Forex Market Updates & Commentary |  |
- GBPUSD tests the 100 and 200 bar MA on 5 minute chart and comes off.
- EURJPY stays below the 100 day MA and moves down. Watch the 200 bar MA on 5 minute chart today.
- Nov 17 2009 Forex Market Update
- US Net Long Term TIC Flows due at 9:00 AM
- US PPI rises less than expected. Ex Food and Energy better
- Economic Calendar for today
- Bobbys Corner-Open Market-Nov.17.2009
- Up and down action of the EURUSD continues.
- Trichet comments on currencies
- UK CPI & RPI
- Swiss Retail sales worse than expected
- 11-17 Economic Calendar
- EUR/USD Sitting on 100HR MAVG
- AUD/USD Post RBA Minutes
| GBPUSD tests the 100 and 200 bar MA on 5 minute chart and comes off. Posted: 17 Nov 2009 07:08 AM PST
The GBPUSD has moved up to test the 100 and 200 bar MA on the 5 minute chart at the 1.6813-15 levels and promptly sold off. Look for sellers against the level as the market has been using the level as a level to deflect against today. There have been no fewer than 7 times the price has moved toward the levels. Intraday support comes in at 1.6796 where the intial low was found today. A move below this level should solicit some additional pressure with a target at 1.6784 (see series of floor lows on the chart above at that level) and then the 1.6750 area which was a high from yesterdays trade (low reached 1.6755 today). On the topside the moving averages remain the key levels to watch today. |
| EURJPY stays below the 100 day MA and moves down. Watch the 200 bar MA on 5 minute chart today. Posted: 17 Nov 2009 06:38 AM PST
If you listen to our daily commentary (to sign up to receive the commentary send me an email at greg@fxdd.com), we talked about the EURJPY daily chart. We noted how the price has traded above and below the 100 day MA (blue line in the chart above) for 12 of the last 14 days. This is indicative of a non-trend market that is trying to decide if it wants to go higher or lower. We commented that if the price was able to stay below that key moving average overnight, this should lead to further downward pressure away from the key moving average. It was time for a break. Today, the 100 day moving average came in at the 133.81 level. The EURJPY moved up to a high of 133.57 but that was all the upside the market could muster and the price started it’s slide to the downside. There has been a couple corrective moves in the pair - this currency pair tends to have more volatility then the EURUSD - but the 200 bar MA on the 5 minute chart has been respected (green line in the 5 minute chart below). The market is acceptive of temporary moves above the 100 bar MA but not above the 200 bar MA it seems.
Going forward, the bias remains down for the pair. Since the price is trading near the lows for the day, waiting for a rebound is recommended. Selling against a stop above the 200 bar MA is the preferred trade. Judge your risk tolerance to determine your approprate trade location, but be patient. The target? The move away from the 100 day moving average should solicit a move toward a test of the 200 day MA that level comes in at the 131.87 level. That would be the longer term target as long as the shorter term downward bias can remain in tact. |
| Nov 17 2009 Forex Market Update Posted: 17 Nov 2009 06:30 AM PST |
| US Net Long Term TIC Flows due at 9:00 AM Posted: 17 Nov 2009 05:44 AM PST
At 9;00 the US TIC data will be released. This release measures the difference in value between foreign long-term securities purchased by US citizens and US long-term securities purchased by foreigners during the reported period. The US because it runs a large deficit and trade deficit needs foreign capital flows into the US in order to keep interest rates low. If foreigners shun securities for other alternatives, it could lead to a rise in rates. In theory a lower number says that foreigners did not need to purchase dollars to buy securities and this may explain the past weakness in the US dollar. Going forward the link is unsure unless there is a trend of avoidance by foreigner purchasers. For example, there was talk a few months ago about the reluctance of the BRIC countries in buying the dollar (diversification out of the dollar). This should manifest itself in the data. A look at the chart above, the trend has been for lower NET TIC inflows over the last year or so which suggests some of the dollar weakness over that time frame The expectation this month is for a rise to a net 30.0B inflow versus last months inflow of 28.6 billion. |
| US PPI rises less than expected. Ex Food and Energy better Posted: 17 Nov 2009 05:33 AM PST The PPI MoM was up +0.3% vs +0.6%. The Ex Food and energy was less than expected falling by -0.6% vs expectation of +0.1%. On a YoY basis, the value rose to -1.9% vs expectation of -1.8%. The YoY ex food and energy came in at +0.7% vs expectation of a +1.4%. This is better news on inflation. The EURUSD has moved higher on a better stock market but activity is modest. |
| Posted: 17 Nov 2009 05:26 AM PST
PPI is expected to increase by 0.6% and +0.1% ex food and energy in October. Higher energy prices are to blame for the change. YoY the PPI is expected to show a gain to -1.8% from -4.8% last month.The big jump higher is as a result of a large -2.6% decline falling out from last October. In November and December another -2.7% and -1.8% fall are to fall out. This will shoot the PPI up to over 2.5% in the next few months on a YoY basis.
Capacity Utilization and Industrial Production are to be released at 9:15.
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| Bobbys Corner-Open Market-Nov.17.2009 Posted: 17 Nov 2009 05:15 AM PST
The USD and JPY are firmer this morning, as comments from the IMF that any global recovery may be sluggish, caused demand for higher-yielding assets to wane overnight. World equity markets are lower, and US Futures are pointing to a lower opening this morning. Oil:$78.79 Gold:$1128.50 Today’s Data: HAVE A GREAT DAY & GOOD LUCK |
| Up and down action of the EURUSD continues. Posted: 17 Nov 2009 05:08 AM PST Overnight, Jean Claude Trichet commented on dollar (Bernanke comment on the dollar “very important statement” and “dollar strength in worlds best interest”), helped the market continue its downward path. He also expressed more uncertainty on the economic rebound (probably because of the strong EURO) and this was enough to force the EURUSD down. The story keeps changing from dollar weakness to dollar strength and once again reminds us to pay attention to what the technical charts are telling us.
On the 5 minute chart above the price was using the 100 bar MA was moving sideways with moves mainly centered to the downside. In the early London hours the price made an attempt to the upside but this was reversed. The slope of the 100 bar MA was sloping to the downside, and the price started to step down (at 1.4963).
On the hourly chart a similar story was unfolding. The market used the 100 and 200 hour MA as support (at 1.4944 and 1.4933 respectively), then started to use the MA as resistance and continued the downward momentum - in tandem with the 5 minute chart.
From a technical basis, there should be some support at the 1.4845-48 area. This was the area from November 9th when the price gapped higher from Friday to Monday. Below this level the 1.4821/24 were lows from November 12th and 13th. 1.4812 was lows from November 5th and November 6th. On the topside now, the 1.4915 leve and the 100 bar moving average at the 1.4931 on the 5 minute chart.
The carry trade using dollars still exists. The dynamic of higher gold, commodities, stocks leads to a lower dollar is also still in play. However, the tide can turn on a dime. This is where watching the bias from moving averages on the charts becomes important. Of note, however, is most of the dollar strength seems to be on talk of a higher dollar. The comments by Trichet are not the first time he has brought up what Bernanke has said about the dollar (it is not a new idea). He does seem to want a weaker EURO and part may also be because the Chinese Yuan is tied to the dollar. So when the EURO gains in value against the dollar it gains in value against the Yuan as well. This makes exports more expensive on a relative basis to the US to the West and China in the East. Trichet would probably accept a little relief from this dynamic. In the US, however, the Fed has said that rates would remain low for an extended period of time and growth will need to firm to change their slant. 10.2% unemployment and 17% underemployed make the idea of tightening difficult to do. All of which should keep the up and down action in play as the tug of war continues with the EURUSD bulls and the EURUSD bears. |
| Trichet comments on currencies Posted: 17 Nov 2009 02:55 AM PST Trichet states that the fiscal situation in some European countries is so bad that there is a danger markets will faith in them. He also agrees with U.S. that a strong dollar is in the countries best interest. These comments have had a cumulative effect on Eur/Usd. The pair has made new lows down to 1.4893. Currently Eur/Usd trades at 1.4900. |
| Posted: 17 Nov 2009 01:41 AM PST UK CPI y/y came in at 1.5%, stronger than the 1.4% expected. Core CPI came in at 1.8%, stronger than the 1.7% expected. RPI y/y came in at -0.8%, stronger than the -0.9% expected. Good numbers for the GBP. Gbp /Usd rose to new highs at 1.6870. The pair has since retreated to 1.6850. |
| Swiss Retail sales worse than expected Posted: 17 Nov 2009 12:23 AM PST Swiss Retail Sales Y/Y came in at -1.6%, much weaker than the +1.0% expected and -1.0% prior reading. Bad number for the CHF as Usd/Chf has gained 20 pips since news trading at 1.0105. Eur/Chf has also gained, up 10 pips so far trading around 1.5100. The release has also effected other European currencies as Eur/Usd is off about 15 pips to 1.4945 and Gbp/Usd off about 20 pips to 1.6825. |
| Posted: 16 Nov 2009 08:36 PM PST
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| Posted: 16 Nov 2009 07:41 PM PST The EUR/USD had a volatile day moving lower initially on the positive USD comments from Fed Chairman Bernanke, before quickly recovering on Euro value buying at the lows. The pair has moved lower in Asian trading as the risk and commodity pairs lost their bid on the back of mixed RBA minutes with some dovish over tones and a lower Nikkei, with US equity futures also trading lower.
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| Posted: 16 Nov 2009 05:28 PM PST The AUD/USD lost its bid and moved lower on the back of RBA minutes that suggested that the tightening of monetary policy would be done over time and in an orderly fashion and that contained inflation has not been an issue with the rising AUD. Looking at the pair below we see a short-term trendline coming into play as a support level, however stronger support is seen at the 76.4% retracement level.
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