German GDP was out this morning and came in line with expectations. A lot of other countries in the Eurozone are struggling to follow Germany out of the recession so EC GDP could disappoint slightly.
Calendar
| EC | 10:00 | GDP QoQ / YoY (3Q) | 0.5% / -3.9% | -0.2% / -4.8% | |
| US | 13:30 | Import Trade Index (OCT) | 1.0% | 0.1% | |
| US | 15:00 | U. of Michigan Confidence (NOV) | 71.0 | 70.6 | |
What's going on?
· The number of macro releases this week has been quite low so far, but today will be more exciting. German GDP has already been released and came out in line with expectations. We believe that Eurozone GDP (out at 10:00) could disappoint slightly as Germany is the main driver behind this number.
· The monthly budget statement from the US showed a deficit of $176.4 billion with receipts plummeting to a seven year low. While the net interest expense on the debt is still low, this will change once interest rates start to increase.
· U. of Michigan consumer confidence will be one of the drivers in the US today. The expectation is for a slight increase which should be doable.
· Fed members Evans and Dudley (both FOMC voters) will speak at separate events today on asset-price bubbles and the financial system, respectively.
FX
| EURUSD | 0/- | Rally likely limited to 1.4900-10 for a re-test of 1.4825, possibly 1.4775. abv 1.4960 negates stance. |
| USDJPY | 0/+ | Suppt now found at 89.90-00 lvl for a rebound to 90.60 en-route for 91.0. Stop below 89.60. |
| EURJPY | 0 | Likely finding a base at 134.0 for a 134.0 – 135.00 range. Below risks 133.30. |
| GBPUSD | - | Sell rallies to 1.6615-20 lvl for next leg down to target 1.6500 min. Stop abv 1.6675. |
| AUDUSD | 0/- | Risk of a deeper correction to 0.9180. Prefer to sell rallies to 0.9285-90, stop abv 0.9330. |
Equities
| DAX | 0/- | Sell on rallies towards 5660 targeting 5620. S/L above 5680. |
| FTSE | 0/- | Sell on rallies towards 5286 targeting 5239. S/L above 5306. |
| S&P500 | 0/- | Sell on rallies towards 1095 targeting 1083. S/L above 1106. |
| Nasdaq100 | 0/- | |
| DJIA | 0/- | |
FX-Options
| EURUSD | Market turned their heads towards EUR puts again after yesterday’s usd rally. |
| | Banks aggressively paying up for EUR puts now and would not be surprised to see |
| | spot reflect that and go lower. |
| EURCHF | Atm vols still remain at 2y lows, however market is still dominated by aggressive buyers |
| | of low delta eur puts, which has taken risk reversals to new highs. |
Futures
| Gold | 0 | Holding the 1,098 critical for upward momentum. Likely ranging 1,100-1,120. Below risks 1,080-1,082. |
| Silver | 0 | Expect rebound to stall at 17.35 level for a 17.15-17.35 range. |
| Oil (CLZ9) | 0 | Suppt at 76.50 holding for now. Likely ranging 76.50-78.0. |
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