Forex Market Updates & Commentary

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• Factory Orders come in weaker than expectations
• USDCHF falls below the 100 hour MA and trendline support
• $EURUSD continues to squeeze higher. Looks to test resistance at 1.4577-92
• Oct 2 2009 Forex market update - NFP details
• GBPUSD falls but bounces. Watching 1.5860 area
• EURUSD falls on weaker NFP report, but rebounds.
• US NFP -263K Unemployment Rate 9.8%. Worse than expected. EURUSD falls. So does USDJPY as safe haven flows dominate.
• EURUSD hanging at trendline support as the NFP approaches. 1.4447 downside. 1.4592 watched above
• Bobbys Corner-Open Market-Oct.2.2009
• Non Farm Payroll today. The look in pictures (and some words).
• Gbp/Usd continues lower
• European PPI
• BOE Housing Equity Withdrawal
• UK Construction PMI
• Gbp/Jpy finding it hard to break below support 141.88

Factory Orders come in weaker than expectations Posted: 02 Oct 2009 07:03 AM PDT New Orders                     -0.8% vs 1.4% last month  Ex-transportation       0.4% vs -0.6%  last month  Ex-defense                    -0.7%   vs 1.0%  last month  Ex-computers              -0.8%  vs  1.5%  last month Capital goods                 -6.3%   vs 8.2%  last month  Non-defense                 -7.6%   vs 7.0% last month   Excluding aircraft    -0.9%  vs -1.3% last month    3-mo. annualized     18.2%  vs 14.7% last month  Defense                           1.0%  vs 15.9% last month Durable Goods Orders fell by -2.6%.

USDCHF falls below the 100 hour MA and trendline support Posted: 02 Oct 2009 06:47 AM PDT The USDCHF fell below the 100 hour MA at the 1.0368 level and stops have been hit.  The level also corresponds with a trendline support. Watch the level.  If the market can not rebound within the hour, the downside has to be preferred.  A key level to watch to confirm the downside is the 1.0351 level. This is the 38.2%  retracement level of the move up from the September 23rd low. The market is being largely influenced by the stock market. The Dow has rebounded to down -47 from down triple digits. This is leading to the downward dollar bias.

$EURUSD continues to squeeze higher. Looks to test resistance at 1.4577-92 Posted: 02 Oct 2009 06:40 AM PDT The market continues to adjust to the NFP and traders seem to be getting sqeezed after the initial fal. The pair is approaching good resistnace at the weeks midpoint at the 1.4577 and the 100 hour MA at the 1.4592 level. Look for sellers with a stop above the 100 hour MA level.

Oct 2 2009 Forex market update - NFP details Posted: 02 Oct 2009 06:38 AM PDT Click here to view the embedded video. Confused by the market reaction to the NFP report? Watch the morning report.

GBPUSD falls but bounces. Watching 1.5860 area Posted: 02 Oct 2009 06:04 AM PDT The GBPUSD fell off the weaker number but has rebounded back up toward the 38.2% of the days range at the 1.5860 level. There is also some old low/highs at the 1.5665 level.  A move above these levels will likely solicit some additional short covering as the market continues to adjust to the number this morning.  Above is the 100 bar MA on the 5 minute chart at the 1.5885 level currently and falling.

EURUSD falls on weaker NFP report, but rebounds. Posted: 02 Oct 2009 05:45 AM PDT The 1.4447 is the high from August 2009.  This was the top during the consolidation this summer. Below that is the 1.4425 level which is the 38.2% Fibonacci level of the move up from the summer low of 1.3748 in June.  O On the topside, the 1.4546 level remains the trendline resistance above.  Before that level is the midpoint of the move down at the 1.4522 level and above that the 100 and 200 bar on the 5 minute chart at the 1.4538 area.

US NFP -263K Unemployment Rate 9.8%. Worse than expected. EURUSD falls. So does USDJPY as safe haven flows dominate. Posted: 02 Oct 2009 05:30 AM PDT Manufacturing Unemployment -51K Avg Earnings +0.1 Revisions Net loss of -13K In July August revisions. Health +19K Stocks are falling on the number.  The EURUSD is falling. The low from earlier today is being tested at 1.4502. The USDJPY is falling at the same time.  Watching the 89.35 level as upside resistnace.

EURUSD hanging at trendline support as the NFP approaches. 1.4447 downside. 1.4592 watched above Posted: 02 Oct 2009 05:21 AM PDT The EURUSD is hanging around the longer term trendline at the 1.4546 level.  I will look at this value as a one barometer for bullish or bearish bias.  If above bullish, if below bearish. Another important level to watch is the 100 hour MA. The price is currently below this value which comes in at the 1.4595 level.  A move higher but one that stays below the 100 hour MA should find sellers against the level.  A break above the MA, is bullish for the pair. On the downside, watch the 1.4447 level. This was the summer high price (August 5th 2009 high).  Also the 1.4427 which is the 38.2% retracement of the move up from the June 2008 low to the recent high price.

Bobbys Corner-Open Market-Oct.2.2009 Posted: 02 Oct 2009 05:16 AM PDT Good Morning: World equity markets dropped , and commodities fell on speculation that rising unemployment will dampen the overall global recovery.  Raw material producers, banks, and retailers led the downward trend. Gold dropped below $1000/oz, and Oil is trading under $70/bar.  The JPY rose as concerns that rising loan defaults and unemployment will slow the recovery, most notably in the US.   On another note, the G-7 will meet this weekend in Istanbul, and the strength of the Euro will be a main topic of conversation. Oil:$69.73                            Gold;$998.60 Today’s data: NFP:                            exp: -180K      prior: -216K Unemp rate:            exp; 9.8%         prior: 9.7% Factory orders:     exp: 50.0         prior: 48.4 Have a GREAT DAY & WEEKEND–GOOD LUCK

Non Farm Payroll today. The look in pictures (and some words). Posted: 02 Oct 2009 05:00 AM PDT Last month the NFP lost 216K jobs which was the 20th straight decline in jobs.  Six of the last 7 months have shown improvement.  The estimate this month is for a change of -175K. However, there has been some last minute changes in the last 24 hours which has probably pushed that estimate up to something in the order of -225K to -250K.  This may have contributed to some of the weakness in the stock market yesterday. The changes were in reaction to things like the ISM and Intial Claims data which did not improve Month on Month and Week on Week.  The Unemployment Rate is expected to rise to 9.8% from 9.7% last month.  This would be the highest reading in this since June 1983 whent the rate was last above 10% (at 10.1%).   In addition to those people who are declaring to be unemployed there are others who are also underemployed and/or who have taken themselves out of the people looking for work category. If you are not looking for work (i.e. discouraged worker) you are not unemployed or employed.  This figure is upwards of 16% which is a scary number.  Last month Construction and Manufacturing led the declines. Education and Health (this is Health care sector) was the only sector which showed a gain. That sector added 52k jobs.  The improvement in the magnitude of the decline in each sector was helped by less negative numbers in each group. Since the start of this current jobs recession, Manufacturing has lost 2 millon  jobs.  The Trade, Transportation and Utilities lost 1.58 millon  jobs. The Professional and Business Services sector including Temporary workers, has lost 1.509 millon  people have lost jobs and 1.430 million workers in the Construction industry have lost jobs.  The Health Care and Government industry is the only sectors which have added jobs since January 2008.  Health Care has added 751 thousand jobs.  and Government has added 118 thousand jobs.  With this months decline, it is likely that the number of people who have lost jobs will go over the 7 million mark.  To date since January 2008 when the first negative job number was announced 6,929,000 people have gone from employed to unemployed.  The 3 million jobs the Obama administration was to have added, do seem to be coming through but who knows what the numbers would be like without stimulus.  Perhaps it saved 3 million extra workers from being unemployed. Temporary Workers can be considered a leading indicator. They go down when employment is going down and may rebound before overall jobs increase.  It is easier to hire back the unemployed from the temporary ranks before making them full time.  Retail Trade jobs are an indicator of the mall traffic.  If jobs start showing up here, it should be a good sign for spending and retail confidence.  If it does not get better, the opposite may be occurring. Finally, risks increase with the NFP monthly release. When risk increases, the position sizes should be reduced.  It is also wise to let the initial reaction come and go.  Many a trader have been whipped around on the initial reaction.   Generally speaking a number which is bullish for stocks, will tend to lead to a lower dollar as investors look for the riskier assets.  If the stock market declines, the dollar gets stronger on a flight to quality bid.  This does not mean it will be case this month - much is dependent on flows in the market.

Gbp/Usd continues lower Posted: 02 Oct 2009 03:52 AM PDT Gbp/Usd has been offered since earlier release of HPI figures. The pair is currently trading at 1.5847. We may find support down at 1.5826 which is area of an old low from Sept. 29. A break below could send pair tumbling to 1.5770, low from Sept. 25. It will be interesting to see sterling’s next move as traders await US non-farm payroll figures at 8:30 EST

European PPI Posted: 02 Oct 2009 02:01 AM PDT PPI in the Euro-zone for August was slightly worse than expected. The details are as follows: Euro-Zone PPI (YoY) - Survey: -7.6%   Actual: -7.5%   Prior: -8.5% Euro-Zone PPI (MoM) - Survey: 0.4%   Actual: 0.4%   Prior: -0.8% The EUR, currently trading mid-range for the session, showed little reaction to the number.

BOE Housing Equity Withdrawal Posted: 02 Oct 2009 01:35 AM PDT The BOE’s Q2 Housing Equity Withdrawal was -7B; less than the prior number of -8.1B. The market showed no reaction to the reading.

UK Construction PMI Posted: 02 Oct 2009 01:35 AM PDT The Purchasing Manager’s Index in Great Britain for the month of September was 46.7: slightly worse than both its forecast of 48.1 and prior reading of 47.7. The market had limited reaction to this release while all eyes remain on the US non-farm payroll number due out in 4 hours.

Gbp/Jpy finding it hard to break below support 141.88 Posted: 02 Oct 2009 01:07 AM PDT Gbp/Jpy is having a hard time breaking the 61.8% Fibo support level of 141.88. It has flirted with this level several times this session. If it can break below it is very possible to see a steep decline down to 140.80 level. If the pair holds it should go back up to 142.60-70 level.

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