 200 pips — on any cross (ex CHF) –  is large enough to sell.

Whatever your trade, have a Happy New Year.

By Denny Gulino

WASHINGTON (MNI) – Secure in the knowledge that Capitol Hill
ultimately cannot withhold $1.2 trillion in additional borrowing
authority, President Obama Friday postponed his request for the increase
of the government’s debt limit.

Eager to record their votes against the inevitable increase, many
congressional Republicans had asked their Capitol Hill leadership to
press the White House to make such a vote possible and the White House
acquiesced. So a 15-day deadline will now end after Congress returns
Jan. 17, not before.

Otherwise the 15-day period would have ended Jan. 14, too soon for
any votes, further irritating many members of Congress and making the
next debt-limit battle in early 2013 even more ferocious.

While voting down the debt hike is possible, mustering the
supermajorities necessary to overturn a guaranteed presidential veto is
seen to be impossible, so President Obama is virtually certain to have
his way in this round.

The arrangement providing for a possible joint congressional
resolution of disapproval was worked out as part of the last agreement
to keep government running in early August. That followed weeks of
partisan paralysis on Capitol Hill that prompted Standard & Poor’s to
deliver its first downgrade of U.S. debt.

The U.S. Treasury will still have to make its $82 billion in
interest payments to various trust funds by the end of this year,
threatening to take it within the $100 billion cash balance boundary
that triggers the pending request. But a mild form of what has become
“extraordinary measures,” no longer as rare as they used to be, will
allow a shuffling of government accounts to keep the Treasury’s
available cash from breaching the current $15.194 trillion debt limit.

Spokesman Josh Earnest, at the Hawaii traveling White House
operation, said talks are underway with leadership in both Houses “to
determine the best timing for submission of the certification and any
subsequent votes,” a Treasury spokeswoman told reporters.

The $1.2 trillion is expected to keep government borrowing until
next December, a Treasury official had said Monday. Then the application
of the measures that can extend the cash for at least a couple more
months will kick in, setting the stage for the next real debt-limit
confrontation in the late spring of 2013.

Whether that confrontation is as fierce as the last one depends on
whether government is still divided between the two political parties,
or whether voters in November decide another configuration is more
appropriate.

** Market News International Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MFU$$$,MCU$$$,M$$FI$]

I bought EUR/CHF shortly after the 1.20 peg was introduced and have held it ever since. My only regret has not been trading the range more aggressively.

At this point everyone has an opinion of the SNB so I won’t try to convince the bears. Personally, I see no signs of a lack of SNB commitment, the public supports the peg and the government supports the peg.

With EUR/CHF at 1.215, we are near the bottom of the range so it’s a great time to get long. The downside is a stop at 1.20 and the upside could be 1.30 or higher. An alternative is long USD/CHF, which mitigates some of the black swan risk in Europe.

#2: a) buyEUR/CHF at 1.2157 and hold on b) buy USD/CHF at 0.9375 and hold on until 1.12/1.15.

The US bond market will close in a few minutes (at 2 p.m. ET). It’s already looking like US stock market trading volumes will be the lowest of the year so things may get especially wonky here.

I wake up every morning at least a little bit long gold. I’ve tried staying flat but I start to lose my sanity and start buying every dip. This year, I’m waiting for the big dip and I’m loading up.

Next year will be an “inside year” on the chart, meaning gold will not exceed the $1308-1921/oz range from 2011.

I don’t believe the bull market in gold is dead but there will be a period of consolidation before moving higher. A strong USD will weigh on gold while monetization, currency spats, pitiful bond yields and continued emerging market growth will offer support.

Gold gained 10.0% in 2011, the eleventh consecutive year of gains.

Buy at $1350-$1400 and sell at $1750-1800.

• 1
• 2
• 3
• 4
• 5
• ...
• 256
• >