FOREX.com Q2 2013 Outlook: Mirror, mirror on the wall - the US dollar is the
fairest of them all...
LONDON, NEW YORK and SYDNEY, March 19, 2013
LONDON, NEW YORK and SYDNEY, March 19, 2013 /PRNewswire/ --FOREX.com, the
retail division of GAIN Capital Holdings, Inc. (NYSE:GCAP), a global provider
of online trading services; today released its Q2 2013 Market Outlook report.
The full FOREX.com Q2 2013 Markets Outlook Report is now available at
www.forex.com under Research and Tools.
FOREX.com analysts predict that the dollar could be the star of the FX world
this quarter as strengthening US economic data helps the greenback to become
the growth currency of choice.
A strong dollar offers lots of opportunities in the FX world including an
extension of USDJPY strength and GBPUSD weakness during Q2. It could also make
life harder for the Aussie dollar, which is struggling under the dual pressure
of lackluster growth at home and in China.
Stocks could also extend their gains this quarter, although investors may
start to focus on value. US stock markets including the Dow and the SPX 500
reached record highs in Q1; this quarter we could see the Hang Seng, the
German Dax index and the Eurostoxx 50 start to catch up with their US
counterparts. The next few months could be the sweet spot for US markets,
according to FOREX.com, as the Fed keeps monetary policy loose and the economy
continues to pick up. But things may start to sour as we get closer to Q3, as
fears about the end of quantitative easing start to grip markets.
In the UK, a triple-dip recession is likely to keep pressure on the pound,
which could fall to its lowest level since the Financial Crisis in 2009.
FOREX.com analysts believe this quarter will be pivotal for the Eurozone as
the periphery becomes more vocal in its opposition to austerity, Italian
political worries come back to the surface and Cyprus continues to dominate
the headlines. This could weigh on the euro and, if the sovereign crisis kicks
off once again, it may cause global volatility levels to spike.
"We are most excited about a potential shift in the dollar, from being a safe
haven to a growth currency. We expect the USDJPY uptrend to continue, although
this quarter the dominating factor is expected to be developments in the US
and at the Fed, rather than at the Bank of Japan. We think USDJPY could get to
100.00. In Q2, we also expect EURUSD to grind back to the mid 1.20's as a
bullish case for the euro gets harder to justify," said Kathleen Brooks,
Research Director, FOREX.com.
Ms. Brooks added: "Although there are risks, particularly in Europe, the
global growth outlook will be supported by a continued recovery in Japan and
the US, which is supportive of risk assets. But investors need to be on their
guard as signs that Italy is being sucked into the sovereign crisis or a
slowdown in China, could cause volatility to spike in the coming months."
Expectations from the FOREX.com Q2 2013 Markets Outlook include:
oThe FTSE is likely to buck the trend in the UK economy and follow its US
oRelative valuations could help the German Dax out-perform the Dow Jones
oGold bugs continue to be thwarted by the Goldilocks situation in the US –
not too hot, nor too cold. This is likely to keep the yellow metal range
bound as global inflation pressures remain contained
oWith gold treading water, copper is our commodity to watch, as we expect
it to overtake the gold/silver ratio as a barometer for global economic
oWe predict the pound is the ultimate loser this quarter as long-term
growth fears limit any recovery in sterling
oChina's uneven recovery could limit Aussie strength as its mining sector
reaches its peak
oThe spread between UK and US oil is expected to narrow further as US
energy demands continue to be met at home
The FOREX.com Markets Outlook report highlights potential price ranges for key
pairs, such as EUR/USD, GBP/USD, USD/JPY, EUR/GBP and USD/RUB. Major foreign
equity markets; key commodities including gold, silver, oil and agriculture
are also covered.
The FOREX.com Markets Outlook report is prepared by Research Director Kathleen
Brooks, Senior Technical Strategists Chris Tevere, CMT, Eric Viloria, CMT, and
Research Analyst Chris Tedder.
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About GAIN Capital
GAIN Capital Holdings, Inc. (NYSE:GCAP) is a global provider of online trading
services. GAIN's innovative trading technology provides market access and
highly automated trade execution services across multiple asset classes,
including foreign exchange (forex or FX), contracts for difference (CFDs) and
exchange-based products, to a diverse client base of retail and institutional
Through our retail brand, FOREX.com, we provide retail traders around the
world with access to a variety of global OTC financial markets, including
forex, precious metals and CFDs on commodities and indices. A market leader
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German, Chinese, Japanese, Russian and Arabic.
GAIN Capital also operates GTX, a fully independent FX ECN for hedge funds and
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Securities, Inc. (member FINRA/SIPC) a licensed U.S. broker-dealer.
GAIN Capital and its affiliates have offices in New York City; Bedminster, New
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For company information, visit www.gaincapital.com.
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