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Friday, December 16, 2011

Dollar Prone to Steady Retracement if Risk Aversion Flags Next Week Euro Traders Weigh ECB’s Liquidity Program against Downgrade Threat New Zealand Dollar Showing Standout Strength as Market Rates Climb Japanese Yen: Will the Bank of Japan Rock the Boat before Year End? Swiss Franc Wedged between SNB Efforts and European Crisis British Pound Likely Pricing Little Risk in BoE …

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By John Kicklighter, Currency Strategist ; David Rodriguez, Quantitative Strategist ; Ilya Spivak, Currency Strategist ; David Song, Currency Analyst ; Michael Boutros, Currency Analyst  and  Christopher Vecchio, Junior Currency Analyst
DailyFX provides forex news on the economic reports and political events that influence the currency market.Learn currency trading with a free practice account and charts from FXCM. …

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British_Pound_May_Rise_on_Profit-Taking_BOE_Minutes_on_Tap_body_Picture_5.png, British Pound May Rise on Profit-Taking, BOE Minutes on TapBritish_Pound_May_Rise_on_Profit-Taking_BOE_Minutes_on_Tap_body_Picture_6.png, British Pound May Rise on Profit-Taking, BOE Minutes on Tap Fundamental Forecast for British Pound: Neutral The British Pound remains sensitive to trends in market-wise risk appetite as GBPUSD continues to show a significant correlation with the S&P 500, the go-to proxy for sentiment trends. As the Christmas/New Year holiday period observed in most of the world’s financial centers draws near, this relationship is likely to offer Sterling the scope …

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US_Dollar_Expect_a_Correction_if_the_Euro_Doesnt_Intensify_body_Picture_5.png, US Dollar: Expect a Correction if the Euro Doesn’t IntensifyUS_Dollar_Expect_a_Correction_if_the_Euro_Doesnt_Intensify_body_Picture_6.png, US Dollar: Expect a Correction if the Euro Doesn’t Intensify Fundamental Forecast for the US Dollar: Neutral The dollar has two significant obstacles that it must overcome to extend this past week’s impressive run and move on to 11-month highs: a rising tolerance for financial shocks and expectations for a seasonal slump in speculative participation. Lifting the dollar requires an active and extensive fundamental push. Though global rates are closing …

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There are a number of cross currents in the market at the moment that are sending mixed messages.  The elliott wave pattern is ambiguous with a bullish bias.  The VIX is trending down, but the Dollar is trending up.  Leading stocks are no longer doing well, but some are beginning to show some buying interest.  This is a typically bullish …

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New_Zealand_Dollar_Will_Larger_Deficits_Overshadow_Faster_Growth_body_Picture_5.png, New Zealand Dollar: Will Larger Deficits Overshadow Faster Growth?New_Zealand_Dollar_Will_Larger_Deficits_Overshadow_Faster_Growth_body_Picture_6.png, New Zealand Dollar: Will Larger Deficits Overshadow Faster Growth? Fundamental Forecast for New Zealand Dollar: Bearish The New Zealand dollar slipped to a fresh monthly low of 0.7460 as market participants scaled back their appetite for risk, but we may see the high-yielding currency gain ground in the week ahead as the economic docket is expected to highlight an improved outlook for the isle-nation. Indeed, we’re expecting to see …

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Aussie_Looks_Towards_RBA_Minutes_for_Direction_in_Light_Conditions_body_Picture_5.png, Aussie Looks Towards RBA Minutes for Direction in Light ConditionsAussie_Looks_Towards_RBA_Minutes_for_Direction_in_Light_Conditions_body_Picture_6.png, Aussie Looks Towards RBA Minutes for Direction in Light Conditions Fundamental Forecast for Australian Dollar: Bearish The Australian Dollar was the second worst major against the U.S. Dollar – only the Euro was weaker – falling 2.28 percent over the past week. Overall, global financial markets were not given much reason to bid the Aussie higher – another disappointing Euro-zone summit, a rate cut by the Reserve Bank of Australia …

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Canadian_Dollar_Faces_Pressure_Though_Oil_Offers_Cushion_body_Picture_5.png, Canadian Dollar Faces Pressure, Though Oil Offers CushionCanadian_Dollar_Faces_Pressure_Though_Oil_Offers_Cushion_body_Picture_6.png, Canadian Dollar Faces Pressure, Though Oil Offers Cushion Fundamental Forecast for Canadian Dollar: Neutral The Canadian Dollar had a mediocre week against the U.S. Dollar, falling 2.06 percent against its southern neighbor. A mixed batch of data over the week certainly didn’t help the Loonie, and with the bulk of poor data coming in during the latter half of the week, it is of no coincidence that the …

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US_Dollar_Drifts_Lower-_Index_Holds_Above_Key_Support_at_10000_body_Picture_2.png, US Dollar Drifts Lower- Index Holds Above Key Support at 10,000 US_Dollar_Drifts_Lower-_Index_Holds_Above_Key_Support_at_10000_body_Picture_3.png, US Dollar Drifts Lower- Index Holds Above Key Support at 10,000 The greenback was modestly weaker two hours ahead of the close in New York with the Dow Jones FXCM Dollar Index (Ticker: USDollar) off by 0.11% on the session. Equity markets rallied early in the session after the Italian Lower House approved new austerity measures and Euro group president Jean-Claude Junker cited that officials are likely to meet an informal …

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Last year I talked about the St. Louis Fed’s Financial Stress Index (which I am calling the STLFSI in order to lower my carpal tunnel risk) as a measure of financial market risk that I consider complementary to the VIX and in some cases perhaps even a superior alternative. Given the fact that some investors have difficulty coming to terms…

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Gold continued to decline yesterday after the sharp falls recorded a day earlier; silver on the other hand changed direction and slightly rallied. The U.S. Producer Price Index slightly inclined according to yesterday’s PPI report, and the Philly Fed Manufacturing Index also rose in December. Today, the ECB President will give a speech, and the U.S. CPI report. Gold slipped …

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Fundamental Headlines • BofA, Goldman, Barclays Have Fitch Ratings Cut – Bloomberg • Europe’s Crisis May Hold Seeds of Dealmaking – Bloomberg • Consumer Prices Flat in November – Reuters • Congress Blinks on Shutdown – WSJ • Ties That Bound Europe Now Fraying – WSJ European Session Summary The U.S. Dollar sell-off continued in the overnight, as a lack …

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