Forex? USD/JPY weekly Outlook: November 22-26

Forex pros - last week of the US dollar against the yen for the third consecutive week saw ahead rises, hit a 6-week high, before profits to trim after Federal Reserve Chairman Ben Bernanke a robust defense against the Central Bank quantitative easing program installed.

USD/JPY meet 83,77 on Thursday the pair's highest since October 5; the pair then consolidate into the 83,52 by close of trading on Friday, surging 1.25% on the week.

The couple is probably helping 82.39, the depths of November 15 and resistance at 84.38 to find high from September 27.

Speech the fed at the Conference of the European Central Bank in Frankfurt on Friday defended Bernanke's decision to buy government bonds in an effort, increasing employment and combating deflation.

The best way to support the dollar and to support the global recovery said Bernanke "by a policy which lead to a resumption of the robust growth in a context of price stability in the United States".

Elsewhere, people's Bank of China announced Friday that it increase the reserve ratio requirement for banks for the fifth time this year would cash from the financial system effective drainage to curb inflation still a string of recent actions.

Early week showed preliminary data from Japan's Cabinet Office published the economy more than expected in the third quarter grew spends in the fourth consecutive quarter.

Gross domestic product grew 0.9% in the third quarter to grow to a revised 0.4% in the previous Quartal.Das GDP grew at an annualized rate of 3.9% in the third quarter, win until a revised 1.8% in the second Quartal.Dritten quarter on the forecast for a 0.6% on quarter was increase or an annualised growth rate of 2.5%.

Next week the U.S. due to release are a range of data in a week after the Thanksgiving holiday on Thursday, including revised figures on gross domestic product for the third quarter, durable goods orders and personal income short geschnitten.Das land claims, while the Fed is his recent monetary policy meeting minutes to its weekly report on unemployed share.

Meanwhile, Japan is official data on inflation and the country's trade balance to publish while Governor of the Bank of Japan is to speak at a public commitment.

Ahead has Forex pros of next week, a list of these and other important events affecting the markets zusammengestellt.Der guide skips Monday and Friday, because it no relevant events on these days.

Tuesday, November 23

The United States are revised figures for third quarter GDP, leading indicator of economic growth to publish that is country to publish industry data on sales of existing homes, while the Federal Reserve of Richmond is Bank, is its manufacturing index to publish later in the day the fed its November monetary policy meeting minutes, publish offers an in-depth insight into economic and financial conditions in the United States

Now markets in Japan in closed meeting of the laboratory are Governor of the Bank Thanksgiving holiday to bleiben.Der of Japan, Masaaki Shirakawa is to speak in Hong Kong, his comments are to be monitored closely for all references to the future direction of monetary policy.

Wednesday, November 24.

Japan is official data on its trade balance, the difference in value between imports and exports to publish the country to share data on its corporate services price index, a leading indicator of consumer price inflation.

The United States is a whole series of data to share with the official data on first unemployment claims, Umsatz.Das country is a leading indicator of economic health and Government data on personal expenses, durable goods orders and new home inventories to publish also revised data on consumer sentiment and inflation expectations, and reports on crude oil and natural gas.

Thursday, November 25

Markets in the United States remain the Thanksgiving in closed compliance.

Meanwhile Japan is until the week with key data on consumer price inflation for round both Japan and the Tokyo area.

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Exploring the dollar Proof Concept, sector by sector

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Seeking Alpha var sector_slug = "etf-content"; by: Roger Nusbaum November 21, 2010  | about: AXID / AXIT / BRAF / CAT / EWS / EWT / IPK / IPN / MGYOY.PK / NKE / TWON     Email

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As a follow up to Friday's post ,deconstructing a Dollar Proof portfolio from Morningstar, I thought it might be interesting to explore the Dollar Proof concept going sector by sector, as while not every equity sector is so easy to add foreign exposure to, many are. In going sector by sector, the context is the ten big sectors that comprise the S&P 500. While there are ETFs for each sector, I think a portfolio that includes individual stocks is a better way to go.

Technology is a difficult sector for me as I believe the sector is still broken from ten years ago. There are plenty of tech stocks that have done well, but almost all of the most "important" domestic tech stocks are a long way below where they were ten years ago. I'm not thrilled with the broad foreign tech ETFs like IPK from SPDR and AXIT from iShares, each very heavy in Japan. I don't mind broad domestic exposure in this sector, but I think Taiwan would be a good place to look for dollar proofing. There is the iShares ETF EWT, the IndexIQ Taiwan Small Cap TWON-- which is not quite as heavy in tech stocks as EWT-- and there are several stocks easily traded in the US, most of which have very high yields.

I am quite comfortable with the financial sector for the simple reason that, from the top down, the sector warned very early on of trouble (its weight in the SPX and the inversion of the yield curve several years ago). It has been quite clear to me that domestic banks and European banks are best avoided for now--this might be the case for years to come. I've been equally vocal about avoiding Chinese banks as well.

We have had good luck with bank stocks from Chile, Australia and Canada. The banks from Norway, Singapore, Malaysia and Israel also seem to be on relatively firm ground in terms of how the businesses were run before the crisis, and I believe these can do well going forward. I also think there is utility in the publicly traded exchanges, including foreign ones. We also own an index provider.

Anyone interested in Singaporean banks could use iShares Singapore (EWS) as a proxy, as the fund is 50% financials, and while I am not wild about Brazilian banks, there is an ETF for that; GlobalX Brazil Financial Sector ETF (BRAF). Moreso than most (or even all) of the other sectors, I think individual stocks are the way to go for financials, as ETFs seem to have too much exposure to the "wrong" places.

Energy might be the easiest sector to add foreign exposure because just about every country has a big oil company. Even Hungary has its Exxon with MOL Magyar Olaj (MGYOY.PK). To be clear, I don't have any interest in the name, but it is accessible for anyone who is interested. In addition to plenty of individual stocks from all sorts of countries, there are plenty of ETFs that are broad within the sector and also very specialized--we recently added a coal industry ETF. Work still needs to be done to properly research names and segments within the sector, but finding choices is very easy.

Healthcare seems like an easy one for dollar proofing but I might give it a Lee Corso "not so fast, my friend." I think it is easy, but getting there requires a willingness to go beyond the big pharma stocks. If you agree with that statement then it rules out the broad sector ETFs, or more correctly, means not relying solely on them. Above a certain account size we use a domestic big pharma, a Swiss big pharma, a Danish specialty company and a foreign generic company.

One theme that I think could be added at some point is medical tourism, which would be foreign exposure, but I would need direct access as the pinksheet volume in these names is too thin. I personally would stay away from Chinese pharma, as it seems like the odds for something going wrong are quite high. Also, many of them are reverse mergers, which raises other problems.

For anyone not interested in going really narrow with the healthcare sector, I don't think the domestic ETFs are a bad hold. I think there is also longer term opportunity in this space-- with medical devices, which is mostly domestic-- but there are a few foreign stocks here as well. One thing to consider in this space is that many of the individual stocks have very good dividends, which might be difficult to capture in a broad ETF.

I'll address staples and discretionary together because some of the funds lump them together. For staples we have food, tobacco and alcohol for their very high dividends-- which again, may not be captured in an ETF. For discretionary we use one ETF and Nike (NKE), which aside from what I think is a great product line also captures foreign aspirational volume -- note this makes Nike a beneficiary of, not a proxy for. I can see increasing the foreign exposure here via an ETF. There is one from EG Shares and two from GlobalX. I'm not sure what I would add in or when, but there is long term value in capturing the consumer in countries where a middle class is ascending.

Industrials are also an easy sector to add foreign exposure, but I would avoid broad funds like SPDR International Industrials (IPN) or iShares International Industrial (AXID), because they are heavy in Japan and Europe. There are plenty of themes in this sector-- like water and infrastructure-- which lend themselves to foreign, and defense, for which I would go domestic-- and there are ETFs for these. There are other themes like solar and wind. Each of these has their share of headwinds these days, but the funds exist. I think a mix of ETFs and stocks is best here; we have Caterpillar (CAT) and a Swedish company, and for people willing to use individual stocks, there are names to choose from many countries.

Obviously, the materials sector has plenty of individual stocks and thematic ETFs; miners of various metals and resources, chemical companies and food related. Stocks or ETFs, I think either can work and the access is very easy. This sector should be no problem for someone who cares about dollar proofing, given the abundant choice.

Utilities are another easy one, especially for anyone willing to use individual stocks and do some research. There are many ADRs from all sorts of countries to choose from and some ETFs. The funds are not terribly precise but decent yield can be had from the funds, which doesn't happen often.

If energy is not the easiest sector to add foreign exposure then telecom is. Just about every country has a big phone company--even Morocco is accessible through this sector. We use one foreign stock with a very high yield and a domestic ETF with a decent yield. Obviously, this sector is a great source of yield for a portfolio.

In general, the narrower you are willing to go, the easier it will be to avoid some lousy markets and groups of stocks. With several sectors I believe using individual stocks will make for a better risk adjusted result, however-- there will be a lot more work involved. I would not rely exclusively on any type of product, be it ETFs or illiquid pink sheet stocks, but those two along with NYSE or regular Nasdaq ADRs should get the job done. Another reason to consider individual names is that some segments are not covered by ETFs with some examples being toll roads, fisheries and cement companies, although looking under the hood of ETFs at some of the smaller holdings can be a good starting point for research of any segment or sector.

Disclosure: No positions

Roger Nusbaum is an Arizona-based financial advisor who builds and manages client portfolios using a mix of individual stocks and ETFs. Roger writes a popular blog, which focuses on 'top down' asset allocation. We think Roger is particularly insightful on exchange-traded funds, risk management... More
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Finding Profits in Forex: Combining Elliott Wave and Fibonacci to Pinpoint Winning Trades

Traders in the know realize that there is a discrepancy between what people think is going on in the market and what is actually going on in the market. Looking at the market through the lens of Elliott Wave and Fibonacci theory can help you to see what is really happening--and how to profit from the market.s moves.

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The foreign exchange problem

The foreign exchange problem

Sunday, November 21 2010

Who tried to buy US dollars by the banks recently would know that there is a queuing system and hardly ever get your complete request in an application. For those of us in business, this is a much more acute problem since even with queues, only a portion of your US dollar requirements is available for purchase, sometimes as little as 20 percent. Business community for more than a year now has plagued this situation and company in danger of losing their credit with foreign suppliers of ? conditions and in fact has already impacted several companies places. The situation can lead, if not already in existence, how some companies to buy US dollars from other companies or persons to have to fall back to avoid a ready supply run into conflict with the supplier credit to a black market for US dollars. Another way for the acquisition of the US dollar is to buy other currencies by banks to pay US dollar bills.The transaction costs that continue this two-step conversions associated costs the U.S. Dollar.Daher while dollar exchange rate TT to the US dollar remained relatively stable by the Central Bank with an average rate of $6.37, in fact, business is paying up to $6,45 for a significant percentage (maybe up to 50 percent) its US dollar, the average cost closer to $6,41. It is only a matter of time, before there were its way into the cost of this impact on inflation again finds.

This Forex situation is a mystery as the Central Bank has stated that its foreign exchange reserves, with import cover at 13 months. It seems therefore that is an obvious answer to inject additional foreign currency in the financial system. However, the Central Bank pointed out that it has never injected unprecedented amounts of foreign currency in the financial system, in 2009 and again in 2010, and their experience shows that such amounts are usually very quickly absorbed with little lasting effect on the long queues.

Where go therefore, the US dollar?The Lieutenant Governor said Chamber members last week that there are more than 77,000 foreign currency accounts in this country, now amounting to approximately US $3Bn.It therefore seems that buy some individuals and companies and save US as a buffer, at the minimum Zinssatz.Die situation can be worse than many other purchase, send US abroad for store or investments, everything since TT dollar liquidity is so high and it no interest rate differential between the US and TT is currency deposits promotion of domestic savings in TT$.

This is a serious matter that must pay attention to the authorities, otherwise it could have far-reaching consequences.Once remains for the average person challenging access to foreign exchange, is the perception of lack of reaction of storing verursachen.Da which Central Bank is inclined to be cautious and reluctant, to flood the market with more US dollars, we could well reach a standoff position for legitimate trade.

This is a very delicate situation with no easy solution. all parties have valid arguments for your conduct and unless urgent action be taken no one is willing to level.the situation calls for more dialogue and to avert a crisis affecting larger understanding among all stakeholders. the Government must be prepared, be an integral part of this dialogue as the underlying cause of the situation could well be a crisis of confidence.

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India's foreign exchange loss of $1.9 billion

India's foreign exchange (Forex) reserves fell from $1.899 billion, down $298.31 billion during the week 12 ended because of a severe contraction in its foreign exchange reserves November.

Foreign currency reserves, the US dollar, euro and pounds sterling, among other things, contain rejected 1.79 billion dollars down to 269.49 billion U.S. dollars during the week in the year under review according to the data of India (RBI) published by the Reserve Bank.

Special drawing rights (SDRS) declined $ 73 million to $5.152 billion and reserve with International Monetary Fund was $34 million 2,001 billion dollars.

The value of the gold reserves remained unchanged at $21.66 billion.

-Indo-Asian news service

GK/RN/vt

(115 Words)

2010-11-20-17: 31: 11 (IANS)

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