Market Review for March 26

Tuesday was much calmer: currencies have moved into consolidation mode after a sharp fall was observed in response to the EU. As a result, EUR/USD closed at 1.2860, and the GBP/USD — 1.5160 at.

As soon as the first reaction to news of Cyprus weakened, EUR/USD has stabilized in the high 1.2850. Partly brought solace and attempts Deysselbluma replay what he said on Monday. Markets reacted excessively to the word «pattern», so the head of the Eurogroup of the day had to be explained that it is not what I meant. Pair has completed trades near the opening level.

GBP/USD has continued to remain under pressure blank calendar and uncertainty. The pair opened at 1.5169 day, hit a low 1.5134 and closed 20 points higher. Meanwhile, the dynamics crosses EUR made attempts to recover, but the closure occurred near the opening level.

USD/JPY was supported by the Bank of Japan. A new chapter in a speech in Parliament sounded pretty optimistic about the economy, promising additional stimulus from monetary policy. The pair opened at 94.14 per day, reached the maximum of 94.44 during the Asian session, but that all attempts to strengthen stopped. Part of their contribution to this trend and have conflicting reports from the U.S.. One of the key reports today — the study of consumer confidence CB — showed a sharp decline from 68 to 59.7. Thus, it is possible that such sentiments are translated into the population to contain costs in the first quarter.

Forecast for Wednesday, March 27, 2013

Apparent calm Tuesday could quickly replaced by a new wave of aggressive sales, as the market will get a new piece of food for thought. By the way, as these foods may see a message saying that the money seems to be locked in the Cyprus banking sector is gradually running out of the state. According to Reuters, the ill-fated and Laiki Bank of Cyprus has offices in London, who all this time remained open and did not set any restrictions on withdrawals. In addition, Bank of Cyprus owns 80% share of the Russian bank «Uniastrum», which also did not impose limits on the withdrawal of Russia.

It turns out that most of the funds of the two Cypriot banks are raised and those unfortunates who did not found a way, it seems, will lose 100% of their deposits. Once this information is confirmed, a new wave of discontent shortsighted actions of the EU could derail the EUR/USD. Now heading back to 1.27. Maybe not today, but on Thursday the data can be confirmed with the discovery of the Cypriot banks. Here then forward reactions.

GBP/USD while adheres tactics of non-aggression against the empty economic calendar. Data published today are unlikely to cause a surge of emotion, but an adjustment to GDP should not completely discounted. Recall also that in the year to pound accumulated a large number of short positions that are just waiting for a reason to close. The next target at 1.5260, 1.53 and 1.5340.

USD/JPY has made no attempt to recover, which will grow by the end of the week due to lower volumes of repatriation flows. Kuroda yesterday’s speech also cheered a couple, as the new head of the Bank of Japan confirmed their mindset to a more loose monetary policy, including the extension of the repayment of the bonds, as well as expansion of the volume of buying long-term bonds. Perhaps these words are the announcement of plans for the next meeting of the Central Bank, to be held February 3-4. Today, a pair of consolidation may continue, but even with the advent of Thursday USD/JPY can take a course to the nearest resistance 95.00 and then 95.30.


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