Euro area unemployment steadied at 10% as the improvement in the German jobless rate was dwarfed by the rise in Spain, Ireland and Portugal. The rate lingered at 10.0% in July, where June’s reading was upwardly revised from 9.9%. The total number of job seekers reached 15.8 million in July, up by 61,000 from June. In the 27-nation EU, the jobless rate remained at 9.5%. The high unemployment levels of 14.5% and 12.3% recorded in Ireland and Portugal has offset the progress in Germany, where the rate has held at 7.0% last month, the lowest since 1991.... 

Foreign exchange markets are extremely quiet today, which contrasts with the stock market. Equity indices in Europe have opened on a positive note. The Eurostoxx 50 index is higher by more than 1 per cent. Likewise, commodities are also joining the stock market party and Brent crude oil is up by nearly $3 per barrel since yesterday, although Brent dropped $0.50 this morning. The spike in commodities and stocks is all down to expectations of QEIII in the US. So why the caution in forex markets? Although EURUSD has bounced off its 1.4380 lows from yesterday... 

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USDJPY – With continued bearish threats seen, further weakness is expected to shape up towards its 2011 low at 75.92. A decisive clearance of that level will eventually resume its long term downtrend towards the 74.00 level and then the 73.00 level, all representing its psycho levels. On the upside, USDJPY will have to break and close above the 80.19 level traded on Aug 04’2011 to end its present bearishness and create scope for more gains towards the 81.47 level, its July 08’2011 high. Further resistance lies at the 82.21 level and then... 

The prospect of more QE from the Federal Reserve has dominated action in the markets in the past few days. We take a look at USDJPY, which is extremely sensitive to changes in US monetary policy, along with an update on EURAUD to see how these pairs are faring in the current QEIII-expectant environment. USDJPY: This pair is approaching the key 76.50 support zone. However, in the absence of any BOJ action to stem the appreciation of the yen combined with QEIII pressure weighing on the greenback, this pair may break lower. When we get close to these record...