EUR/usd
The dashing march of stock exchanges is fading away by the end of the week, which in fact can boast the strongest growth since last January. As has already been mentioned in our previous reviews, good corporate reports helped the markets, favourably telling on the risk demand. Yet the single currency is enjoying just a nominal growth after the drop down to 2yr lows against the dollar. A sequence of ascending highs and lows in EUR/USD is good in itself, but still it is a very slack dynamics. By now the common currency hasn't managed to make any gains against the opening levels of the week. Roughly the same bounce was observed a week before. A good thing about this story is that the single currency is justly unpopular now. It was much stranger when the euro was growing despite widening of the spread between the bonds of periphery and core currencies. What changes have occurred in the attitude of market players since then? First, the situation in Germany has become different: business sentiment and economic activity show greater deterioration. A large number of EU countries (Germany, Holland, Denmark, Belgium, Switzerland) have negative yield rates. It means that those who wanted to transfer the money within the region, have already done that, or have to pay a premium for keeping their money. It is quite an unusual situation, especially in our world where it's possible to find some other currencies that deserve trust and that can bring some returns in the long run. There won't be any vital statistics today and yesterday's data on existing home sales and Philly Fed Manufacturing Index proved to be disappointing. In this regard we believe that stock exchanges are very likely to develop a correction today, driving the euro down to 1.2200.
GBP/USD
Yesterday the pound proved to be one of the currencies which were favoured by euro-sellers. The euro/pound sank below 0.78 yesterday, but has stabilized in this area by now. The pounds were actively bought for the euros yesterday afternoon, when EUR/USD was falling and GBP/USD, on the contrary, was going up. We'll hardly see the same picture today, but we can't exclude that it will occur again in the coming days. It is particularly surprising that the pound should be that steady despite poor data on retail sales. In June they grew up by 0.1% with auto fuel included, though it was expected that they would go up by 0.6%. Yet, the previous month was rather strong in this regard (1.5% growth), so yesterday's statistics don't look very disappointing. Well, for how long will Britain be able to show economic growth with such an expensive sterling, we wonder?
EUR/JPY
Yesterday USD/JPY bears were stopped only near 78.50 after an attempt to fight their way lower. The daily minimum made 78.42 yesterday. However, taking into consideration the current tendency of traders to skip from the euro to other currencies, we can suppose that this support line won't stand for long. Now traders prefer to move to liquid assets and the Japanese bond market is the second largest market in the world after the American one. Formally, in late 90s the euro was cheaper than 96¥, but this period persisted just for 3 months. By the way, the drop down to these figures occurred just from the same levels as now: from above 160.
gold
Gold bulls and bears are equally strong now. From the technical perspective we see the formation of a triangle which can end up with a sharp break upwards, taking into account the broad picture of global growth since the end of 2008. What we have to understand now is if 2012 will repeat 2008 when the world will be on the verge of collapse again. Only such fears can breathe new life into the precious metal.
