Swim The Forex: August 2010

Tuesday, August 31, 2010

Forex Market Updates & Commentary

EURUSD stays above 100 day MA at 1.2712. Squeezes higher
USDCHF falls to 19 month lows. Approaching support at 1.0158.
US Consumer Confidence with Stronger Data
Chicago Purchaser Manager Comes out a Touch Lower
Chicago PMI comes in at 56.7 Weaker than expectations
US Consumer Confidence 10AM
Forex Morning Report August 31
US Case-Shiller Home Prices Rise
USDCAD moves higher on weaker growth. Less rate pressure
Chicago Purchasing Manager Data 9:45AM
S&P Case-Shiller Data at 9AM
Canada GDP Comes out Same as Forecast
NYC Business conditions lowest in a year
Bobbys Corner-Open Market-August.31.2010
5 Minutes of Forex Charts

EURUSD stays above 100 day MA at 1.2712. Squeezes higher

Posted: 31 Aug 2010 07:16 AM PDT

USDCHF falls to 19 month lows. Approaching support at 1.0158.

Posted: 31 Aug 2010 07:04 AM PDT

US Consumer Confidence with Stronger Data

Posted: 31 Aug 2010 07:02 AM PDT

Chicago Purchaser Manager Comes out a Touch Lower

Posted: 31 Aug 2010 06:46 AM PDT

Chicago Purchasing Manager: Survey: 57.0 Actual: 56.7 Prior: 62.3

Chicago PMI comes in at 56.7 Weaker than expectations

Posted: 31 Aug 2010 06:45 AM PDT

Chicago PMI 56.7
Business barometer 56.7 vs 62.3

Prices paid 57.2 vs 58.1 last month
Production 57.6 vs 65.0 last month
New orders 55.0 vs 64.6 last month
Order backlogs 56.2 vs 57.6 last month
Inventories 46.5 vs 50.8 last month
Employment 55.5 vs 56.6 last month
Supplier deliveries 61.2 vs 59.4 last month

US Consumer Confidence 10AM

Posted: 31 Aug 2010 06:39 AM PDT

Forex Morning Report August 31

Posted: 31 Aug 2010 06:30 AM PDT

Forex Morning Report August 31

US Case-Shiller Home Prices Rise

Posted: 31 Aug 2010 06:05 AM PDT

S&P/CaseShiller Home Price Ind: Survey: Actual: 147.97 Prior: 146.43 Revised: 146.47

S&P/CS 20 City (MoM%) SA: Survey: 0.20% Actual: .28% Prior: 0.47% Revised: .53%

S&P/CS Composite-20 (YOY): Survey: 3.50% Actual: 4.23% Prior: 4.61% Revised: 4.64%

S&P/CaseShiller US HPI: Actual: 138.0 Prior: 131.8 Revised: 132.2

S&P/CaseShiller US HPI (YoY%): Actual: 3.6% Prior: 2.0% Revised: 2.3%

US june S&P/CaseShiller home prices rise 4.2% versus a year ago

USDCAD moves higher on weaker growth. Less rate pressure

Posted: 31 Aug 2010 05:46 AM PDT

Chicago Purchasing Manager Data 9:45AM

Posted: 31 Aug 2010 05:44 AM PDT

S&P Case-Shiller Data at 9AM

Posted: 31 Aug 2010 05:36 AM PDT

Canada GDP Comes out Same as Forecast

Posted: 31 Aug 2010 05:33 AM PDT

NYC Business conditions lowest in a year

Posted: 31 Aug 2010 05:32 AM PDT

Chicago PMI to be reported later at 9:45 AM

Bobbys Corner-Open Market-August.31.2010

Posted: 31 Aug 2010 05:26 AM PDT

Good Morning:

The last day of the month reiterates the markets sentiment that the global economic recovery is faltering. The YEN has been the major winner when it comes to gains against the USD.
Safe haven demand has allowed the JPY to strengthen for the fourth row in a month.
Slowdowns in US housing, consumer spending, and business investment are all adding to economist lowering their forecast for future growth.
Comments by Fed Chairman Bernanke this past weekend, stating that growth has been “too slow” and unemployment has been “too high” also reiterates the fact that the US and global recoveries are not getting traction.

World equity markets dropped after yesterday’s 140 point drop in the Dow. US Futures are also pointing to a lower opening this morning.

TIME		FOR	EST	PRIOR
09:00AM	S&P/CASESCHILLER HOME PRICE INDEX	JUNE	——	146.3O
09:00AM	S&P/CS 20 CITY MoM% SA	JUNE	O.2O%	O.47%
09:00AM	S&P/CS COMPOSITE 20 YoY	JUNE	3.55%	4.61%
09:00AM	S&P/CASE -SCHILLER US HPI	2 Q	——–	131.8O
09:00AM	S&P/CASE -SCHILLER US HPI YoY%	2 Q	——–	2.O%
09:45AM	CHICAGO PURCHASING MANAGER	AUG	57.O	62.3O
10:00AM	CONSUMER CONFIDENCE	AUG	5O.8	5O.4
10:00AM	NAPM MILWAUKEE	AUG	6O.3	66.O

HAVE A GREAT DAY & GOOD LUCK

5 Minutes of Forex Charts

Posted: 31 Aug 2010 05:15 AM PDT

Monday, August 30, 2010

Forex Market Updates & Commentary

EURUSD between the Goal Posts…Looking for a break
GBPUSD moves below 200 hour MA in quiet UK holiday trade
Forex Morning Report- August 30th
This weeks Webinar: “Why I love the 100 and 200 bar moving average” You need to register
USDJPY: The 84.80 rears it’s head again. Watch level this morning
Bobbys Corner-Open Market-Aug.30.2010
Personal Income, Personal Spending Along with PCE Data Same as Survey
EURUSD tests support at 1.2682-90
EURJPY pauses at the 100 hour MA. Between the Goal Posts
Personal Income & Personal Spending Data 8:30AM
The NY Opening Forex Commentary for August 30th is available for viewing
BoJ not as aggressive as market anticipated; yen regains early losses
8-30 Economic Calendar
BOJ Expands Credit
USD/JPY Better Bid

EURUSD between the Goal Posts…Looking for a break

Posted: 30 Aug 2010 07:15 AM PDT

When the EURUSD trades above the 100 hour MA, it gives the pair a bullish bias. When the price trades above the 200 hour MA, it confirms the bullish bias. When the price fails to stay above the 200 hour MA and moves back below that moving average, longs should be exited as the market is saying, “I am not ready to trend higher”.

This is the situation for the EURUSD today. The price gapped above the 200 hour MA in early trade, then came down to test the 200 hour MA as momentum faded (green line in the chart below). The price moved below the 200 hour MA line and moved back down to test the 100 hour MA (blue line in the chart) where buyers reemerged against the 100 hour MA and the 50% retracement level. Note the market could not register a close below the 100 hour MA line and a modest buying rally ensued.

fxdd-pic-0916

The correction took the price up to the 1.2715 level. The price move higher has faded and the price has rotated back down in quiet trading.

When the price is “Trading Between the Goal Posts” it is a signal that the market is unsure of the directional move. Typically, a move below the 100 hour MA (blue line) or above the 200 hour MA should lead to a move away. So watch the levels and look for momentum on a break.

GBPUSD moves below 200 hour MA in quiet UK holiday trade

Posted: 30 Aug 2010 06:44 AM PDT

Forex Morning Report- August 30th

Posted: 30 Aug 2010 06:30 AM PDT

Forex Morning Report- August 30th

This weeks Webinar: “Why I love the 100 and 200 bar moving average” You need to register

Posted: 30 Aug 2010 06:25 AM PDT

To all.. Due to positive comments and interest, we will focus Tuesday’s webinar on the weekend post titled “Why I love the 100 and 200 bar moving average“

The webinar will take place at Tuesday, August 31st, 4pm est/ 21:00 GMT. You do need to register for the webinar by going to the following site:

https://www1.gotomeeting.com/register/356147496

Kind regards,

Greg Michalowski

USDJPY: The 84.80 rears it’s head again. Watch level this morning

Posted: 30 Aug 2010 05:47 AM PDT

Bobbys Corner-Open Market-Aug.30.2010

Posted: 30 Aug 2010 05:34 AM PDT

Good Morning:

The UK is closed today for their summer bank holiday-thus thinning out the ranks of market participants for a Monday.
The JPY advanced as speculation that the BOJ will increasee credit easing measures.
Policy makers in Japan indicated that they want a weaker Yen. They did not take direct steps to weaken the JPY, but made every indication that they will f necessary.
Asian equity markets were higher, and European markets are lower. US Futures are also lower this mornng.

Oil:$74.71 Gold:$1238.70

TIME FOR EST. PRIOR

8:30A.M. PERSONAL INCOME JULY 0.30% 0.00%

8:30A.M. PERSONAL SPENDING JULY 0.30% 0.00%

8:30A.M. PCE DEFLATOR YoY JULY 1.40% 1.40%

8:30A.M. PCE CORE MoM JULY 0.10% 0.00%

8:30A.M. PCE CORE YoY JULY 1.40% 1.40%

10:30A.M. DALLAS FED MANF. ACTIVITY AUG. -21.00%

HAVE A GREAT DAY & GOOD LUCK

Personal Income, Personal Spending Along with PCE Data Same as Survey

Posted: 30 Aug 2010 05:33 AM PDT

Personal Income: Survey: 0.3% Actual: 0.2% Prior: 0.0%

Personal Spending: Survey: 0.3% Actual: 0.4% Prior: 0.0%

PCE Deflator: Survey: 1.5% Actual: 1.5% Prior: 1.4%

PCE Core(MoM): Survey: 0.1% Actual: 0.1% Prior: 0.0%

PCE Core(YoY): Survey: 1.4% Actual: 1.4% Prior: 1.4%

EURUSD tests support at 1.2682-90

Posted: 30 Aug 2010 05:30 AM PDT

EURJPY pauses at the 100 hour MA. Between the Goal Posts

Posted: 30 Aug 2010 05:13 AM PDT

Personal Income & Personal Spending Data 8:30AM

Posted: 30 Aug 2010 04:59 AM PDT

The NY Opening Forex Commentary for August 30th is available for viewing

Posted: 30 Aug 2010 04:56 AM PDT

BoJ not as aggressive as market anticipated; yen regains early losses

Posted: 30 Aug 2010 12:23 AM PDT

The BoJ was not as aggressive as some thought only making minor adjustments to policy. The markets had been looking for more aggressive action, possibly intervention, to weaken the currency.

Usd/Jpy rose to 85.88 earlier in anticipation of bolder steps by the BoJ. When market learned of only tweaks in policy the pair sold off to 84.90. Currently Usd/Jpy trades at 85.10.

8-30 Economic Calendar

Posted: 29 Aug 2010 09:04 PM PDT

region_forex_00031

BOJ Expands Credit

Posted: 29 Aug 2010 08:25 PM PDT

The BOJ has kept the overnight rate unchanged at 0.10%. (unanimous)
BOJ expands credit program from 20 Trillion Yen to 30.
To provide 10TLN Yen in 6 month lending program.
Expansion of credit to enhance easing effect and guide market rate lower.
BOJ reiterates economy will stay on recovery path, shows further signs of moderate economy.
BOJ says consumer price drop will keep moderating.
Uncertainty about economy, particularly US growing.
Suda was opposed to expanding credit.

Surprisingly, the Yen received a bid on this release, moving off session highs, but the USD/JPY has gained some traction in the middle of the 85 handle.

USD/JPY Better Bid

Posted: 29 Aug 2010 07:31 PM PDT

The Yen has weakened to open the trading week as the Chief Cabinet Secretary Sengoku is indicating that Finance Minister Kan and the BOJ’s Shirakawa will meet this afternoon to discuss the state of the economy, after which Kan will decide on a stimulus outline. It seems the market is interpreting this as additional easing is in the pipline, particularly with the strong performance of the Yen recently making things more difficult in Japan. On a 4-hr chart it seems the USD/JPY pair has broken the channel below to the upside and could test the 4-200hr moving average in the near-term. Above that indicator it seems that resistance is abundant, however at these depreciated levels the pair could move higher as easily as it did lower.

usdjpy1

Sunday, August 29, 2010

Forex Market Updates & Commentary

Why I love the 100 and 200 bar Simple MAs. A look at the GBPUSD

Posted: 28 Aug 2010 08:09 AM PDT

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The blue line is the 100 hour Simple MA. The green line is the 200 hour Simple MA. I use the same MAs on 5 minute and daily charts as well and they give the same “unambiguous” clues. That is if the price is above the MA line, it is unambiguously bullish. If the price goes below the MA line it is unambiguously bearish.

The “market” (that is the smart money and even those small traders who want to be like the “smart money”), tends to follow these MA (or so it seems) and as a result, when the price goes above them or below them, the price tends to move away. It may also use the levels as support or resistance levels that traders will trade against when the “market” is unsure of direction.

Why does the market use these MA lines? The reason is smart traders who are focused on risk, use these “borderline” levels because risk can be defined. I call them “borderlines” because the price is bullish above and bearish below . So it is like a borderline where it is one state on one side, and another state on the other). If you sell against a moving average (border)line like 10 and 11 in the chart above, put a stop 10 or so pips above (assume a bearish bias). If the price goes down you have great trade location. If the price goes above, the ”Market” is not doing what it is supposed to do, so GET OUT. Don’t blame yourself. Blame the “market”!

If a trader is able to define risk and accept risk (10 or so pips above - it is up to you but it does not have to be any more than 20 pips), you can diffuse fear and “fear is a traders worst enemy”. Traders need to “steer clear of fear”. Not having fear allows successful traders to be confident of the position and trade more trend type moves.

The 100 bar MA is the trigger the 200 bar is the confirming MA. At 1 the price breaks above the trigger MA and the price moves higher. The target is the 200 hour MA. The market can not confirm the trend by going through and so this creates a borderline to take profit against. If the price goes through the 200, go long as the trend higher is confirmed. The price does not do this and when the price moves below the 100 hour MA at 3, the bias turns negative and the price moves sharply lower. The market bottoms and the price moves back up to 4 where the price breaks through the 100 bar MA and moves up again to the 200 bar confirming MA at 5. It fails again, so the price comes down again and breaks below the 100 bar MA. It corrects and tests the 100 bar MA at 6. The smart money sells against the level (risk is 10-20 pips) and the price moves sharply lower.

The market bottoms again and starts the rebound. At 7 the price moves above the 100 bar MA and this time through the 200 bar confirming moving average finally. This should lead to a further move higher. It does but the rally fizzles out and the price moves back below the MA at 9 and then back above and after trying to use the 200 bar MA as support, the price pushes below the 200 bar MA at 10. Between 11 and 12, the smart money (i.e. the market) can not decide what to do as it awaits Bernake. So it ranges between the 100 MA line and the 200 MA line. The market breaks and bottoms at 13 during Bernanke speach. That fails and the market price moves above the 100 hour MA one last time, races to the 200 hour MA and stops. The week ends inbetween the 100 and 200 bar MA. “In Between the Goal Posts” is what i call it when the price is contained by the 100 and 200 bar MA.

Next week I will use those MA for clues as to market direction. If the price stays above the 100 the bias is bullish but the price has to get through the 200 bar MA to confirm the bullish trend. IF it does, look for increased upside momentum. If it fails to develop that momentum and the price moves back below the 200 bar MA, get out (the market is not doing what it should do! So get out!). If instead the price moves below the 100 bar MA, look for increased bearish sentiment. Successful traders will use other tools like Fibonacci retracements, trendlines, and even 100 and 200 bar MA levels on 5 minute and daily charts (these are my favorites) to target levels as the price trends lower or higher.

I love moving averages - in particular the 100 and 200 bar MA lines. They provide definable, low risk trading opportunities for the smart money.

If you want to subscribe to my daily emailed forex video commentary (4 times a day), send me an email at greg@fxdd.com. I conduct free webinars twice a week on Tuesday and Thursday at 4PM EST. To register and view rebroadcasts go to http://forex.fxdd.com/webinars. You will learn, so you can be aware and be prepared.