Technical Analysis & Market outlook by ACFX December 29th, 2011

Currencies          EUR/USD The euro dropped against most major peers after the ECB said yesterday its balance sheet soared to a record after last week’s lending to banks in the region. The shared currency bought $1.2929 from $1.2941, after falling to as low as $1.2888, the weakest since Jan. 10.

USD/CAD The Canadian dollar fell as stocks dropped after the European Central Bank’s balance sheet soared to a record on lending to the region’s banks, adding to concern fiscal turmoil will slow growth. The Canadian currency, nicknamed the loonie for the image of the aquatic bird on the C$1 coin, dropped 0.6 percent to C$1.0244 per U.S. dollar at 5 p.m. Toronto time.

AUD/USD The Australian dollar traded 0.1 percent from a one-week low against the greenback as concern increased that Europe’s debt crisis may deepen, damping demand for higher-yielding assets. The Australian dollar traded at $1.0086 at 10:40 a.m. in Sydney from $1.0094 yesterday in New York, when it touched $1.0071, the lowest since Dec. 22

Commodities Oil declined for the first time in seven days as a surge in the European Central Bank’s balance sheet to a record highlighted the growing risks of the region’s debt crisis and threatening fuel demand. Crude oil for February delivery fell $1.98 to $99.36 a barrel on the New York Mercantile Exchange.

Gold fell, capping the longest slump since October 2009, and silver tumbled to a three-month low as Europe’s deepening debt crisis drove commodities and stocks lower Gold futures for February delivery declined 2 percent to settle at $1,564.10 at 1:47 p.m. on the Comex in New York. The price dropped for the fifth straight session, the longest slide since October 2009.

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