Big Week Ahead in Asia

A mix of thinned holiday markets and poor Euro sentiment led to a poor showing for the single European currency to start the week. A rash of bearish news has helped to drop the Euro today, including word that Greece has not met austerity conditions for a new trance of aid. Also, news out of Germany wasn’t very helpful for the Euro cause either as Chancellor Angela Merkel’s party was defeated in regional elections and questions remain whether a German constitutional court will pull the plug on the constitutionality of the contributions to the Greek bailout. The EUR/USD gapped lower by almost 50 pips to 1.4160 and the pair drifted lower from there. A well known option barrier at 1.4150 was easily breeched on the way to the pair’s lows under 1.4140. Concerns over the ECB’s meeting this week have also kept traders on the sideline.

Most majors opened with the similar gap lower, and remained lower, but the GBP was able to pull itself up 40 pips off of lows to continue near 1.6180 heading into the London session. The BOE as well as the ECB will have rate announcements this week. The RBA rate decision will be tomorrow, and the Aussie dollar remained soft against the dollar in the face of the risk adverse tone hanging over the markets. The Australian unit was 70 pips off of Friday’s close of 1.0640, and did not recover in light of the poor showing in equities. Regional burses were lower by almost 2% across the board, helping to keep risk at bay.

With risk off of the table, the yen crosses were cruising lower as the day went on with the EUR/JPY losing half a handle to 108.50 and the AUD/JPY dropping from 81.60 to 81.20 on the day. USD/JPY saw a drop to 76.70 after earlier highs close to 77.00, despite new finance minister Azumi stating that the firm yen will be a topic of conversation in upcoming G7 meetings.

The week ahead is a busy one, with central bank rate decisions from the BOJ, RBA, ECB and BOE. As well, many will be tuned in to see if US President Obama will have anything new to say in his new job creation plan on Thursday.

Источник: Forex.com

05.09.2011