EUR/usd
Corporate reports are disappointing. The analysts' favourite company – Apple – has managed to increase its net profit by 24%, but still failed to surpass the market expectations. About 70% of S&P 500 corporations have already submitted their reports by now. More often, the profit rates prove to be better than forecasted, while the turnover goes beyond expectations. This happens when companies sell high margin products, however on a smaller scale than desired by market participants. This disappointing fact sets the US stock indices along with Asia going down. And altogether this results in a lower demand for risk. The single currency was systematically sold all through yesterday afternoon. Our hope for the beginning of the reversal once again has proved to be vain. eurusd has failed to consolidate above 1.30 and is now back again at the levels of Wednesday, 1.2920. No matter how fierce the struggle for these levels is, it is really puzzling why the market has been sticking to these levels for so long. The absence of any investment idea was quite logic at the end of summer. It could be justified in September as at the beginning of the new fiscal year fresh money was just put into operation. But such a low volatility as we have now becomes a real cause for concern. More often, all this spills over into the burst of volatility. Yet now it's hard to identify which direction the markets will move in, since the situation depends much on the politicians. Technically if the markets stay in a defensive mood, the single currency may again go down to the level of its 200-day MA at 1.2835. The bulls have successfully repulsed three previous attacks of the level. All eyes before the US session will be turned towards the preliminary estimate of the US GDP in 3Q12.
GBP/USD
A day ago Britain published its GDP stats. The factual figures were much to the liking of the markets. In the third quarter the economy grew by 1.0% and showed a zero dynamics against last year's level. Among the three most important economic sectors – manufacture, services sector and construction – the first grew by 1.1%, the second – by 1.3%, only construction shrank by 2.5%. Actually it's not very surprising since construction performed well at the beginning of the year and manufacture, on the contrary, was on the decline because of an extra day off to celebrate Queen's 60-year reign.
USD/JPY
The Japanese yen grew to 80.37 against the dollar yesterday, but then followed a retracement. It was provoked by the weakness of the Asian markets, which reacted to the decline of Apple's quotes. Today we can see some profit-taking in the yen on the news from the government. The latter decided to allocate ¥423bln ($5.3bln) to stimulate the economy. Even for small Spain this sum would be very little, to say nothing about the 4trln economy. Now all attention is riveted on the country's CB, which is expected to extend the asset purchase programme on October 30.
gold
Against other markets the single currency looks rather good. In the meantime, commodities are losing their ground. For example, Gold has dropped already to $1703 per oz, though at the beginning of the month was at some point trading above 1790. The second attempt to break above this level proved to be futile. Are the bears aiming at 1670? Or even lower, at 1530?
