EUR/usd
The end of the last week can hardly be called lucky for the euro. EURUSD slipped down from 1.3575 to 1.3370 on Thursday and continued drifting on Friday, falling as low as 1.3350. Friday's decline of the euro against the dollar doesn't look very impressive, but the currency's weakness in other key crosses is striking. The single currency depreciated much against the pound, the yen and even against the franc. Thus, we get another proof of our opinion that the period of the euro's strength and growth of EURUSD is over. The currency has rowed up the stream for a while, but it cannot last for long: either a stream changes its direction or a swimmer flings himself on the mercy of nature. In our case the latter is more likely. Though there is one more counter-argument which can warm up demand for the single currency. This is the continuation of the uptrend in the stock exchanges. The S&P 500 index keeps hitting fresh highs. However, in our opinion the stock markets are also not far from a reversal, simply Forex reacts a bit quicker. The stock exchange needs facts. And it may find them in the US retail sales report, which will be released on Wednesday. It is expected that the index will report growth of 0.1% for January. The recent published data for December (released early last week) showed a decline by 0.8% m/m and 3.4% y/y. The US consumers still feel quite confident. This cannot be said about business, which doesn't hurry to expand the output and hire new staff.
GBP/USD
At the end of the last week the sterling again got in contrast to the euro. While the single currency was depreciating, we could observe gathering of stops in gbpusd on its way up. Having bounced off 1.5630 in the middle of the week the sterling managed to reach 1.5850 at some point on Friday. EURGBP won applause by its impressive antirally in the second half of the week. The euro's weakness, in our opinion, will lead to the further depreciation of EURGBP soon, though the sterling is unlikely to have enough strength to rise against the dollar.
USD/JPY
usdjpy touched the bottom at 92.13 on Friday. It's a bit above the lows hit early last week. These levels seem to make up a good base for the further growth. But still we recommend being cautious with selling the yen before the g20 meeting, even if Japan isn't criticized much for the intention to weaken its domestic currency at it. Probably, we will hear more amicable comments from the officials (especially from the Japanese ones). Yet, it's unlikely that the pair will manage to go much above the preceding high of 94.0.
AUD/USD
The confusing behaviour of the commodity markets puts pressure on such commodity currencies as the aussie and Loonie. Even the traders' favourite, the Aussie, slipped below 1.03 this morning. The formal reason for that was decrease in the value and volume of housing loans. The chance that the RBA will cut the rate is growing.
