Month-end flows to dominate as US markets re-open
City Index October 31, 2012 1:00 PM
<p>The press is full of pictures of the havoc hurricane Sandy has caused. Investors are on the side lines as they await how the equity […]</p>
The press is full of pictures of the havoc hurricane Sandy has caused. Investors are on the side lines as they await how the equity markets will open in New York after two days of a forced close. Month-end flows however might come into play as the day progresses in the FX world.
The AUD received a further boost in Asian following the release of the September building approvals which came in much better than expected. The month on month number printed 7.8% versus an expected 6.4%. The lifestyle currency fell just shy of the 1.0400 level with technical resistance seen in the 1.0400-20 region as the next risk event for Australia is likely to come from China tomorrow in the form of the official manufacturing PMI data.
The euro has rallied 50 points in early European trading on reserve data from the Swiss National Bank that has shown their holdings in the single currency at the end of Q3 have dropped to 48% from 60% in Q2 thus showing the diversification operation they have conducted in supporting EUR/CHF at 1.2000 is largely finished.
As I mentioned above I believe the main driver for FX markets today will be month-end rebalancing with the Chicago PMI and new mortgage approvals the US data releases.
Supports 1.2930-1.2875-1.2835 | Resistance 1.3020-1.3080-1.3175
Supports 79.30-78.80-78.45 | Resistance 80.00-80.15-80.65
Supports 1.6025-1.6000-1.5975 | Resistance 1.6145-1.6185-1.6225
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.