Wednesday, January 4, 2012

Forex Market Updates & Commentary

Forex Market Updates & Commentary

Link to Forex News and Commentary by FXDD

EURUSD continues trend lower but bounces off support

Posted: 04 Jan 2012 07:56 AM PST

Dollar moves higher. EURUSD pressured toward yesterday’s lows

Posted: 04 Jan 2012 07:36 AM PST

Factory Order 1.8% vs 2% expectations

Posted: 04 Jan 2012 07:04 AM PST

The EURUSD has moved a touch lower after the report. The price remains below the 100 hour MA and 50% retracement of the move up from the December 29th low. That level comes in at the 1.2966 area.  Stay below and the bias remains down for the pair. The low from yesterday came in at the 1.2917 level.  The low for today at 1.2931 and this level are the next targets for the pair.

US Factory Orders Comes out at 1.8% vs Projected of 2.0%, Higher Than Prior of 0.4%.

Posted: 04 Jan 2012 07:01 AM PST

NZDUSD bangs against 100 day MA.

Posted: 04 Jan 2012 06:22 AM PST

The NZDUSD has tested the 100 day MA over the last few days of trading. The level comes in at the 0.7902 level.  The high today came in at the 0.7903.   Staying below the level, should keep the possibility of further corrective pressure on the pair. The price has moved from a low of 0.7651 to the high yesterday of 0.7906 over the last week of trading. Running into the 100 day MA is an obvious level to take some profit by the longs (and for bears to enter).

However, the decline from the top has not been all that robust. The low to high trading range today is only about 50 pips. This is half the average trading range over the last 20 days of 100 pips (see NZDUSD in the chart below).

Moreover, the chart formation on the hourly looks more like a bull flag, then a market intent on falling.  In the last few hours the price dipped below the bottom trendline, but that move failed.  Traders may look at that move as an indication of continued demand for the pair. A break of the 0.7896 topside trendline is needed to confirm the bullish bias followed by the break of the 100 day MA not far from there at the 0.7903 level.

GBPUSD finds buyers against the 200 hour MA

Posted: 04 Jan 2012 05:57 AM PST

The GBPUSD sold off in sympathy with the EURUSD today. The economic news out of the UK today was quite bullish as the UK PMI Construction came out much better at 53.2 vs 51.5 last, Mortgage Approvals rose to 52.9K vs expectations of 52.5K and Consumer Credit was higher than expectations.  Despite the data, the price of the GBPUSD fell.

The fall did find support, however, against the 200 hour MA which comes in currently at the 1.5571 level (low reached 1.55778). The price is now back above the 38.2% at teh 1.5590. I will look for support against this level on dips now.  Holding would be positive for the pair. A move below and my bullish thoughts will be tarnished.  A test of the 200 hour MA can be expected. A fall through the 200 hour MA would likely lead to further selling pressure.

 

EURUSD falls below 100 hour MA and 50% retracement

Posted: 04 Jan 2012 05:29 AM PST

The EURUSD is continuing the trend to the downside, falling below the 100 hour MA and the 50% retracement of the move up from the December 29th low to the high reached on January 3rd. That level came in at 1.2966.  THis will now be used as topside resistance by intraday traders.

On the daily chart, the price tried move above the top trendline in the early London session, but fell quickly from the level.  The subsequent selloff has pushed the price back comfortably in the channel. The Jan 2011 low at 1.2873 followed by the end of December 2011 low at 1.2857 are the first downside targets. The bottom channel trendline (not shown) comes in at the 1.2598 area.

Bobbys Corner-Open Market-January.4.2012

Posted: 04 Jan 2012 05:28 AM PST

Good Morning:

A report showing that inflation slowed in Europe has prompted investors to push the ECB to reduce interest rates-as a means to get the stalled European economy back on track.
The single currency dropped to the lowest level in 11 years against the JPY.  Germany sold 10 year bonds 4.06 billion worth at an average yield of 1.93%.

Asian equity markets were higher-but European equity markets dropped as the marketplace realizes that the banks will need additional capital to boost their balance sheets in the wake of the debt crisis that is strangling Europe.

It seems that the ECB is out in the market buying Italian and Spanish bonds-no surprises there.

Oil trading over $102/bar, gold and silver are slightly lower at this time.

HAVE A GREAT DAY & GOOD LUCK

Dollar rebounds in European trading. EURUSD tests key intraday support though

Posted: 04 Jan 2012 04:57 AM PST

US Factory Orders Data Due at 10AM

Posted: 04 Jan 2012 04:20 AM PST

Italian prelim CPI (m/m) 0.4%; better than expected.

Posted: 04 Jan 2012 02:02 AM PST

Euro-area December inflation rate falls to 2.8%; median estimate was 2.8%.

Posted: 04 Jan 2012 02:00 AM PST

EUR/USD support at 1.3024

Posted: 04 Jan 2012 01:57 AM PST

The pair has been trading in a 50 point range for the last day; currently trading in the middle of the range. We saw some firmer trading earlier after a slightly better than expected Euro zone final services PMI, but has since re-tested the low. European equities are slightly lower, and DOW futures are flat and we have Euro area flash CPI estimate coming up at 5 am.

EU’s Junker says that Europe is on the brink of a recession.

Posted: 04 Jan 2012 01:39 AM PST

  • Europe must react adequately to economic slowdown.
  • Greek situation is “difficult”, solution is “feasible”.
  • “Return to the Drachma isn’t an option”.
  • Greece isn’t contemplating a return to its former currency.
  • Greek bondholder talks to wrap up “soon”.

 

UK Mortgage approvals 52.9K; better than expected.

Posted: 04 Jan 2012 01:33 AM PST

UK construction PMI was also better at 53.2 and net consumer credit was 0.4 bln vs. 0.2 bln expected. The market was relatively unaffected by the release.

 
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Tuesday, January 3, 2012

Forex Market Updates & Commentary

Forex Market Updates & Commentary

Link to Forex News and Commentary by FXDD

EURJPY finds sellers against 100 hour MA

Posted: 03 Jan 2012 08:11 AM PST

The 100.29 level is the 100 hour MA, and that is well the risk defiing sellers came in and sold the EURJPY ont he last move higher. Looking at the 5 minute chart below, the fall below from the peak, has the pair back in the channel area. A move below the 100.11 (38.2% of the last leg higher), is needed to confirm a possible top (intraday or otherwise).  The 100 bar MA on the chart below has been leading the buyers higher.  This moving average line (blue line in chart below) continues to be a key level for the pair.

The dollar falls on risk on buying. Technical levels loom.

Posted: 03 Jan 2012 07:41 AM PST

AUDUSD moves toward the next target at 1.0371

Posted: 03 Jan 2012 07:07 AM PST

The AUDUSD is benefitting from the “risk on” move today and trades near the high. The pair is approaching the next target at the 1.0371 level. A move above will next look toward the 200 day MA (green line in the chart below) which comes in at the 1.0414 level today. Keep this level in mind. I would expect that longs would look to pare some gains at the level and sellers might also enter for a low risk trade near the level.

US Manufacturing Data and Construction Spending Both Better

Posted: 03 Jan 2012 07:01 AM PST

Construction Spending MoM:  Survey:  0.4%     Actual:  1.2%    Prior:  0.8%  Revised: -0.2%

ISM Manufacturing:   Survey: 53.4   Actual: 53.9     Prior:  52.7

September vs August 2011
Prices Paid: 47.5 vs 45.0
Production:  59.9 vs 56.6
New Orders:  57.6 vs 56.7
Backlog of Orders:  48.0 vs 45.0
Inventory Change:  47.1 vs 48.3
Employment: 55.1 vs 51.8

ISM Prices Paid:   Survey: 48.0  Actual:  47.5   Prior:  45.0

New Orders and Employment better in ISM report

Posted: 03 Jan 2012 07:01 AM PST

  • ISM comes in at 53.9, highest since June
  • Employment 55.1 vs 51.8 also highest since June
  • New Orders highest since April at 57.6 vs 56.7.
  • Production is 59.9 vs 56.6 last month
  • Prices Pair 47.5 vs 45.0 last month
  • Order backlog 48 vs 45 last month
  • Inventories 47.1 vs 48.3 last month

Non Farm Payroll on Friday. The concensus is 150K jobs vs 120K last month.

EURCHF may be helping the EURUSD today

Posted: 03 Jan 2012 06:28 AM PST

Today the EURCHF is up despite better PMI data out of Switzerland. The reason may be that the price had declined and tested the 100 and 200 day MAs which had converged at the 1.2140-55 level. Yesterday the price reached a low of 1.2132 but could not muster any selling pressure below and the price bounced. Today, the market continued the upside, moving  above the 200 day moving average at the 1.2155 level. It did come down on the better PMI data (see hourly chart below), but has moved back higher over the last 4-5 hours of trading. The price is above the 100 hour MA at the 1.2176 level. I will be watching this level as support currently. Stay above and a test of the 200 hour MA at the  1.2196 level may be in order, with a move above opening up the door for further upside potential.

The rise in the EURCHF may be helping push the EURUSD up today. That pair – as outlined earlier – has marched higher. In NY trade, the price corrected to the 200 hour MA, but bounced off the support (at 1.3010).  The action is more two way in NY, but most of the gains from the lows yesterday remain in tact (above the 38.2% level at 1.3038). A break above the high for the day (and topside trendline) is needed for the bulls, however. On the downside, a move below the 1.3000 would not be welcomed by the buyers today.

Perhaps there may be some price clues from the action in the EURCHF today? I will be keeping an eye on both as they may play follow the leader today.

 

Turkish central bank in the market selling dollars

Posted: 03 Jan 2012 06:07 AM PST

This is according to traders.

The USDTRY reached new highs last week as traders exited the risky currency pairs.

Today, the pair has resistance at the 1.8790-1.8827 level.  The 1.8790 is the 38.2% of the move up from the December low. The 1.8287 is the underside of the upward sloping trendline.

 

USDJPY moves closer to the November (i.e., post BOJ intervention) low

Posted: 03 Jan 2012 05:58 AM PST

The USDJPY contined its move down after falling below the key 100 day MA on the last trading day of the year. The next key support target for the pair comes in against the 76.567 level which was the low following the BOJ intervention in October. The market is likely to pause against the level on the first test. However, on a break, expect stops to be triggered.  I will be watching the  76.83 are for signs a bottom may be forming. This is the topside trendline on the hourly chart below. A move above, gives shorts a reason to cover and perhaps some dip buyers a reason to stick their toe in the water.  The high for the day at the 76.95 and then the 77.17 level would be the upside targets.  The 77.17 area represent the 100 day MA level (blue line in the chart above) and the 38.2% of the move down from the December 28th high to the low reached today (see hourly chart below).

 

EURUSD tests support against 200 hour MA in early NY trade.

Posted: 03 Jan 2012 05:40 AM PST

The EURUSD rallied today on the back of better data in Europe  but has found some profit taking as NY enters. The price is testing support at the 1.3010 level which is the 200 hour MA. Below is the 38.2% of the move up from yesterday’s low to the high today. That level comes in at the 1.30038 level.  Stay above and the bullish trend continues. If the price moves below, look for  the bullish bias to be a little tainted as traders search for the rhythm of the market in the new year.

Chatter of a possible French downgrade has been in the market which gives the buyers a bit of a cause for pause, but so far the upside is the preferred direction.  On the topside. the 1.3052 level (trendline on the hourly chart above) and then the 1.3077 level is the next resistance (see channel on the daily chart below).

Dollar falls as traders flock to risk on 1st major trading day of the year

Posted: 03 Jan 2012 05:15 AM PST

CLICK on CHART for PDF version.

US Construction Spending and ISM Data Due at 10AM

Posted: 03 Jan 2012 04:44 AM PST

Kiwi testing daily trend line resistance

Posted: 03 Jan 2012 03:25 AM PST

The risk pairs are trading on highs with Dow futures currently up 200 points. The New Zealand dollar (NZD) has traded continually higher against the USD today; currently testing trend line resistance around .788o with the next bullish target at .7907. If resistance holds, the daily target to the downside is the 50.0% line.

Spain says social security system will post a deficit in 2012.

Posted: 03 Jan 2012 02:01 AM PST

EUR/USD re-testing highs

Posted: 03 Jan 2012 01:55 AM PST

So far this session the pair has traded between 1.29723 and 1.30072; currently testing resistance at the highs. The market is showing some risk appetite in recent trading with the FTSE +63.69 and Dax +83.31. If support holds the lower target is back to the 38.2% line. A move higher may bring us to 1.3025; a support level from December 21st to the 26th.

 

UK manufacturing PMI (Dec) 49.6 vs. 47.4 expected.

Posted: 03 Jan 2012 01:30 AM PST
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Monday, January 2, 2012

Forex Market Updates & Commentary

Forex Market Updates & Commentary

Link to Forex News and Commentary by FXDD

The Forex Week Ahead for the week of December 2nd 2011

Posted: 02 Jan 2012 07:28 AM PST

Week Ahead in Trading Webinar rebroadcast with Greg Michalowski

To view the rebroadcast, click on the following link:

CLICK HERE FOR THE REBROADCAST

By the way if you are having diffuculty viewing the rebroadcast, you may need to load the GotoMeeting codec. That can be found by clicking on the following link:

GotoMeeting Codex (Video player update) >> CLICK Here

The Forex Week Ahead for January 2nd 2011

Posted: 02 Jan 2012 06:23 AM PST

Euro firmer after Eurozone December manufacturing PMI comes in at 46.9.

Posted: 02 Jan 2012 01:02 AM PST

1-2 Calender

Posted: 02 Jan 2012 12:08 AM PST

USDCHF ends the year at the midpoint of the move down from the 2010 high

Posted: 01 Jan 2012 11:09 PM PST

2011 saw the USDCHF spend most of the year moving lower as a flight into the safety of the CHF kept the USDCHF trending to the downside.   Then on September 6th the Swiss National Bank made a stand, pegged the EURCHF at the 1.2000 level and the USDCHF soared higher.  The pair ended the year up by 0.4% and testing the 50% of the move down from the June 2010 high at 1.1729. That midpoint retracement level comes in at the 0.9396 level.  The year ended just below this level.

Going into 2012, this 0.9396 level will be a key level to get above and stay above if the pair is going to continue to move higher. If it is able to push through, the December high at 0.9546 followed by the 100 week moving average at the 0.9613 level will be the next key targets for traders.

 

If on the otherhand, the market decides to continue to take profit against the key resistance level and the price dips below – and stays below the 0.9396 and 0.9613 levels- look for corrective potential to dominate in the new year. The downside targets off the hourly chart come in at 0.9305 and below that 0.9248 (see chart below).

USDJPY ends 2011 by moving below the 100 day moving average. EURJPY closes below 10 year low.

Posted: 01 Jan 2012 09:50 PM PST

The USDJPY ended 2011 below the key 100 day MA at the 77.16 level. The move below this level starts the new year with a bearish bias.  Traders will be looking for more downside momentum which will next target the 76.56 low from Mid November and then the all time low at the 75.56 level. That low was reached in October 2011 and led to intervention from the Bank of Japan on October 31st.  The sharp rally at that time saw the price move above the 38.2% of the move down from the 2011 high, but only for a single day.  Sellers reemerged and the pair spent most of the final two months of the year in a narrow 76.59 to  78.26 range.

If the price moves back above the 77.16 level, traders who are short, will likely cover.  A move toward the two month high at 78.26 could be expected in response. Keep an eye on this level as the new year begins.

Of course, the Bank of Japan would prefer not to have their currency get too strong after the rally in the JPY in 2011.  However, the pair – which was subject to the weakness of the dollar for the most of 2011 – is now subject to EURO weakness as 2012 is started.  The EURJPY fell to a new 10 year low last week (below 99.87) and was down the most of the JPY pairs in 2012 (-8.2% – see chart below).

That pair also fell below the bottom trendline at 99.82 on the monthly chart (see chart below).   With the price closing Friday at the 99.60 level, traders will likely use the 99.82/87 as their upside stop.  Stay below this level in the new year and traders will be forced to keep the pressure on the pair.  If the price decline below this key level fails, and the price moves back above the 99.87 level, look for a relief rally and for a big sigh of relief from the  Bank of Japan.

GBPUSD ends an up and down December with a sharp rally.

Posted: 01 Jan 2012 09:29 PM PST

The GBPUSD ended an up and down December with a short covering rally. The rally was started after failing to develop and keep downward momentum on the break of the December low at 1.5403 on Thursday.  The January 2011 low of 1.5405 was also near this key level and gave traders a reason to buy on the quick failure.

The up and down December still needs to develop the next trend for the pair. If I were to put a bias, it would be to the downside as the price ended below the 100 hour MA currently at the 1.5535 level (blue line in the chart below) and also near the low for 2011.  However, the price can change the bias to bullish by moving above the 100 hour MA this week and then the 200 hour MA at the 1.5600 level currently (green line).  This should open the door for further upside momentum with a target of the high for December at the 1.5772 area.

On the downside, if the price can stay or move below the 100 hour MA, a move below the 1.5400 level should open the door for lower levels.  The low for 2012 came in at the 1.5270 and would be a major downside target for the pair in early 2012.

So although things are bearish at years end, the door remains open for a quick change on a rally above close resistance.

EURUSD ends the year near the lows for the year.

Posted: 01 Jan 2012 08:35 PM PST

As the year moved toward the end, sellers pushed the price of the EURUSD below the low level of the year reached way back on January 10th 2011 (at the 1.2873). The price moved below this level on Thursday, but could only stay below the level for 30 or so minutes before a rally ensued. From there, profit taking buyers and a pretty good short squeeze, sent the price higher on Friday morning.  However, the rally stalled at the 100 hour MA (see blue line in the hourly chart below).

From there, the EURUSD had a steady move lower and closed near trendline support on the hourly chart at the 1.2930 level (see chart below). A move below this level – and staying below this level on Monday – will be needed to keep the downside momentum going in the new year.

If the price should break the 1.2930 level, traders will be looking for the 2nd break of the 1.2873 level (low from January 10th 2011) to entice further selling pressure and momentum.  If that momentum develops, a move toward the bottom channel trendlines which come in at the 1.2653 level and then the 1.2460 level (see daily chart below) will be the next targets for traders.

If the pair cannot breach the 1.2873 level and stay below this key level, a move above the 1.3025 level and then the 1.3100 area would not be welcomed by sellers.  I would expect shorts to cover above these levels and re-evaluate the situation.

Longer term, the bias is down for the EURUSD as the year begins. The weekly chart below has the price below the 61.8% retracement of the move up from the 1.1876 low reached in 2010.  This low was reached at the time of the 1st Greek bailout.  The retracement level comes in at the  1.30462 level.  The price also ended the year not far from the low for 2011.  Most analysts and traders expect further selling into 2012.

The only thing that seems to be able to derail the downside momentum is the overwhelming bearishness as the year begins.  When too many traders are bearish, it can lead to a move the other way.  However, unless the price can get above the 1.3025 level and then 1.3100, expect sellers on rallies.

 

Gold starts the week with the bulls looking for continued momentum

Posted: 01 Jan 2012 07:53 PM PST

Last week, gold fell sharply – falling through trendline support that dated back to the 2008 low (see weekly chart above).  The move below the trendline should have solicited selling presssure.  It did for a while, but the price quickly moved back above the trendline and that led to buying on Friday.

As we head into the new week, the price now has support against the old trendline at the 1550-54 area.  Holding above this level, keeps the bulls in control and should lead to further upside potential.  If able to hold support, the next key target needed to keep the bulls in charge would be at the 1620/1628 area where the topside trendline and 200 day MA (green line in the chart below) are found.   The ability to breach this level would be encouraging for the bulls and could reestablish the upside momentum.

On the downside a break of the 1550-54 area would likely frustrate the buyers and would next target the 38.2% retracement  of the move up from the 2008 low (see chart above) at the 1447 level.
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