Forex Market Updates & Commentary

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• IMF expects completion of Greek loan program within days
• ECB’s Juncker on the Wires
• EURUSD surges back toward and through the highs
• Charting the Majors with James Chen – Webinar Rebroadcast
• GBPUSD rebounds but remains below resistance levels
• The 1.3346 level is the close from yesterday. Next target resistance level.
• EURUSD defines the range as Trichet comments digested
• Canada Building Permits
• Trichet headline comments from his final press conference
• Canada Building Permits fall sharply
• US Jobless Claims & Continuing Claims
• Bobbys Corner-Open Market-Oct.6.2011
• EURUSD trades up and down in volatile trading. Awaits Trichet comments
• ECB leaves rate unchanged at 1.5%.
• ECB decision late…HMMM

IMF expects completion of Greek loan program within days Posted: 06 Oct 2011 07:44 AM PDT Meanwhile, Greece’s private sector union rejects Troika talks invitation.  The EURUSD has paused at the 200 hour MA at the 1.3435 level but needs to move back below the 1.3411 level and then 1.3491/97. The Monday high at the 1.3481 level will also now be support for the pair.

ECB’s Juncker on the Wires Posted: 06 Oct 2011 07:42 AM PDT Says: ECB’s Draghi will defend Euro stability. Expects Greek troika report Oct.24. EU me need to review Greek aid program. Opposes further expansion of EFSF. EFSF couldn’t handle any Italy Rescue. Must use EFSF as efficiently as possible.

EURUSD surges back toward and through the highs Posted: 06 Oct 2011 07:32 AM PDT The move above the 1.3356 level has opened the door for a move back toward the highs of the day/the week – and with the last surge is now above those levels.  We can go back to Friday and Monday for a review of the levels. On Friday, the price closed at 1.3394 (4 pm close) On Monday the high came in at 1.3381.  Today, in the London session that gap was filled when the price moved up to the 1.33977 level.  In the last few minutes the price has pushed even higher – breaking above the 1.3400 level. Now, the price is currently testing the 50% of the trend move down from the September 29th high. That level comes in at the 1.34114 level.  Above that the 200 hour MA at the 1.3436 level is the next target.  Traders will be eyeing the 1.3394/97 and then the 1.3381 level as support.  Shorts are getting squeezed as risk appetite increases and that means into the EURUSD.

Charting the Majors with James Chen – Webinar Rebroadcast Posted: 06 Oct 2011 07:22 AM PDT Please click on the following link to access the rebroadcast of today’s Charting the Majors with James Chen. This webinar featured the current technical outlook on the major currency pairs in an interactive and educational session. Please click here to access: https://www1.gotomeeting.com/register/938606617 .

GBPUSD rebounds but remains below resistance levels Posted: 06 Oct 2011 07:10 AM PDT The GBPUSD has moved off the lows but the pair remains below the low from Tuesday’s trade at the 1.5340 level.  The high price on the move higher has reached 1.5334.  Staying below this level keeps the bears firmly in charge.  A move above still has the 38.25 of the days range at 1.5356.  IF the price moves above that, shorts from below may look to cover more.  The GBPUSD is down sharply as a result of the increase in QE today by the BOE to 275 billion pounds from 200 billion.

The 1.3346 level is the close from yesterday. Next target resistance level. Posted: 06 Oct 2011 06:46 AM PDT The 1.3346 level was the close from yesterday.  Not far from it is the 1.3356 level. Above that, and the door is opened for a move back to the highs (1.3384-94)

EURUSD defines the range as Trichet comments digested Posted: 06 Oct 2011 06:07 AM PDT The EURUSD has found it’s range as Trichet’s final press conference continues.  On the downside the low from yesterday at the 1.3259 level has the markets attention. While on the topside the 1.3300 to 1.3310 now seems to be the resistance for the pair. The 100 hour MA is currently at the 1.3310 level. The 38.2% of the move down today comes in at the 1.33008 level.     Should the price dip below the 1.3259 level, the lows and highs from October 4th (see chart below) at the 1.3226 and 1.3233 level will become the next target.  The lows for the week is at 1.31449.  Looking at the daily chart, in January 2011, there was a low floor at 1.3243 before the price surged higher.  I would consider this level a minor support level but when the market looks for profit taking clues,  the past lows (and highs) can become more important.  The move down since the end of August has been sharp (from 1.4548 to 1.3144). The price decline has taken the pair below the 50% of the move up from the June 2010 low of 1.1876.  That level comes in at 1.34077 currently and last nights high at 1.33977 is confirmation that downside remains supportive.   The question is the short term is up in the air.

Canada Building Permits Posted: 06 Oct 2011 05:45 AM PDT Canada Building Permits drop to a whopping -10.4% versus a projected survey of 0.3% and a prior number of -0.6%.

Trichet headline comments from his final press conference Posted: 06 Oct 2011 05:43 AM PDT Inflation has remained elevated Expects inflation to stay above 2% over the next few months Economy facing intensified downside risk Intensified downside risks Interest rates remain low There is high uncertainty ECB to offer 1 year loans to banks ECB to also offer 1 year and 13 month and 3 month  Longer term refinancing Operations ECB to resume covered bond purchases of 40 billion Euros. To start in November. Will buy in primary and secondary markets He adds that the non-standard measures are temporary by nature. GDP expected to be very moderate in the 2H Tension of sovereign debt to hurt growth The EURUSD to this point has risen from the lows but remains below the 1.3300 level. The rally has been in reaction to the increased liquidity measures (risk off bid).   However, the markets remain volatile.  1.3259 and 1.3226-33 remain downside suppport targets. On the topside, the 1.3311-15 area remains upside resistance. Sees inflation as broadly balanced Monetary expansion continues to be moderate. Banking system requires particular attention Banks must boost balance sheets, retain earning, and use government support All governments need to take decisive action All need to show determination Nations under programs need to implement measures. Governments must act swiftly. We have heard these words before.  Must act swiftly. Must implement measures.  It is easily said, but not easily done by the governments in question.  EURUSD holds the 1.3259 level on the latest dip and trades at 1.3283 currently (8:56 AM ET). The chart below shows the up and down volatility in the last half hour of trading.  The range seems to be defined, with the major comments likely all over.  So the market should start to settle down. The upside resistance now can be outlined as the 38.2% of the days range at the 1.303008 level up to the 100 hour MA at the 1.3315 level currently.  On the downside the 1.3259 and 1.3226-33 remains the support targets to get through.

Canada Building Permits fall sharply Posted: 06 Oct 2011 05:36 AM PDT The Canada Building permits surprised with a -10.4% decline.   The USDCAD spiked higher on the news but found profit taking sellers at the 38.2% retracement at 1.0478 level  The price has since moved back lower and stands near the levels just prior to the release. The low, after the release has corrected 38.2% of the move higher today (see chart below) at 1.0435 level.  Staying above this level keeps the bulls in charge.

US Jobless Claims & Continuing Claims Posted: 06 Oct 2011 05:32 AM PDT Jobless Claims:  Survey: 410K  Actual: 401K  Prior: 391K  Revised: 395K Continuing Claims:  Survey: 3725K  Actual: 3700K  Prior:  3729K  Revisad: 3752K

Bobbys Corner-Open Market-Oct.6.2011 Posted: 06 Oct 2011 05:25 AM PDT Good Morning: In a move that makes no common sense-the ECB left interest rates unchanged at 1.5%.  The markets were expecting a 25 basis point cut to help spur economic activity in the depressed Euro Zone’s economy.  With the EU’s banking sector in tatters-you would think they would react logically and lower rates versus looking for other monetary easing policies to help lift their economies.   With Greece on the verge of a potential default-the European community is looking for it’s member countries to work in a coordinated effort to inject needed capital into the banking sector.  With European banks heavily burdened with Greek (along with Spanish, Irish,Portuguese and Italian) debt, the fear of the further tightening of bank funding along with the overall credit markets is a major global concern.     In other news across the pond-the BOE left interest rates unchanged at .5%.  They also added additional QE (Quantitative Easing) to their ongoing monetary easing policy.   With the BOE seeing inflation rising, along with  a potential strain in bank funding in the coming months-they felt compelled to add addition QE without lowering interest rates at this time. All eyes will be looking for any additional indication on whats tomorrow’s non farm payroll and unemployment data will be. I was very sad to hear of the death of Steve Jobs from Apple-he really was a visionary. World equity markets are higher and US Futures are also higher at this time. TIME       FOR EST. PRIOR 7:00A.M. BANK OF ENGLAND RATE DECISION       7:45A.M. ECB RATE DECISION         8:30A.M. ECB PRESS CONFERENCE         8:30A.M. INITIAL JOBLESS CLAIMS   OCT.1 410K 391K 8:30A.M. CONTINUING CLAIMS   24-Sep 3725K    3729K HAVE A GREAT DAY & GOOD LUCK

EURUSD trades up and down in volatile trading. Awaits Trichet comments Posted: 06 Oct 2011 05:01 AM PDT   The EURUSD has been trading in a volatile range since the interest rate decision to keep rates unchanged. The 100 hour MA at the 1.3315 level currently will be eyed on the topside as resistance.  On the  downside, the 1.3259 level is the low from yesterday.  Below that, the 1.3226/33 will be targeted (highs and lows  from October 4th). Looking at the shorter term 5 minute chart, the 38.2% retracement of the sharp move down today, comes in at the 1.3315 level.  This combined with the 100 hour MA, increases the importance of the level for trading today.

ECB leaves rate unchanged at 1.5%. Posted: 06 Oct 2011 04:48 AM PDT The EURUSD moved lower as an initial reaction, but has slingshot back higher in volatile trading. The  market will await further details from Trichet’s press conference at 8:30 AM ET.

ECB decision late…HMMM Posted: 06 Oct 2011 04:48 AM PDT

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