Action Insight Market Overview	Markets Snapshot
Euro Extends Rally as China Stocks Lead Asian Equities Higher Strong rally in China stock markets led Asian equities higher today and pressured dollar and yen. Euro has been the relatively stronger one this week and also supported rally in EUR/CHF, which was triggered by talk of negative interest rates on Swiss Franc deposits. EUR/USD continues its rally and is staying comfortably above 1.31 level for the moment. EUR/USD is set to take on 1.3171 key near term resistance soon. EUR/JPY also leads other yen crosses higher and is edging closer to 108 level. Though, commodity currencies lag behind again. Aussie's rally is limited as Q3 GDP missed expectations and grew 0.5% qoq only. Looking ahead, UK PMI services will be the main focus in European session, together with Osborne's Autumn forecast statement. US will release ADP employment as well as ISM services. Full Report Here...
Featured Technical Report
EUR/JPY Daily Outlook Daily Pivots: (S1) 106.98; (P) 107.18; (R1) 107.45; More EUR/JPY is picking up momentum again and soars to as high as 107.95 so far today. Intraday bias remains on the upside and current rise from 100.32, which is part of the rally from 94.11, should target 100% projection of 94.11 to 104.58 from 100.32 at 110.79 next, which is close to 111.43 key resistance. On the downside, below 106.85 minor support will turn bias neutral and bring retreat. But downside should be contained by 105.27 support and bring rally resumption. Read more... EURUSD Technical Outlook USDJPY Technical Outlook GBPUSD Technical Outlook USDCHF Technical Outlook USDCAD Technical Outlook AUDUSD Technical Outlook EURJPY Technical Outlook EURGBP Technical Outlook EURCHF Technical Outlook GBPJPY Technical Outlook

Special Reports

BOC Leaves Policy Rate at 1%, Stating Fiscal Cliff as the key Uncertainty in US As expected, the BOC left the overnight rate target at 1%, with Bank Rate and deposit rate at 1.25% and 0.75% respectively. While a more dovish tone regarding both global and domestic economic developments was delivered in the statement than the October one, the central bank retained the view that withdrawal of some of the stimulus might be required. Read more... RBA Lowers Cash Rate To 3% The RBA lowered it cash rate by -25 bps to 3% in December. The current policy rate is now at the lowest level since October 2009 and the easing trend will likely continue through 2013. The rate cut has been widely anticipated by the market as the central bank struggles to stimulate domestic economy. Governor Glenn Stevens warned of strong Australian dollar and stated that the near-term outlook for non mining investment would remain 'relatively subdued'. Read more...

Economic Indicators Update
GMT Ccy Events Actual Consensus Previous Revised 0:01 GBP BRC Shop Price Index Y/Y Nov 1.50% 1.50% 0:30 AUD GDP Q/Q Q3 0.50% 0.60% 0.60% 9:00 EUR Eurozone PMI Services Nov F 51 50.6 9:30 GBP PMI Services Nov 51 50.6 10:00 EUR Eurozone Retail Sales M/M Oct -0.20% -0.20% 13:15 USD ADP Employment Change Nov 125K 158K 13:30 USD Non-Farm Productivity Q3 F 2.70% 1.90% 13:30 USD Unit Labor Costs Q3 F -0.90% -0.10% 15:00 USD Factory Orders Oct 0.00% 4.80% 15:00 USD ISM Non-Manufacutring Composite Nov 53.5 54.2 15:30 USD Crude Oil Inventories -0.4M -0.3M 20:00 NZD RBNZ Rate Decision 2.50% 2.50%
Orders and Options Watch
US Session: Orders and Options Watch EUR: The single currency continued to head north since European session, option players pulled out their offers at 1.3090 and stops above 1.3100 barrier are in focus, however, sell orders from large corps are scattered from 1.3120 up to 1.3150 (where another barrier is located) with next batch of buy stop orders tipped above there. On the downside, bids are raised to 1.3060-65 and also at 1.3040-45, then from 1.3020 down to 1.3000, more buying interests are located at 1.2970-80 with sell stop orders located below 1.2970 and 1.2950, mixture of bids and stops is located around 1.2930-40, more buying interests are noted at 1.2900-10 and combination of bids and stops is expected at 1.2870-80. Read more...
Forex Trade Ideas
Trade Idea Update: EUR/USD – Buy at 1.3025 As the single currency has maintained a firm undertone after recent rally, suggesting recent upmove is still in progress and further gain to 1.3100 would be seen, however, loss of upward momentum should prevent sharp move beyond 1.3125-30 and reckon previous resistance at 1.3140 would hold on first testing, price should falter well below recent high of 1.3172, risk from there is seen for a retreat to take place later. Read more... Trade Idea: AUD/USD – Hold long entered at 1.0400 The Australian dollar found renewed buying interests at 1.0393 and has staged a rebound in line with our expectations, adding credence to our bullishness and test of indicated resistance at 1.0491 would be seen, a break of this level would signal recent rise from 1.0149 has resumed and extend gain towards 1.0525-30 but break of 1.0550-60 is needed to indicate the fall from 1.0625 top has ended, then an eventual retest of this level would follow Read more... Candlesticks Intraday Trade Ideas Update Schedule (GMT): 1st Update: 0630 - 0700; 2nd Update: 0930 - 1000; 3rd Update: 1230 - 1300; 4th Update: 1500 - 1530 Pairs Covered: EUR/USD, USD/JPY, GBP/USD, USD/CHF Elliott Wave Daily Trade Ideas Update Schedule (GMT): AUD/USD, EUR/JPY: 0800 - 0830; EUR/GBP, USD/CAD: 1430 - 1500
Suggested Readings
Fundamental Highlights EUR/USD Extending Rally AUD/USD: Australian GDP Grew In The Q3 FY2012 EUR/USD: US Dollar Weighed Down By Concerns Over The US Fiscal Cliff AUDUSD Held Its Ground Despite Softer Than Expected Q3 AU GDP Data Technical Highlights USD/JPY And EUR/JPY In Breakout Mode The Daily Wave Analysis Daily Forex Update: AUD/CAD USD/JPY - A Bit Overstretched In The Near Term?

USDCAD Dips after BoC, EUR/CHF Jumped on Negative Rates Talks Canadian dollar strengthened mildly after BoC kept rates unchanged at 1.00% as widely expected. Bank rate and deposit rate were also kept unchanged at 1.2.5% and 0.75% respectively. In the accompanying statement, most importantly, BoC noted again that "some modest withdrawal of monetary policy stimulus will likely be required" to meet the 2% inflation target. The tightening bias is providing a little boost to the loonie. Regarding global economy, BoC noted that fiscal cliff uncertainty is holding back US recovery but Chinese growth "appears to be stabilizing". In Canada, Q3 was "weak" due to "transitory disruptions in the energy sector." But BoC expects "the pace of economic growth is expected to pick up through 2013." The central bank also reiterated challenges of Canadian dollar's persistent strength". Full Report Here...
Featured Technical Report
USD/CAD Mid-Day Outlook Daily Pivots: (S1) 0.9927; (P) 0.9939; (R1) 0.9964; More... USD/CAD dips in early US session but is so far staying in recent tight range. Intraday bias remains neutral. While another fall cannot be ruled out, as long as 0.9874 support holds, near term outlook stays cautiously bullish. Rise from 0.9633 is still in favor to continue. Above 0.9981 minor resistance will turn bias back to the upside for retesting 1.0056 first. But sustained break of 0.9874 will argue that whole rise from 0.9633 is already completed and will turn near term outlook bearish. Read more... EURUSD Technical Outlook USDJPY Technical Outlook GBPUSD Technical Outlook USDCHF Technical Outlook USDCAD Technical Outlook AUDUSD Technical Outlook EURJPY Technical Outlook EURGBP Technical Outlook EURCHF Technical Outlook GBPJPY Technical Outlook

Special Reports

RBA Lowers Cash Rate To 3% The RBA lowered it cash rate by -25 bps to 3% in December. The current policy rate is now at the lowest level since October 2009 and the easing trend will likely continue through 2013. The rate cut has been widely anticipated by the market as the central bank struggles to stimulate domestic economy. Governor Glenn Stevens warned of strong Australian dollar and stated that the near-term outlook for non mining investment would remain 'relatively subdued'. Read more...

Economic Indicators Update
GMT Ccy Events Actual Consensus Previous Revised 23:50 JPY Monetary Base Y/Y Nov 00:30 AUD Current Account Balance (AUD) Q3 -14.9B -14.7B -11.8B -12.4B 00:30 AUD Building Approvals M/M Oct -7.60% -1.60% 7.80% 9.50% 03:30 AUD RBA Rate Decision 3.00% 3.00% 3.25% 09:30 GBP PMI Construction Nov 49.3 50.5 50.9 10:00 EUR Eurozone PPI M/M Oct 0.10% 0.00% 0.20% 10:00 EUR Eurozone PPI Y/Y Oct 2.60% 2.50% 2.70% 14:00 CAD BoC Rate Decision 1.00% 1.00% 1.00%
Orders and Options Watch
US Session: Orders and Options Watch EUR: The single currency continued to head north since European session, option players pulled out their offers at 1.3090 and stops above 1.3100 barrier are in focus, however, sell orders from large corps are scattered from 1.3120 up to 1.3150 (where another barrier is located) with next batch of buy stop orders tipped above there. On the downside, bids are raised to 1.3060-65 and also at 1.3040-45, then from 1.3020 down to 1.3000, more buying interests are located at 1.2970-80 with sell stop orders located below 1.2970 and 1.2950, mixture of bids and stops is located around 1.2930-40, more buying interests are noted at 1.2900-10 and combination of bids and stops is expected at 1.2870-80. Read more...
Forex Trade Ideas
Trade Idea Update: EUR/USD – Buy at 1.3025 As the single currency has maintained a firm undertone after recent rally, suggesting recent upmove is still in progress and further gain to 1.3100 would be seen, however, loss of upward momentum should prevent sharp move beyond 1.3125-30 and reckon previous resistance at 1.3140 would hold on first testing, price should falter well below recent high of 1.3172, risk from there is seen for a retreat to take place later. Read more... Trade Idea: AUD/USD – Hold long entered at 1.0400 The Australian dollar found renewed buying interests at 1.0393 and has staged a rebound in line with our expectations, adding credence to our bullishness and test of indicated resistance at 1.0491 would be seen, a break of this level would signal recent rise from 1.0149 has resumed and extend gain towards 1.0525-30 but break of 1.0550-60 is needed to indicate the fall from 1.0625 top has ended, then an eventual retest of this level would follow Read more... Candlesticks Intraday Trade Ideas Update Schedule (GMT): 1st Update: 0630 - 0700; 2nd Update: 0930 - 1000; 3rd Update: 1230 - 1300; 4th Update: 1500 - 1530 Pairs Covered: EUR/USD, USD/JPY, GBP/USD, USD/CHF Elliott Wave Daily Trade Ideas Update Schedule (GMT): AUD/USD, EUR/JPY: 0800 - 0830; EUR/GBP, USD/CAD: 1430 - 1500
Suggested Readings
Fundamental Highlights EURCHF Rallies On Negative Interest Rate News EURO's Course of Action Has Not Changed RBA Cuts Rates As Expected GOLD Dives, EUR Records Fresh High EUR/USD Rebound Continues Technical Highlights GBP/USD Breaks above 1.61; 1.6178, 1.63 are Targets/Resistance USD/JPY - Failure to Extend Leads to Possible Double Top EUR/USD - 1.3138 and 1.3170, Oct. and Sept. Highs are Next EURUSD - Bullish, Sets Up For More Upside

Spain’s De Guindos: Banking union is fundamental to end doubts over the Euro

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• Schaeuble: Would be very difficult to get approval by German parliament if all banks were included in supervision by ECB
• More Nowotny: Euro functions as currency
• Latest on the Swiss bank stuff
• ECB’s Nowotny: Fears contraction of economy in Southern European countries will continue in 2013
• UK Nov construction PMI falls to 49.3…
• EU’s Barnier : ECB should be able to supervise any bank
• EUR/CHF extends rally
• AUD/USD grinds higher…
• Spanish 10 year govt bond yield off 3 bps at 5.23%
• USD/JPY sees some slight slippage in early Europe
• Spain’s November jobless rises 1.5% m/m
• Spain’s De Guindos: Banking union is fundamental to end doubts over the Euro
• Sweden’s FinMin Borg: Compromise on ECB supervision of banks possible on Tuesday
• Danish Fin Min Vestager: Enormous strength seen if non-euro states are able to join supervisor
• Is everybody happy?
• Updated option expiries
• Today’s orderboard
• European stocks seen opening marginally lower
• Gold takes an early tumble
• We could do with a real BIG tape bomb round about now

Schaeuble: Would be very difficult to get approval by German parliament if all banks were included in supervision by ECB Posted:

More Nowotny: Euro functions as currency Posted: Yippeeeeeeee!!! EU has no permanent transfer system like U.S. EFSF, ESM are no permanent transfer mechanism Political EU union not needed for euro survival (just as well) EU treaty change would mean uncertainty

Latest on the Swiss bank stuff Posted: Latest talk now has the major Swiss bank charging a minimum of -0.75% on institutional bank holdings above 100 million.

ECB’s Nowotny: Fears contraction of economy in Southern European countries will continue in 2013 Posted: I think we already knew this,  didn’t we boys and girls? Europe needs France-Germany harmony (such a drama queen) Monetary policy ‘difficult’ amid country differences Yields, spreads have stabilized Stabilization after Draghi’s OMT announcement Greece is a special problem, will need longer Debt levels becoming more important than deficits Crucial that countries don’t depend on markets Crucial lesson to avoid external funding dependence Austria must stick to fiscal discipline Bloomberg reporting.

UK Nov construction PMI falls to 49.3… Posted: ..from 50.9 in October and also below Reuters forecast of 50.5 Lowest level for nearly 4 years and comes just a day before the bi annual budget statement that George Osborne will be delivering to parliament

EU’s Barnier : ECB should be able to supervise any bank Posted: Single bank supervisor important for stability Opposes a 2-tier supervisory system Threshold for ECB oversight should be low ECB should pick the supervisory board chairman, approaching ‘very good compromise’ on supervisor Supports 1 member 1 vote on supervisory board EU is open to treaty revision on ECB supervision

EUR/CHF extends rally Posted: Amid talk a major Swiss bank will impose 1.0% charge on swiss franc balances over 100 million (chunky negative interest rate!!) Cross up at 1.2125.

AUD/USD grinds higher… Posted: Steady buying from macro names was apparently behind the drive to a fresh day’s high of 1.0471 which ran into importer offers just ahead of some buy stops now placed at 1.0480. Larger offers also lurk ahead of the 1.0500 barrier with likely heavy buy stops just above . Tech resistance lies above at  1.0515/20 ( Sept 21 high 1.0519) ahead of 76.4% fibonacci retracement of the 1.0857-0.9581 fall at 1.0558 and  stronger resistance in the 1.0564/69 highs  17/13 Sept highs) AUD’s since backed off a bit to 1.0467

Spanish 10 year govt bond yield off 3 bps at 5.23% Posted: Italian 10 year govt bond yield also off 3 bps at 4.42%. EUR/USD touch firmer again at 1.3078. Helped by some further buying of  the EUR/CHF cross, which is up over 1.2100 presently at session high 1.2110. UPDATE:  Swiss banks behind the cross buying. I shit you not

USD/JPY sees some slight slippage in early Europe Posted: We’ve slipped through 82.00, presently at 81.92 having been as low as 81.87 (EBS) Talk of sell stops through 81.85 before buy orders clustered 81.50/70 and then more stops through 81.50. I get the sense (but no real confirmation) that the stops through 81.50 could be rather lumpy.

Spain’s November jobless rises 1.5% m/m Posted: By 74,296 people to 4.9 mln. Ughh

Spain’s De Guindos: Banking union is fundamental to end doubts over the Euro Posted: Eurogroup recognizes Spanish budget and reform efforts (Bloomberg)

Sweden’s FinMin Borg: Compromise on ECB supervision of banks possible on Tuesday Posted: How exciting EUR/USD hits new session high 1.3077.

Danish Fin Min Vestager: Enormous strength seen if non-euro states are able to join supervisor Posted: Need to be able to join up on an equal footing Possible to resolve  open supervisor issues today Need to work out EBA role to represent all EU countries Common supervisor has to work closely with national ones Bloomberg reporting

Is everybody happy? Posted: YOU BET YOUR LIFE WE ARE!! EUR/USD up at  1 .3064 from the 1.3052 which greeted me, having been up to the dizzying heights of 1.3072 (EBS) at one stage. Sources note a modicum of real money buying in this latest rallyette.

Updated option expiries Posted: For the 1000 NY/1500 GMT cut: EUR/USD: 1.2975, 1.2990 1.3000, 1.3030, 1.3050 USD/JPY: 81.00 (3bln), 81.30, 82.00, 82.35, 82.50, 83.00 EUR/JPY: 107.00 EUR/GBP: 0.8020, 0.8100 GBP/USD: 1.6000 AUD/USD: 1.0400, 1.0450, 1.0500

Today’s orderboard Posted: EUR/USD:  Bids 1.3040/45, 1.3020/25 and 1.3000/10. Offers 1.3065/75  ahead of offers tech res Oct 22 high 1.3084 and offers 1.3090/00 ( 1.3100 barrier), likely buy stops above GBP/USD:   Bids 1.6085/95, 1.6050/60possible sell stops below ahead of bids 1.6000/10. Offers 1.6105/20 (Mon high 1.6116, Oct 5 high 1.6117), likely buy stops above through 1.6140 ahead of offers 1.6170/80 EUR/GBP: Offers 0.8125/35 ahead of larger offers 0.8145/60 with likely large buy stops above 0.8165 (Oct 22 high). Bids 0.8105/15 and 0.8080/90 possible sell stops just below, tech supp/options at 0.8060/70 (200 day MA 0.8062, daily cloud top 0.8064), more bids 0.8040/50 USD/JPY: Bids 82.00/10 sell stops below  and through 81.85 but stronger bids 81.50/70 with sell stops on a break.Tech res tenkan line 82.26 ahead of offers 82.40/50 (exporters) buy stops through 82.80 ahead of large offers 82.90/00 (barrier 83.00) very large buy stops just above. EUR/JPY:  Offers 107.40/50, 107.60/70 buy stops above ahead of offers 107.90/00  with more buy stops above. Bids 106. 95/05, and 106.70/80, sell stops below .  More bids 106.45/55, sell stops below and through 106.00 AUD/JPY:  Bids 85.45/55 ( 85.81  tenkan line) likely sell stops through 85.40 and 85.20 ahead of  tech supp 85.00/10, sell stops below through 85.00. Offers 85.90/00 and 86.15/25, tech res 86.40/50 (Apr 2 high 86.50), likely buy stops above. Ahead of tech res 86.70/75 (86.74 Apr 2 high) AUD/USD: Bids 1.0410/20 and 1.0390/00, sell stops through 1.0385, (100 day MA 1.0391, cloud top 1.0387)  ahead of large bids 1.0350/60 with more sell stops below. Offers 1.0470/80 (importers), ahead of barrier interest at 1.0500) large buy stops above ahead of offers/tech res 1.2510/20 (Sep 21 high 1.5019) EUR/AUD: Bids 1.2485/95 and 1.2450/60 ahead of tech supp 1.2410/20 (200 day MA at 1.2412). Offers 1.2540/50 ahead of tech res cloud top1.2565 and offers 1.2570/80, buy stops above. NZD/USD: Bids 0.8200/10 tech support 0.8170/80 and 0.8130/40 (daily cloud base 0.8138) . Offers 0.82325/35, strong offers 0.8260/70 possible buy stops above ahead of tech res/offers 0.8290/0.8310 (Nov 7 high 0.8309)

European stocks seen opening marginally lower Posted: Financial bookies see European stocks opening marginally lower;  FTSE, DAX and CAC 40 all down as much as -0.3%.

Gold takes an early tumble Posted: Stop losses were triggered down through $1710 and $1705 briefly breaching the psychological $1700  to lows around $1698.75 before a weak bounce back to $1704. The dip was halted around the 100 day MA currrently $1698.50 which is providing support ahead of the 200 day MA down at $1662.60. Gold is presently trading around $1702.70

We could do with a real BIG tape bomb round about now Posted: I jotted down my closing North American EUR/USD level Monday as 1.3052 and we’re presently at……………1.3052. Nothing of consequence on the euro zone economic data front today Buy orders seen clustered 1.3040/45 and more 1.3020/25, sell orders clustered 1.3065/75 and more up at 1.3090/00 ahead of 1.3100 barrier option interest. Might pop out and do a spot of Christmas shopping later this morning.