Forex Market Updates & Commentary

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• GBPUSD takes out the days low.
• S&P says no comment on potential shift to negative watch for France
• There is talk of a potential France rating change to “watch negative”…Speculation
• ECB Kranjec says scenario of Eurozone breakup is not being considered
• EURUSD testing intraday support targets
• EURUSD 38.2% at 1.3626. 1.3607 Nov 1 low. Battle lines are drawn
• GBPUSD tests 38.2% and finds profit takers
• EURUSD hanging around 38.2% of the trend move yesterday
• US Numbers All Improve
• Data is better in US with Claims lower and Trade Balance (deficit) lower
• Market awaits 8:30 data
• ECB Stark says Euro crisis a political leadership crisis in peripheral countries
• Germany Merkel: Important that Italy wins back confidence
• Greek PM Papedemos says economy faces huge problems
• Bundesbank says German banks have upped Basel III core capital to 13.1% from 8.1%

GBPUSD takes out the days low. Posted: 10 Nov 2011 07:34 AM PST   The GBPUSD corrected up 38.2% of the move down from two daya ago, and has now fallen to new lows for the day   Admittedly, the move back down is unusual. Action typically is not so quick. But the range was narrow, even with the extension higher in the early NY sesssion. Now the days range is extended with the new lows being printed.

S&P says no comment on potential shift to negative watch for France Posted: 10 Nov 2011 07:21 AM PST

There is talk of a potential France rating change to “watch negative”…Speculation Posted: 10 Nov 2011 07:06 AM PST S&P meanwhile has said that the France’s BICRA (Banking Industry Country Risk Assessment) is unchanged at the “group 2″. So be careful. Activity in the EURUSD has gotten choppy over the last 30 or so minutes.  1.3607 topside resistance. 38.2% of the days range is at 1.35853 100 bar MA on 5 minute is at 1.3580 now

ECB Kranjec says scenario of Eurozone breakup is not being considered Posted: 10 Nov 2011 06:57 AM PST …and no point in debating it either.

EURUSD testing intraday support targets Posted: 10 Nov 2011 06:54 AM PST The EURUSD is testing the next targets a the 100 hour MA and the 38.2% of the days trading range. Those levels come in at the 1.3577-85 prices

EURUSD 38.2% at 1.3626. 1.3607 Nov 1 low. Battle lines are drawn Posted: 10 Nov 2011 06:36 AM PST

GBPUSD tests 38.2% and finds profit takers Posted: 10 Nov 2011 06:20 AM PST The GBPUSD had a 50 pip range coming into the NY session. That range was just too narrow. So a move to the upside ensued that took the price up to the 38.2% of the  move down from the most recent high from November 8th.  That level comes in at the 1.5980 level. The high reached just above that level at the 1.5983 level. The fall from the high has corrected 50% of the now 87 pip range to 1.59395.  The level is also near the pre NY high of 1.5938.  This level will need to be broken to increase the bearish bias today.  So far NY seems balanced with buyers and sellers having their moment in the sun. The range for the day is still a bit light, which could lead to an extension at some point.

EURUSD hanging around 38.2% of the trend move yesterday Posted: 10 Nov 2011 05:40 AM PST The 38.2% of the move down from yesterday (into today) comes in at the 1.3626 level  The current price is around that level. There is upside resistance at the 1.3635 level and above that the 1.3650/56 area (see daily chart below for all the prior lows around this area).  On the downside the 1.3607 level (November low prior to yesterdays move down) needs to be broken to swing the intraday bias back to the downside for the pair.

US Numbers All Improve Posted: 10 Nov 2011 05:33 AM PST Jobless Claims:  Survey:  400K    Actual: 390K   Prior: 397K    Revised:  400K    Continuing Claims:  Survey: 3680K    Actual:  3615K    Prior: 3683K  Revised: 3707K Import Price Index(YoY):  Survey: 11.8%    Actual: 11.0%    Prior:  13.4%    Revsied: 12.9%   US Trade Balance:  Survey: -46.0B   Actual: -43.1B   Prior: -45.6B   Revised: -44.9B

Data is better in US with Claims lower and Trade Balance (deficit) lower Posted: 10 Nov 2011 05:32 AM PST The Trade deficit ex petroluem came in at -16.777 . A year ago the deficit was -22.307B. Imports rose by 0.3% Exports rose by 1.4%.  A year ago exports were 155 billion. This month they were 180 billion.  There is a -$28.057 deficit with China. Initial Claims 390K vs 400K Trade increases GDP for the 3rd quarter.

Market awaits 8:30 data Posted: 10 Nov 2011 05:27 AM PST Trade figures for US and Canada. Initial Claims (400 k expected).  Import/export prices MoM and YoY. The EURUSD has resistance at the 1.3552-58 area.  Support at 1.3607 (old low from November 1st).

ECB Stark says Euro crisis a political leadership crisis in peripheral countries Posted: 10 Nov 2011 05:21 AM PST Those peripheral countries have economic problems as well and those problems both politically and economically can be substantial.

Germany Merkel: Important that Italy wins back confidence Posted: 10 Nov 2011 05:19 AM PST Confident ITaly to clarigy government situation soon Will work with every Greek leader Wants broad political support for reforms in Greece

Greek PM Papedemos says economy faces huge problems Posted: 10 Nov 2011 05:08 AM PST Agreement by parties on Feb 19th election is point of reference New govt is transitional and the govt must have wider backing New govt has specific task to implement EU bailout deal

Bundesbank says German banks have upped Basel III core capital to 13.1% from 8.1% Posted: 10 Nov 2011 05:06 AM PST Banks are likely to write down more Greek debt Bank risks to Italy and Spain are more significant than risks to Ireland and Portugal. Risk to financial system grew perceptibly as debt crisis worsened

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