Forex Market Updates & Commentary

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• EURUSD tests intraday resistance
• GBPUSD starts corrective move
• New Home sales worse at 250K
• The NY Morning Forex Commentary
• Osborne cuts corporate tax 2% from April of this year
• Radiation at reactor 2 at highest level
• Chancellor of Exchequer Osborne speaking on budget
• Bobbys Corner-Open Market-March.23.2011
• GBPUSD moves toward 100 hour MA test at 1.6247
• The FXDD NY Morning Call for March 23rd
• EURUSD looks to test key support in early NY trade
• Eurozone Industrial New Orders
• BBA mortgage approvals 29.6K; better than expected
• BOE voted 6-3 in March to leave benchmark rate at 0.5%
• UK MPC meeting minutes and BBA Mortgage Approvals in 20 minutes..

EURUSD tests intraday resistance Posted: 23 Mar 2011 07:39 AM PDT The EURUSD has also moved back higher. The weaker housing data put  a damper on the dollar bullishness it seems. The price has moved up to test the midpoint of the days range and the 100 bar MA on the 5 minute chart. The price is also back above the 100 hour moving average at 1.4147.  Earlier the price tested and held the 38.2% of the move up from the March 16th move higher at the 1.4102 level  and this also gave traders a reason to cover shorts.

GBPUSD starts corrective move Posted: 23 Mar 2011 07:31 AM PDT The GBPUSD moved above the channel trendline signalling a corrective wave back higher after the trend move for most of the London session. Support is now down to 1.6238 where the trendline from the move up from the March 16th low comes in currently. The target above comes in at the 38.2% of the days range at the 1.6280. I would expect to see sellers on a test of this level on the first go round.  A break above targets the 1.6300 level.

New Home sales worse at 250K Posted: 23 Mar 2011 07:01 AM PDT This is a record low for this series. The month supply of new homes at this record pace is back up to 8.9 months Northeast         15,000 vs    35,000 Midwest           29,000 vs     40,000 South            148,000  vs  158,000 West              58,000  vs   68,000 The Median price fell sharply to $202,100 which is down 8.9% from a year ago. Last month the median was $234,800 The Mean Sale price also fell sharply to $246,000 from $265,300 The good news is the affordability is rising. The very bad news is the fall in wealth will not make consumers feel any better.

The NY Morning Forex Commentary Posted: 23 Mar 2011 06:54 AM PDT   In the morning commentary, I take a look at the EURUSD, GBPUSD, USDJPY, USDCHF, Gold and USDCAD and outline the technical levels that are driving the trading roadmap for today's trading.

Osborne cuts corporate tax 2% from April of this year Posted: 23 Mar 2011 05:51 AM PDT Will adjust bank levy to offset the corporate tax cut. The GBPUSD is subject to event risk from the Chancellors comments. So care and technical levels become more important.  The current price is testing the technical support at the 1.6233 area. Above is the 100 hour MA which is currently at 1.6249. A move above 1.6249 would alleviate some of the selling pressure in the pair.  On the downside (which is the trend for the day) a break of the 1.6233 area will open the pair up to further selling pressure. The 1.6217 is a target level on a break of the trendline support (see channel trendline in the chart below). Below that level, the 1.6207 area (see chart above).

Radiation at reactor 2 at highest level Posted: 23 Mar 2011 05:50 AM PDT According to newswire source

Chancellor of Exchequer Osborne speaking on budget Posted: 23 Mar 2011 05:45 AM PDT Cuts UK growth forecast to 1.7% from 2.1%. 2.5% in 2012, 2.9% in 2013 and 2014 and 2.8% in 2015 Sees inflation dropping to 2% in 2 years time Budget seeks enduring growth Sees comprehensive plan that is credible Comments that it is not a tax raising budget Powerful stimulus in the economy The UK gambled on a debt fueled model of growth Says BOE remit to remain at 2% based on CPI (of course inflaton is 4.4% well above the target) Urges private sector growth must replace government deficit Budget removes 100 pages of UK tax code

Bobbys Corner-Open Market-March.23.2011 Posted: 23 Mar 2011 05:38 AM PDT Good Morning:  FX markets were mostly range bound in overnight trading.  With the ECB still on track for a rate increase in April.  The euro has benefited from the expected rate hike-as interest rate differentials are keeping the euro strong versus the greenback.  The problems in Japan and the Middle East seem not to have a direct impact on Euro Zone industrial demand.  If the ECB anticipates that this is not true-you will most probably see the euro under selling pressure-and any rate hike decisions could be put on hold.  Portuguese legislators will vote today on new austerity measures for the economy, which is needed to reduce the budget deficit.  The future of Prime Minister Socrates rests in the passage of these austerity measures. In global news:  Japanese authorities have stated that tap water in Tokyo may not be safe for infants.  Nestle SA-the maker of Pure Life bottled water-which is the largest brand of bottled water in the world saw their stock price jump 1.2% in Zurich trading. Oil rose as allied forces continue to enforce the no fly zone over Libya.  This is raising concerns that oil exports will remain disrupted for some time to come. Asian equity markets dropped, and Europe is higher at this time-and US futures are a touch lower. Oil:$105.45                                                                         Gold:$1434.10   TIME FOR EST. PRIOR 7:00A.M. MBA MORTGAGE APPLICATIONS 18-Mar -0.70% 10:00A.M. NEW HOME SALES  FEB. 290K 284K 10:00A.M. NEW HOME SALES MoM       FEB. 2.10% -12.60% HAVE A GREAT DAY & GOOD LUCK

GBPUSD moves toward 100 hour MA test at 1.6247 Posted: 23 Mar 2011 05:36 AM PDT The GBPUSD is moving closer to the next key target area for the pair. The 100 hour MA comes in at 1.6247 while trendline support (and remembered line support) comes in at 1.6234 area. These levels should solicit some profit taking buying after the sharp fall today on the back of less hawkish comments from Monetary Policy Committee minutes from the Bank of England. The market had priced in the potential for a change in vote to 5 for keeping rate unchanged and 4 voting to raise rates.  The vote came in at 6-3. Chancellor of Exchequer Osborne will be speaking shortly on the budget. The link to the meeting minutes can be found by clicking on the following link: CLICK HERE FOR THE MPC MEETING MINUTES

The FXDD NY Morning Call for March 23rd Posted: 23 Mar 2011 05:15 AM PDT

EURUSD looks to test key support in early NY trade Posted: 23 Mar 2011 04:35 AM PDT The EURUSD has fallen sharply in early NY trade and is looking to test 100 hour MA, the 38.2% of the move up from the March 16th low, and finally the lows from Monday’s trade, all are coming in around the 1.4145 level. The level should find profit taking buyers on the first look. A move below should solicit additional selling however.

Eurozone Industrial New Orders Posted: 23 Mar 2011 03:01 AM PDT Eurozone Industrial New Orders m/m  came in at 0.1%, weaker than the 1.4% expected. Eur/Usd trades at 1.4185, unaffected by news.

BBA mortgage approvals 29.6K; better than expected Posted: 23 Mar 2011 02:32 AM PDT

BOE voted 6-3 in March to leave benchmark rate at 0.5% Posted: 23 Mar 2011 02:31 AM PDT Saw “merit in waiting” to see oil impact. “Significant risk” CPI rising above 5% in near term. Turmoil in mideast is a “substantial development”. Voted 8-1 to leave bond purchases at 200 BLN pounds. Too early to assess the recovery after 4Q contraction. “Tentative” evidence of higher pay pressures. Elevated inflation could persist longer than forecasted. MPC says inflation likely to fall back in medium term. Higher oil may dent global growth and confidence. Sterling saw some selling going into the number and continued lower on the release with the GBP making a new session low of 1.62814 against the USD. It has since recoverd and is back trading near 1.6320.

UK MPC meeting minutes and BBA Mortgage Approvals in 20 minutes.. Posted: 23 Mar 2011 02:09 AM PDT

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