Forex Market Updates & Commentary

GBPUSD quiets down. Bull flag forming?
US Richmond Fed & House Price Index Both Fall
EURGBP moves below 38.2% Fibo and 200 hour MA
US House Price Index & Richmond Fed Manufacturing Index Data Due at 10AM
Bobbys Corner-Open Market-March22.2011
EURUSD falls below trendline support. Range narrow today
USDCHF continues to test 100 hour MA resistance
USDCAD moves higher on weaker Canadian Data
Canada Leading Indicators Positive as Retail Sales Fall
Fed’s Fisher: Fiscal consolidation is going to be very painful
The FXDD NY Morning Call for March 22nd
Feds Fisher no accomodation needed past June
Canada Leading Indicators & Retail Sales Data Due at 8:30AM
Hildebrand on the wires…
ECB’s Stark says inflation expectations are still anchored

Posted: 22 Mar 2011 07:30 AM PDT

The GBPUSD has moved lower and could be forming a bull flag. The pair moved higher on better CPI this morning. The NY session has seen two way action. There have been lower highs and lower lows. However, the correction has been able to stay above the 38.2% of the days trading range.

Trader’s will be watching the upside trendline at the 1.6383 level for upside clues. A move above this level keeps the idea of a bull flag in tact. On the downside, the bottom trendline, 100 bar MA and 38.2% retracement of the move up from the low to the high comes in at 1.6350. A break of this area would likely solicit additional selling for the pair.

US Richmond Fed & House Price Index Both Fall

Posted: 22 Mar 2011 07:03 AM PDT

Richmond Fed Manf. Index: Survey: 24 Actual: 20 Prior: 25

Business Activity (Mar vs. Feb)
Overall Index: 20 vs 25
Shipments: 23 vs 29
New Order Vol: 20 vs 27
Order Backlog: 8 vs 12
Capacity Utilization: 14 vs 17
Vendor Lead Time: 16 vs 20
Number of Employees: 16 vs 16
Average Workweek: 10 vs 17
Wages: 19 vs 18

House Price Index: Survey: -0.2% Actual: -0.3% Prior: -0.3% Revision: -1.0%

EURGBP moves below 38.2% Fibo and 200 hour MA

Posted: 22 Mar 2011 06:42 AM PDT

The EURUSD has moved below the 38.2% fibonacci support and the 200 hour MA at the 0.8673 level. This should solicit additional selling pressure on the confirmation of the change in the bias from bullish to bearish on the earlier break of the 100 hour MA (at the 0.8705 level). The catalyst today was the strong CPI out of the UK today which is likely to increase the pressure to raise rates.

US House Price Index & Richmond Fed Manufacturing Index Data Due at 10AM

Posted: 22 Mar 2011 06:38 AM PDT

Bobbys Corner-Open Market-March22.2011

Posted: 22 Mar 2011 06:29 AM PDT

Good Morning:

GBP was the star of the overnight session as CPI in the UK came out almost double what analysts expected. This will put pressure on the Bank of England to consider a bump up in interest rates.

The Euro touched a 5 month high versus the USD as speculation that the ECB will raise interest rates next month-as the concern of inflation mounts. Last month ECB President Trichet mentioned the rate increase-and even after the crisis in Japan, he has not changed his tone.

Analysts are mixed in there thinking-some feel that Japan will slip into (another) recession, and other feel that Japan will see a big rebound in Q3 and Q4. The disruptions of the electric supply, and how it disrupts the supply chain will be a major factor in rebuilding the economy. The resumption of exports used in the production of good overseas will be the litmus test for the economy.
For now-Japan just needs to get the nuclear crisis under control, and assist their population in any way they can.

Oil:$101.56 Gold:$1421.90

TIME		FOR	EST.	PRIOR
10:00A.M.	HOUSE PRICE INDEX MoM	JAN.	-0.20%	-0.30%
10:00A.M.	RICHMOND FED MANUFACT.INDEX	MAR.	22.O	25.O

HAVE A GREAT DAY & GOOD LUCK

EURUSD falls below trendline support. Range narrow today

Posted: 22 Mar 2011 06:17 AM PDT

There is a rumor in the market that Allied Irish Bank missed a coupon payment. This may be contributing to the fall in the EURUSD over the last 30 minutes.

In the FXDD Morning Call I talked about the support from trendline. When this line was broken, along with the 200 bar MA, the pairs selling momentum intensified.

Support comes in at the 1.4202 level now. This was a high from yesterday and a low from today. The narrow range of 45 pips for todays trade suggests that there is an extension at some point today. A move through the 1.4200 level should open the door to the downside. A target would be the 1.4145 which is the 38.2% of the move up from the Friday low.

Look for resistance at 1.4221 now. A move above this level would not be congruent with continued sell pressure (see chart below)

USDCHF continues to test 100 hour MA resistance

Posted: 22 Mar 2011 06:09 AM PDT

The USDCHF has tested the 100 hour MA 4 separate times over the last 24 hours of trading. The pair is testing a 5th time currently at the 0.9042 level. A break above should solicit additional buying interest in the pair. The key above resistance comes in at the underside of the trendline from the March 17th low at 0.9072 and the 0.9084 which is the 38.2% of the move down from the March 11th high (see chart below)

The USDCHF has been pressured as flight to safety bid keeps the CHF a currency in demand (USDCHF pressured). Libya, Japan, EU Debt, US uncertainty are the fundamental reasons for the strength.

USDCAD moves higher on weaker Canadian Data

Posted: 22 Mar 2011 05:40 AM PDT

Retail Sales were much weaker than expected and as a result, the USDCAD has move higher. Retail Sales fell by -0.3% with the expectations of a positive 1.0%. The Ex Autos also was weaker at +0.0% vs +0.7% expectations.

From a technical perspective, the price has moved toward the high for the day at 0.9796. Getting above this level and the 200 hour MA (green line in the chart above) at 0.9802 (the level also corresponds with other trendlines that come in at the level) should solicit additional buying interest in the pair.

On the downside, the buyers/bulls would like to see the price stay above the 200 bar MA on the 5 minute chart and the 38.2% retracement of the intraday move up today. The 200 bar MA comes in at the 0.9775 level while the 38.2% retracement comes in at the 0.9772 level. Traders, after a sharp spike higher, like to see the 38.2% level hold on corrections of the initial move. If it does, the potential for a move through the highs is increased. Risk is a move below the 0.9772 for longs in the market now.

Canada Leading Indicators Positive as Retail Sales Fall

Posted: 22 Mar 2011 05:36 AM PDT

Leading Indicators: Survey: 0.7% Actual: 0.8% Prior: 0.3% Revised: 0.4%

Components (Feb vs. Jan)
Housing Index: 1.8% vs 1.5%
Bus. Service Employment: -0.2% vs -0.4%
S&P/TSX Stock Index: 2.7% vs 2.6%
Money Supply: 0.5% vs 0.5%
U.S. Composite: 0.6% vs 0.6%
Average Work Week: 0.3% vs 0.0%
New Orders, Durables: 1.0% vs -2.0%
Shipment/Inventory: 0.0% vs -0.5%
Furniture, Appliance Sales: 0.9% vs 0.0%
Other Durable Sales: 0.6% vs 1.0%

Retail Sales(MoM): Survey: 1.0% Actual: -0.3% Prior: -0.2%

Core Retail Sales: Survey: 0.7% Actual: 0.0% Prior: 0.6%

Fed’s Fisher: Fiscal consolidation is going to be very painful

Posted: 22 Mar 2011 05:35 AM PDT

Newswire report

The FXDD NY Morning Call for March 22nd

Posted: 22 Mar 2011 05:09 AM PDT

Feds Fisher no accomodation needed past June

Posted: 22 Mar 2011 04:47 AM PDT

Newswire report

Canada Leading Indicators & Retail Sales Data Due at 8:30AM

Posted: 22 Mar 2011 04:37 AM PDT