Forex Market Updates & Commentary

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• Feds Evans on the newswires
• Forex Morning Report - March 9
• Market getting ready for better stocks has interest in risk again
• USDJPY stays pressured on risk aversion. Below the key 100 day moving average.
• EURUSD moves below 61.8% retracement support at 1.3551. Can the momentum continue?
• AUDUSD respects 100 hour MA and bounces. Key levels remain.
• Bobbys Corner-Open Market-March.9.2010
• GBPUSD testing intraday resistance levels as NY day begins
• China News and UK Trade and news send risk pairs lower along with the Pound
• Fitch’s Brian Coulton comments on U.K. in London speech
• UK Trade Balance
• Mundell on the wires…
• CHF CPI
• JPY Prelim Machine Tool Orders
• Hopes of USD Peg Removal Fade…

Feds Evans on the newswires Posted: 09 Mar 2010 06:35 AM PST Says: Fed accomodation is likely to be appropriate for some time and the Fed Policy has been clear. Hiring is scarce but there are a few signs that hiring has increased.  He does warn that long term Unemployment could have lasting demand impact.  He sees a considerable amount of slack in the economy and as a result inflation is likely to remain signficantly below his specific benchmark. Mr Evans is not a voting member on the current FOMC

Forex Morning Report - March 9 Posted: 09 Mar 2010 06:30 AM PST Click here to view the embedded video.

Market getting ready for better stocks has interest in risk again Posted: 09 Mar 2010 06:23 AM PST Cisco has announced they will have a press conference at 11AM and announce a change that will revolutionize the internet, and that has led to a flow back into risk it seems (or at least a covering of the days trend moves).  The EURUSD remains near - but back above - the 1.3551 retracement level, and the GBPUSD is moving above the 100 bar MA on the 5 minute chart at 1.4973 and now targets the 200 bar MA at the 1.5000 level in the same chart.  The USDJPY is also testing the 100 bar MA on the 5 minute chart at 89.83. A move above will next target 89.95 and then 90.14 key resistance.

USDJPY stays pressured on risk aversion. Below the key 100 day moving average. Posted: 09 Mar 2010 05:49 AM PST Gold down $11.50 has the risk aversion crowd exiting the USDJPY today. The price for the USDJPY has moved below the 100 day MA at the 90.14 level which has given the bearish bias to the pair.  After the break of this key level, the market momentum down intensified (see chart above at 90.15 line).  The price is also now using the 100 bar MA on the 5 minute chart as topside resistance in early NY trade.  The 100 bar MA on that chart comes in at the 89.85 level currently. That level was also double bottom lows from trading earlier.    The level will be a key level for trading today.  A move above should lead to further upside momentum with 89.97 (200 bar MA in the chart above) the next target followed by the 90.14 area. On the downside, the low for the day comes in at the  89.62 and the 100 hour MA comes in at 89.46.  The 89.40 level is the midpoint of the move up from the March 4th low adding more ammunition for support buyers.

EURUSD moves below 61.8% retracement support at 1.3551. Can the momentum continue? Posted: 09 Mar 2010 05:27 AM PST The 1.3551 level is the 61.8% retracement support of the move up from the March 1st low to the March 3rd high.  The level comes in at 1.3551.  The level has just broken and should lead to a further move lower in the pair, but can the EURUSD keep the momentum?  If so, the target on the downside becomes the 1.3513 level which has been a level where there has been support and resistance over the last few weeks (see chart arrows above).      On the topside, if the price moves back above the 1.3551 level, the 1.3567 level be eyed  This is the  NY high. A move above this level will be a disappointment for the bears who are eyeing a continuation of the trend type move down in the EURUSD today.

AUDUSD respects 100 hour MA and bounces. Key levels remain. Posted: 09 Mar 2010 05:18 AM PST Although the AUDUSD dipped below the 100 day MA at the 0.9067 level (see chart below), it ran into support against the 100 hour MA just below at the 0.9056 level. The combo has given the pair a lift as technical traders used the low risk trading level to buy against (with likely stops on a break). Now, with the market back higher, the levels below remain as key support.  A break will likely lead to further selling.  So be aware and be prepared should the level give way.   On the topside, look for resistance against the 100 and 200 bar MA on the 5 minute chart below (blue and green lines). Those levels come in at the 0.9085 and 0.9087 respectively. Reprots that the US may be closer to tightening and commodity selling is pressuring the AUDUSD despite better than expected data overnight which showed Business Confidence up (19 vs 15 last month) and larger Job Advertisement (+19.1% vs -8.1% last month).

Bobbys Corner-Open Market-March.9.2010 Posted: 09 Mar 2010 05:11 AM PST Good Morning: As world equity markets snap 2 days of gains-the JPY advanced as investors look for a “safer haven” for their funds. The JPY also gained as speculation mounts that Japanese companies are repatriating profits before the end of the fiscal year.  New tax breaks initiated by the Japanese government may lead to “larger than normal” repatriations. The GBP lost ground overnight as Moody’s Investor Services said that U.K. banks creditworthiness may be at risk. World equity markets are lower as companies report earnings that missed estimates, along with concerns that the year long rally in stocks cannot be sustained .  Commodities are lower, and government bonds rose. Oil:$80.42                                        Gold:$1117.70 Today’s Data:   10:00AM IBD/TIPP ECONOMIC OPTIMISM  MAR    47.4O      46.8O HAVE A GREAT DAY & GOOD LUCK

GBPUSD testing intraday resistance levels as NY day begins Posted: 09 Mar 2010 05:01 AM PST The GBPUSD has seen some profit taking buying in early NY trade as the selling found support at the 61.8% retracement of the move up from the March 1st low to the high on March 8th.  That level came in at 1.4939 (see hourly chart below).  The pair is now testing the intraday resistance against the 100 bar MA on the 5 minute chart (at 1.4983) and a double bottom level from earlier trading (at 1.4976).  Additional upside resistance comes in at 1.4991 trendline from the most recent highs. Looking at the hourly chart the 1.4988 level is also a level to be aware of this morning.  This level was the low from last Friday and the 50% retracement of the move up from the March 1st low to the March 8th high (see chart below).   The market should find sellers against these levels (1.4976 to 1.4991). A move above would likely lead to further short covering with 1.5008 (200 bar MA on the 5 minute chart) and 1.5037, the next upside targets.    On the downside a break ov the 1.4939 level will be needed to solicit additional selling pressure with 1.4854  a key level. The pair has been hit from a combination of credit rating warnings for UK sovereign debt from Fitch and from UK bank related ratings from Moody’s.   Also the Trade Balance can in at the largest deficit in 17 months. This also weighed on the GBPUSD.

China News and UK Trade and news send risk pairs lower along with the Pound Posted: 09 Mar 2010 04:31 AM PST Click here to view the embedded video.

Fitch’s Brian Coulton comments on U.K. in London speech Posted: 09 Mar 2010 01:47 AM PST During a speech today in London, Fitch’s Brian Coulton made the following negative remarks regarding the U.K. *expects U.K. fiscal consolidation *U.K. sovereign credit profile deteriorated pretty sharply *outlook for U.K. economy is quite uncertain *U.K. economy proceeds with an important source of caution *U.K. fiscal adjustment too slow at a pedestrian pace Gbp/Usd is currently trading at session lows of 1.4945.

UK Trade Balance Posted: 09 Mar 2010 01:36 AM PST The GBP made a new session lows against the USD and the JPY and continued to move lower after the release of a worse than expected trade balance out of the UK which read -8.0B versus a forecast of -6.9B and -7.3B previous release.

Mundell on the wires… Posted: 09 Mar 2010 01:15 AM PST Columbia professor Robert Mundell has made the following comments on Bloomberg television: Growth/stability pact not strong enough. There may not be a need for European monetary fund. EU could create a less formal way of dealing with crisis. Speculators are a big problem for Greece. IMF can be useful; EU wants to solve issue itself. Greece has to make the budget adjustments. Euro is “best thing” that has happened to Europe. Governments have to balance budgets. He doesn’t see a Euro area defaulting. Although not related, as these comments were release, the EUR made a new session low of 1.3579.

CHF CPI Posted: 09 Mar 2010 12:26 AM PST CPI m/m did not meet its forecast of 0.2%, coming in at  0.1%, but still surpassed its prior reading of -0.1%.

JPY Prelim Machine Tool Orders Posted: 09 Mar 2010 12:04 AM PST After a delayed release the monthly reading of Japan’s preliminary machine tool orders came in at 2173.%; much better than the prior showing of 189.4%.

Hopes of USD Peg Removal Fade… Posted: 08 Mar 2010 10:18 PM PST Zhou Xiaochuan, the governor of the People’s Bank of China, has made a clear indication that Beijing is preparing to abandon its peg to the USD. In his statements, it was said that the peg was a measure to help China make it through the financial crisis. However, as markets digest the comments, some continue to winder if Mr. Zhou was suggesting a shift in policy may still be some time off. Further more, Beijing may need to raise interest rates or appreciate the currency to meet its target of keeping inflation below 3% this year.

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