Forex Market Updates & Commentary

EURGBP makes new highs but….
EURUSD has ceiling in place. Trendline on the bottom
GBPUSD stays contained. Watch 200 hour MA for clues
IMF with comments on financial stability
AUDUSD supported today in consolidating range
Retails Sales mixed but revisions better
US Retail Sales Show Mixed Data
Bank of Canada monetary policy report due at 10:30 AM
US Business Inventories Numbers Due at 10AM
ECB Mersch says budgets are compulsory for single currency
Bobbys Corner-Open Market-April.13.2011
The NY Morning Forex Call for April 13th
US Retail Sales Data due at 8:30AM
Eurozone February Industrial Production up 0.4% from prior month
Claimant count 0.7K, Average earnings 2.0%, Unemployment rate 7.8%

Posted: 13 Apr 2011 07:01 AM PDT

The headlines say the EURGBP is at 6 month highs, but the new high today did not solicit a rush to buy. The high yesterday wa 0.8914. The high today came in at 08921 and the market pushed that level on three separate occassions only to have sellers keep it contained. Now, the downside is not all that impressive either with the low for the day at the 0.8891 level. So the bulls and bears are fighting it out or perhaps just in their respective corners waiting for one to make a move.

The burden of proof does remain on the bears to start the fight to the downside. The price over the last week has surged higher on the back of higher rates in the Eurozone and yesterdays UK CPI helping pressure the GBP. A move below the low for the day and below trendline support in the hourly at 0.8888 should solicit more selling. This may also be the catalyst for a move lower in the EURUSD.

EURUSD has ceiling in place. Trendline on the bottom

Posted: 13 Apr 2011 06:32 AM PDT

I am focused on the hourly chart for clues today. The price is contained by a ceiling above at the 1.4519 level and on the downside by a trendline at the 1.4475 level. There is “talk” that the 1.4500 level is a key option expiration level today, that those involved are trying to defend. The options expire at 10 AM ET which “may” open the range.

Speaking of the range for the day, the low is 1.4454. The high is 1.4519. The 65 pips range is once again (Monday was narrow as well) below the 113 average range over the last 14 days. This suggests a non trending consolidative pattern. Traders should be patient and wait for clues from the technicals. On breaks to the downside or the upside should solicit momentum and a directional move in the direction of the break. If the break fails, get out and be aware a move to the opposite extreme may ensue.

Watch the key levels.

GBPUSD stays contained. Watch 200 hour MA for clues

Posted: 13 Apr 2011 06:14 AM PDT

The GBPUSD remains in a narrow trading range. Over the last 4 or so hours the price has had a low to high range of 1.6256 to 1.6296 (40 pips). The bottom has been supported by the 200 hour MA (green line in the chart above). The price dipped below this level in the London sesssion but quickly rejected that break and moved to the high for the NY session).

On the topside the price moved below the 100 hour MA and trendline support yesterday (blue line in the chart above), tested it during the NY session yesterday, and moved back lower. The price has been more focused on the bottom end of the trading range since the last test. Nevertheless, the 100 hour MA level remains a level to watch on any move higher. That level comes in at the 1.6320 level.

The better CPI yesterday and weaker sales from the BRC on Monday, should take some pressure off the BOE to raise rates. However, the comments from key Fed officials (Dudley and Yellen) seem to suggest there are some doves remaining on the Fed board (likely to keep rates lower for a while still). So the action could be a stalemate.

Watch the levels for clues from the technical levels. Define the risk and look for the momentum in the direction of any break. If the momemtum does not materialize, then look for the range to define the boundaries until the market is ready to move.

IMF with comments on financial stability

Posted: 13 Apr 2011 06:07 AM PDT

Sovereign funding in the EU a challenge
$3.6 trillion in maturing debt in the next 2 year
EU stress test needs broad coverage for banks with tighter capital levels
Says that some German and Italian banks have low capital levels
Funding costs to rise for Portugal and Spain through 2015
They also comment that household debt may weakne banks further
Modest growth in advanced economies
Emerging countries are robust

AUDUSD supported today in consolidating range

Posted: 13 Apr 2011 05:56 AM PDT

The AUDUSD is trading near the highs of the day after finding support against the 200 hour MA in the Far East session . The top has two key levels that traders are using to lean against. The 100 hour MA (blue line in the chart above) comes in at the 1.0497 level. Not far from that is a “Remembered Price” at the 1.0507 area (high from April 7th. High are from April 12th. High from earlier today). A move above or below the key areas should solicit additional momentum.

If you were to rank growth potential, the Australian economy is ranked at the high. Rates are higher. The geographic location (in the area of the emerging economies) and the commodity slant are the obvious advantages.

Retails Sales mixed but revisions better

Posted: 13 Apr 2011 05:32 AM PDT

Headline 0.4%
Ex Auto +0.8%
Ex Auto and Gas +0.6

Revisions saw the headline move up to 1.1% from 1.0% and the Ex Auto and Gas +0.6 vs +0.9%.

CNBC Steve Leasman is saying below 2% quarter for GDP. He is also commenting that the shocks from higher oil prices and Japan have yet to make it into the economy.

US Retail Sales Show Mixed Data

Posted: 13 Apr 2011 05:32 AM PDT

Advance Retail Sales: Survey: 0.5% Actual: 0.4% Prior: 1.0% Revised: 1.1%

Retail Sales Less Autos: Survey: 0.7% Actual: 0.8% Prior: 0.7% Revised: 1.1%

Retail Sales Ex Auto & Gas: Survey: 0.5% Actual: 0.6% Prior: 0.6% Revised: 0.9%

Ten of 13 major U.S. retail categories show march sales gains.

Bank of Canada monetary policy report due at 10:30 AM

Posted: 13 Apr 2011 05:29 AM PDT

This report provides insight into the Bank of Canada’s view of economic conditions and inflation. Focus is on the factors that will shape the future of monetary policy and influence their interest rate decisions going forward. Of course yesterday the BOC kept interest rates unchanged.

US Business Inventories Numbers Due at 10AM

Posted: 13 Apr 2011 05:22 AM PDT

ECB Mersch says budgets are compulsory for single currency

Posted: 13 Apr 2011 05:16 AM PDT

Also adds Greece, Ireland and Portugal must use time for reform. He does think that the EU reforms fall short of ECB call for “quantum leap”.

Bobbys Corner-Open Market-April.13.2011

Posted: 13 Apr 2011 05:16 AM PDT

Good Morning:

The EUR/USD pair tried to take out 2011 high-but feel short, with the pair hitting 1.4519 before settling back into the 1.44 handle.
Reports that China would continue to buy Spanish bonds helped the Euro overall.
The JPY lost ground as data showed that the Euro Zone’s economy seems to be improving, and equity markets rebounded-making investors seek higher-yielding assets.
With global economies on the road to recovery, there is cause to believe that the stock and commodity markets should stay robust in the near future, which may slow demand for the safe haven of the JPY.

Today we have data on US Retail Sales-and President Obama will discuss his plans for the new budget at 1:30 this afternoon.

Equity markets were higher across the board-and US Futures are also higher today.

Oil:$106.65 Gold:$1460.70

TIME FOR EST. PRIOR

8:30A.M. ADVANCE RETAIL SALES MAR. 0.50% 1.00%

8:30A.M. RETAIL SALES LESS AUTOS MAR. 0.70% 0.70%

8:30A.M. RETAIL SALES EX AUTO & GAS MAR. 0.50% 0.60%

10:00A.M. BUSINESS INVENTORIES FEB. 0.80% 0.90%

2:00P.M. FEDS BEIGE BOOK

HAVE A GREAT DAY & GOOD LUCK

The NY Morning Forex Call for April 13th

Posted: 13 Apr 2011 05:06 AM PDT

US Retail Sales Data due at 8:30AM

Posted: 13 Apr 2011 04:37 AM PDT