USD/CHF will bounce off 1.0900 with a reasonable target of 0850 or just below. A small stop of 20-25 pips is all one should need unless near news time for one of the majors. If however at time of bounce Elliot Wave seems incomplete re today's uptrend, then waiting till completion as high as 0925ish might yeild a ultrta safe entry. Same target. Trading the bounce at about 0900 might be best done by taking quick profit on partial pposition and leaving the rest with stop quickly moved to at or near 0.
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Quote from FXAnalyst:
USD/CHF will bounce off 1.0900 with a reasonable target of 0850 or just below. A small stop of 20-25 pips is all one should need unless near news time for one of the majors. If however at time of bounce Elliot Wave seems incomplete re today's uptrend, then waiting till completion as high as 0925ish might yeild a ultrta safe entry. Same target. Trading the bounce at about 0900 might be best done by taking quick profit on partial pposition and leaving the rest with stop quickly moved to at or near 0.
Pattern is now such that I scratch that as a trade concept despite a probable temporary bounce down from 0925ish.
EUR/USD may bounce up temporarily but re-analysis is required to make for better trade entries. G/U may bounce the most, up from about 8550.
Swiss franc moves lower ahead of Bernanke speech
Fri, Aug 22 2008, 08:37 GMT
http://www.afxnews.com
ZURICH, Aug 22 (Reuters) - The Swiss franc moved lower against the dollar and the euro on Friday as markets await a speech by Federal Reserve Chairman Ben Bernanke later in the day.
"This is essentially a rebound in the major currencies. Additionally, yesterday's data showed that the Swiss economy is struggling," UBS economist Reto Huenerwadel said. Investors will focus on a speech from Bernanke on financial stability at the Kansas City Fed's annual symposium in Jackson Hole, Wyoming.
"It will be interesting to see what leeway central bankers have," Huenerwadel said.
UPDATE 1-UK economy grinds to halt in Q2, weakest since 1992
Fri, Aug 22 2008, 09:13 GMT
http://www.afxnews.com
LONDON, Aug 22 (Reuters) - Britain's economy unexpectedly came to a standstill in the second quarter, its weakest performance since the recession of the early 1990s, revised official data showed on Friday.
The Office for National Statistics said GDP was unchanged on
the quarter in the three months to June, down from a preliminary estimate of 0.2 percent growth and below analysts' forecasts for a revision to 0.1 percent growth.
That was the weakest since the second quarter of 1992 when the economy was in the throes of its last recession. On the year, GDP was 1.4 percent higher, revised down from an initial reading of 1.6 percent and the weakest since Q4 1992.
Sterling and the FTSE 100 index of leading British shares fell and interest rate futures rose after the data boosted expectations that borrowing costs will need to fall to prevent a deep and protracted slowdown.
"This really does put a rate cut firmly on the agenda although it is unlikely to come until we have seen the peak in inflation," said Brian Hillard, an economist at Societe Generale.
The Bank of England is already factoring in the economy standing still over the next year and has said growth needs to slow to tame inflation, which is running at more than double the central bank's 2 percent target and expected to spike higher.
The figures are likely to fan further criticism of Prime Minister Gordon Brown's handling of the economy. He will no longer be able to boast of the economy growing continuously since the Labour government came to power in 1997. But the government is likely to point out that high oil prices and a credit crunch are hurting economies right across the world. The euro zone economy contracted in Q2. The downward revisions to the preliminary estimate of British GP were across the board. Britain's mighty services sector grew by just 0.2 percent on the quarter, its poorest showing since the fourth quarter of 1995.
Manufacturing output fell by 0.8 percent on the quarter, the weakest since the first quarter of 2005. Construction output, which has been hard hit by the housing market slump, fell by 1.1
percent on the quarter -- the worst since Q3 2005.
Household spending fell 0.1 percent on the quarter, its weakest since the second quarter of 2005.
(Reporting by Sumeet Desai and Matt Falloon; Editing by Victoria Main)
Fri, Aug 22 2008, 08:37 GMT
http://www.afxnews.com
ZURICH, Aug 22 (Reuters) - The Swiss franc moved lower against the dollar and the euro on Friday as markets await a speech by Federal Reserve Chairman Ben Bernanke later in the day.
"This is essentially a rebound in the major currencies. Additionally, yesterday's data showed that the Swiss economy is struggling," UBS economist Reto Huenerwadel said. Investors will focus on a speech from Bernanke on financial stability at the Kansas City Fed's annual symposium in Jackson Hole, Wyoming.
"It will be interesting to see what leeway central bankers have," Huenerwadel said.
UPDATE 1-UK economy grinds to halt in Q2, weakest since 1992
Fri, Aug 22 2008, 09:13 GMT
http://www.afxnews.com
LONDON, Aug 22 (Reuters) - Britain's economy unexpectedly came to a standstill in the second quarter, its weakest performance since the recession of the early 1990s, revised official data showed on Friday.
The Office for National Statistics said GDP was unchanged on
the quarter in the three months to June, down from a preliminary estimate of 0.2 percent growth and below analysts' forecasts for a revision to 0.1 percent growth.
That was the weakest since the second quarter of 1992 when the economy was in the throes of its last recession. On the year, GDP was 1.4 percent higher, revised down from an initial reading of 1.6 percent and the weakest since Q4 1992.
Sterling and the FTSE 100 index of leading British shares fell and interest rate futures rose after the data boosted expectations that borrowing costs will need to fall to prevent a deep and protracted slowdown.
"This really does put a rate cut firmly on the agenda although it is unlikely to come until we have seen the peak in inflation," said Brian Hillard, an economist at Societe Generale.
The Bank of England is already factoring in the economy standing still over the next year and has said growth needs to slow to tame inflation, which is running at more than double the central bank's 2 percent target and expected to spike higher.
The figures are likely to fan further criticism of Prime Minister Gordon Brown's handling of the economy. He will no longer be able to boast of the economy growing continuously since the Labour government came to power in 1997. But the government is likely to point out that high oil prices and a credit crunch are hurting economies right across the world. The euro zone economy contracted in Q2. The downward revisions to the preliminary estimate of British GP were across the board. Britain's mighty services sector grew by just 0.2 percent on the quarter, its poorest showing since the fourth quarter of 1995.
Manufacturing output fell by 0.8 percent on the quarter, the weakest since the first quarter of 2005. Construction output, which has been hard hit by the housing market slump, fell by 1.1
percent on the quarter -- the worst since Q3 2005.
Household spending fell 0.1 percent on the quarter, its weakest since the second quarter of 2005.
(Reporting by Sumeet Desai and Matt Falloon; Editing by Victoria Main)
Libor Signals Tighter Credit as Banks Balk at Lending (Update1)
By Liz Capo McCormick and Gavin Finch
Aug. 25 (Bloomberg) -- Most of the bond strategists and salesmen that Resolution Investment Management Ltd.'s Stuart Thomson talked to last August expected the credit crunch to be long over by now. Instead, money markets show there's no end in sight, and it may even worsen.
``It's like an ongoing nightmare and no one is sure when we're going to wake up,'' said Thomson, a money manager in Glasgow at Resolution, which oversees $46 billion in bonds. ``Things are going to get worse before they get better.''
In a replay of the last four months of 2007, interest-rate derivatives imply that banks are becoming more hesitant to lend on speculation credit losses will increase as the global economic slowdown deepens. Binit Patel, an economist in London at Goldman Sachs Group Inc., said in an Aug. 21 report that nations accounting for half of the world's economy face a recession.
The premium banks charge for lending short-term cash may approach the record levels set last year, based on trading in the forward markets, where financial instruments are sold for future delivery. Back then, concern about the health of the banking system led investors to shun all but the safest government debt, sparking the biggest end-of-year rally for Treasuries since 2000.
``These problems going into year-end are likely to be worse this time round because of the amount banks have to refinance in December,'' Thomson said, citing a figure of $88 billion. ``The suspicion is that banks are still hiding losses. The banking system relies on trust and at the minute there quite simply isn't any.''
By Liz Capo McCormick and Gavin Finch
Aug. 25 (Bloomberg) -- Most of the bond strategists and salesmen that Resolution Investment Management Ltd.'s Stuart Thomson talked to last August expected the credit crunch to be long over by now. Instead, money markets show there's no end in sight, and it may even worsen.
``It's like an ongoing nightmare and no one is sure when we're going to wake up,'' said Thomson, a money manager in Glasgow at Resolution, which oversees $46 billion in bonds. ``Things are going to get worse before they get better.''
In a replay of the last four months of 2007, interest-rate derivatives imply that banks are becoming more hesitant to lend on speculation credit losses will increase as the global economic slowdown deepens. Binit Patel, an economist in London at Goldman Sachs Group Inc., said in an Aug. 21 report that nations accounting for half of the world's economy face a recession.
The premium banks charge for lending short-term cash may approach the record levels set last year, based on trading in the forward markets, where financial instruments are sold for future delivery. Back then, concern about the health of the banking system led investors to shun all but the safest government debt, sparking the biggest end-of-year rally for Treasuries since 2000.
``These problems going into year-end are likely to be worse this time round because of the amount banks have to refinance in December,'' Thomson said, citing a figure of $88 billion. ``The suspicion is that banks are still hiding losses. The banking system relies on trust and at the minute there quite simply isn't any.''
WASHINGTON (Dow Jones)--Existing-home sales climbed in July, rising more than expected, but inventories expanded and prices kept dropping.
Home resales rose to a 5.00 million annual rate, a 3.1% increase from June's revised 4.85 million annual pace, the National Association of Realtors said Monday. June originally was seen slipping 2.6% to 4.86 million.
The median home price was $212,400 in July, down 7.1% from $228,600 in July 2007. The median price in June this year was $215,100.
Falling prices are restraining sales, as would-be buyers wait for a better deal instead of signing on the dotted line. High inventories are driving down prices. Prices must fall further for inventories to recede. Analysts say inventories have a good distance to drop for a signal that price deflation is nearing an end.
Despite the sales increase, inventories of homes rose 3.9% at the end of July to a record-high 4.67 million available for sale, which represented an 11.2-month supply at the current sales pace. There was an 11.1-month supply at the end of June.
"Inventories continue to remain high, which means we are in a buyers' market," NAR economist Lawrence Yun said. "Builders need to continue to cut production more.
"We expect more balanced conditions in 2009 and will eventually return to normal long-term appreciation patterns," Yun said.
Mortgage liquidity is drying up, which is what the results this month of a Federal Reserve survey suggest. Lenders continued in the second quarter of 2008 to tighten their standards on home loans, the Fed's latest quarterly survey of senior loan officers at U.S. banks showed - signaling the credit crunch hasn't let up. About 75% said they tightened standards on prime mortgages, up from 60% in the previous survey, released in May.
Aside from tighter loan standards and prices falling under the weight of bloated inventories, a weakening job market hasn't helped the housing market. The key non-farm payrolls number in the government monthly report on employment has gone down seven times in a row.
The July resales level of 5.00 million reported Monday by NAR was above Wall Street expectations of a 4.92 million sales rate for previously owned homes. The sales level was the highest since 5.03 million in February.
The average 30-year mortgage rate was 6.43% in July, up from 6.32% in June, according to Freddie Mac (FRE).
Sales rose 5.9% in the Northeast, 0.9% in the Midwest, and 9.7% in the West. Sales fell 0.5% in the South.
-By Jeff Bater, Dow Jones Newswires; ; jeff.bater@dowjones.com
Home resales rose to a 5.00 million annual rate, a 3.1% increase from June's revised 4.85 million annual pace, the National Association of Realtors said Monday. June originally was seen slipping 2.6% to 4.86 million.
The median home price was $212,400 in July, down 7.1% from $228,600 in July 2007. The median price in June this year was $215,100.
Falling prices are restraining sales, as would-be buyers wait for a better deal instead of signing on the dotted line. High inventories are driving down prices. Prices must fall further for inventories to recede. Analysts say inventories have a good distance to drop for a signal that price deflation is nearing an end.
Despite the sales increase, inventories of homes rose 3.9% at the end of July to a record-high 4.67 million available for sale, which represented an 11.2-month supply at the current sales pace. There was an 11.1-month supply at the end of June.
"Inventories continue to remain high, which means we are in a buyers' market," NAR economist Lawrence Yun said. "Builders need to continue to cut production more.
"We expect more balanced conditions in 2009 and will eventually return to normal long-term appreciation patterns," Yun said.
Mortgage liquidity is drying up, which is what the results this month of a Federal Reserve survey suggest. Lenders continued in the second quarter of 2008 to tighten their standards on home loans, the Fed's latest quarterly survey of senior loan officers at U.S. banks showed - signaling the credit crunch hasn't let up. About 75% said they tightened standards on prime mortgages, up from 60% in the previous survey, released in May.
Aside from tighter loan standards and prices falling under the weight of bloated inventories, a weakening job market hasn't helped the housing market. The key non-farm payrolls number in the government monthly report on employment has gone down seven times in a row.
The July resales level of 5.00 million reported Monday by NAR was above Wall Street expectations of a 4.92 million sales rate for previously owned homes. The sales level was the highest since 5.03 million in February.
The average 30-year mortgage rate was 6.43% in July, up from 6.32% in June, according to Freddie Mac (FRE).
Sales rose 5.9% in the Northeast, 0.9% in the Midwest, and 9.7% in the West. Sales fell 0.5% in the South.
-By Jeff Bater, Dow Jones Newswires; ; jeff.bater@dowjones.com