Forex Market Updates & Commentary

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• Canada Ivey Purchasing Manager Better at 64.1 vs 59.7 Survey and Prior of 63.5
• GBPUSD breaks above trend line resistance
• Bullard expects high employment for a while
• Greek Government Official: Papendemos to meet with leaders tomorrow.
• EURUSD moves back toward the days low
• Bobbys Corner-Open Market-Feb.6.2012
• No Greece PSI or austerity agreement sends the EURUSD lower.
• EU says “we’re already beyond deadlines” on Greece.
• German Factory Orders (Dec) 1.7% vs. 1.0% expected.
• Eurozone gov’t debt at 87.4% of GDP in Q3 vs. 87.7% in Q2.
• Eurozone Sentix Investor Confidence (Feb) -11.1 vs -15.0 expected.
• Greek gov’t official says thereis no deadline on Monday for political leaders to respond to bailout terms.
• EUR/USD testing resistance @ 1.30961.
• UK HPI (Jan) 0.6% vs 0.1% expected (-0.9% prior).
• 2-6 Economic Calendar

Canada Ivey Purchasing Manager Better at 64.1 vs 59.7 Survey and Prior of 63.5 Posted: 06 Feb 2012 07:01 AM PST

GBPUSD breaks above trend line resistance Posted: 06 Feb 2012 06:08 AM PST The GBPUSD is moving above the trendline resistance against the 1.5768 level and will now look toward the 1.57867 Fibo Retracement level. Above that the 100 hour MA at the 1.5797 will be a target. A move above this MA willl not be welcomed by those looking for continued downside momentum today.  The price tested the 200 hour MA (green line in the chart above) and found the expected buying interest.

Bullard expects high employment for a while Posted: 06 Feb 2012 06:02 AM PST Sees only a slow recovery in jobs market Zero interest rate policy punishes savers 2% inflation target will serve the nation well US suffered one time shock to wealth THere is no value in letting inflation rise Fed must keep inflation stable.

Greek Government Official: Papendemos to meet with leaders tomorrow. Posted: 06 Feb 2012 05:55 AM PST They were expected to meet today.  The expectation is Papademos meets with Troika today.

EURUSD moves back toward the days low Posted: 06 Feb 2012 05:31 AM PST The EURUSD tested the 38.2% of the move down from the high on Friday and rotated back lower. The low from last week came in at the 1.3026 level. The low today came in at 1.3029.  The range from last week was a narrow 201 pips. There were only 4 weeks in 2011 when the range was less than this amount.   The expectation would be for a larger range this week.  Therefore on a break of either range this week, look for momentum. The next target on the downside on a break would be the 1.29958 level which is the 38.2% of the move up from the January low to the high at the end of the month.

Bobbys Corner-Open Market-Feb.6.2012 Posted: 06 Feb 2012 05:24 AM PST Good Morning: I have returned after my knee surgery.  The surgery went well-and now my job is to do physical therapy and get back up to speed. I see that very little changed- Greece is still trying to work out their latest mess.  The discussions between the parties regarding austerity measures to ensure the bailout funds for March (as Greece has a 14 billion payment due) are virtually at a stand still. There needs to be agreement within the Papademos’ government regarding these new austerity and the restructuring of government  programs and staffing. EU officials are waiting for the Greek government to come to terms with the new package which includes “wage and pension reductions, along with job cuts and tougher tax enforcement programs”. Asian equity markets were higher-but with no news out of Greece-European equity markets dropped lower-and US Futures are lower at this time. Last night the NY Giants won the NFL Superbowl-and the big winners were the advertisers and networks.  Commercials cost up to $3.5 million for a  30 second spot during the game. HAVE A GREAT DAY & GOOD LUCK

No Greece PSI or austerity agreement sends the EURUSD lower. Posted: 06 Feb 2012 05:07 AM PST

EU says “we’re already beyond deadlines” on Greece. Posted: 06 Feb 2012 03:53 AM PST

German Factory Orders (Dec) 1.7% vs. 1.0% expected. Posted: 06 Feb 2012 03:00 AM PST

Eurozone gov’t debt at 87.4% of GDP in Q3 vs. 87.7% in Q2. Posted: 06 Feb 2012 02:13 AM PST

Eurozone Sentix Investor Confidence (Feb) -11.1 vs -15.0 expected. Posted: 06 Feb 2012 01:35 AM PST

Greek gov’t official says thereis no deadline on Monday for political leaders to respond to bailout terms. Posted: 06 Feb 2012 01:15 AM PST

EUR/USD testing resistance @ 1.30961. Posted: 06 Feb 2012 12:10 AM PST The Euro is firmer in recent trading as equities open up slightly higher; FTSE, CAC, and DAX all up over 1.5%. On the 15 minute chart the EUR/USD is testing the 38.2% fibo line; the next bullish target is 1.31095. If resistance holds we look back to the low of 1.30525.

UK HPI (Jan) 0.6% vs 0.1% expected (-0.9% prior). Posted: 06 Feb 2012 12:01 AM PST

2-6 Economic Calendar Posted: 05 Feb 2012 08:55 PM PST

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Forex Market Updates & Commentary

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• Week Ahead in Trading with Greg Michalowski & Shawn Powell this Monday at 9:30am
• EURUSD short position falls 8% on the week: CFTC Commitment of Traders report
• Feds Bullard says Fed may have to raise rates before 2014
• EURAUD continues its fall to new lows
• FT: Greece leaders oppose new austerity measures
• EURUSD moves back above the weeks midpoint and buyers follow
• GBPUSD expectations for additional QE revised lower
• Swiss government spokesperson says Franc cap of at least 1.2000
• EURUSD looking like a squeeze higher? Will be watching the 1.3126 level
• Gold sells off on relief from US data.
• AUDUSD moves to 6 month high

Week Ahead in Trading with Greg Michalowski & Shawn Powell this Monday at 9:30am Posted: 03 Feb 2012 12:47 PM PST Week Ahead in Trading with Greg Michalowski & Shawn Powell this Monday at 9:30am – Register now

EURUSD short position falls 8% on the week: CFTC Commitment of Traders report Posted: 03 Feb 2012 12:31 PM PST

Feds Bullard says Fed may have to raise rates before 2014 Posted: 03 Feb 2012 11:39 AM PST Strong data weakens case for QE. He is a non voter on FOMC Data surprising on the upside Unemployment likely to fall to 7.8% this year.

EURAUD continues its fall to new lows Posted: 03 Feb 2012 10:11 AM PST The EURAUD has fallen sharply today as the AUD benefits from the stronger US data.The thought is if the global economy is going to get better, it will help the Australian economy the most. The EU meanwhile still has their problems to sort through and with austerity cuts likely to dominate, the may need help from a lower currency (that is the theory or story at least).   The fall lower has so far had little in the way of a correction. The shorter term chart above, has flattened out, but with lower lows and lower highs still in place.  A move above 1.2189 and thens 1.2208 is needed to get shorts concerned. From there, look for resistance at the 1.2222 level (38.2% of the move down today). With the market making new lows today, where might there be a floor. Looking at the weekly chart, the bias remains decidely bearish. The price has a Fibonacci extension that measures out to the 1.20000 level. This would be a nice round number to shoot for. Below that level the 1.1861 is the bottom trendline support target.

FT: Greece leaders oppose new austerity measures Posted: 03 Feb 2012 09:56 AM PST A failure for Greece to approve austerity measures would likely lead to no money from Troika and Greek default in March. This is the link to the story http://www.ft.com/intl/cms/s/0/76b31dcc-4e88-11e1-ada2-00144feabdc0.html#axzz1lLJo4c4L

EURUSD moves back above the weeks midpoint and buyers follow Posted: 03 Feb 2012 09:43 AM PST The EURUSD moved above the midpoint of the weeks range and has pushed higher.  The next target is the 1.3159 level and then 1.3184. The move higher in the dollar against the EURO on the better US data, has given way to “risk on”. Greece hope and stronger US help the flows.  The pair is still mired in the narrow trading range for the week. Perhaps next week the pair finds more of a direction.    In the meantime will be paying attention to the technicals for clues as to bias until the break occurs.

GBPUSD expectations for additional QE revised lower Posted: 03 Feb 2012 09:17 AM PST The expectations for additional QE by the BOE at their interest rate meeting next week, has been racheted down to 50 B additional from 75 B which has been more of the concensus.  The better global tone is perhaps a contributing factor.  Besides, it is easier to add rather than subtract down the road.

Swiss government spokesperson says Franc cap of at least 1.2000 Posted: 03 Feb 2012 08:37 AM PST The EURCHF is above the 200 day MA a thte 1.2054 level. A close would be bullish from a technical perspective. The problem is the longs are likely overcrowding the shorts as the pair as inched lower and lower toward the 1.2000 floor.  In an overcrowded trade, the buyers need to continue to show up. If they don’t those buyers could become disenchanted and sell.   So barring intervention, the topside may be limited (reference USDJPY).

EURUSD looking like a squeeze higher? Will be watching the 1.3126 level Posted: 03 Feb 2012 08:27 AM PST Although the midpoint of the week at 1.31267 level has yet to be breached, the sellers don’t seem to be in control. A move above the 1.31267 level should encourage buying/shorts covering as market struggles with dollar strength or is this a signal for “risk on” EURUSD buying.

Gold sells off on relief from US data. Posted: 03 Feb 2012 07:52 AM PST

AUDUSD moves to 6 month high Posted: 03 Feb 2012 07:46 AM PST The AUDUSD moved to the highest level since August 2nd 2011 on the back of the “Risk On” trade from the better than expected US Employment report .  The new high overtook the September 2011 hight the 1.0762 level  On the daily the next targets are at the 1.0810 and 1.0835 level which are topside trend line targets.

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Forex Market Updates & Commentary

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• USDCAD dips below the 200 day MA
• The EURUSD rebounds. No news seen
• A look at the EURUSD, GPDUSD, USDCHF and USDJPY
• ISM Non-Manufacturing Improves, Factory Orders Lower
• EURUSD fall stalls. Correction will be eyed closely.
• USDCHF tests topside trendline.
• GBPUSD falls below 100 hour MA but finds support at trendlines.
• EURUSD breaks below 100 hour MA, 50% wks range and 200 hour
• USDJPY soars higher (well relatively) on better jobs.
• The EURUSD moves higher initially but comes off as mkt thinks about it
• US Nonfarm Payrolls Surge, Unemployment Rate Down to 8.3%
• Great Employment Numbers
• Key levels through NFP report
• Overnight review and preview
• NFP awaited. Markets coiling for a move

USDCAD dips below the 200 day MA Posted: 03 Feb 2012 07:25 AM PST Despite weaker than expected Canada Employment, the USDCAD is taking its clue from the “risk on” traders.  The 0.9960 level is the 200 day MA and the price has dipped below this level after surging on the Canada employment report which came out at 7 AM (before the US report).

The EURUSD rebounds. No news seen Posted: 03 Feb 2012 07:20 AM PST Weeks midpoint is looking to be tested at the 1.31257 level. A move above will be a disappointment for the bears.

A look at the EURUSD, GPDUSD, USDCHF and USDJPY Posted: 03 Feb 2012 07:07 AM PST This report is now viewable on the IPhone and IPad.

ISM Non-Manufacturing Improves, Factory Orders Lower Posted: 03 Feb 2012 07:03 AM PST ISM Non-Manufacturing Composite Survey: 53.2, Actual: 56.8, Prior: 52.6 Factory Orders Survey: 1.5%, Actual: 1.1%, Prior: 1.0%, Revised: 2.2%

EURUSD fall stalls. Correction will be eyed closely. Posted: 03 Feb 2012 06:35 AM PST The fall in the EURUSD has stalled and the correction will be eyed closely by traders. The 38.2% of the sharp move lower comes in at 1.3118. The low from the asian session comes in at 1.3114. The low at 1.3124 is another important level. Traders, looking for further downside momentum (dollar buying) would not want to see the pair move above this area. Staying below it, keeps the bears in charge intraday at least. The weeks range of 201 pips in the EURUSD is still light.  There exists a chance for an extension.  The low came in at 1.3025.  It seems a long way off but keep in mind if the momentum continues.

USDCHF tests topside trendline. Posted: 03 Feb 2012 06:23 AM PST The USDCHF moved above trendline resistance at the 0.9226 level but come off. This trendline is from the high on Jan 20 connecting to the high on Jan 25th. The price previously moved above 38.2% of the same move down at the 0.92139.  Traders will be watching this level for bullish clues. If support holds against this level, the upside should have further potential with a move toward the 0.9244 (50%) being the next target.  If the level is broken, traders will look for the underside of the  lower trendline in the chart above (currently at the 0.9203 level) to hold support.   This trendline was initial resistance on the first surge higher before breaking higher.

GBPUSD falls below 100 hour MA but finds support at trendlines. Posted: 03 Feb 2012 06:06 AM PST The lower trendline comes in at 1.5745 area and is from the lows back on Jan 13th connecting to the low on January 18th.  The 100 hour MA come in at 1.5781 currently.  The 1.5760 level is  another key level off the daily chart. It is the 38.2% of the move down from the August high.  This was broken this week. A move back below is not welcomed.

EURUSD breaks below 100 hour MA, 50% wks range and 200 hour Posted: 03 Feb 2012 05:53 AM PST The EURUSD has moved below the 100 hour MA and the weeks midpoint at 1.31257. The price has now moved below the 200 hour MA and looks toward the next target at the 1.3089 areal. 1.3076. 1.3051 and the low for the week at the 1.30257 are downside targets. Traders will like to see corrections stay below the 1.31257 midpoint (and the 100 hour MA at the 1.3137) if the price breaks back above the 1.3137 level (100 hour MA) all bets off for the downside as the market stays unsure of the directional bias given the strong number.

USDJPY soars higher (well relatively) on better jobs. Posted: 03 Feb 2012 05:44 AM PST The USDJPY soared higher on the better jobs data. A move above the November low at 76.54 should open the door for further upside momentum. The 75.82 is the 200 hour MA. This will be another target level above.

The EURUSD moves higher initially but comes off as mkt thinks about it Posted: 03 Feb 2012 05:35 AM PST The initial move was to the upside for the pair, but the market is rethinking the initial risk on reaction in that pair. The number may be strong enough to warrant an buy the dollar vs the EURO assuming EU has continued problems and the US is recovering. THe 100 hour MA at the 1.3138 level and the midpoint of the weeks range at the 1.31257 will be eyed for clues. Move below these levels and the bias could switch to the downside. Stay above and remains bullish. The 1.3184 level and then the 1.3211-15 level become targets above.  The high for the week was at 1.3226.  The range for the week is a narrow 201 pips.  That range can be extended today so watch the key levels for clues. Market is still battling it out with the buyers holding the line.

US Nonfarm Payrolls Surge, Unemployment Rate Down to 8.3% Posted: 03 Feb 2012 05:32 AM PST Change in Nonfarm Payrolls:   Survey:  140K     Actual:  243K    Prior:  200K      Revision: 203K Change in Private Payrolls:  Survey: 160K    Actual: 257K     Prior:  212K     Revised: 220K Change in Manufacturing Payrolls:  Survey: 13K   Actual:  50K   Prior:  23K     Revised:  32K Unemployment Rate:  Survey:  8.5%     Actual: 8.3%     Prior:  8.5%       Avg Hourly Earning (MoM) All Emp:    Survey:  0.2%     Actual: 0.2%      Prior:  0.2%          Avg Hourly Earning (YoY) All Emp:    Survey:  1.9%      Actual: 1.9%      Prior:  2.1%       Avg Weekly Hours All Employees:    Survey:  34.4      Actual: 34.5         Prior:  34.4   US Jobless rate drops to February of 2009

Great Employment Numbers Posted: 03 Feb 2012 05:30 AM PST Payroll up Unemployment rate down to 8.3% Underemployment 15.1%

Key levels through NFP report Posted: 03 Feb 2012 05:26 AM PST

Overnight review and preview Posted: 03 Feb 2012 04:54 AM PST Overnight the all the major currency pairs traded in very narrow trading ranges as the market awaits the US Employment report at 8:30 AM ET. The expectations is for the NFP to show a rise of 140K vs 200K last month. The job creation ex government workers is expected to rise by 160K vs 212K last month (Private payroll).  The Unemployment rate is expected to remain at 8.5%. Last month the Underemployment Rate was at 15.2%.  Mfging jobns are expected to add 13K jobs vs 23K last month.  The direction of the market will be determined off the number. If the number is weak, you can espect a lower dollar on the back of the chance for QE3 becomes more real.  If the number is strong, the reaction may not be as predictable. The market may look at it as good for the dollar, but it may also view the gains as good for extending risk.  As a result, it is important to watch the technical levels.  In the EURUSD the range for the week is 201 pips.  In 2011 there were only 2 weeks with a more narrow trading rang. The high for the week was in the 1st hour of trading at 1.3226. The low on Weds at 1.3025. The midpoint is 1.31257. This will be a bullish or bearish tipping point after the number is released – above 1.31257 bullish, below 1.31257 bearish. The GBPUSD has had a more normal week – trending to the upside. The pair moved outside the 2 1/2 month range this week (1.5795 was the highest px going back to 11/18). The low today was 1.5784. The USDJPY broke lower on Monday and bottomed at 76.01. The 76.39 is the midpoint of the wk. A move above this level is needed for any upside chance. A move below 76.00 has the Aug 11 low at 75.94 and then the post WWII low of 75.56 as targets. USDCHF has been above and below the 100 day MA every day this wk. The 100 day MA is at 0.9167 today. Price moves above it= bullish. If price stays below it = bearish (after the release).

NFP awaited. Markets coiling for a move Posted: 03 Feb 2012 04:51 AM PST

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Forex Market Updates & Commentary

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• USDCHF tests intraday support
• Bernanke see signs economy improving
• anBernanke Sees Signs Economy is Improving and Fiscal Policy Risks
• EURUSD trades between the Goal Posts. Looks for break
• EU’s Rehn on the Wires
• AUDUSD looks to break higher intraday
• EURUSD trades between the “Goal Posts”
• EURUSD falls on no Greece solution.
• Jobless Claims Data Improves
• Challenger Job Cuts Comes in Higher 38.9% vs 30.6% Prior
• No Greece solution, lower EURUSD today. Dollar mixed.
• The FXDD overnight review and preview
• Irish Central Bank cuts 2011 GDP growth to 0.8% from 1.0%.
• Merkel says China says that Europe must do its homeowrk first on the Eurozone crisis, then ready to work for a stable Euro.
• Euro rises after China’s Premier Wen says China is considering greater involvement in the EFSF and ESM stabilization funds.

USDCHF tests intraday support Posted: 02 Feb 2012 07:15 AM PST The USDCHF has come off and moved below the 100 bar MA on the 5 minute chart above. The next target to get through is the 200 bar MA (green line) . This corresponds with a trendline earlier which was broken on comments from Chinese PM Wen, but was quickly reversed (I will reestablish the old trendline as support)  A break below this key intraday level should solicit stops. Staying above gives shorts a reason to buy with limited risk (sell on the break)

Bernanke see signs economy improving Posted: 02 Feb 2012 07:04 AM PST Recovery is frustrating Vulnerable to shocks Outlook uncertain Credit remains tight Jobs improved modestly Housing remains depressed. Inflation subdued Current fiscal policies is not sustainable; would create big budget gap His comments are a little less dovish perhaps.  Driving down the middle of the road as he faces a split audience.  Note that during his press conference after the FOMC, he was  a bit more brave with his dovish views.

anBernanke Sees Signs Economy is Improving and Fiscal Policy Risks Posted: 02 Feb 2012 07:01 AM PST Large and increasing level of government debt runs risk of serious economic consequences Long way before labor market can be said to be operating normally Fed will continue to monitor situation in Europe closely, and take every available step to protect US financial system and economy There are concerns that have been weighing on US business investment Inflation has declined and Fed expects it to remain subdued Signs economy has declined and Fed expects it to remain subdued

EURUSD trades between the Goal Posts. Looks for break Posted: 02 Feb 2012 07:00 AM PST

EU’s Rehn on the Wires Posted: 02 Feb 2012 06:50 AM PST Says: Euro governance to be determined this year Closer economic union to complement monetary union Recession to be ‘much nastier’ if crisis not resolved EU going through a ‘mild recession’ EU undertaking reformation of Europe’ Portugal making ‘good progress’ on fiscal reforms Greek PSI agreement by the end of the week Greece must make ‘decisive progress’ on reforms

AUDUSD looks to break higher intraday Posted: 02 Feb 2012 06:31 AM PST

EURUSD trades between the “Goal Posts” Posted: 02 Feb 2012 06:03 AM PST The EURUSD is trading between what I call the Goal Posts (between the 100 and 200 hour MA’s in the chart above). The pair moved higher in the late London morning on comments from China Premiere Wen who said China was exploring helping in the ESM/EFSF mechanisms. However, he later commented that he was not sure how. EU’s Juncker sent the EURUSD to the NY lows on comments that Greece PSI talks were ultra difficult. This sent the price down to test the 200 hour MA vut the price could not close below that level. Now with the price higher and off the 200 hour MA (green line in the chart above), the pair has found initial resistance against the midpoint of the weeks trading range at the 1.3125 level. A move above that level will target the 100 hour MA at the at 1.3143.  A break above that level targets the topside trendline at the 1.3191 level currently. Holding below the weeks midpoint (look for sellers against the level) should send the pair back down to test the 200 hour AM at the 1.3095 level currently. A break of it, will next look toward the 1.3076 level and then the lows for the week at 1.3041 (Tuesday’s low)  and 1.3025 (from Wednesday). The week is a non trending week. Bernanke speaks at 10 AM ET which could ignite some action. The Fed Chair has been dovish and will likely continue to express this sentiment in Washington today.  Hints of QE3 have sent stocks higher and with it the EURUSD but in this market filled with news (and unemployment tomorrow) it is always best to follow the key technical levels and define risk against those levels.

EURUSD falls on no Greece solution. Posted: 02 Feb 2012 05:33 AM PST

Jobless Claims Data Improves Posted: 02 Feb 2012 05:31 AM PST Jobless Claims:  Survey:  371K    Actual: 367K   Prior: 377K    Revised:  379K    Continuing Claims:  Survey: 3535K    Actual:  3437K    Prior:3554K   Revised: 3567K EUR/USD moves higher on the news Nonfarm Productivity:    Survey: 0.8%    Actual:  0.7%    Prior:  2.3%     Revised: 1.9% Unit Labor Costs:    Survey:   0.8%    Actual:  1.2%    Prior:  -2.5%  Revised: -2.1%

Challenger Job Cuts Comes in Higher 38.9% vs 30.6% Prior Posted: 02 Feb 2012 05:20 AM PST

No Greece solution, lower EURUSD today. Dollar mixed. Posted: 02 Feb 2012 05:01 AM PST CLICK on picture for FULL SIZE PDF.

The FXDD overnight review and preview Posted: 02 Feb 2012 04:45 AM PST The dollar opens the NY session mixed but with little changes from yesterday's closes. EU PPI came in at -0.2% MoM and 4.3% YoY which was close to expectations. Spain registered jobless climbed by the most in 3 years (+177,470 jobs lost in the current mo.).  The total unemployed is the most since January 2009 and was higher than the estimate of 127K.  The UnE rate is 22.9%.  What helped the EURUSD in London trade was a comment by Chinese Premiere Wen who said that China is considering greater involvement in EFSF/ESM.  However, the spike higher was quickly reversed. The early NY decline was attributed to a comment from EU Juncker who said the Greek PSI talks are "ultra difficult".   In the UK Construction PMI fell to 51.4 from 53.2 last mo(below exp of 52.5). Japan vehicle sales were up 40.7% YoY. The USDJPY and EURJPY reversed back down after the gains yesterday &the low of 76.56 is in trader's sites. The Swiss Trade Balance declined to 2.07B from 2.95B last mo.(est. 2.5B), however, the Swiss exports rebounded by 6.1 after declining by -4.8% last mo. Imports increased 7.6% after declining 8.2% last mo.  Despite the gains, with the spending cuts in the EU &the high value of the CHF franc, the export market is not likely to experience a resurgence of growth. The EURCHF reached new lows since September 2010 yesterday.  The low reached 1.2030.  The 200 day MA currently comes in at 1.2057. A close above that level is needed to solicit more buying interest.  In the US today, the Challenger Job Cuts rose by 38.9% YoY. Employers planned on cutting 53,486 jobs which was the highest number since Sep2011.  Non Farm Productivity is expected to rise by 0.8% vs 2.3%.  The Unit Labor cuts are also expected to rise by 0.8%.  Intial Claims are to decline to 371K from 377K according to Est.

Irish Central Bank cuts 2011 GDP growth to 0.8% from 1.0%. Posted: 02 Feb 2012 03:03 AM PST Sees 2013 GDP increasing to 2.1%. Cuts 2012 GDP forecast to 0.5% from 1.2%.

Merkel says China says that Europe must do its homeowrk first on the Eurozone crisis, then ready to work for a stable Euro. Posted: 02 Feb 2012 02:41 AM PST

Euro rises after China’s Premier Wen says China is considering greater involvement in the EFSF and ESM stabilization funds. Posted: 02 Feb 2012 02:35 AM PST

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Forex Market Updates & Commentary

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• FOREX TRADERS COURSE Thursday at 4:00PM with Greg Michalowski
• EURJPY finds some upside resistance against 38.2% retracement
• Fitch’s Riley says unsure if Portugal needs another bailout
• Construction Spending and ISM Prices Paid Move Higher, Manufacturing Lower
• ISM Manufacturing due out at 10 AM. Last months components for comparison
• State of California Treasury official says CA may borrow up to 1 billion
• White House announces refinancing plan
• ItaFitch’s Riley says Greece will default
• ECB role in Greek bailout has been discussed this wk: Sources
• Ford US sales up 7.4% vs 9.5% expectations.
• GBPUSD consolidates, then surges to highest level since Nov 2011
• EURUSD trends higher. Runs into trendline resistance
• Feds Plosser did not back 2014 pledge on interest rates
• US ISM Manufacturing and Prices Paid Data Alongside Construction Spending Due at 10AM
• Better PMI data in China/Europe send the dollar lower

FOREX TRADERS COURSE Thursday at 4:00PM with Greg Michalowski Posted: 01 Feb 2012 07:38 AM PST Traders Course Lesson 14 at 4:00PM TODAY with Greg Michalowski and Shawn Powell. The topic is Using Trend lines effectively in your Forex Trading: Part 2 Register now

EURJPY finds some upside resistance against 38.2% retracement Posted: 01 Feb 2012 07:30 AM PST Like a lot of pair, the EURJPY has reversed some of the declines from yesterday. The price has moved above channel resistance and moved to the 38.2% of the move down from the January 26th high to the low today (at 100.363 see chart above). The price moved above that level but has not been able to close above this level today.  ON a move above be aware that the 100 and 200 hour MA are converged at the 100.63 level. I would expect good resistance at the level. On the downside the 99.95 level is the underside of the trendline.  Look for support on dips toward that area.

Fitch’s Riley says unsure if Portugal needs another bailout Posted: 01 Feb 2012 07:12 AM PST EURUSD pops on the headline.  The Portuguese debt has been hit recently on the back of worries about their fiscal health

Construction Spending and ISM Prices Paid Move Higher, Manufacturing Lower Posted: 01 Feb 2012 07:01 AM PST ISM Manufacturing:  Survey: 54.5   Actual: 54.1  Prior: 53.9 Jan  vs Dec Breakdown Production: 55.7 vs 58.9 New Orders: 57.6 vs 54.8 Employment: 54.3 vs 54.8 Supplier Deliveries: Inventories: 49.5 vs45.5 Prices:  55.5 vs 47.5 Order Backlogs: 52.5 vs 48.0 ISM Prices Paid:  Survey: 50.0   Actual:  55.5  Prior: 47.5 Construction Spending: Survey: 0.5%   Actual: 1.5%  Prior:  1.2%   Revised: 0.4%

ISM Manufacturing due out at 10 AM. Last months components for comparison Posted: 01 Feb 2012 06:57 AM PST Prices paid       47.5 Production      59.9 New orders      57.6 Backlog of orders     48.0 Supplier deliveries   49.9 Inventories     47.1 Customer inventories  42.5 Employment   55.1 New export orders  53.0 Imports           54.0

State of California Treasury official says CA may borrow up to 1 billion Posted: 01 Feb 2012 06:53 AM PST …to avert a cash shortfall. Earlier today, the LA Times was reported as saying that CA faced a cash shortfall of up to 3.3 billion by March

White House announces refinancing plan Posted: 01 Feb 2012 06:45 AM PST Would be open to borrowers whose loans are current for the last 6 months, miss no more than 1 payment, and programme would only be open to single family owner occupied properties

ItaFitch’s Riley says Greece will default Posted: 01 Feb 2012 06:43 AM PST But does not see Greece leaving the EU Italy is the key for success or failure of the EURO Italy should not focus on fiscal austerity now. Growth is more important Does not expect to resolve France’s negative outlook before 2013

ECB role in Greek bailout has been discussed this wk: Sources Posted: 01 Feb 2012 06:41 AM PST

Ford US sales up 7.4% vs 9.5% expectations. Posted: 01 Feb 2012 06:33 AM PST US data coming out a bit weaker today so far.  Construction spending (est +0.5%) and  ISM (54.5 est) due 10 AM

GBPUSD consolidates, then surges to highest level since Nov 2011 Posted: 01 Feb 2012 06:22 AM PST The GBPUSD has been contained on the topside over the last 2 to 2 1/2 months of trading. Yesterday a play was made to extend higher but failed. Today, the move has pushed above the 1.5778 level after consolidating in a narrow range for much of the trading day (see chart above). Better UK PMI helped push the pair higher. The price has since moved to a high of 1.5866. The high print going back to November 18th came in at 1.5886.   The 1.5886 will be the next target above.   Other upside targets include the 1.5924 (50 % of the move down from August 2010 high) and the 200 day MA  at the 1.5953 level (see daily chart below). On the downside, intraday traders will take clues from the 38.2 of the last leg higher today which comes in at the 1.5819 level (see above). Below that the high from yesterday at 1.5795 should hold support if the break is not a failed one.

EURUSD trends higher. Runs into trendline resistance Posted: 01 Feb 2012 05:55 AM PST The EURUSD has trended higher today after trending lower for most of yesterday. The move higher today has two legs. The last leg higher has corrected to the 38.2% after testing the topside channel trendline. The high also corresponded with the topside trendline connecting the highs over the last three trading days (see hourly chart below).   Sellers/profit takers were more than happy to sell against this level with risk so clearly defined and limited.  A move below the 38.2% at the 1.3168 area will likely lead to a test of the lower channel trendline at the 1.3156 level currently (see chart above).  The earlier high for the day at 1.3151 will also be a target to breach on the downside if the bears are going to wrestle some more control from the bulls.

Feds Plosser did not back 2014 pledge on interest rates Posted: 01 Feb 2012 05:48 AM PST Policy should not hinge on a calendar date Inflation to be monitored carefully due to very accomodative policy I personally have to agree with Plosser.  Setting a date every month is simply painting yourself in a corner.  There is a boat load of stimulus and if the economy does pick up, inflation could jump rather quickly.  The Fed will likely be late to the game as they worry about their credibility from their date.

US ISM Manufacturing and Prices Paid Data Alongside Construction Spending Due at 10AM Posted: 01 Feb 2012 05:36 AM PST

Better PMI data in China/Europe send the dollar lower Posted: 01 Feb 2012 05:18 AM PST

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