Forex Technical And Fundamental Analysis For The Week Of November 28, 2011

EUR/USD Technical Analysis for the Week of November 28, 2011

EUR/USD fell hard during the week as the debt crisis is starting to infect Germany as well. The Germans had a failed debt auction this week, and the markets got spooked as a result. The pair is decidedly broken at this point, and the all-important 1.35 level finally gave way to the bears. The breaking of 1.31 will be watching for now, and could open the door to 1.30 and 1.25, respectively. The pair could and probably will bounce at one point or another, and this could be looked at as a selling opportunity as the EU looks unable to come to grips with the problems facing it in the debt markets. We sell rallies, and will not buy this pair anymore.

EUR/USD Fundamental Analysis for the Week of November 28, 2011

The EUR/USD pair ended a strongly bearish week, affected by rising yields on European indebted nations’ bonds in addition to the disagreement between European leaders over the means to fight back the debt crisis, which spread pessimism further in the market and sent the EUR/USD pair to the lowest level recorded in seven weeks.

The sentiment deteriorated further last week as Italian yields surged again, which led European Officials to reduce the fire power of the European Financial Stability Facility, where they explained that the rescue fund could provide only the half of the amount previously planned due to the ongoing incline in yields.

Moreover, jitters and rising debt woes spread further in the market after Germany was not able to sell as much bonds as planned, which forced the German Central Bank (Bundesbank) to intervene and buy almost half of the amount to assure the success of the auction, where investors are demanding higher yields since the fall of the euro means the fall of the entire union, and in result investors preferred to hold Italian and Spanish bonds rather than German Bunds, which gives lower yields, in the time the risk is almost equal.

Furthermore, Merkel in a meeting the Sarkozy and Mario Monti, the fresh Italian Prime Minister, explained theGermanyis still against the intervention of the European Central Bank and the issuance of European joint bonds, where the Chancellor explained that joint bonds would eliminate incentives for European nations to seek fiscal consolidation and improve their budgets.

This week our eyes will be focused on the euro zone and European Union finance ministers meeting on November 29 and 30 respectively, where markets are tracking any comment, proposal or plan that aims to solve the debt crisis and prevent it from spreading further into the euro-area region, where the debt crisis is expanding quickly to larger economies raising more risk that the once currency union could fail soon unless lawmakers act in the right time to block the crisis, which sent the confidence further to the downside and spread pessimism and fears in the market.

Turning to the critical fundamentals awaited this week, the United States, Germany and the euro-area region are to release unemployment and manufacturing data, where expectations indicate that the United states public sector is to add more jobs this month, while unemployment is expected to remain unchanged in the euro zone, in the time unemployment could improve slightly in Germany, which if confirm, could spread a slight wave of optimism in the market.

Other news from the euro area and the U.S. economy to affect the pair this week:

Monday November 28:

Germanywill start this week at 07:00 GMT with the GFK consumer confidence survey for December, where the confidence is expected to slip slightly to 5.2 from 5.3.

The euro zone will join the session at 09:00 GMT with the M3 money supply for October, with expectations the seasonally-adjusted three-month average could have expanded by 3.1% from 2.6%, while the annual index could have improved 3.4% from 3.1%.

TheUnited Stateswill join the session at 13:00 GMT with the new home sales figures for October, with expectations that the number on new homes sales could retreat to 310 thousands from the previous 313 thousands, while the monthly new home sales index could have dropped by 1.0% from 2.3%.

During the dayGermanywill release the Consumer Price index second reading for November, where the monthly CPI index is expected to expand by 0.1% from the previous steady reading, while the annual CPI index could have slowed to 2.4% from the previous 2.5%.

Germanywill also provide the CPI harmonised indexes for November in a second reading, with expectations the monthly index could have dropped 0.1% from the previous 0.1%, while the annual index is expected lower at 2.8% from 2.9%.

Tuesday November 29:

The euro zone will start the day at 10:00 GMT with the European Confidence data for November, where the business climate indicator could have dropped further to 0.23 from 0.18, while the consumer confidence final reading is expected to linger at -20.4, in the time the economic confidence could have retreated slightly to 94.0 from 94.8.

The industrial confidence is expected lower at -7.0 from -6.6, while the services confidence is expected to linger at 10.2.

TheUnited Stateswill join the session at 14:00 GMT with the S&P/CS 20 report for September, where the monthly S&P/CS 20 City index is projected to remain steady compared with the previous drop of 0.05%, in the time the annual S&P/CS composite-20 could have dropped 3.00% from the previous drop of 3.80%.

At 15:00 GMT theUnited Stateswill announce the consumer confidence for November, with expectations it could have improved to 44.4 from 39.8.

Wednesday November 30:

Germany will start the session at 08:55 GMT with the unemployment report for November, where the unemployment figure is expected 7 thousands lower compared with the previous surge of 10 thousand jobs in unemployment. In addition, the unemployment rate is expected to linger at 7.0%.

The euro zone will join the session at 10:00 GMT with the annual CPI flash estimate for November, which is expected to remain steady at 3.0%.

The euro zone will also release the unemployment rate for October, with expectations that unemployment could have remained unchanged at 10.2%.

TheUnited Stateswill join the session at 13:15 GMT with the ADP employment change for November, which is expected to show that theU.S.private sector could have added 130 thousand new jobs compared with the previous addition of 110 thousands in October.

At 13:30 GMT theUnited Stateswill provide the nonfarm productivity and the unit cost labour indexes for the third quarter in a final reading, where the nonfarm productivity index is expected to expand by 2.6% from 3.1%, while the unit labour costs index could have dropped by 2.1% from the previous drop of 2.4%.

At 14:45 GMT theUnited Stateswill also release theChicagopurchasing manager indicator for November, with expectations the indicator could have slightly improved to 58.5 from 58.4.

At 15:00 GMT theUnited Stateswill end the session with the pending home sales indexes for October, where the monthly index could have expanded 1.2% from the previous drop of 4.6%, while the annual index previous reading was 7.9%

Thursday December 1:

Germanywill start the session at 08:55 GMT with the PMI manufacturing for November in a final reading, where the index is expected unchanged at 47.9.

The euro zone will join the session at 09:00 GMT with the PMI manufacturing index for November in a final reading, with expectations the index could have lingered at 46.4.

TheUnited Stateswill join the session at 13:30 GMT with the initial jobless claims figure (November 26), where the number of claims could have retreated to 390 thousands from 393 thousands.

At 15:00 GMT theUnited Stateswill provide the construction spending monthly index for October, which could have expanded by 0.4% from 0.2%.

The ISM manufacturing for November could improved to 51.5 from 50.8, while the ISM prices paid indicator could have expanded to 45.0 from 41.0.

Friday December 2:

The euro zone will start the session at 10:00 GMT with the producer price index for October, where the monthly PPI index is expected to expand 0.2% from 0.3%, while the annual index could have expanded by 5.6% compared with the previous of 5.8%.

TheUnited Stateswill join the session at 13:30 GMT with the closely watched jobs report for November, where the public sector could have added 120 thousand jobs to the economy compared with the previous addition of 80 thousands jobs in October, while the unemployment rate is expected to linger at 9.0%.

USD/JPY Technical Analysis for the Week of November 28, 2011

The USD/JPY pair had a very positive week for the last 5 sessions, but one has to keep in mind the extreme amount of bearishness in this pair to begin with. The longer-term weekly charts clearly show that the 0.80 level is a massive resistance area, and we feel that this area should continue to serve as being too strong to be overcome anytime soon. The rise of the USD in this pair probably has more to do with the run to the Dollar in general as the EU crisis gets worse. The Yen will also be considered a safe haven as well, so to think this pair rises above 0.80 is probably wishful thinking at this point. A weekly close above that level would have us second guessing this idea though. In the mean time, we will probably see opportunities to sell this pair on rallies.

USD/JPY Fundamental Analysis for the Week of November 28, 2011

The USD/JPY pair ended last week with gains for the first time in two weeks, where the dollar strength and the unclear outlook for the Japanese economy helped the pair to rise.

The greenback was the best performer last week, as the ongoing debt crisis and Fed’s discussions regarding more easing drove investors to focus on the dollar as a safe haven amid the uncertainty in financial markets.

The Japanese economy faced a significant drop in the exports due to the yen strength, along with a drop in the consumer price index which increased uncertainty regarding the Japanese outlook.

Bank of Japan did not offer anything new during its last meeting, while some of its members asked for more easing and to expand the central bank’s budget, the move which could indicate to us that another action will be taken from the BOJ.

Any further action from BOJ will be closely monitored during the upcoming period, where it seems that the BOJ’s intervention is the only effective measure to affect the yen’s movements.

Major highlights for this week that will affect the USD/JPY pair’s trading:

Monday November 28:

On Monday at 15:00 GMT, the U.S. economy will release the New Home Sales for October where it’s expected to drop by 1.0% to 310 thousand from 313 thousand.

Tuesday November 29:

On Tuesday at 23:30 GMT (Monday), Japan will release the annual Household Spending for October which had a prior reading of –1.9%. As for the Japanese Jobless Rate for October it had a previous reading of 4.1%.

At 23:30 GMT the Japanese economy will release the annual Retail Trade for October with a prior reading of –1.2%, while the seasonally adjusted Retail Trade for October had a prior reading of –1.5%.

The U.S. economy will release the Consumer Confidence of November at 15:00 GMT, with a prior reading of 39.8 and it’s expected to come at 43.5. While the House Price Index for September had a prior reading of –0.1%.

Wednesday November 30:

On Wednesday at 23:50 GMT (Tuesday) Japan will issue the Industrial Production for October which had a prior reading of –3.3%.

At 05:00 GMT, Japan will issue the annual Construction Orders for October with a previous reading of –9.3%.

The U.S. economy will release the ADP employment change for November at 13:15 GMT, where it’s expected to come at 128 thousands from the previous reading of 110 thousands.

The U.S. Non-Farm Productivity for the third quarter is to be released at 13:30 GMT and expected to come at 3.1% inline with the previous reading, and the Unit labour Costs for the third quarter is also expected unchanged at -2.4%.

The Chicago Purchasing Manager for November will be released at 14:45 GMT and is expected to come at 58.5 from the previous 58.4. At 15:00 GMT the Pending Home Sales will be published and it’s expected to remain flat from the prior –4.6%.

Thursday December 01:

On Thursday at 13:30 GMT, U.S. economy will issue its weekly initial claims numbers, where the number of people filing for first-time claims for the state unemployment insurance increased 388 thousand last week.

The U.S. Construction Spending for October will be released at 15:00 GMT and it’s expected to come at 0.2% inline with the previous.

The ISM Manufacturing Survey for November will be published at 15:00 GMT, with a previous reading of 50.8 and it’s expected to improve to 51.5.

Friday December 02:

On Friday at 23:50 GMT (Thursday), Japan will issue the Capital Spending for the third quarter which had a previous reading of –7.8%.

The United States of America will release the infamous jobs report on Friday at 13:30 GMT which is expected to show that the U.S. economy added 116 thousand jobs during the month of November compared with the previous reading of 80 thousand jobs. Unemployment during the month of November is expected to remain steady at 9.0%.

GBP/USD Technical Analysis for the Week of November 28, 2011

The GBP/USD pair had a horrible showing this past week as the world continues to run towards the US Dollar. The pair is currently sitting in the middle of the “line in the sand” of 1.55 – 1.53. The area is absolutely vital if bulls want any chance to regain the upper hand. As a result, we like selling a break below the 1.53 level for a long-term trade that could perhaps run as low as 1.42 before it is done. The pair is very risk-sensitive, so headline shocks out of the EU will continue to guide the direction. We don’t buy this pair as we aren’t fond of catching falling knives.

GBP/USD Fundamental Analysis for the Week of November 28, 2011

In the week ended Nov 25, the GBP/USDshowed a sharp decline as the tensions stemming from the euro area enhanced demand on the dollar as a refuge.

The rise in Italian and Spanish short-term bond yields to record high as well as German bund yields triggered concerns the debt contagion is spreading among the euro region’s largest economies amid indecision between European leaders and rejection of German Angel Merkel to issuing euro-area joint debt and the idea that the ECB should play a key role in solving debt crisis.

On the other hand, the latest forecasts by officials refer to a slowdown in growth and inflation which increases speculations policy makers will continue their expansion in the stimulus to boost recovery, thereby putting downside pressure on the sterling which fell to seven-week versus the greenback.

Amid the high demand on the dollar as a favourite safe haven due to the turbulences in European markets, forecasts are in favour of seeing further decline in the pair.

This week the main focus will be the infamous jobs report in theUnited Statesas well as housing, manufacturing and confidence data. On the flip side, the British economy will release less important data yet focus will be on PMI manufacturing and construction.

The release of the data this week will be as follows:

Monday Nov. 28:

While the British economy lacks fundamentals, theU.S.will release new home sales for Oct. at 15:00 GMT with expectations referring to a drop to 310,000 from 313,000 a month earlier.

Tuesday Nov. 29:

At 09:30 GMT, mortgage approvals, M4 money supply and net lending for Oct. will be due. At 23:01 GMT, theUKwill release Gfk consumer confidence for Nov. with expectations of seeing a drop to -34 from -32.

In theU.S., the main focus will be housing data starting with S&P/caseShiller, due at 14:00 GMT, followed by new home sales due at 14:00 GMT. At 15:00 GMT, consumer confidence is expected to soar to 44.4 in Nov. from 39.8.

Wednesday Nov. 30:

Amid the absence of data from theU.K., eyes will be on MBA mortgage applications for Nov. 25 at 12:00 GMT, followed by ADP employment change at 13:15 GMT, where it is expected to increase to 130,000 in Nov. from the previous 110,000, then at 15:00 GMT pending homes sales for Oct. will be available. Finally, at 19:00 GMT, Fed’s Beige book will be out.

Thursday Dec. 1:

As of 09:30 GMT, U.K. PMI manufacturing will show a widening contraction to 47.0 in Nov. from the prior 47.4.

TheU.S.economy will release initial jobless claims for the week ending Nov. 26 and continuing claims for the week ending Nov. 18 will be available at 13:30 GMT. At 15:00 GMT, ISM manufacturing for Nov. is expected to show a widening expansion to 51.5 compared with Oct. reading of 50.8, noting that a reading above 50 means expansion and vice versa.

Friday Dec. 2:

The week ends with the release of the awaited non-farm payrolls report from theUnited States, due at 13:30 GMT. Expectations refer that change in non farm payrolls will reach 120,000 in Nov. from the previous 80,000 while unemployment will linger at 9.0%.

However, before the release of the NFP report, at 09:30 GMT,U.K.construction is set to show a drop to 52.5 in Nov. from 53.9 in Oct., according to PMI gauge.

USD/CHF Technical Analysis for the Week of November 28, 2011

USD/CHF rose during the week as traders continue to run towards the Dollar in general. The Swiss National Bank is also working against the Franc, so it makes sense that this pair rose, and should continue to as well. The 0.95 level above should be resistive, but there is absolutely nothing fundamentally or technically to suggest that the area should continue to hold as resistance. We like buying the dips in this “buy only” pair now, and will continue to do so. If 0.95 is overcome, the parity level is next, and with Friday’s action – we may have even seen a trend change for the immediate future.

USD/CHF Fundamental Analysis for the Week of November 28, 2011

In the week ended Nov 25, the USD/CHF showed incline for the forth week as the tensions stemming from the euro area enhanced demand on the dollar as a refuge.

The rise in Italian and Spanish short-term bond yields to record high as well as German bund yields triggered concerns the debt contagion is spreading among the euro region’s largest economies amid indecision between European leaders and rejection of German Angel Merkel to issuing euro-area joint debt and the idea that the ECB should play a key role in solving debt crisis.

On the other hand, UBS put the franc under pressure after it said “the Swiss economy slowed significantly in the second half of the year as the strong franc squeezed exporters’ profit margins,” while it predicts growth to slow further to 1% in the fourth quarter.

These reports will more likely put pressure on the SNB to intervene to curb the franc’s appreciation amid the high demand on the dollar as a favourite safe haven due to the turbulences in European markets which may increase forecasts of seeing further rise in the pair.

This week the main focus will be the infamous jobs report in theUnited Statesas well as housing, manufacturing and confidence data. On the flip side, the Swiss economy will release important data such as 3q GDP, retail sales and PMI manufacturing.

The release of the data this week will be as follows:

Monday Nov. 28:

While the Swiss economy lacks fundamentals, theU.S.will release new home sales for Oct. at 15:00 GMT with expectations referring to a drop to 310,000 from 313,000 a month earlier.

Tuesday Nov. 29:

As of 07:00 GMT, the Swiss economy will release UBS consumption Indicator for the month of Oct., yet the release is expected to have slight impact on the pair’s movements.

In theU.S., the main focus will be housing data starting with S&P/caseShiller, due at 14:00 GMT, followed by new home sales due at 14:00 GMT. At 15:00 GMT, consumer confidence is expected to soar to 44.4 in Nov. from 39.8.

Wednesday Nov. 30:

KoF Swiss leading indicator which is estimated to retreat to 0.70 in Nov. from the preceding 0.80 will be available at 10:30 GMT.

Thereafter, eyes will be on MBA mortgage applications for Nov. 25 at 12:00 GMT followed by ADP employment change at 13:15 GMT, where it is expected to increase to 130,000 in Nov. from the previous 110,000, then at 15:00 GMT pending homes sales for Oct. will be available. Finally, at 19:00 GMT, Fed’s Beige book will be out.

Thursday Dec. 1:

Eyes will be Swiss GDP for the third quarter at 06:45 GMT; the quarterly reading is predicted to show an ease in growth to 0.2% from 0.4% in the second quarter. Thereafter, PMI manufacturing for Nov., due as of 08:30 GMT, is expected to show further contraction to 46.5 from the previous 46.9 recorded in Oct.

TheU.S.economy will release initial jobless claims for the week ending Nov. 26 and continuing claims for the week ending Nov. 18 will be available at 13:30 GMT. At 15:00 GMT, ISM manufacturing for Nov. is expected to show a widening expansion to 51.5 compared with Oct. reading of 50.8, noting that a reading above 50 means expansion and vice versa.

Friday Dec. 2:

The week ends with the release of the awaited non-farm payrolls report from theUnited States, due at 13:30 GMT. Expectations refer that change in non farm payrolls will reach 120,000 in Nov. from the previous 80,000 while unemployment will linger at 9.0%.

However, before the release of the NFP report, the Swiss economy will release retail sales (real) for the year ending Oct. at 08:15 GMT.

EUR/CHF Technical Analysis for the Week of November 28, 2011

EUR/CHF had a bearish week this past week as traders reacted to the relatively weak bond auctions in the EU. The Germans even had trouble selling debt, and as a result this pair sold off. The Swiss National Bank is defending a floor at 1.20, so the pair continues to have limited downside potential, but the very fact that it still managed to fall in that scenario shows just how weak this pair really would be if it weren’t for the SNB meddling in it. This says everything you need to know about the Euro: Sell it on rallies. In this pair though, we would like to buy if it can close above 1.25 or so. Until then, there simply isn’t anything to do.

EUR/CHF Fundamental Analysis for the Week of November 28, 2011

The EUR/CHF fluctuated heavily last week with the focus still on the mounting debt woes in the euro area and the rising fears over the outlook for the global economy.

Fears of the debt crisis in the euro area and the evident contagion pressures are keeping the pair on the edge with heavy volatility as we saw last week surging borrowing costs and even disappointing auction for Germany even with its low yield on fears over the outlook for the area.

Switzerland remains strained by this pressure and also with the slowing export market as global growth slows and the franc pressures companies’ earnings.

This week will continue to track the developments in the euro area and what the finance ministers might offer in the 29-30 meeting and whether there is any hope to contain the selloff in the market that extended last week to its fourth straight weekly loss!

We have more debt auctions and we need to track the yields that signal the worse is still yet to come as nations like Italy and Spain cannot sustain such high borrowing costs.

As for Switzerland we have key GDP data and the economy is surely expected to have slowed in the third quarter and the worse the data the weaker the franc will be and will support the pair higher on expectations the SNB will move to support the faltering recovery amid rising deflation threats as those expectations already started to take effect from late hours on Friday trading on expectations the bank will lift its floor.

Other news from the euro area and the Swiss economy to affect the pair this week:

Monday November 28:

Germanywill start this week at 07:00 GMT with the GFK consumer confidence survey for December, where the confidence is expected to slip slightly to 5.2 from 5.3.

The euro zone will join the session at 09:00 GMT with the M3 money supply for October, with expectations the seasonally-adjusted three-month average could have expanded by 3.1% from 2.6%, while the annual index could have improved 3.4% from 3.1%.

During the dayGermanywill release the Consumer Price index second reading for November, where the monthly CPI index is expected to expand by 0.1% from the previous steady reading, while the annual CPI index could have slowed to 2.4% from the previous 2.5%.

Germany will also provide the CPI harmonised indexes for November in a second reading, with expectations the monthly index could have dropped 0.1% from the previous 0.1%, while the annual index is expected lower at 2.8% from 2.9%.

Tuesday November 29:

As of 07:00 GMT, the Swiss economy will release UBS consumption Indicator for the month of Oct., yet the release is expected to have slight impact on the pair’s movements.

The euro zone will start the day at 10:00 GMT with the European Confidence data for November, where the business climate indicator could have dropped further to 0.23 from 0.18, while the consumer confidence final reading is expected to linger at -20.4, in the time the economic confidence could have retreated slightly to 94.0 from 94.8.

The industrial confidence is expected lower at -7.0 from -6.6, while the services confidence is expected to linger at 10.2.

The euro area finance ministers meeting in Brussels will be the highlight for our session.

Wednesday November 30:

Germany will start the session at 08:55 GMT with the unemployment report for November, where the unemployment figure is expected 7 thousands lower compared with the previous surge of 10 thousand jobs in unemployment. In addition, the unemployment rate is expected to linger at 7.0%.

The euro zone will join the session at 10:00 GMT with the annual CPI flash estimate for November, which is expected to remain steady at 3.0%.

The euro zone will also release the unemployment rate for October, with expectations that unemployment could have remained unchanged at 10.2%.

KoF Swiss leading indicator which is estimated to retreat to 0.70 in Nov. from the preceding 0.80 will be available at 10:30 GMT.

The EU finance ministers will meet in Brussels after the euro zone ministers and will be very important for the market and the euro.

Thursday December 01:

Eyes will be Swiss GDP for the third quarter at 06:45 GMT; the quarterly reading is predicted to show an ease in growth to 0.2% from 0.4% in the second quarter. Thereafter, PMI manufacturing for Nov., due as of 08:30 GMT, is expected to show further contraction to 46.5 from the previous 46.9 recorded in Oct.

Germanywill start the session at 08:55 GMT with the PMI manufacturing for November in a final reading, where the index is expected unchanged at 47.9.

The euro zone will join the session at 09:00 GMT with the PMI manufacturing index for November in a final reading, with expectations the index could have lingered at 46.4.

Friday December 02:

The euro zone will start the session at 10:00 GMT with the producer price index for October, where the monthly PPI index is expected to expand 0.2% from 0.3%, while the annual index could have expanded by 5.6% compared with the previous of 5.8%.

AUD/USD Technical Analysis for the Week of November 28, 2011

The AUD/USD pair had a bearish week again as the world’s risk appetite continues to deteriorate. The pair is rapidly approaching a hammer on the weekly chart that was the start of the most recent up move in this pair. The 0.95 level just below should be supportive, so selling at this point is going to be difficult. We prefer to sell rallies at this point in time, and will continue to do so as negative headlines will continue to push this pair lower. The breaking of 0.93 to the downside would shift this into a down trend overall in our opinion. The markets are very nervous, and that never bodes well for the Aussie. We sell rallies, and will not buy at this point.

AUD/USD Fundamental Analysis for the Week of November 28, 2011

The AUD/USD pair reached its lowest level in seven weeks, where the US dollar dominated the currency market last week which opened the way for a free fall for the pair.

The Aussie continued its downside movement against the greenback for the fourth consecutive week, where the greenback found enough support from investors to soar against other majors on haven demand.

The latest FOMC minutes showed that the bank’s members considered more easing, which fuelled risk aversion between investors driving them to prefer the greenback as a safe haven.

On the other hand, the U.S. congress failed to reach a final decision to cut the budget deficit, spilling more uncertainty among investors as the EU debt crisis continued to draw a gloomy picture for the global economy.

Aussie lost momentum after the Reserve Bank of Australia cut its interest rate and indicated that they will keep the rate at theses levels till the end of the year, which reduced demand for the Australian currency.

Expectations are still bearish for the AUD/USD pair, as the current RBA’s policy does not support Aussie, while fears and concerns is feeding risk aversion which helps the US dollar maintain the upper hand.

Major highlights for this week that will affect the AUD/USD pair’s trading:

Monday November 28:

On Monday at 15:00 GMT, the U.S. economy will release the New Home Sales for October where it’s expected to drop by 1.0% to 310 thousand from 313 thousand.

Tuesday November 29:

On Tuesday at 00:00 GMT the Australian economy is to issue the HIA New Home Sales for October, where the previous reading was down by 3.5%.

The U.S. economy will release the Consumer Confidence of November at 15:00 GMT, with a prior reading of 39.8 and it’s expected to come at 43.5. While the House Price Index for September had a prior reading of –0.1%.

Wednesday November 30:

The U.S. economy will release the ADP employment change for November at 13:15 GMT, where it’s expected to come at 128 thousands from the previous reading of 110 thousands.

The U.S. Non-Farm Productivity for the third quarter is to be released at 13:30 GMT and expected to come at 3.1% inline with the previous reading, and the Unit labour Costs for the third quarter is also expected unchanged at -2.4%.

The Chicago Purchasing Manager for November will be released at 14:45 GMT and is expected to come at 58.5 from the previous 58.4. At 15:00 GMT the Pending Home Sales will be published and it’s expected to remain flat from the prior –4.6%.

Thursday December 01:

On Thursday at 22:30 GMT (Wednesday), Australia will release the AiG Performance of Manufacturing Index for November, where it had a prior reading of 47.4.

At 00:30 GMT, the Australian economy will release the seasonally adjusted Retail Sales for October, where it had a previous reading of 0.4%. The RBA Commodity Index SDR for November will be released at 05:30 GMT, where it had a prior reading of 19.4%.

At 13:30 GMT, U.S. economy will issue its weekly initial claims numbers, where the number of people filing for first-time claims for the state unemployment insurance increased 388 thousand last week.

The U.S. Construction Spending for October will be released at 15:00 GMT and it’s expected to come at 0.2% inline with the previous.

The ISM Manufacturing Survey for November will be published at 15:00 GMT, with a previous reading of 50.8 and it’s expected to improve to 51.5.

Friday December 02:

On Friday at 00:30 GMT, Australia will release the Building Approvals for October, where it had a prior reading of –13.6%, while the annual Building Approvals had a previous reading of –12.0%.

The United States of America will release the infamous jobs report on Friday at 13:30 GMT which is expected to show that the U.S. economy added 116 thousand jobs during the month of November compared with the previous reading of 80 thousand jobs. Unemployment during the month of November is expected to remain steady at 9.0%.

USD/CAD Technical Analysis for the Week of November 28, 2011

The USD/CAD pair shot straight up during the week as traders continue to buy the US dollar hand over fist. The risk profile of the markets is being reduced as the world worries about recession and debt markets. The Dollar and its safe haven status will more than likely continue to push this pair higher, but we are getting lofty at this point. The pair should prove to be a “buy on the dips” pair going forward, and the 1.07 level will be a real test. The breaking of that level to the upside sends this pair to at least 1.10, and quite possibly higher. We don’t sell this pair at the moment – there are far too many reasons to own Dollars now.

USD/CAD Fundamental Analysis for the Week of November 28, 2011

The USD/CAD pair extended its gains last week, as the U.S. dollar extended its gains to reach the highest level in seven weeks on mounting fears the European debt crisis is worsening, after Germany witnessed one of its worst Bund auctions since the inception of the Euro, while yields on Italian bonds rose last week above 7%, a level that forced Greece, Ireland, and Portugal to seek bailouts, and yields on Spanish bonds also rose last week, which raised fears that the debt crisis is spreading into major economies within the euro zone area.

Meanwhile, economic data from the United States generally showed worse than expected performance, where GDP fell below projections, as the U.S. economy expanded in the third quarter by 2.0%, down from 2.5% in the prior estimate, while the income report showed that spending levels expanded at a moderate pace ahead of the holiday season, which raised concerns over the outlook of the world’s largest economy.

Europe will be very much the focus next week, where traders will be eyeing new developments on the European debt crisis, where Italy and Spain, the third and fourth largest economies in the euro zone area, are facing mounting pressures from the debt crisis, and the uncertainty that is surrounding the outlook continues to weigh down on confidence.

Traders will be eyeing the EU Finance Ministers meeting next week, where they will discuss the recent developments regarding Greece, and most likely Italy, and the European Financial Stability Facility fund. Moreover, traders will be eyeing bond auctions in Italy, France, Belgium, and Spain. Accordingly we should expect high levels of fluctuations in markets.

Important data will be released from Europe and the United States next week, where the ISM manufacturing index is due next week. Nonetheless, the main focus will be the employment data, as investors will be first eyeing the ADP employment report on Wednesday and after that their attention will shift to the U.S. jobs report, which is due on Friday. Traders will be also eyeing data from Canada, where the GDP report for September is due to be released, and the Canadian jobs report will be also released on Friday.

The high level of uncertainty in markets could provide the USD/CAD pair with more bullish momentum, where traders will be eyeing developments in Italy and Spain, and accordingly, we should expect Europe to dominate the pair’s movement next week. Moreover, data from Canada and more importantly from the United States are likely to dominate the mood towards the end of the week, but overall we preserve a bullish outlook for the pair.

Highlights for this week that will probably affect the USD/CAD pair’s direction are:

Monday November 28:

The United States will join the session at 13:00 GMT with the new home sales figures for October, with expectations that the number on new homes sales could retreat to 310 thousands from the previous 313 thousands, while the monthly new home sales index could have dropped by 1.0% from 2.3%.

Tuesday November 29:

Canada will release the current account for the third quarter at 13:30 GMT, where the current account deficit is expected to narrow to 11.1 billion CAD, compared with the prior deficit of 15.63 billion CAD.

TheUnited Stateswill join the session at 14:00 GMT with the S&P/CS 20 report for September, where the monthly S&P/CS 20 City index is projected to remain steady compared with the previous drop of 0.05%, in the time the annual S&P/CS composite-20 could have dropped 3.00% from the previous drop of 3.80%.

At 15:00 GMT theUnited Stateswill announce the consumer confidence for November, with expectations it could have improved to 44.4 from 39.8.

Wednesday November 30:

Canada will release the industrial product price index and the raw materials price index for October at 13:30 GMT, where industrial product price are expected rise by 0.2% following the 0.4% reported in September, while raw materials prices are expected to rise by 1.5% after 1.4% in September.

Canada will also release the GDP estimate for September at 13:30 GMT, where the Canadian economy is expected to expand by 0.2% after 0.3% in August, while compared with a year earlier, GDP is expected to expand by 2.7% up from 2.4%, and growth is expected to rise to 3.0% in the third quarter, compared with the prior contraction of 0.4% in the second quarter.

TheUnited Stateswill join the session at 13:15 GMT with the ADP employment change for November, which is expected to show that theU.S.private sector could have added 130 thousands new jobs compared with the previous addition of 110 thousands in October.

At 13:30 GMT theUnited Stateswill provide the nonfarm productivity and the unit cost labour indexes for the third quarter in a final reading, where the nonfarm productivity index is expected to expand by 2.6% from 3.1%, while the unit labour costs index could have dropped by 2.1% from the previous drop of 2.4%.

At 14:45 GMT theUnited Stateswill also release theChicagopurchasing manager indicator for November, with expectations the indicator could have slightly improved to 58.5 from 58.4.

At 15:00 GMT theUnited Stateswill end the session with the pending home sales indexes for October, where the monthly index could have expanded 1.2% from the previous drop of 4.6%, while the annual index previous reading was 7.9%

Thursday December 01:

TheUnited Stateswill join the session at 13:30 GMT with the initial jobless claims figure (November 26), where the number of claims could have retreated to 390 thousands from 393 thousands.

At 15:00 GMT theUnited Stateswill provide the construction spending monthly index for October, which could have expanded by 0.4% from 0.2%.

The ISM manufacturing for November could improved to 51.5 from 50.8, while the ISM prices paid indicator could have expanded to 45.0 from 41.0.

Friday December 02:

Canada will release the jobs report for November at 12:00 GMT, where the unemployment rate is expected to remain unchanged at 7.3%, while the net change in employment is expected to show that 20.0K jobs were added, compared with the prior 54.0K lost jobs in October.

The United States will join the session at 13:30 GMT with the closely watched jobs report for November, where the public sector could have added 120 thousand jobs to the economy compared with the previous addition of 80 thousand jobs in October, while the unemployment rate is expected to linger at 9.0%.

NZD/USD Technical Analysis for the Week of November 28, 2011

NZD/USD had a rough week over the last 5 sessions as the 0.75 level gave way. This crucial area is the start of the absolute bottom of support in this market, and a violation of it could rush in a bit of a meltdown in the Kiwi dollar. The pair is highly sensitive to economic headlines and negative sentiment, so the pressure should continue to be there as the world continues to worry about recession and debt issues in the EU. We like selling rallies, and would become aggressively short of this pair if we can break the 0.70 as well. We think the move to 0.70 is coming, and view the recent breaking of 0.75 as a very bad omen.

NZD/USD Fundamental Analysis for the Week of November 28, 2011

The NZD/USD pair dropped to its lowest level in eight months, with the strong performance from greenback which dominated the FX market last week due to the pessimistic market sentiment and ongoing risk aversion.

Kiwi continued its downside movement against greenback for the fourth straight week as investors abandoned higher yielding currencies and focused on safe haven currencies such as the US dollar.

The latest FOMC minutes showed that the bank’s members considered more easing, which fuelled risk aversion driving them to prefer greenback as a safe haven.

On the other hand, the EU debt crisis still has its negative effect on financial markets and on other economies, which fuelled fears over the outlook for the global economy and drove investors to abandon higher-yielding currencies.

The NZD/USD pair is still expected to resume the bearishness during the upcoming period, and even with the expected upside recovery on a needed correction, the overall outlook till now remains bearish.

Major highlights for this week that will affect the NZD/USD pair’s trading:

Monday November 28:

On Monday at 00:00 GMT, New Zealand will release the NBNZ Activity Outlook for November, where it had a previous reading of 26.1. While the NBNZ Business Confidence for November had a prior reading of 13.2.

On Monday at 15:00 GMT, the U.S. economy will release the New Home Sales for October where it’s expected to drop by 1.0% to 310 thousand from 313 thousand.

Tuesday November 29:

The U.S. economy will release the Consumer Confidence of November at 15:00 GMT, with a prior reading of 39.8 and it’s expected to come at 43.5. While the House Price Index for September had a prior reading of –0.1%.

Wednesday November 30:

On Wednesday at 21:45 GMT (Tuesday), New Zealand will release the Building Permits for October which had a previous reading of –17.1%.

The U.S. economy will release the ADP employment change for November at 13:15 GMT, where it’s expected to come at 128 thousands from the previous reading of 110 thousands.

The U.S. Non-Farm Productivity for the third quarter is to be released at 13:30 GMT and expected to come at 3.1% inline with the previous reading, and the Unit labour Costs for the third quarter is also expected unchanged at -2.4%.

The Chicago Purchasing Manager for November will be released at 14:45 GMT and is expected to come at 58.5 from the previous 58.4. At 15:00 GMT the Pending Home Sales will be published and it’s expected to remain flat from the prior –4.6%.

Thursday December 01:

On Thursday at 00:00 GMT New Zealand will release the ANZ Commodity Price for November which had a prior reading of –3.5%.

At 13:30 GMT, U.S. economy will issue its weekly initial claims numbers, where the number of people filing for first-time claims for the state unemployment insurance increased 388 thousand last week.

The U.S. Construction Spending for October will be released at 15:00 GMT and it’s expected to come at 0.2% inline with the previous.

The ISM Manufacturing Survey for November will be published at 15:00 GMT, with a previous reading of 50.8 and it’s expected to improve to 51.5.

Friday December 02:

The United States of America will release the infamous jobs report on Friday at 13:30 GMT which is expected to show that the U.S. economy added 116 thousand jobs during the month of November compared with the previous reading of 80 thousand jobs. Unemployment during the month of November is expected to remain steady at 9.0%.

 

Find technical analyses, fundamental analyses, Forex news and information about Forex Brokers by visiting the FX Empire. You can also check out our Best Forex Brokers list here.

About the FX Empire:
The FX Empire is dedicated to providing the most expert and timely technical and fundamental analyses to our readers. Coupling those with our Forex broker overviews and our Forex news updates assists our readers in making the best possible financial decisions for themselves. Our readers are among the best informed in the market, every day.

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.