TJ Marta's  Instablog

TJ Marta
Send Message
  • (BFW) Daily FX View: AUD, NZD Fall As China Fincl Conditions Tighten 0 comments
    Oct 23, 2013 6:49 AM

    NZD, AUD underperformed, JPY outperformed as China bank borrowing costs rise, banks increase bad loan write-offs, Bloomberg strategist TJ Marta writes.

    • China conditions tightening:
    • Bank borrowing costs higher; 7-day repo +47bps to 4.05%; overnight rate +72bps to 3.80%
    • Largest Chinese banks triple bad loan write-offs for 1H, stoking concern they may be clearing accounts for new defaults

    • NZD underperformed 22 peers overnight:
    • NZD/USD down sharply, breaking lower from 3-day consolidation of mid-Oct. rally
    • Support 0.8194 Oct. 2 low, 0.8163 Aug. 19 high

    • AUD underperformed 20 peers
    • Losses mitigated by 3Q CPI 1.2%q/q vs est. 0.8%
    • AUD/USD forming outside day lower after reaching new high since June
    • Technicals signal AUD extremely overbought: stochastics near high for 2013, MACD high since 2012, RSI falling from high since 2011
    • Support 0.9529 Sept. 18 high, 0.9281 Sept. 30 low

    • JPY outperformed 22 peers:
    • USD/JPY continued correction from 99.17 Oct. 17 high
    • MACD about to cross lower, stochastics crossing lower, supporting continued move lower
    • Support ~97 late-Aug. lows, 96.57 Oct. 8 low

    • CAD risk from BoC decision/statement
    • Unanimous est. from 23 economists for unch. 1.00% rate
    • Statement watched for reiteration or removal of tightening bias
    • USD/CAD higher on China developments
    • On daily chart, rebounding after consolidating for 3 days at/below 1.03; resistance 1.0420 Oct. 10 high

    • NOTE: TJ Marta is an FX strategist who writes for First Word. The observations he makes are his own.

Back To TJ Marta's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


More »

Latest Comments

Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.