BOC To Deliver Same Dovish Tone As In Early May, No Change In Policy Stance In June

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Daily Report: EUR/CHF Rebounds on Greece Hope, Weak Swiss Data Swiss Franc is notably lower against Euro after EU finance ministers leader said yesterday that EU has ruled out a "total restructuring" of Greece's debts. The inspection team is expected to complete a review on Greece's implementation of bailout requirements and EU will then formulate a plan for additional aids by the end of next month. Meanwhile, it's reported that Germany will drop the call for rescheduling of Greek bonds but instead, consider to make concessions on efforts to put together a bailout for Greece. On the other hand, data from Switzerland are disappointing, with Q1 GDP grew merely 0.3% qoq comparing to consensus of 0.7% qoq. UBS consumption indicator dropped slightly to 1.59 in April. The GDP data basically ruled out the possibility of a Q2 hike from SNB. Data from Eurozone saw German retail sales rose .6% mom in April. Eurozone CPI is the main focus and is expected to be be unchanged at 2.8% yoy in May while unemployment rate is expected to be unchanged at 9.9% in April. Full Report Here...
Featured Technical Report
EUR/CHF Daily Outlook Daily Pivots: (S1) 1.2141; (P) 1.2162; (R1) 1.2191; More The break of 1.2255 minor resistance suggests that a temporary low is formed in EUR/CHF. Intraday bias is turned neutral and some recovery could be seen towards 4 hours 55 EMA (now at 1.2338). But upside is expected to be limited by 1.2484 resistance and bring fall resumption. Below 1.2100 will target 1.2 psychological level first and then 100% projection of 1.3833 to 1.2401 from 1.3234 at 1.1802 next. 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

BOC To Deliver Same Dovish Tone As In Early May, No Change In Policy Stance In June While the June BOC meeting will likely be a non-event (i.e.: the policy rate will stay at 1% while corresponding Bank Rate and Deposit Rate will remain at 1.25% and 0.75% respectively), the market focus is on whether Governor Mark Carney will hint on a rate hike in the next month. We expect the post-meeting statement will remain dovish, a similar tone as the speech the Governor delivered earlier this month. Read more...

Economic Indicators Update	The Traders Expo provides a chance to take a productive step back from the trading screen and look at the overall markets from a broader perspective. Join your fellow traders at The Traders Expo Dallas and experience it for yourself.
GMT Ccy Events Actual Consensus Previous Revised 23:30 JPY Household Spending Y/Y Apr -3.00% -2.80% -8.50% 23:30 JPY Unemployment Rate Apr 4.70% 4.70% 4.60% 23:50 JPY Industrial Production M/M Apr P 1.00% 2.20% -15.50% 23:50 JPY Industrial Production Y/Y Apr P -14.00% -12.40% -13.10% 1:00 NZD NBNZ Business Confidence May 38.3 14.2 1:30 AUD Building Approvals M/M Apr -1.30% -1.80% 9.10% 1:30 AUD Current Account (AUD) Q1 -10.4B -10.1B -7.3B 5:00 JPY Housing Starts Y/Y Apr 0.30% -3.90% -2.40% 5:45 CHF GDP Q/Q Q1 0.30% 0.70% 0.90% 6:00 CHF UBS Consumption Indicator Apr 1.59 1.66 6:00 EUR German Retail Sales M/M Apr 0.6% 1.80% -2.70% 7:55 EUR German Unemployment Rate May 7.00% 7.10% 7:55 EUR German Unemployment Change May -30K -37K 9:00 EUR Eurozone CPI Estimate Y/Y May 2.80% 2.80% 9:00 EUR Eurozone Unemployment Rate Apr 9.90% 9.90% 12:30 CAD Industrial Product Price M/M Apr 0.70% 0.90% 12:30 CAD Raw Materials Price Index M/M Apr 4.20% 5.70% 13:00 CAD BoC Rate Decision 1.00% 1.00% 13:00 USD S&P/Case-Shiller Composite-20 Y/Y Mar -3.40% -3.30% 13:45 USD Chicago PMI May 62.3 67.6 14:00 USD Consumer Confidence May 66.2 65.4
Forex Trade Ideas
Trade Idea: EUR/USD – Buy at 1.4275 As the single currency has rallied after yesterday’s minor pullback, suggesting the rise from 1.3968 is still in progress and the breach of previous resistance at 1.4345 signals a stronger retracement of recent decline from 1.4940 is still in progress for further gain towards 1.4450/55 (50% Fibonacci retracement of 1.4940 to 1.3968), however, near term overbought condition should limit upside and reckon 1.4500 would hold Read more... Trade Idea: GBP/USD – Buy at 1.6445 or sell at 1.6600 Although the British pound has risen again after yesterday’s pullback to 1.6451 and further gain to 1.6570/75 (50% projection of 1.6275-1.6515 measuring from 1.6451) would be seen, weakening of upward momentum should prevent sharp move beyond there and reckon 1.6595/00 (61.8% projection) would limit upside and bring retreat later today. Below the Ichimoku cloud top (now at 1.6476) would bring retracement to said support at 1.6451 but reckon 1.6443 (38.2% Fibonacci retracement of 1.6275-1.6547) would attract renewed buying interest and bring another rally. 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: 1330 - 1400
Suggested Readings
Fundamental Highlights Asia Session: Euro Leaves Greece In The Rearview Mirror Daily Financial Market Outlook EURO Up Late On 2nd Greece Bailout Canadian Real GDP Advance Decent, But Underlying Story Weak Technical Highlights EURUSD - Bullish Above 1.4326 The Daily Forecaster: USDCHF The Daily Wave Analysis AUD/NZD Targets 1.28

Japan Q1 Output Gap Flat Q/Q; Quake Hits Both GDP, Potential

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• JAPAN DATA: Sentiment among small businesses in……
• Japan Q1 Output Gap Flat Q/Q; Quake Hits Both GDP, Potential
• EUR sliding slowly lower
• UK DATA: This week is a working day shorter due to…
• US DATA: (4 of 4) The S&P/Case-Shiller Home Price on.
• US DATA: (3 of 4) Other indicators for manufacturing.
• ForexLive Asian market wrap: NZD reaches record high after strong trade data
• US DATA: (2 of 4) Also on Wednesday, the Challenger..
• US DATA: (1 of 4) Monday is a holiday in the US but..
• Highlights for early part of the week
• NZD/USD backs off record highs
• What would a Greek haircut mean for Germany
• PBOC set USD/CNY at new record low
• Staying quiet in Asia
• ECB Bini Smaghi: ‘Soft’ Greek Restructuring Would Be Disaster
• Around the markets
• JAPAN DATA: Japan’s trade balance for the first 10…
• USD/JPY: Very solid bids reported
• Europe/Greece Deal Would See EU Intervene in Economy: Press
• NZD/USD touchs .8216, new post-float record high

JAPAN DATA: Sentiment among small businesses in…… Posted: JAPAN DATA: Sentiment among small businesses improved slightly in May, after showing the largest month-on-month drop in April, monthly data released by Shoko Chukin Bank showed. The business sentiment index for small firms stood at 37.8 in May, up 1.7 points from April. Automakers and shipping lines contributed to the improvement in May. In April, [...]

Japan Q1 Output Gap Flat Q/Q; Quake Hits Both GDP, Potential Posted: TOKYO (MNI) – Japan’s negative output gap — excess capacity vs. slack demand — stood at -3.9%, or around Y20 trillion, in the January-March quarter, unchanged from the previous three months, the Cabinet Office said on Monday. The negative output gap widens when gross domestic product growth falls below the economy’s potential growth rate. But [...]

EUR sliding slowly lower Posted: EUR/USD and the EUR crosses continue to slide slowly lower as early European traders enter the fray and read the bearish EUR headlines from the weekend. We may see an early flurry from Swiss and German players but its unlikely that we’ll see any big moves, with the UK and the US on a long [...]

UK DATA: This week is a working day shorter due to… Posted: UK DATA: This week is a working day shorter due to Monday’s June Bank Holiday. Markit/CIPS PMI for Manufacturing will be released on Wednesday, Construction on Thursday and Services on Friday. The May numbers will of course be mined for any sign that activity is rebounding in Q2. The BOE MPC will need to see [...]

US DATA: (4 of 4) The S&P/Case-Shiller Home Price on. Posted: US DATA: (4 of 4) The S&P/Case-Shiller Home Price Index for March on Tuesday will offer further evidence of softness in home values due to the unfavorable conditions in the housing market in spite of low mortgage rates. The presence of a large inventory of distressed properties has kept valuation of homes from rising. Data [...]

US DATA: (3 of 4) Other indicators for manufacturing. Posted: US DATA: (3 of 4) Other indicators for manufacturing and services scheduled for release during the week are the Chicago Purchasing Managers Business Barometer and the Dallas Fed’s Texas Manufacturing Outlook, both on Tuesday. Coming off the holiday weekend, and with more closely-watched indicators in the days ahead, these two reports will likely get little [...]

ForexLive Asian market wrap: NZD reaches record high after strong trade data Posted: NZ April trade balance NZ$ +1.113 billion, twice as much as expected NZD/USD marginally reaches new record high at .8216 USD/CNY fixed at new record low of 6.4856 EUR has weakened slightly on more speculation regarding the Greek situation Bini-Smaghi: Soft Greek restructure could be disastrous EU could intervene in Greek economy: FT Dutch FinMin: [...]

US DATA: (2 of 4) Also on Wednesday, the Challenger.. Posted: US DATA: (2 of 4) Also on Wednesday, the Challenger report on layoff intentions in May should offer some evidence about the health of the labor market. Layoff activity has been quite low in recent months, and should remain so for now. While job growth remains sluggish, job losses have plateaued. Initial jobless claims on [...]

US DATA: (1 of 4) Monday is a holiday in the US but.. Posted: US DATA: (1 of 4) Monday is a holiday in the US but the remaining four days are packed with economic data. There won’t be much to distract from the upcoming May data on employment and payrolls, but the numbers will round out what is known about conditions in the second quarter to-date. The median [...]

Highlights for early part of the week Posted: Today is the obvious lowlight but there are some early-week events which may encourage volatility pre-US jobs data on Friday. Canadian GDP and jobs data, US consumer confidence, and EU CPI and unemployment should all catch the markets attention before the Australian GDP data on Wednesday morning Sydney time. On-going M&A flows are expected to [...]

NZD/USD backs off record highs Posted: The strong trade data wasn’t enough to push the NZD/USD convincingly through the previous multi-decade high at .8213. That level was only breached by 3 pips and the Kiwi has now joined the rest of the FX world in the doldrums. As mentioned earlier, holidays today in London and NY so it’s likely to stay [...]

What would a Greek haircut mean for Germany Posted: Der Spiegel analyses it so.

PBOC set USD/CNY at new record low Posted: Today’s fix is at 6.4856. The stronger fix for the Yuan might weigh on sentiment for USD/Asian pairs, especially USD/SGD, and this in turn might create more bearish USD sentiment against the majors. A lot of ‘mights’ in there but I’m clutching at straws, hoping for some activity.

Staying quiet in Asia Posted: Usually when I write that something happens, so here’s hoping. EUR/USD has been chopping around in a 20 pip range since it broke back below 1.4300 and as long as prices stay below 1.4340, bears will consider themselves a chance of seeing another sell-off. The situation in Greece remains in the headlines and as long [...]

ECB Bini Smaghi: ‘Soft’ Greek Restructuring Would Be Disaster Posted: SINGAPORE (MNI) – Talk of restructuring Greek debt is damaging the European economy and any action, even a so-called “soft” restructuring, would be disastrous, European Central Bank executive board member Lorenzo Bini Smaghi said in an interview with the Financial Times. According to the transcript of the interview, Bini Smaghi said restructuring would be unfair [...]

Around the markets Posted: The Nikkei is -0.35% in early trade and the Kospi is +0.7%. Oil is steady at $100.70/bbl as are both Gold and Silver at $1537/oz and $38.20/oz respectively.

JAPAN DATA: Japan’s trade balance for the first 10… Posted: JAPAN DATA: Japan’s trade balance for the first 10 days of May showed a deficit worth Y646.4 billion, compared with a deficit of Y219.4 billion a year earlier, as exports fell 13.6% y/y while imports rose 23.6%, data from the Ministry of Finance show. It is not unusual for Japan to post a deficit in [...]

USD/JPY: Very solid bids reported Posted: Solid bids reported in NY on Friday at 80.70 lows Further solid bids seen between 80.30/50 Some chat in market that China has been one of the bigger buyers over the last few trading sessions.

Europe/Greece Deal Would See EU Intervene in Economy: Press Posted: SINGAPORE (MNI) – Negotiations are continuing on a deal that would see new loans for Greece and European intervention in tax collection and sales of state assets, the Financial Times reported, citing people involved in the talks. The paper said the deal would also include more austerity measures and incentives designed to have private holders [...]

NZD/USD touchs .8216, new post-float record high Posted: AUD/NZD is sharply lower this morning, currently trading at 1.3020 down from opening levels above 1.3100