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Forex WebTrader

2007-19-12

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ECB Liquidity Infusion Opening Up For Jolly Holidays
The record liquidity infusion yesterday created a positive sentiment that it should help alleviating the financial crisis

Overnight News Bullets

SZ Adjusted Real Retail Sales (Oct), out at 2.2% vs. 5.2% exp. 7.1% prior.
UK CPI MoM/YoY (Nov), out at 0.3%/2.1% vs. 0.3%/2.2% exp. 0.5%/2.1% prior.
UK Core CPI YoY (Nov), out at 1.4% vs. 1.6% exp. 1.5% prior.
UK Retail Price Index (Nov), out at 209.7 vs. 209.6 exp. 208.9 prior.
UK RPI MoM/YoY (Nov), out at 0.4%/4.3% vs. 0.3%/4.2% exp. 0.4%/4.2% prior.
UK RPI Ex Mort Int. Payments (Nov), out at 3.2% vs. 3.1% exp. 3.1% prior.
E-Z Euro-Zone Trade Balance nsa (Oct), out at 6.1B vs. 3.5B exp. 3.1B prior.
E-Z Euro-Zone Trade Balance sa (Oct), out at 4.0B vs. 3.0B exp. 3.9B prior.
CA Consumer Price Index MoM/YoY (Nov), out at 0.3%/2.5% vs. 0.2%/2.4% exp. -0.3%/2.4% prior.
CA Bank Canada CPI Core MoM/YoY (Nov), out at 0.0%/1.6% vs. 0.2%/1.8% exp. -0.2%/1.8% prior.
UK Total Business Investment QoQ/YoY (3Q F), out at 2.0%/6.6% vs. 0.0%/4.6% exp. 0.0%/4.6% prior.
CA Leading Indicators MoM (Nov), out at 0.0% vs. 0.1% exp. 0.1% prior.
US Housing Starts (Nov), out at 1187K vs. 1176K exp. 1229K prior.
US Building Permits (Nov), out at 1152K vs. 1150K exp. 1178K prior.
NZ Visitor Arrivals (Nov), out at 2.8% vs. -2.6% prior.
NZ Food Prices (Nov), out at 0.4% vs. 0.6% prior.
US ABC Consumer Confidence (Dec 16), out at -17 vs. -23 prior.
AU Westpac Leading Index (Oct), out at 0.5% vs. 0.8% prior.
JN All Industry Activity Index (Oct), out at 1.2% vs. 1.1% exp. -1.6% prior.
AU DEWR Skilled Vacancies MoM (Dec), out at 1.9% vs. 0.6% prior.
Markets
FX: EURUSD consolidating around 1.4400, Yen weakness with risk appetite picking up.
Stocks: Slight positive sessions in Europe and US helped by ECB liquidity injection. Asia up on average, though Nikkei down
Fixed Income: Treasuries supported by the liquidity infusion.
Commodities: Oil still supported above 90$ a barrel. Precious metals lacking direction

O/N Data Heat map:

EU	US	JP	UK	SZ	AU	CA	NZ	NO	SE	FR
+	(+)		+	-		-

Calendar

Today's Highlights:

Time (GMT)	Region	Release	Consensus
08:30	SW	Riksbank interest rate announcement (DEC)	4.00%
09:00	GE	IFO – Business Climate (DEC)	103.8
09:00	GE	IFO – Current Assessment (DEC)	109.9
09:00	GE	IFO – Expectations (DEC)	98.0
09:30	UK	Bank of England – minutes
10:00	EC	Construction Output MoM/YoY (OCT)	Prior 0.0% / 1.5%
12:00	US	MBA Mortgage Applications (DEC)	Prior 2.5%
13:30	CA	Wholesale Sales MoM (OCT)	0.2%
15:30	US	DOE U.S. Crude Oil Inventories (DEC)	-1500K
15:30	US	President Bush speaks on Energy Bill
21:45	NZ	Current Account Balance (3Q)	-4.910B
21:45	NZ	Current Account %GDP (3Q)	-8.2%
23:50	JN	Merchands Trade Balance Total (NOV)	JPY917.5B
23:50	JN	Adjusted Merchands Trade Balance Total (NOV)	JPY973.4B

This and Next Week’s Highlights:

Date	Region	Release
20 Dec	AU	RBA Foreign Exchange Transactions
20 Dec	JN	BoJ Target Rate, Convenience Store Sales
20 Dec	GE	GfK Consumer Confidence Survey
20 Dec	SZ	Trade Balance, Producer & Import Prices
20 Dec	NO	Unemployment Rate
20 Dec	UK	GDP, Current Account, Public Finances, Public Sector Net Borrowing, M4 Money Supply, M4 Sterling Lending, BSA Mortgage Approvals
20 Dec	US	Personal Consumption, GDP Price Index, Core PCE, Initial Jobless Claims, Continuing Claims, Leading Indicators, EIA Natural Gas Storage Change, Philadelphia FED
20 Dec	NZ	GDP
21 Dec	AU	New Motor Vehicle Sales,
21 Dec	NZ	Credit Card Spending
21 Dec	GE	Import Price Index
21 Dec	SW	Manufacturing Confidence, Consumer Confidence, Economic Tendency Survey, PPI,
21 Dec	EC	E-Z Currenct Account SA, Industrial New Orders,
21 Dec	UK	Retail Sales, Index of Services, GfK Consumer Confidence Survey
21 Dec	US	Personal Income, Personal Spending, PCE Deflator, PCE Core, University of Michigan Confidence, Baker Hughes U.S. Rig Count
21 Dec	CA	GDP, Retail Sales

What's going on?

The ECB has added 350 billion EUR to the money market. Interbank rates have declined 50 bps. in the aftermath of the liquidity injections.
The Japanese government is revising growth forecasts to 1.3% annualized from 2.1% prior due to stricter rules for building permits and collapsing housing starts. JPY edging lower.
USD crosses completely lost momentum in the past 50-60 hours. A break-out might be imminent. Most likely to the upside.
US stocks closing higher after having made new 3-week lows. Nasdaq looks weakest.

EUR	USD	JPY	GBP	CHF	AUD	CAD	NZD	NOK	SEK	PLN
		-	-	+	-			+	+

FX Trading Strategies

Pair	Supp.	Resis.	Comments
EURUSD	1.4390	1.4437	Break-out play in EURUSD. Trading Range too compressed. Place order to buy at 1.4438 bid, target 1.4524. Use 25 pips trailing stop. Place order to sell at 1.4390 offered. Target 1.4553. 20 pips trailing stop

Equities

Liquidity Infusion - The Last Push For a “White Christmas”?

The Liquidity Infusion by the ECB y’day was and is viewed as rather positive news, in addition Goldman Sachs showed some positives in that they managed to gain in the worst quarter of Wall Street since ’01 however they remained somewhat bleak on the future. Today’s important events is Minutes from Bank of England and Morgan Stanley reporting Q4 earnings.

DAX	UKX	CAC	OMX	KFX	OBX	SMI	NDX	DJI	SPX	NKY
+		+	+	+	+	+				-

Equity Trading Strategies

Trading Strategy: With a bullish sentiment entering the day, we are looking to buy Deutsche Post (DPWGn:xetr) we like the risk/reward setup and see the uptrend intact. We are looking to buy between 23.00-23.25. Setting a stop at 22.80. Pushing for a target of 25.

Equity Index Levels

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