Forex Market Updates & Commentary

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• EURUSD steady and unchanged on the day
• USDCAD maintains firm support. Tests 100 hour MA
• Canada GDP Better, Annualized a Touch Lower
• Canada GDP & Current Account Due at 8:30AM
• Russian central bank unexpectedly raised deposit rate to 3.5% from 3.25%; the fourth increase since December.
• Swedish finance minister says there can be no talk of extending Greek debt maturities until the country achieves a budget surplus.
• 5-30 Calender
• EURUSD opens higher but moves down from there

EURUSD steady and unchanged on the day Posted: 30 May 2011 06:14 AM PDT The EURUSD moved higher on the opening but has been below those level since and currently is near the 4 PM closing price of 1.4278 on Friday.   The price low dipped below and old trendline on the hourly chart (see chart above) but the price moved back higher soon thereafter. In the latest hour, the price dipped below the support line again, but it is more from time moving on, rather than extreme market selling. Needless to say, the market is steady within a narrow range. The low came in at 1.4256. The high came in at 1.43207.  The 65 pip range would normally make me look for a range extension but with the quiet and steady markets as a result of holidays in the UK and US, the momentum may be hard to find. Trendline is at 1.4275. Use that as a borderline with bullish above/bearish below.  The target on the downside is to get through the 1.4257 level.  Below that the next target would look toward the 1.4204 area. ON the topside, the 1.4292 level is the next key level to get through. This has been the ceiling price over the last 9 hours of trading.

USDCAD maintains firm support. Tests 100 hour MA Posted: 30 May 2011 05:47 AM PDT The Canada GDP on a quarterly annualized basis came in a touch weaker than expected although the MoM was a bit better.  What balanced that out was the prior month was down by 0.1%. So the MoM data balanced out. The Current Account for the 1st quarter meanwhile was much weaker at -8.9B from -7.2B expected. The combination has forced the USDCAD higher. The pair has good support against the floor trendline and the 200 hour MA (green line in the chart above).  Those levels come in at 0.97516 and 0.9748.  On the topside, traders should watch the 100 hour MA for clues. That level is represented by the blue line in the chart above and it currently comes in at 0.9779 level.  A move above this level should lead to further upside potential.  The 0.9784/89 highs from NY trade on Friday and the high for today are not far behind and other levels to breach to give the bulls more upside confidence.  Last week, the week was largely a consolidation period that moved the price above the 100 day MA, but momentum could not be established.  The 100 day MA today comes in at the 0.9753 level. With the low at 0.97504, this keeps the bulls in charge for the time being.

Canada GDP Better, Annualized a Touch Lower Posted: 30 May 2011 05:32 AM PDT Quaterly GDP Annualized:  Survey: 4.0%   Actual: 3.9%   Prior: 3.3%  Revised: 3.1% Gross Domestic Product (MoM):   Survey: 0.2%  Actual: 0.3%   Prior: -0.2  Revised: -0.1% Gross Domestic Product (YoY):  Survey: 2.6%  Actual: 2.8%   Prior: 2.9%  Revised: 3.0% Current Account:    Survey: -7.2B  Actual: -8.9B   Prior: -11.0B   Revised:  -10.3B

Canada GDP & Current Account Due at 8:30AM Posted: 30 May 2011 04:53 AM PDT

Russian central bank unexpectedly raised deposit rate to 3.5% from 3.25%; the fourth increase since December. Posted: 30 May 2011 12:45 AM PDT The move was forecasted by 9 of 20 economists in a Bloomberg survey. Benchmark kept at 8.25%. Move was made due to continuing inflation expectations and risk to stable growth. Says lower money supply growth in May will contribute to lower inflation in the future.

Swedish finance minister says there can be no talk of extending Greek debt maturities until the country achieves a budget surplus. Posted: 30 May 2011 12:30 AM PDT

5-30 Calender Posted: 29 May 2011 09:07 PM PDT

EURUSD opens higher but moves down from there Posted: 29 May 2011 04:10 PM PDT The EURUSD opened higher and moved above the trendline in the daily chart, but the price action has not been supportive. The price is looking to test that trendline in the daily chart with a move below the 1.4277 level having the potential of increasing the disappointment in the upside move. The next target would be the 1.4254 level which would bring the price back in the channel from Tuesday to Thursday.

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