German manufacturing PMI april: 48.1 vs 47.9 exp

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• Cable taking heart from good PMI data
• EURUSD orders
• GBPUSD orders
• UK construction PMI april: 49.4 vs 48.00 exp
• Italian producer prices april: m/m 0.0 % vs +0.1% prev
• Eurozone manufacturing PMI april : 46.7 vs 46.5 exp
• German manufacturing PMI april: 48.1 vs 47.9 exp
• French manufacturing PMI april: 44.4 vs 44.4 exp
• Italian manufacturing PMI april: 45.5 vs 44.8 exp
• Swiss PMI april: 50.2 vs 49 exp
• Spanish manufacturing PMI april: m/m 44.7 vs 44.2 prev
• European equity markets open lower
• EURUSD fails to hold early gains
• The problems facing the ECB even with a rate cut
• Nikkei 225 closes down 0.76% at 13,694.04
• UK mortgage time-bomb
• AUD lower on talk of weaker Chinese GDP
• Data coming up in this session
• Option expiries 10am NY cut
• ForexLive Asia Wrap posted now – follow this for the link

Cable taking heart from good PMI data Posted: 02 May 2013 01:57 AM PDT Good morning one and all. The better that expected construction PMI data gave a small boost to the pound popping it to 1.5580. It’s the first to beat expectations since December when it fell below the all important 50 mark. The figure has shown a marked improvement each month since the March low of 46.8. It’s just another small part of the economy that’s looking like it’s starting to turn around, albeit very slowly. It may not be enough to change Mike’s view of the economy but the arrows are beginning to point up not down. Cable still hasn’t managed to force its way through the upper channel line, though we have managed to get a foot hold above the 100 dma. If we can get a close above it then we should get a further push up. As you can see we still have the 50 fib level at 1.5604 to contend with, as well as Mike’s aforementioned large orders at 1.5600. Aside from what happens today, tomorrows UK Services PMI will be the figure to watch. The Feb read broke above the 50 mark and the service sector is usually the one that shows the most strength in a recovery. The expectation is for an unchanged read at 52.4 so a better print will underpin cable further and dent any hopes of further QE from the BOE next week.

EURUSD orders Posted: 02 May 2013 01:53 AM PDT The 1.3150 area is proving a good base for the moment with bids all the way down to 1.3130. Low post 1.3147. Sellers 1.3190, 1.3200, 1.3240,1.3250,1.3280, 1.3300, 1.3320, 1.3350 Buyers 1.3140, 1.3130, ( stop loss selling if breached), 1.3100,1.3085,1,3050,1.3030,1.3000

GBPUSD orders Posted: 02 May 2013 01:42 AM PDT That jump just now after  construction PMI  was short lived with orders at 1.5580-85 and the larger interest at 1.5600 still in place I hear. Currently 1.5567. Sellers 1.5585,1.5600,1.5625,1.5640,1.5675 Buyers 1.5545,1.5525,1.5500,1.5480,1.5450,1.5425

UK construction PMI april: 49.4 vs 48.00 exp Posted: 02 May 2013 01:30 AM PDT 47.2 prev GBP higher immediately with GBPUSD at 1.5578 from 1.5560 but stalling as I type

Italian producer prices april: m/m 0.0 % vs +0.1% prev Posted: 02 May 2013 01:00 AM PDT y/y  -0.1%  vs  +0.3% prev

Eurozone manufacturing PMI april : 46.7 vs 46.5 exp Posted: 02 May 2013 12:58 AM PDT 46.5 prev

German manufacturing PMI april: 48.1 vs 47.9 exp Posted: 02 May 2013 12:54 AM PDT 47.9 prev A little better than forecast but remember that anything below 50 is still contraction as with the other numbers just posted. EURUSD a tad higher at 1.3162 but hearing that an Asian sovereign is selling up above 1.3160

French manufacturing PMI april: 44.4 vs 44.4 exp Posted: 02 May 2013 12:48 AM PDT 44.4 prev

Italian manufacturing PMI april: 45.5 vs 44.8 exp Posted: 02 May 2013 12:43 AM PDT 44.5 prev PMI output 45.4 vs 43.4 prev Euro unimpressed with EURUSD still at 1.3158

Swiss PMI april: 50.2 vs 49 exp Posted: 02 May 2013 12:30 AM PDT 48.3 prev

Spanish manufacturing PMI april: m/m 44.7 vs 44.2 prev Posted: 02 May 2013 12:18 AM PDT manufacturing new orders  index falls to 43 vs 43.3 prev. lowest since Nov 2012

European equity markets open lower Posted: 02 May 2013 12:04 AM PDT FTSE  -0.1% DAX -0.1% CAC40 -0.5% IBEX -0.2% FTMIB -0.5%

EURUSD fails to hold early gains Posted: 01 May 2013 11:38 PM PDT The earlier move up in this pair failed to hold above 1.3180 and is now testing support at 1.3150 Buy orders noted here with stop-loss selling if breached. ACB noted on the bid  for reserve diversification previously. EURJPY and EURGBP also lower at 127.95 and 0.8461

The problems facing the ECB even with a rate cut Posted: 01 May 2013 11:18 PM PDT There is growing expectation of a rate cut later from the ECB but just how much it might help remains the big question   Here’s the BBC’s respected economics editor’s take on the problematic decision

Nikkei 225 closes down 0.76% at 13,694.04 Posted: 01 May 2013 11:02 PM PDT down 105.31 points but a small recovery from the afternoon lows

UK mortgage time-bomb Posted: 01 May 2013 10:46 PM PDT This is not going to help increase spending in the economy as mortgagees shore up their defences and draw down reserves, or try and borrow more to cover. Let’s hope that FLS scheme really does do the job but it won’t be for what it was intended in this case. Damage limitation at best.

AUD lower on talk of weaker Chinese GDP Posted: 01 May 2013 10:28 PM PDT There’s talk out there that the next Chinese GDP figure will give real cause for concern. Just to add to the earlier weak Chinese PMI reading and growing calls for a rate cut by the RBA AUDUSD continues its fall and now looks to run into the strong buying interest that  we’ve  been posting about for days at 1.0200-1.0220. Currently 1.0228.. low posted 1.0226

Option expiries 10am NY cut Posted: 01 May 2013 09:20 PM PDT USDJPY 96.50,97.00,98.00,99.00,100.00 EURUSD 1.2950,1.3000,1.3070,1.3090,1.3100,1.3135,1.3150,1.3160,1.3200 GBPUSD 1.5380,1.5540 USDCHF 0.9255,0.9275,0.9305 AUDUSD 1.0250,1.0290,1.0360,1.0365,1.0375 NZDUSD 0.8415 EUTJPY 126.00

ForexLive Asia Wrap posted now – follow this for the link Posted: 01 May 2013 09:04 PM PDT Th wrap-up didn’t make it to Twitter, find it here: ForexLive Asia Wrap

Action Insight Market Overview	Markets Snapshot
Sentiments Weighed Down by Dovish FOMC, ECB Rate Cut Awaited Sentiments was somewhat weighed down by the dovish FOMC statement overnight as DOW dropped -138.85 pts while S&P 500 dropped -14.87 pts. Asian equities also followed by opening lower and stay soft. The development in US equities suggests that recent consolidation is still in progress and is probably extending with another down leg. DOW faced some selling pressure ahead of April's high of 14887. While S&P 500 edged to record high earlier this week, it also faced some pressure ahead of 1600 psychological level. A focus will be on whether the NFP from US on Friday would trigger deeper pull back in stocks and pressure commodity currencies. But before that, focus will be on ECB rate decision today first. Full Report Here...
Featured Technical Report
EUR/AUD Daily Outlook Daily Pivots: (S1) 1.2720; (P) 1.2783; (R1) 1.2886; More..... EUR/AUD rises further to as high as 1.2866 so far today and broke mentioned 61.8% retracement of 1.3189 to 1.2218 at 1.2818. Intraday bias remains on the upside and current rally would now extend towards 1.3189 resistance next. On the downside, break of 1.2611 support is needed to signal completion of such rebound from 1.2218. Otherwise, outlook will stay cautiously bullish. 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 Report

ECB To Cut Policy Rate To 0.5% There has been increasing conviction that the ECB would announce to cut interest rates at its Thursday meeting, thanks to the weakness in economic data. While disappointing German PMI and IFO, and the French business climate indicator had shown initial signs of vulnerability of the bloc's economic developments, moderate inflation and the rise in jobless rate released yesterday have reinforced easing bias. On the rate cut, the deposit rate, currently at zero, is expected to stay unchanged. Read more... Fed Opens The Door For Further Easing As Economic Recovery Slows Down As widely expected, the Fed left its policy stance unchanged with asset purchases of 85B maintained. Yet, the policy statement was increasingly dovish with policymakers indicating that further easing would be adopted should the economic recovery stall. The central bank acknowledged economic growth at a moderate pace but admitted slowdown in inflation and was less enthusiastic on the job market. It also raised concerns that the negative effects to be imposed by fiscal tightening. The policy statement was also a reminder that QE can move in both direction, rather than market focus of reduction later in the year. Read more...

Economic Indicators Update
GMT Ccy Events Actual Consensus Previous Revised 23:50 JPY Monetary Base Y/Y Apr 23.10% 19.80% 1:30 AUD Building Approvals M/M Mar -5.50% 1.30% 3.10% 3.00% 1:30 AUD Import Price Index Q/Q Q1 0.00% -0.50% 0.30% 1:45 CNY HSBC Manufacturing PMI Apr 50.4 50.6 51.6 7:30 CHF SVME-PMI Apr 50.2 49 48.3 8:00 EUR Eurozone PMI Manufacturing Apr F 46.5 46.5 8:30 GBP PMI Construction Apr 48 47.2 11:30 USD Challenger Job Cuts Y/Y Apr 30.00% 11:45 EUR ECB Rate Decision 0.50% 0.75% 12:30 EUR ECB Press Conference 12:30 CAD International Merchandise Trade (CAD) Mar -0.70B -1.02B 12:30 USD Trade Balance Mar -$42.0B -$43.0B 12:30 USD Non-Farm Productivity Q1 P 1.80% -1.90% 12:30 USD Unit Labor Costs Q1 P 0.00% 4.60% 12:30 USD Initial Jobless Claims 345K 339K 14:30 USD Natural Gas Storage 30B
Orders and Options Watch
European Session: Orders and Options Watch EUR: Despite rising to as high as 1.3243 yesterday, the single currency ran into defensive offers below 1.3250 option barrier and has retreated in European and NY sessions, bids at 1.3165-70 were filled. At the moment, some bids are still noted at 1.3140-50 and also at 1.3120 as well as 1.3100 (good size), stops are reported below 1.3140 and 1.3100 (large) but mixture of bids and stops is located further out at 1.3050-60. On the upside, offers are now reported at 1.3190-00 and also in good size at 1.3220, indicated defensive offers remain at 1.3250 with stops expected above said barrier. Option expires today include: 1.2950, 1.3000, 1.3070, 1.3090, 1.3095, 1.3100, 1.3135, 1.3150, 1.3160, 1.3165 and 1.3200. Read more...
Forex Trade Ideas
Trade Idea: GBP/USD - Sell at 1.5630 Although the British pound has retreated after rising briefly to 1.5607 yesterday, reckon the Ichimoku cloud (now at 1.5519-29) would limit downside and risk remains for recent upmove to extend one more rise to 1.5625-30, however, still reckon upside would be limited to 1.5640-45 (50% projection of 1.5196-1.5547 measuring from 1.5467), risk from there is seen for a strong pullback to take place later. A clear break below the Ichimoku cloud bottom would bring weakness to 1.5500 Read more... Trade Idea: EUR/USD - Turn short at 1.3200 Although the single currency resumed recent rise to 1.3243 yesterday, the subsequent retreat suggest a temporary top is possibly formed there (with a shooting star on both hourly and daily chart), hence consolidation with mild downside bias is seen for test of previous resistance at 1.3121 but break of the lower Kumo (now at 1.3115) is needed to add credence to this view and bring correction of recent upmove to 1.3100 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 Euro Erases Gains, JPY Strengthens Asia Session: A One-Two Punch Adds To AUD's Battering Aussie, Stocks And Copper Hit By Weak Growth Fed Maintains Policy, But Prepared To 'Increase Or Reduce' QE U.S. FOMC Leave Funds Target and Purchase Program Unchanged Technical Highlights EURJPY 'One Way, Or Another' GBP/USD Tranquil In Absence Of Data Day Daily Technical Analysis Daily Forex Update: AUD/USD