Forex Market Updates & Commentary |  |
- GBPUSD hurt by data this morning. Bias down.
- Oct 6 2009 Forex Market Update
- EURUSD holds the support and moves higher
- $EURUSD moves higher on dollar selling today. Watch support at 1.4705
- Canada Building Permits better than expected. $USDCAD looks to test 2009 lows at 1.0590
- “Secret meetings” also lead to a shift out of dollar. Rumor of a 9 year plan to price oil in a basket of currencies other than US dollars.
- Bobbys Corner-Open Market-Oct.6.2009
- Australia’s rate rise dominates. Watch the 0.8888 level.
- Gbp/Jpy not far off low
- UK Manufacturing & Industrial Production signicantly weaker than expected
- Halifax House Price Index (UK)
- Swiss CPI
- 10-6 Economic Calendar
- RBA Rate Decision
- Japanese Finance Minister Fujii Speaks
| GBPUSD hurt by data this morning. Bias down. Posted: 06 Oct 2009 06:47 AM PDT
The UK Industrial Production and Manufacturing Production data this morning was much weaker than expected this morning and it has pressured the GBPUSD today. The pair has been largely non-trending over the last few days and the 100 and 200 hour MAs have converged at the 1.5954/62 area. The midpoint of the last 5 days of trading also provides resistance at the 1.5964 level. The combination makes the 1.5954 to 1.5964 level as topside resistance for the day. Before that level should find sellers against the 1.5925 level . Keep these levels in mind for intraday trading. On the downside the there is support at 1.5859/63 and below that the low from last week at 1.5802. Overall, the GBPUSD has a bearish bias in a dollar negative day. This makes trading the pair somewhat counter to a traders intuitive bias (i.e. dollar selling). Good trade location with tight stops is recommended for new positions, but the bias is down as per the analysis above. |
| Oct 6 2009 Forex Market Update Posted: 06 Oct 2009 06:30 AM PDT Click here to view the embedded video. The RBA raised rates by 25 basis points to 3.25%. Also reports of a secret meeting to discuss priciing oil in currencies other than the USD has pressured the dollar this morning. |
| EURUSD holds the support and moves higher Posted: 06 Oct 2009 06:05 AM PDT Holds the 1.4705 level and bounces. A break of the high at 1.4748 targets 1.4801. |
| $EURUSD moves higher on dollar selling today. Watch support at 1.4705 Posted: 06 Oct 2009 05:47 AM PDT
The EURUSD is higher today on the back of the general dollar selling. The pair has had a low of 1.4646, the high so far has reached 1.4748. The pair is above the 61.8% retracement of the last corrective move lower from 1.4844 to the low of 1.4480. That level comes in at the 1.4705 level. Watch this level for support. this morning. Additional intraday support comes at the 1.4697 level where the 200 bar MA on the 5 minute chart is found (and the midpoint of the days range). A move below this level would raise an eyebrow for the intraday bullish trend. However, I would expect buyers on dips against these key levels.
A move to the upside would next target the 1.4801 where the high from September 24th is found |
| Canada Building Permits better than expected. $USDCAD looks to test 2009 lows at 1.0590 Posted: 06 Oct 2009 05:32 AM PDT Rise by 7.2% after a revised -10.0% decline last month (was -11.4%). The figures have been influenced over the last few months due to a strike in Toronto which literally shut down the processing of applications in the region. Excluding Toronto, permits rose by 0.8% for the month according tot he Statistics Canada.
The USDCAD is being pressured today as oil is up and the general dollar decline today. The pair is down and approaching the 2009 low of 1.0590 level. The low has reached 1.0611. |
| Posted: 06 Oct 2009 05:16 AM PDT Although the GBPUSD is not fully participating as weak economic data hurt its currency this morning, the other big news is the oil producers secret meetings - reported in the UKs Independent newspaper- saying that the Gulf States, China, Russia, Japan and France were looking to denominate oil transactions in a currency other than the US dollar. The article titled “The Demise of the US Dollar” (Click here to read the article), discusses a 9 year plan to rid the pricing of oil in dollars, instead using a basket of currencies. This is pressuring the US dollar this morning which in turn is leading to higher oil prices and Gold this morning. GBPUSD may also be pressured as they are considered more an allie of the US and may therefore be guilty by association. Although there have been some denials this morning, the article has definitely got the market nervous for the dollar and this will likely remain for the time being. The market seems to be thinking that where there is smoke there may be fire, so the dips may be limited. Be aware. Risk is increased. |
| Bobbys Corner-Open Market-Oct.6.2009 Posted: 06 Oct 2009 05:11 AM PDT
I am writing to you from the Kuwait Traders Expo in Kuwait City,Kuwait. Equity and commodity markets rallied around the world after the Reserve Bank of Australia increased interest rates by 25 basis points. Raw material producers and financial companies led the charge. The USD dropped after the Australian rate decision. The EUR/USD moved into the 1.47 handle, compared to yesterday’s mid 1.46 levels. Oil: $71.40 Gold:$1027.50 |
| Australia’s rate rise dominates. Watch the 0.8888 level. Posted: 06 Oct 2009 04:44 AM PDT The Reserve Bank of Australia raised rates by 25 basis points as per the rumor yesterday and the news led to a rise in the AUDUSD. The central bank is likely to initiate a series of rises as when a central bank starts a change in direction, it is not for one 25 basis point move. They are fearful of inflation. They are fearful of growth pickup. This keep the buyers on dips in the market, and the market guessing how much will be enough. We don’t know that. However, we know it is not the last but is the start of a series of rises.
From a technical basis, the trendline off the tops was broken at 0.8850. The price approached a retracement of 75% of the move down from the July 2008 high of 0.9848 to the low in October 2008 of 0.6006. That level comes in at the 0.8888 level. Watch this level. The 75% move, might suggest the rise is already discounted (interest rate spread between Australia and US rates are 300 basis points, while at the peak it was 525 basis points). However, with rates likely to continue to rise and the US lagging behind, the spread is likely to widen out. How far is unknown, but a widening back out is likely. On a break of the 0.8888 level, the next target I see is 0.8952 area. The high going back to Aug 11 2008 came in at 0.8951. Prior to that in March 2008, the low was 0.8952 (see chart below).
On the downside, look for support at 0.8855 t0 0.8862 area. The 100 bar MA on the 5 minute chart is found at this level. The consolidation of the move higher has been consolidating since 1 AM NYT and this has allowed the moving average to catch up to the price. The market has to make a decision to move higher or correct/consolidate further. Be aware. |
| Posted: 06 Oct 2009 03:33 AM PDT Gbp/Jpy is not far off session low of 141.90. Fibo retracement lies at 141.88, which has been a good level of support lately. On October 2nd the pair did break below and trade down to 140.75, but by end of that session returned above. If pair can hold it may push 143.00. A more likely scenario sees a break below and possible run down, maybe even below 141.00.
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| UK Manufacturing & Industrial Production signicantly weaker than expected Posted: 06 Oct 2009 01:41 AM PDT UK Industrial Production m/m came in at -2.5%, far weaker than the 0.2% expected. Y/y came in at -11.2%, weaker than the -8.7% expected. Manufacturing Production m/m came in at -1.9%, weaker than the 0.3% expected. Y/y came in at -11.3%, weaker than the -9.3% expected. Extremely weak numbers for the pound as Gbp/Usd lost about 60 pips on news. Currently Gbp/Usd trades at 1.5955. |
| Halifax House Price Index (UK) Posted: 06 Oct 2009 01:04 AM PDT Halifax HPI came in at 1.6%, stronger than the 0.6% forecasted. Strong number for sterling as Gbp/Usd made a new session high of 1.6047. Note UK Industrial Production figure is out at 4:30 EST. |
| Posted: 06 Oct 2009 12:29 AM PDT Swiss CPI m/m came in at 0.0%, stronger than the -0.1% expected and prior reading. Eur/Chf trading mid range at 1.5108 and Usd/Chf trading at 1.0250 without much reaction to figure. |
| Posted: 05 Oct 2009 09:08 PM PDT
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| Posted: 05 Oct 2009 08:43 PM PDT The RBA rate decision came in unexpectedly higher at 3.25%. Although there was some speculation earlier that they might raise rates, helping move the AUD higher today, the pair caught a bid on the release, but did not break the September highs.
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| Japanese Finance Minister Fujii Speaks Posted: 05 Oct 2009 07:45 PM PDT The newly appointed Japanese Finance Minister Fujii commented that he had told the G-7 that a weak yen policy is not desirable for Japan and that governments should not pursue FX devaluation. He added that the economy is not ready to implement an exit strategy and that employment and income conditions may worsen in Japan. He continued:
The Yen is continuing its bid across the board as USD/JPY is testing the 89 handle.
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