Browsing all articles from February, 2013

Cuts Doubtful To Deliver Assure US budget Savings

On paper there is one thing to similar to regarding the ugly spending cuts due to kick in on Friday $85 billion in budget savings at a time when Washington persist to bleed red ink.

In part, that has to do with the complex way the government hold its money. However it also replicate the likelihood that the spending cuts will hurt the economy, which in turn will decrease tax revenue and compel up the costs of social safety net programs like unemployment insurance. In addition the definite savings could be a lot less than budget hawks prediction.

Steve Bell, a former Republican congressional aide now with the Bipartisan Policy Center said that there is a likelihood that we had save almost nothing in expends.

Comparatively small turn down in spending would be exaggerated over the coming years as it would decrease debt servicing costs.

However the requisition would do little to hold back federal debt over the long term as it fails to tackle health costs, which are projected to get bigger as the population ages. If the requisition were not to take effect, federal debt would equal the size of the economy by 2031.

The requisition was not supposed to happen, Democrats and Republicans in 2011 set up the deep cuts to military and domestic spending as a worst case scenario that would force them to attain tough decisions on spending and taxes in order to set US finances on a sustainable course.

Although they have been not capable to reach an agreement. Missing a last minute deal, spending cuts of almost 13 percent for defense programs and 9 percent for domestic programs will kick in just before Friday night.


Gold Heads for greatest run of monthly Fall in 16 years

Yellow metal traded little changed on Thursday, however was headed for its greatest enlarged of monthly turn down in more than 16 years as its safe haven demand has faint with the global economy showing signs of revival.

It slipped almost 1 percent in the last session, wiping out Tuesday’s addition that were fulled by US Federal Reserve Chairman Ben Bernanke’s encouragement of the bank’s monetary stimulus programmed.

Holdings of SPDR Gold Trust, the world’s largest gold backed exchange traded fund, fall to a more than six month low of 1,258.4 tonnes on Feb. 27. The holdings had been declining for seven sessions straight, marking the greatest losing run since the fund was incepted in 2004.

US economic statistics was upbeat. A gauge of planned US business spending testimony its biggest augmented in more than a year in January, signifying growing confidence in the durability of the economic recovery.

The US jobless rate is doubtful to reach more normal levels for several years, Federal Reserve Chairman Ben Bernanke stated on Wednesday as he defended the central bank’s monetary stimulus in the second day of indication in front of the Congress.

Positions hardened on Wednesday among US Republican congressional sledders and President Barack Obama over the budget crisis even as they arranged to hold previous channel talks to prevent harsh automatic spending cuts opening this week.

Spot gold traded little changed at $1,597.60 per ounce by 0048 GMT, on track for a monthly drop of 4 percent.

US gold climbed up 0.1 percent to $1,597.80 per ounce.

US stocks increased on Wednesday, with major indexes posting their greatest daily addition since early January, as Federal Reserve Chairman Ben Bernanke remained committed in supporting the Fed’s stimulus policy and statistics pointed to economic improvement.


EUR/USD D1 Technical February 28

Pair is in bearish strength today. Bollinger bands are not providing clear signals for the EUR/USD. Yesterday closure below resistance provide pair  bearish strength. Now pair will face its support 1.3009 level. Price action on this level should be carefully handle. If pair manage to break this level and H4 candle close below it, then EUR/USD is likely to continue its bearish trend and target 1.2880 level. On the contrary, if H4 candle close above support level. It will change the scenario and EUR/USD will then again move towards northward.

High impact News can change the scenario. News like Prelim GDP q/q and Unemployment Claims.


AUD/USD D1 Technical February 28


Aussies is in bullish strength, pair is currently testing its resistance at 1.0290 level. If AUD break this level and H4 candle close above 1.0290 then it will indicate that pair got more potential to move upward. If H4 candle close below 1.0290 level it will change the scenario and AUD/USD will then move towards south.

High impact News of USD can affect the trend of AUD/USD. . News like Prelim GDP q/q and Unemployment Claims.



GBP/USD D1 Technical February 28

GBP/USD is trading in a range of 1.5215-1.5050. Break of any level will clear the trend. Pair has strength to break its resistance 1.5215 level and further move up. If GBP/USD hold its key level 1.5050 level and give a day closure above resistance level. It will provide move bullish strength to Cable and GBP will then continue its northward trend and next target will be 1.5300 level. On the other hand, if pair break key level 1.5050 it will then rapidly fall towards 1.5000 level.

High impact News can affect the movement of GB/USD. News like Prelim GDP q/q and Unemployment Claims.


USD/CHF D1 Technical February 28

USD/CHF is testing is resistance at 0.9340 level. Pair is expecting to break this level today and move towards next resistance 0.9385 level. But this scenario can be change if pair get bounces under its daily resistance, it will then change the strength of pair. USD/CHF will then move towards southward and target its support  0.9227 level.

High impact Data’s can affect the trend of USD/CHF. News like Prelim GDP q/q and Unemployment Claims.


Europe Steadies Following Italy clears Auction Assessment

Euro bond and shares prices stabled on Wednesday following solid demand at an auction of Italian government debt facilitate calm fears that political stalemate in Rome could reignite the bloc’s debt crisis.

Though paying more than half a point additional interest previous to the vote, Italy sold all 6.5 billion euros of the 5 and 10 year bonds it presented investors two days following an election presented no party a majority and rehabilitated worries over its finances, It could have chosen to sell less.

European stocks and Italian bonds briefly increased following the sale. Bonds of other euro zone countries suffering worries over their creditworthiness were also helped. Save haven German bonds chop down before recouping losses, as the euro dropped having just strike a session high of $1.3114.

Michael Leister, a senior bond strategist at Commerzbank in London said that a very strong auction on all accounts, mutually when we look at the pricing side and the demand side. The Tesoro packed the maximum amount, with 4 billion allocated in the new 10-year which is very strong.

Italian 10-year yields chop down 7 basis points to 4.83 percent in the secondary market, the Bund future was 18 basis points up on the day at 145.09 following the sale.

The reinforcement over Italy was somewhat offset by statistics from the European Central Bank which demonstrate bank lending to euro zone firms contracted for the ninth month in a row in January although its record low interest rates.


Gold Seized About 2 week Elevated As Ben Bernanke Backs Incentive

Precious Gold traded flat on Wednesday, settle on near a 2 week high strike in the last session as Federal Reserve Chairman Ben Bernanke protected the bank’s monetary policy, lending support to yellow metal as a hedge verses central banks’ cash printing.

Federal Reserve Chairman Ben Bernanke strongly defended the US central bank’s monetary incentive prior to Congress on Tuesday, easing financial market doubts over a possible early recoil from bond purchases.

US home prices closed out 2012 with the largest annual addition in more than six years as sales of new homes spiked in January, the hottest sign that the housing market was on the patch up, statistics demonstrate on Tuesday.

Italy’s political parties hunted for a way self-assured on Tuesday subsequent to an uncertain election gave none of them a parliamentary majority and threatened prolonged instability and a renewal of the European financial crisis.

Goldman Sachs cut its 2013 gold price predicted to $1,600  per ounce from $1,810 per ounce, stating the precious metal’s current price slump and an boost in US real interest rates have led it to bring forward its projections for a turn down in the yellow metal.

Spot gold was little changed at $1,613.61 per ounce by 0028 GMT, following trouncing a 2 week high of $1,619.66 per ounce. It increased 1.2 percent on Tuesday, its major daily addition in three months.

US gold slumped down 0.1 percent to $1,613.30 per ounce.

In addition, remarks from Federal Reserve chairman Ben Bernanke relieved investors that the central bank was not about to recoil on its asset buying program. Fed bond buying has formerly supported bullion.


USD/CHF D1 Technical February 27

USD/CHF is in bullish potential. Pair will face its resistance at 0.9385 level. If pair manage to break this level and give a daily closure above it then pair will further move upward and target North. On the contrary, If H4 candle close below resistance then it will change the scenario and USD/CHF will then start to move downward.

High impact News can affect the pair. News like Core Durable Goods Orders m/m, Fed Chairman Bernanke Testifies and Pending Home Sales m/m.


EUR/USD D1 Technical February 27

The outlook for EUR/USD is bullish. Rate is at last Bollinger showing oversold zone for EUR . So, pair can get a good pull back and will target 1.3170 level if EUR/USD manage to hold its support 1.2988 level. On the other hand, If pair manage to break its support level and give a daily closure below 1.2988 level. It will indicate strong bearish strength and pair will then start to move further towards southward.

High impact News can affect the movement of EUR/USD. like Core Durable Goods Orders m/m, Fed Chairman Bernanke Testifies and Pending Home Sales m/m.