EUR/usd
The beginning of November was quite a hard time for stocks and risky assets. However, since the middle of the month the situation began to change for the better. Eventually, the S&P 500 index grew by 0.29%. It's a petty growth, but taking into account the 6% drop in the middle of November we can speak about a rather good demand for risky assets by the beginning of December. The November sale pushed the stock to the levels where they again became attractive for buyers. The currency market, however, lacks this consistency. eurusd got above 1.30 on the last trading day of November and started this day at 1.3030. The return is partly a result of favourable statistic from China, but actually we can't but notice the existence of some buyer of the euro, which systematically pushes up the currency, even despite the continuing uncertainty around Greece and poor news from other EU countries, the unemployment growth and growing evidence that Germany gradually loses the growth impulse and the periphery countries are still in the descending spiral. The growth of trade surplus in Europe is a favourable factor, but with oil prices growing and the euro appreciating even this factor is unlikely to be effective for long. If at the beginning of the next year the USA and China don't show a higher growth, the surplus may again vanish. Thus, we should take into consideration that the situation is at risk to get worse, but at the same time there is still some space for growth. The euro may try to get above 1.31 after two futile attempts in September and October.
EUR/GBP
As mentioned above, not all the currencies were on firm ground against the dollar last month. For example, the sterling now looks weak against the dollar and the euro. The demand for the dollar at the beginning of November pushed the pair back to its 200-day MA, but the further purchases allowed the pair to move off this level. Still the sterling is a figure and a half lower than was by the beginning of November. EURGBP demonstrates even a greater progress. The rate is getting farther and farther away from 0.80, now being already at 0.8130. Ahead there is an important resistance at 0.8150, from where the currency rolled down twice last year. Yet, this time the chances to break through this level are fatter: less concern about Greece deprives the sterling of the funds which it could get from the Europeans seeking shelter from the risks of the sovereign-debt crisis.
USD/JPY
In November the Japanese yen was falling quickly on the expectations of the December government elections. The new government is believed to spur further depreciation of the yen and pump more money into the economy. In our opinion, the yen may keep depreciating in December. More so, at the end of November the pair corrected and consequently may start growing with renewed vigour now. The current situation may be equal to that in the 90s, when the decisive measures of the government reversed the market.
AUD/USD
The aussie is another currency, which hasn't felt very well recently. The general surge of optimism in the markets couldn't stop the drop of AUD on the poor retail sales data. The zero growth for October has increased the risk that tomorrow the RBA will cut the rate for two months out of caution. In January the Bank won't hold the meeting, so Stevens has to predict the risks for two months at once.
