Market Outlook 9.27-10.01
| 27 September 2010
True enough with the not so good reports overall for these past months have created and built the unseeminly doubtful investors to find other safe have intruments especially in overseas markets. The continuing ailing economy that has brought the USD lower and providing a more interesting outlook for the Euro and the precious metal higher for that matter.
Although, stocks has significatly gained overall from the start of the year until last week's performance were some analysts were concerned that the stock market may reverse its gains if and when the US consumer confidence and the 2nd quarter economic growth report this coming Thursday would be disappointing. Which may obviusly be the case.
The USDX opening prices slightly higher from the previous week's close still points to this directional move and would still continue to head lower. The only possible consideration for the market prices to enter in a corrective mode in almost all major currencies is the technical fact that the areas where they are now may prove to be adjusted by some major institutions towards the closing of the month. It so happens again that the closing and opening of the new month ends within this last week of trading.Plus the probability that the numbers report would be positive for the USD. Consumer confidence has always been a key factor for growth in spending, jobs, housing on top of the interest rates.
The projected 79.25bp for the low on the USDX has proven to be the extension during last weeks trading activities.The normal behavior for a technical rebound for the USDX can not be ruled out in spite of it penetrating technical head and shoulder's formation neckline.Without a convincing follow-through in volumes the corrective move may also be expected in a day-to-day price movement.
Meanwhile, the Euro's high price at 1.3495 has been the extension high for a Fib fan and retracement half way meeting point. Which may serve to be a resistance price that a pivotal correction would be highly anticipated.However, pacing the Euro is the GBPUSD which has maintained its gradual movements higher where some new longs have emerged from last week.Currently, at 1.5829 proves to be steadier. The same case extends with both the AUDUSD and the NZDUSD where the behavioral price movments are seemingly the same; of course except for their prices.Nonetheless,taking the cue from the GBPUSD for the NZDUSD would be the more likely to go as far trades are concerned. However, watch for the wider range as we go closer towards the mid-trading week and the opening of the new month at the closing of the week.With that said,pay a close attention to the cross rates between the EURGBP and AUDNZD were will cover at the middle of the week's trading.So we would see whether such analysis and outlook would prove to be true.
