Market Review for April 22

On Monday, the markets were full of calm with a slight roll to the south. Pair consolidated within a fairly narrow range, with no desire to go for more drastic action. As a result, EUR/USD ended the day near 1.3060 and GBP/USD — in the area of ​​1,5280.

EUR/USD failed to break 1.31, reaching only up to the maximum of 1.3083, although officials on Friday gave all the reasons for the strengthening, suggesting that the early rate cut is not strictly necessary. However, the market has an opinion on this matter — something clearly needs to stimulate economic activity in the euro area. Couple in the U.S. session rolled to a minimum 1.3014 and closed trading near 1.3060.

GBP/USD during the day hovered in the range of 30-Item, but by the end of the trading day began to strengthen. The pair opened the day at 1.5228, 1.5290 and reached a maximum of completed trades 10 points lower.

USD/JPY once again stopped in front of a mark 100.00, despite good demand. The pair was supported by the results of the last meeting of the G20, in which Japan was not inkvizirovana, but optimism to go on, not enough. The pair opened the day at 99.79, reached a high of 99.87 and then again came down to a minimum 98.97, in the district of which were completed trading day.

Forecast for Tuesday, April 23, 2013

Given hibernation in the markets, as well as a blank calendar on Monday, we can rightly speak of objective factors that can influence the dynamics of the exchange is not momentary, but in the near future. First of all, it is the political situation in Italy. The fact that, as the president was re-elected Napolitano (for the first time in the 67-year history of the Republic) as a result of the 6th round of the vote, said that politicians prefer to form a new government, and not to hold another election of the Prime Minister. The idea is that the chances of a speedy resolution of the political stupor in Italy rose, and, therefore, had to grow and the demand for euros.

However, the single currency is in no hurry to capacity, and all because the market in anticipation of radical moves by the ECB. Typically, the governing board prefers to prepare the players for any changes in monetary policy, and it looks like he started to do it. Last week was the assumption Weidmann possible rate cut, and on weekends — Asmussen, who said that although the effectiveness of a lower level of interest rates is not as great, though such a move is possible in certain circumstances. So watching the PMI and IFO indicators this week, for the weak performance will only increase the chances of a breakdown of 1.30 in the near future. Next target for 1,2940 and 1,2860.

With respect to the pound sterling will play important publication of British GDP. If it is confirmed return to the territory of the growth of the economy, it will be able to neutralize the negative left by the decision of Fitch’s downgrade. In addition, the couple will receive the support and understanding of what a strong need for further promotion of the Bank of England yet. Thus, the GBP/USD has a chance to go further to 1.53 and 1.5340.

Plans for major Japanese insurance companies offering investment will be in the spotlight this week. An estimated WSJ insurance business has more than 3 trillion. dollars in assets, and may begin to shift a portion of their portfolios in foreign bonds in pursuit of higher returns. With the outflow of capital flows and the yen. USD/JPY to 100 and then 100.45.


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