Forex Market Updates & Commentary

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• Irish vote on the EU fiscal compact not the end on failure
• Irish PM will hold referendum on the EU fiscal compact
• Richmond Fed better at 20 vs 14 expecations
• Richmond Fed Released Higher Alongside Consumer Confidence
• The 1.3425 area is a strong level intraday for the EURUSD
• USDCHF keeps below trendline resistance
• EURUSD falls post housing data but holds intraday support
• S&P Case-Shiller Numbers
• Case Shiller Home data add to the economic weak numbers today
• EURUSD chopping around after weaker Durables
• Bobbys Corner-Open Market-Feb.28.2012
• Durables a disappointment
• German CPI comes in higher at 0.7% MoM and 2.3% YoY
• US Durable Goods Orders Much Lower Than Anticipated, Biggest Drop in 3 Years
• Traders prepare for the next LTRO tomorrow. Japan Retail Trade better than expected.

Irish vote on the EU fiscal compact not the end on failure Posted: 28 Feb 2012 07:24 AM PST According to sources, 12 of the 17 member states of the EU need to ratify the EU fiscal compact. If Ireland referendum vote is not passed, it does not mean the measures cannot be enacted.   The news nevertheless worried the market and new lows were made (below 1.33897. Low reached 1.33884). The close from yesterday at the 1.3396 and the 1.34066-1.34122 will be eyed as topside resistance.

Irish PM will hold referendum on the EU fiscal compact Posted: 28 Feb 2012 07:09 AM PST The EURUSD has moved lower on the headline on the uncertainty of the vote. The Irish Deputy PM Gilmore does add that he feels any referendum vote will pass.

Richmond Fed better at 20 vs 14 expecations Posted: 28 Feb 2012 07:01 AM PST Consumer Confidence better than expected at 70.8 as well. The up and down action continues for the EURUSD. The USDJPY pushed higher on the data. and looks toward the 80.71 level (broken trendline). The 100 hour MA at the 80.46 is now support. Not much rhythm to the market action today.

Richmond Fed Released Higher Alongside Consumer Confidence Posted: 28 Feb 2012 07:00 AM PST Consumer Confidence:    Survey: 63.0   Actual: 70.8    Prior: 61.1    Revised:  61.5 Highest consumer confidence number since February 2011. Richmond Fed Manufacturing Index:  Survey:  14     Actual: 20   Prior: 12

The 1.3425 area is a strong level intraday for the EURUSD Posted: 28 Feb 2012 06:42 AM PST The 1.3425 area is shaping up as a level the market is paying attention to for the EURUSD.  There are a number of support levels at the area. Should the price move below the level, there should be some further selling in the pair, with a break of 1.3415 the next target. The pair has been in a quiet range today.  There is room for an extension (above or below) but it is a non-trendy type day and the market is unsure about the LTRO operation tomorrow.

USDCHF keeps below trendline resistance Posted: 28 Feb 2012 06:28 AM PST

EURUSD falls post housing data but holds intraday support Posted: 28 Feb 2012 06:10 AM PST The EURUSD fell on the Case Schiller data (risk off) but the buyers showed up against the 50% of the days range and the 200 bar MA on the 5 minute chart. The  last intraday lows were also at the level.  Activity remains two way it seems for the pair as the market awaits the LTRO tomorrow. The 100 bar MA is at 1.3441. Traders will watch this level for intraday clues.

S&P Case-Shiller Numbers Posted: 28 Feb 2012 06:03 AM PST S&P Case-Shiller Numbers S&P/CS 20 City MoM SA: Survey: -0.35%, Actual:-0.50%, Prior: =0.70%, Revised: -0.74% S&P/CS Composite-20 YoY Survey: -3.65%, Actual: -3.99%, Prior: -3.67%, Revised:-3.85% S&P/Case-Shiller US HPI YOY Survey: -4.30%, Actual: -4.03%, Prior: -3.90%, Revised: -3.70% S&P/CaseShiller Home Price Survey: 137.11, Actual: 136.71, Prior: 138.49, Revised: 138.24 S%P/Case-Shiller US HPI Actual: 125.67, Prior: 130.39, Revised: 130.66

Case Shiller Home data add to the economic weak numbers today Posted: 28 Feb 2012 06:02 AM PST The foreclosure hangover continues to be a problem according to officials

EURUSD chopping around after weaker Durables Posted: 28 Feb 2012 05:59 AM PST The EURUSD has been chopping around after the weaker Durables data. The price has support at the 1.3435 and resistance at 1.3455. The range for the EURUSD is narrow today at 72 pips. This leaves the door open for an extension of the range in NY trading.

Bobbys Corner-Open Market-Feb.28.2012 Posted: 28 Feb 2012 05:40 AM PST Good Morning: The Greek sage continues: S&P cuts Greece’s rating to “selective default” from CC.  This was expected once the debt swaps started.  S&P sees the Greek debt plan as nothing but a distressed restructuring. Markets reacted positively to the initial news that the German Parliament voted in favor of the aid package to Greece.  It seems that the German courts may have a challenge to this aid package-we will see what happens in due time. In US economic data Durable goods tumbled 4%-a dreadful report.  Durable goods data is always volatile-but this will be a hard number to overcome. World equity and US Futures are higher. Gold and silver are higher-while oil is stable. HAVE A GREAT DAY & GOOD LUCK

Durables a disappointment Posted: 28 Feb 2012 05:36 AM PST The numbers were weak across the board.  They are guessing that the expiration of a tax incentive allowing full depreciation of equiptment purchases may have led to the sharp decline in January as purchases were front loaded in 2011.  The fall ex transportaton of -3.2% was the most since October 2010.  Civil aircraft orders fell 19%.  Orders for non defense capital goods excluding aircraft fell by 4.5%. This is thought to be an indication of overall  business investment. All in all, a disappointment as the New Year and quarter got started.

German CPI comes in higher at 0.7% MoM and 2.3% YoY Posted: 28 Feb 2012 05:32 AM PST They were expecting 0.5% and 2.1% respectively

US Durable Goods Orders Much Lower Than Anticipated, Biggest Drop in 3 Years Posted: 28 Feb 2012 05:31 AM PST Durable Goods Orders:   Survey:  -1.0%    Actual: -4.0%    Prior: 3.0%  Revised: 3.2% Durables Ex Transportation:   Survey: 0.0%   Actual:  -3.2%   Prior:  2.1%   Revised: 2.1%

Traders prepare for the next LTRO tomorrow. Japan Retail Trade better than expected. Posted: 28 Feb 2012 04:47 AM PST The ranges overnight are generally narrow in comparison to the 20 day averages with the dollar down against most of the currency pairs.  Traders may look to extend the ranges in the NY session so be aware.  The EURUSD increased on the eve of the next phase of the LTRO on the thought that the operation is risk supportive and the EURUSD is a risk currency pair (at least that is the story). Whether or not an additional 400, 500, 600  billion or 1 trillion of liquidity (there is no limit) is good or not will not be decided until the tomorrow.   What is known is the 1st piece of liquidity was successful in reducing sovereign debt fears and lowered bond yields in the Eurozone and was a boost (at least initially) for the EURUSD.  However, when the US embarked on it’s quanitative easing, the dollar fell.  So risk will be increased and traders can expect volatile market conditions.   The estimate is for 470 billion Euros ($631 billion) according to a Bloomberg survey.  In the last operation they gave banks 489 billion euros.  In other news out of the EU, S&P said Greek was in selective default following their insertion of collective action clauses in some sovereign debt documentation. EU Business Climate indicator came in weaker at -0.18 vs -0.15 expectations.  Services Confidence came in at -0.9 vs -0.6 exp, Consumer Confidence came in at -20.3 vs -20.2 exp, and Industrial Confidence came in at -5.8 vs -6.9 exp.  German inflation numbers are being released from the different regions with most showing elevated increases of 0.8% MoM, the expectations is for a 0.5% increase.  Japan Retail Trade grew by a larger than expected 4.1% MoM vs 1% last.  The  USDJPY initially declined on the news but then rallied back higher. The EURJPY tested the 100 hour MA on the decline and found buyers at the key technical level (see chart).  In the UK the CPI reported retail sales  at -2 vs expectations of -12. The GBPUSD rallied after falling to the 50% retracement of the Friday sharp move higher.  The AUDUSD is mired in a month long non trending range and is back near the topside resistance area.  Last week, the price tested the bottom end (actually made a new low for the month) but could not muster additional selling pressure.  The other commodity currency pairs NZDUSD and USDCAD are in similar chart patterns.  A breakout will be eyed for these pairs that could lead to a trend move. US Durable Good Orders will be released at 8:30 with expectatations of -1% with 0.0% for ex Transportation. S&P Home Sales for the top 20 cities are expected to show -3.65%.  US Consumer Confidence (63 vs 61.1 last) and Richmond Fed (14 vs 12) are expected at 10 AM ET.  Feds Duke speaks at 10. SNBs Jordan speaks at 12:30 PM ET.

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