Eur/usd - page 179

 

German Ifo business climate falls to 22-month low in October

German business confidence deteriorated to the lowest level in almost two years in October, dampening optimism over the health of the euro zone’s largest economy, industry data showed on Monday.

In a report, the German research institute, Ifo said its Business Climate Index fell to a seasonally adjusted 103.2 this month, below forecasts for 104.3 and down from a reading of 104.7 in September.

The Current Assessment Index declined to 108.4 in October, disappointing expectations for a reading of 110.0 and down from 110.5 in September.

The Business Expectations Index, which measures attitudes toward business prospects over the next six months, dropped to 98.3 this month from 99.3 in September, missing forecasts for 98.9.

The monthly index is based on a survey of around 7,000 German firms in the manufacturing, construction, wholesale and retail sectors.

EUR/USD was trading at 1.2689 from around 1.2695 ahead of the release of the data, while EUR/GBP was at 0.7878 from 0.7882 earlier.

Meanwhile, European stock markets were mostly lower. Germany's DAX fell 0.15%, the DJ Euro Stoxx 50 shed 0.3%, France’s CAC 40 slumped 0.3%, while London’s FTSE 100 dipped 0.1%.

source

 

There Is One Huge Thing Missing From The ECB's Stress Tests

On Sunday, the European Central Bank released the results of "stress tests" performed on 130 eurozone banks.

Twenty-five banks failed.

There's a bit of a split on whether or not these results were good.

But there is no divide on whether or not the ECB considered one key scenario: deflation.

Analysts at Societe Generale said the results show that in an adverse scenario that occurs in 2016, only 7 billion euros of capital would be needed. And given that these stress tests involved banks holding more than 20 trillion euros in deposits, they don't think this is a huge deal.

Others aren't so sure, including economist Philippe Legrain who called the results, "Yet another eurozone bank whitewash."

In a blog post Legrain, who wrote a book on the eurozone crisis titled, "European Spring: Why Our Economies and Politics are in a Mess — and How to Put Them Right," wrote in a blog post on Sunday that the stress test's capital need assumptions are "ludicrously overoptimistic."

But aside from how you choose to argue some of the ECB's assumptions, the central bank said, point blank, that it did not consider a situation where prices fall across the eurozone.

In a press conference following the results, the ECB's Vítor Constâncio said, "The scenario of deflation is not there because indeed we don't consider that deflation is going to happen."

Constâncio added, "But let me highlight that nevertheless, whereas the baseline scenario which is in the stress test has inflation at 1.6 in 2016, in the adverse it comes down to 0.3. So this drop in inflation is indeed factored in, in the exercise and is a very significant drop. So it cannot be said that we did not consider the impact of a scenario of very low inflation. Indeed, we did it in comparison with the baseline."

But the problem is that we are already seeing falling inflation across the eurozone, with prices rising just 0.3% across the economic bloc in September.

And what's more, deflation has already been a reality for many of the bloc's economies.

The Telegraph's Ambrose Evans-Pritchard noted on Twitter that in the last six months we've seen deflation in Spain, Italy, Greece, and Portugal.

And as a whole, the euro area saw prices rise just 0.3% year-over-year in September, according to data from Eurostat, down from increases of between 0.7% and 0.9% a little less than a year ago.

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Some volatility was expected the next day to be known stress tests among European banks.

The dollar traded mixed against its peers but has been stronger than the EUR.

R3 - 1.27581

R2 - 1.27266

R1 - 1.26971

Pivot - 1.26656

S1 - 1.26361

S2 - 1.26046

S3 - 1.25751

 

price kept trading above friday's candle which consider as the day support level. RSI and Stochastic are oversold I'll be looking for a buy position above 1.2700

 

EURUSD was consolidating during the course of yesterday session, essentially going nowhere. The pair continues to struggle at the 1.27 level, and as a result it’s we may expect the sellers to come into this marketplace and make their presence be known. Even if we rally from here, it’s very likely that we will see a significant amount of selling pressure somewhere in the neighborhood of 1.2795.

 

Great analysis for today, I am totally agree with it.

Thank you.

 

Germany Import Prices Continue To Fall In September

Germany's import prices continued to decline in September, data from Destatis showed Tuesday.

Import prices slid 1.6 percent year-on-year in September, which was slower than the 1.9 percent decrease seen in August. The index has declined in each consecutive month since January 2013.

Nonetheless, the annual rate of decline was slower than a 1.9 percent decrease forecast by economists.

Excluding crude oil and mineral oil products, the import price index was 0.6 percent below the level of a year earlier.

Month-on-month, import prices gained 0.3 percent, confounding expectations of a 0.1 percent drop. In August, import prices slid 0.1 percent.

At the same time, export prices advanced 0.1 percent from a year ago, offsetting a 0.1 percent fall in August. On a monthly basis, export prices were up 0.2 percent after staying flat in August.

source

 

The movements of the EUR / USD this Monday were consolidation, keeping close to the moving average of 50 periods, and the 1st of the barrier resistance (1.27218).

R3 - 1.27647

R2 - 1.27393

R1 - 1.27218

Pivot - 1.26964

S1 - 1.26789

S2 - 1.26535

S3 - 1.26360

 

great thanks for the update

 

After a boring European session, with the pair trading either side of the 1.2700 handle, stronger price action was again dictated by US data.

This meant upside for the EUR, and the pair spiked from 1.2708 to 1.2760, eventually printing a high at 1.2765. The pair came off these high somewhat as the session moved closer to the close on little fundamental, almost retracing its initial strength, yet EURUSD stabilized around the 1.2730 level.

Looking ahead to the seminal FOMC rate decision today where all analysts are expecting the FOMC to taper and finish QE3.