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A daily close above 1.1104 (the 61.8% retracement of the 1.1224 to 10.0911 sell-off) would provide a new bullish move and suggest a further extension to the recent high of 1.1224. A weak Canadian CPI print tonight could be that catalyst, and while the market expects an annualised reading of 1.3%, a weak number could be well received by CAD bears.
UK retail sales are released at 20:30 AEDT and traders are expecting another strong month of consumer activity. A reading above 5% (annualised) could see cable push back to the recent high of 1.6823.
In US trade we’ve seen a huge reversal in FB, with traders pushing the stock up over 6% from its early session low. Clearly the market is giving the WhatsApp acquisition the big thumbs up and we are left with a daily chart that is in a textbook uptrend. We need to remember the absolute scale of WhatsApp; it has 450 million monthly active users, with around 70% of these active on a daily basis, which looks like a good acquisition despite being expensive. Stay with the trend, although on around 51 times project 2014 earnings it’s hard to value investors looking at this name anytime soon. Still, it’s fairly clear that this is a stock that investors and traders are happy to pay up for with its strong growth profile.
STO has broken the September downtrend and is looking much more constructive of late. There are signs that the upside momentum is losing steam, with stochastic indicators starting to top out. Traders will be keen to look out at CY13 earnings and in terms of NPAT (underlying) the market expects A$560 million, with a final dividend of 15 cents. STO has already detailed to the market that it will review its dividend policy, so this is a key area the market is focusing on. Traders will also be keeping an eye on costs around its Gladstone LNG project.