Forex Market Updates & Commentary

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• New Homes Sales surge. Much better than expectations.
• GBPUSD moves below 1.6187 support level and moves lower.
• August 26 2009 Forex Market Update - Special Training
• GBPUSD falls overnight. Good selling for most of the day
• Durable Goods better than expectations. Revisions better as well.
• Bobbys Corner-Open Market-Aug.28.2009
• US Mortgage Applications rise again. Durable Goods and New Home Sales due out today.
• Ifo comments cautious after release of survey
• German Ifo business climate survey
• Aud/Usd trading above 61.8% Fibo
• German import prices below expectations
• 8-26 Economic Calendar
• AUD DEWR Skilled Vacancies
• The BOJ and Falling Rates (USD/JPY)
• Yen Bid Again in Asia

New Homes Sales surge. Much better than expectations. Posted: 26 Aug 2009 07:06 AM PDT JULY NEW Home Sales come in at 433K versus 390 estimate (+9.6% Month on Month Prior month was revised from 384K to 395K . Most importantly the Months Supply fell to 7.5 months supply from 8.8 months.  A healthy month supply is between 5 and 6 months.   This is good news and the initial reaction is a lower dollar against the EURO and GBP but I would be on the lookout for a stronger dollar across the board.   Watch the 1.6187 level in GBPUSD.  Watch for sellers against 1.4250 in the EURUSD and a move through the 1.4211 level on the downside.

GBPUSD moves below 1.6187 support level and moves lower. Posted: 26 Aug 2009 06:37 AM PDT The GBPUSD is continuing to move sharply lower - breaking through the June low level of 1.6187 price.  Stops have been hit and momentum has taken the price lower.   Look for resistance against the level now on a rebound.  A failure to extend above this level will be even more bearish for the GBPUSD and should lead to a move to the next level of support  at 1.6144 and then down at 1.6100. A move back above 1.6187 may lead to some short covering but keep the level as a key level to watch today.

August 26 2009 Forex Market Update - Special Training Posted: 26 Aug 2009 06:28 AM PDT Click here to view the embedded video. August 26 2009 Forex Market Update - Special Training on Market Analysis. Greg and Shawn explain how viewing multiple timeframes can show the story in trading. We do a single very detailed review of the EUR/USD, looking at multiple factors. It should be very helpful for new traders. Be sure to leave a comment for us. Thanks and have a great day trading.

GBPUSD falls overnight. Good selling for most of the day Posted: 26 Aug 2009 06:02 AM PDT The GBPUSD fell early in the day rebounded toward the closing level, and has trended lower.  Six of the last seven hourly bars have been down. The price stalled at the key 1.6317 level but eventually moved away from the area on the downside.  The pair is approaching support at the 1.6187 area.  This is a low price from the June area.   The GBPUSD has been in a narrow range since June with brief moves down (below 1.6187) and to the upside (above 1.6600 area). Most of the activity has been centered between 1.6317 and 1.6589 over the last 2-3 months.   The bias is to the downside as the price is below the 100 hour MA and the 100 bar MA on the 5 minute chart (see 5 mnute chart below).  The price correction today should remain below the 100 bar MA on the 5 minute chart (level comes in at the 1.6300 level)  A move above this level would muddy the bearish waters today.  Before that level there is some resistance at the 1.6279 area.  This was a low level on the first move lower after holding the 100 bar MA the last time.

Durable Goods better than expectations. Revisions better as well. Posted: 26 Aug 2009 05:33 AM PDT Durable Goods up 4.9% revision better a -1.3% vs -2.5% Ex Transportation +0.8% vs a revised 2.5% increase (prior +1.1%) Combined with the revisions is much better than expectations.  The Dollar is getting stronger against the EURO after the release after an initial spike higher. Look for support in the EURUSD at eh 1.4250.  This is the 50% retracement of the last move higher.

Bobbys Corner-Open Market-Aug.28.2009 Posted: 26 Aug 2009 05:16 AM PDT Good Morning: The Greenback picked up overnight as US stock futures dropped after a report that China will be looking to curb overcapacity in industry, including steel and cement. The Euro gained in early trading after the German IFO survey was higher than expected, but not strong enough to keep the Euro in positive territory. Asian equity markets were higher-European markets are lower after some disappointing corporate profits. Oil:$71.89                                  Gold:$948.50 Todays data: Durable Goods:                exp:3.0%         prior: -2.5% New Home Sales:             exp: 390k       prior: 384K HAVE A GREAT DAY & GOOD LUCK

US Mortgage Applications rise again. Durable Goods and New Home Sales due out today. Posted: 26 Aug 2009 04:58 AM PDT US Mortgage Applications rose by 7.5%. This is on the back of a 5.6% gain last week.  The Purchase index rose by 1.0% .  This is the 4th increase in a row but down from last weeks gain of +3.9%.  The Refinance index rose by 12.7% vs last weeks 6.9% increase.  The gains were despite an increase in the 30 year mortgage rate of 5.24%.  The data is consistent with a steadying/improving housing market. Note however, that anecdotal evidence still points toward sales of foreclosed homes and sales of homes in the lower price levels as purchasers take advantage of rebates from the government for 1st time homeowners. At 8:30 the US Durable Goods Orders will be released.  The Expectation is for a healthy gain of 3.0% and Ex transportation rising by 0.9%.  The Durable Goods Orders were likely boosted by the rebate for 1st time homeowners which has led to a bottoming in the housing market and the cash for clunker program which has helped deplete auto inventories.  At 10:00 AM the US New Home Sales for the month of July will be released. The expectation is for a gain to 390K from 384K last month -an 11% gain which was the largest MoM gain in 9 years.  This months increase equates to a 1.6% gain.  The months supply of homes for sale fell to 8.8 months last month from 10.2 months in May.  This was the lowest months supply since October 2007.  This is good news for builders and suggests that there is a healing and that demand may actually spur on more supply at some point.  A more healthy month supply is still at 5-6 months.  However, it is a step in the right direction.  A further decline will certainly be good news as new home sales help spur on other ancillary consumer spending like Durable Goods sales as homeowners furnish their new homes.    The Existing Home Sales which accounts for most of US home sales, was released last week and showed a gain to 5.24M - the highest annualized rates since August 2007 and well above the 5.00M estimate.

Ifo comments cautious after release of survey Posted: 26 Aug 2009 01:13 AM PDT Ifo’s Abberger states he cannot conclude that economic recovery is sustainable and expects a significant rise in jobless rate in fall of 2009 and continuing into 2010 but not to exceed 5,000,000. Ifo’s Nerb states ECB should maintain low rates. He expects no rate hikes until September 2010. Also sees no risk of inflation. on these comments Eur/Usd has come off down to 1.4318.

German Ifo business climate survey Posted: 26 Aug 2009 01:06 AM PDT German Ifo business climate came in at 90.5, better than the 89.0 expected. current assessment also slightly better coming in at 86.1 vs. 86.0 expected. The Euro got an instant lift up to 1.4345 vs. Usd and has come off since to pre-number level of 1.4330.

Aud/Usd trading above 61.8% Fibo Posted: 26 Aug 2009 12:47 AM PDT Aud/Usd is trading above the 61.8% Fibo (high 8/13 .8477,  low 8/17 .8154) for the last 5 hours. If it holds above the 61.8% (.8354) look for a move higher possibly up to .8427 which is a trendline of recent hourly highs. There is added support at .8349 which is the 100 hour M/A. A break below could bring the pair down to .8310-15 level where the 200 hour M/A and 50 % Fibo lie.

German import prices below expectations Posted: 25 Aug 2009 11:12 PM PDT German import prices m/m came in at -0.9%, worse than the -0.7% expected and the 0.4% prior reading. No major reaction to the euro in very light trading thus far. eur/Usd currently trading at 1.4315.

8-26 Economic Calendar Posted: 25 Aug 2009 08:56 PM PDT

AUD DEWR Skilled Vacancies Posted: 25 Aug 2009 06:03 PM PDT THE DEWR Skilled Vacancies (MoM) came in at 1.0%; better than the prior release of -1.7% and it’s first increase since October of 2007. The Aussie recieved a light bid on this release as it trades off session lows across the board.

The BOJ and Falling Rates (USD/JPY) Posted: 25 Aug 2009 06:00 PM PDT A report earlier from the far east suggested the BOJ appears to be scaling back some of its liquidity provisions to the money market. According to the report the BOJ has been reducing the frequency of some open market operations and the funding amounts offered. However, BOJ officials suggest the central bank remains committed to its basic policy of providing ample liquidity to the money market. This is becoming a more critical part of the BOJ approach as they attempt to ensure that falling rates do not constrain transactions between private sector financial institutions. Rates are becoming more and more of a concern as 3 month-libor in the US remains below Japan (.38% vs. .38875%,) which has not occurred for 16+ years. The steadily declining price on the USD/JPY daily chart below displays this downward trend. We have also added some long-term technicals.

Yen Bid Again in Asia Posted: 25 Aug 2009 05:17 PM PDT The Yen has once again caught a bid early in the Asian session on soft Asian equities and waning US equity futures and was pushed to its session lows on worse than expected trade balance figures but better export and import readings. The Yen crosses have since recovered some, but continue to exhibit measured weakness on the bid side. The USD/JPY pair has moved back above the 94 handle, but faces multiple levels of technical resistance in the short-term, making the move down seemingly easier.

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Forex Market Updates & Commentary

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• Conusmer Confidence comes in stronger
• EURUSD watching topside resistance
• August 25 2009 Forex Market Update
• GBPUSD tests retracement resistance and comes off. 1.6414 close from yesterday eyed
• Case Schiller comes in better than expected
• EURUSD moves above trendline resistance in early NY trade
• USDCAD tests yesterday’s support area
• Bobbys Corner-Open Market-Aug.25.2009
• The Peoples Bank of China comments made on their website
• Morning. US Case Schiller, Consumer Confidence, Richmond Fed and House Price Index due out this morning.
• BBA mortgage approvals (UK)
• Swiss employment level slightly worse than expected
• Eur/Usd breaks lower after much indecisiveness
• German Final GDP inline with forecasts
• 8-25 Economic Calendar

Conusmer Confidence comes in stronger Posted: 25 Aug 2009 07:00 AM PDT The number comes in at 54.1 which is stronger than the 47.9 expectation and the highest since May when it rose to 54.8. The Richmond Fed Index came in at 14 vs 16. The confidence is good news as it shows consumers are not losing the faith.

EURUSD watching topside resistance Posted: 25 Aug 2009 06:59 AM PDT Watch the 1.4356 level.  A move higher should lead to further gains.

August 25 2009 Forex Market Update Posted: 25 Aug 2009 06:31 AM PDT Click here to view the embedded video. Watch the morning report for the big picture in the Forex markets today. Talk out of Japan and Chinese markets appear to be steering the day so far. Thanks for all your comments and feedback.

GBPUSD tests retracement resistance and comes off. 1.6414 close from yesterday eyed Posted: 25 Aug 2009 06:28 AM PDT The GBPUSD has tested the 38.2% retracement level providing an opportunity for longs to take some profits.  The level comes in at the 1.6447 level.  The high reached 1.6442.  The price has come down off the high but should find support against the close from yesterday at the 1.6414 level.    A move below this level would not be welcomed for the bulls and should lead to further downside pressure toward the 1.6397 level.

Case Schiller comes in better than expected Posted: 25 Aug 2009 06:13 AM PDT The Case Schiller index came in at -15.44 This should benefit the equities this morning.

EURUSD moves above trendline resistance in early NY trade Posted: 25 Aug 2009 05:44 AM PDT The EURUSD fell in early trade in the new day on the back of risk aversion due to falling stocks.  As the markets rebounded, so did the EURUSD. Before then, however, the pair did test the 100 hour MA overnight at 1.4260 (low reached 1.4253 but quickly reversed - see 5 mnute chart below) .  This also aided the move higher from a technical perspective.  Over the last hour or so, the price has broken through a top trendline at the  1.4312 level   This will be key support  with buyers likely against the level.  Other support comes in at the 1.4274 level. This level was the top and bottom on a number of hourly bars over the last 3 or so days. A break of this level should lead to further declines.   The bias does remain to the upside. The high yesterday came in at the 1.4359 and the high Friday came in at the 1.4376 level.  These are the next obvious targets for the pair today as long as the trendline support can hold.  The high for the year is 1.4447.

USDCAD tests yesterday’s support area Posted: 25 Aug 2009 05:15 AM PDT The USDCAD has maintained the 1.0761 support level over the last few days and has moved below this level this morning.  The pair moved below the 200 bar MA on the 5 minute chart at the 1.0775 level this NY morning and a break of the 1.0750 level will likely lead to further downside pressure. The low from yesterday came in at the 1.0724 level. This would be the target area. The low for 2009 came in at the 1.0630 level.  On the upside the price will need to get back above the 1.0761 level and then the 200 bar and 100 bar MA on the 5 minute chart to solicit addtional upside moves.  The 200 bar MA comes in at the 1.0775 level and the 100 bar MA comes in at the 1.0778.  The key level remains the 1.0750 to 1.0761. If the price can hold the support a drift back higher should occur.

Bobbys Corner-Open Market-Aug.25.2009 Posted: 25 Aug 2009 05:13 AM PDT Good Morning: Comments overnight from Chinese official Wen Jiabao who noted that the “Chinese economy faces many uncertainties, and external demand will likely remain weak for the foreseeable future”.  Shanghai stocks were down 5% at one time-but rebounded to slid 2.6%. Asian equity markets were down-European markets are mixed at this time.  US Futures are higher. The JPY strengthened on the news-and the greenback was little changed. Oil was lower-as is gold this morning. The White House announced that Fed Chairman Bernanke will be renominated for another 4 year term later this morning  by President Obama.  Oil:$74.16                                  Gold:$949.30 Today’s data: Case Shiller Index:              exp:                    prior: 139.84 Consumer Conf:                   exp: 47.6          prior: 46.6 Richmond Fed:                    exp: 16.0          prior: 14.0 House price Index:            exp: .4%            prior: .9% HAVE A GREAT DAY & GOOD LUCK

The Peoples Bank of China comments made on their website Posted: 25 Aug 2009 05:08 AM PDT Reiterates to continue “appropriately loose monetary policy” and ensure reasonable liquidity for banks.  They warn that excessive monetary developments could cause inflationary pressure They further comment that they look to promote yuan currency exchange rate reform and to keep the Yuan at reasonable and balanced level.  Furthermore, they say they will continue to promote appropriate growth in lending. They also look to keep interest rates more market oriented.  Going forward they see downward pressure on prices easing in the 2nd half of 2009.  In  2009 they see fixed investment growth to exceed 2008 levels.  The investment growth is expected to put upward pressure on prices of capital goods. Analysis:  The PBoC continue to see the need for stimulus however, the inflation fear due to expansion (i.e. investment) may need to be addressed down the road.  Overnight the Shanghai index was down -5.5% at one point as rumors of banks increasing capital requirements hurt equities. These rumors were eased later and the stocks rebounded.  The index still ended down -2.59%.   The UK FTSE  and Euro bourses are mainly unchanged this morning.  Gold is up $6. Spot oil is unchanged.  The Dow futures are up 40 points.   President Obama is expected to reappoint Bernanke this AM.   To make a change now would probably not be in the best interest of the continuity of the plans already enacted and the unwinding that needs to be eventually orchestrated.

Morning. US Case Schiller, Consumer Confidence, Richmond Fed and House Price Index due out this morning. Posted: 25 Aug 2009 04:54 AM PDT Case Schiller 20 largest markets YoY -16.4% vs -17.06% last month.  This is due at 9:00 AM and has been recovering as prices seem to stabilize.  Supply/foreclosures remain a problem as too many homeowners are upside down and jobs continue to remain weak.  The Case Schiller Home price index came in at 139.84 last month. US Consumer Confidence (10 AM) is expected to rise to 47.9 from 46.6 in July.  It will be curious to see how Consumer Confidence moves along. The declines are steadying  at a lower pace but will the consumer continue to feel better or has their expectations been permanently damaged due to so much uncertainty. The Richmond Fed Manufacturing index (10 AM) comes on the heals on better Empire and Philadephia Fed Indices over the last week or so.  The expectation for the index is for a gain to 16 from 14 in July.  This would be the 4th straight month with the index above the 0 level.  The manufacturing has been boosted by a lower dollar (makes exports more competitive abroad) and the need to replenish inventories.  Stimulus measures like Cash for Clunkers also provide stimulus effects for a multitude of businesses as the auto industry gets a boost. Finally, at 10 AM we will also get the House Price index for the 2q and for June.  This index show the change in the purchase price of homes with mortgages backed by Fannie Mae and Freddie Mac.  The data is a bit dated as it is only for June and the 2Q.  There are also a multitude of more timely house data. ;

BBA mortgage approvals (UK) Posted: 25 Aug 2009 01:33 AM PDT BBA mortgage approvals came in at 38,200, better than the 37,800 expected and the 35,600 prior reading. No market reaction to number as Gbp/Usd holds at 1.6370.

Swiss employment level slightly worse than expected Posted: 25 Aug 2009 12:18 AM PDT Swiss Q2 final employment level came in at 3.95M, less than the 3.96M expected. Y/y came in at -0.4%, worse than the -0.1% expected. Usd/Chf currently trading close to session highs at 1.0635.

Eur/Usd breaks lower after much indecisiveness Posted: 25 Aug 2009 12:06 AM PDT Eur/Usd has broken below a trendline of recent hourly lows and is testing its 100 hour M/A of 1.4259 If the pair can remain below this trendline (1.4274) there is a chance it can break below the 100 hour M/A. If so the next support level is 1.4220, its 200 hour M/A.

German Final GDP inline with forecasts Posted: 24 Aug 2009 11:04 PM PDT German final GDP q/q came in at 0.3% and y/y came in at -5.9%, both inline with forecasts. Initial reaction to Eur/Usd has been a slight sell off down to 1.4279.

8-25 Economic Calendar Posted: 24 Aug 2009 08:35 PM PDT

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Forex Market Updates & Commentary

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• August 24 2009 Forex Market Update
• EURUSD stays within a channel today.. Activity is quiet
• Canada Retail Sales much better than expected
• Bobbys Corner-Open Market-AUg.24.2009
• USDJPY keeps using the 200 day MA above, but can not maintain the upside momentum .
• Good to meet you all at the SF Money Show
• Eurozone Industrial Orders stronger than expected
• Usd/Jpy continues its uptrend
• 8-24 Economic Calendar
• AUD New Motor Vehicle Sales
• US Comments From Jackson Hole Symposium
• ECB Comments From Jackson Hole Symposium
• Yen Opens Weaker
• Japanese Weekend News Update

August 24 2009 Forex Market Update Posted: 24 Aug 2009 07:03 AM PDT New Video Now Pending

EURUSD stays within a channel today.. Activity is quiet Posted: 24 Aug 2009 06:36 AM PDT The EURUSD drifted lower initially today but found support against trendline support at the 1.4284 level.  The low reached 1.4280 but the price moved higher off the level and started to use the trendline as a level to buy against. The current trendline point comes in at the 1.4300 level and I would expect buyers to lean against this level on dips.  An additional level to watch today is the 1.4328-35 price.  This was the earlier lows for the day and the close from Friday.  There seems to be some apprehension above this level.  The high extended to 1.4344 but there was not much momentum on the move higher.    So with the quiet market, look for sellers above with buying interest above 1.4335, and support against the downside trendline support currently at the 1.4300.    Look for momentum on any breaks above or below these levels to confirm the directional bias move.

Canada Retail Sales much better than expected Posted: 24 Aug 2009 05:32 AM PDT They rise by 1.0% vs _0.2% expectation. The Ex Autos also comes in stronger at +1.0% vs +0.4%. This should benefit the CAD$ - lead to a lower USDCAD. The pair just moved below some “remembered lows from August 7th at the 1.0755 level.  Watch this level as well as the low from Friday at the 1.0761.  If the price can hold below these levels the bias will remain to the downside for the pair.  A move back above has resistance at 1.0778 (prior low for the day) with better resistance at the 1.0818 level.

Bobbys Corner-Open Market-AUg.24.2009 Posted: 24 Aug 2009 05:22 AM PDT Good Morning: A fairly quiet night in the forex markets.  EuroZone Industrial new orders rose , but they are still 25% below last years orders.   No major data on the calender in North America except for Canadian retail sales.  No US data. Worldwide equity markets rose, as did metals.  Comments from  Trichet and Bernanke at the annual central bankers symposium in Jackson Hole, WY, stating that the world economy is pulling out of recession helped lift markets and added a level of confidence to the marketplace. Oil;$74.02                          Gold;$958.10  No Major Data today HAVE A GREAT DAY & GOOD LUCK

USDJPY keeps using the 200 day MA above, but can not maintain the upside momentum . Posted: 24 Aug 2009 05:00 AM PDT The 94.96 level is the 200 day MA for the USDJPY.  The price moved above the moving average this morning to a high of 95.05 but the move above was reversed back to the downside.  The inability to move above this MA keeps the longer term bias to the downside for the pair.  On the shorter term charts, the market was able to break above the 100 hour MA on Friday for the first time since August 11th.  The price on Friday closed at 94.31, just under the 100 hour MA at 94.33.  Today the low has been 94.28 which came in the first hour of trading and since then the price moved steadily higher.  The price moved above the 200 hour MA (currently at 94.78), but because of the 200 day MA resistance at hte 94.96 level today, the upside was maintained.  Finally, an attempt to break to the upside was made, but found no buyers.  As a result, the price started its move back lower and has moved back below the 200 hour MA again.  Now the price is below the 200 hour MA at the 94.78 level.  We will use that level as initial intraday resistance this morning. The 100 bar moving average on the 5 minute chart is also at that area (94.82 currently - see 5 minute chart below) ). If the price can stay below this level further downside pressure should ensue.  Below is support against the 100 hour MA at the 94.34 level.   I would expect buyers against the level with stops below - at least initially. A move above the 94.78 /82 level will likely solicit additional buying and a test of the 200 day MA once again. The more times the market knocks on the level, the better chance for a move to the upside, but for the time being, the bias remains to the downside.

Good to meet you all at the SF Money Show Posted: 24 Aug 2009 04:32 AM PDT Let me thank all who attended the FXDD SF MoneyShow seminars and visited us at our booth.   We will be getting the PowerPoint presentation to you shortly.   If you have any questions please feel free to send me an email at greg@fxdd.com or put a Comment on the blog at any time of course.  Thanks again. Greg Michalowski

Eurozone Industrial Orders stronger than expected Posted: 24 Aug 2009 02:03 AM PDT Eurozone industrial orders m/m came in at  3.1% , stronger than the 1.8% expected. Y/y came in at  -25.1% , stronger than the -28.3% expected. Eur/Usd got small lift up to 1.4305 after release and has now paired back to 1.4295.

Usd/Jpy continues its uptrend Posted: 23 Aug 2009 11:27 PM PDT Usd/Jpy has been on a steady uptrend since breaking above its 100 hour M/A of 94.35. It has seen some resistance at 94.80 which is its 200 hour M/A, not yet holding above this pivotal number. If it can break above you should see slight resistance at 95.00 and then more at 95.28, previous hourly high on Aug 18th. A failed break may bring the pair back down to 94.35.

8-24 Economic Calendar Posted: 23 Aug 2009 08:22 PM PDT

AUD New Motor Vehicle Sales Posted: 23 Aug 2009 06:37 PM PDT Australian New Motor Vehicle Sales came out worse than the prior reading, as follows:  New Motor Vehicle Sales (MoM) - Actual: -6.9%   Prior: 5.7% New Motor Vehicle Sales (YoY) - Actual: -10.4%   Prior: -7.3% The AUD has started the trading week gaining strength across the board, particularly against the JPY. The market has had no reaction to the previously mentioned data.

US Comments From Jackson Hole Symposium Posted: 23 Aug 2009 04:32 PM PDT FED’s Kohn: believes that there is no inconsistency between the Fed’s pledge for maintaining low rates for an “extended period” of time and keeping inflation low. Low rates are aimed towards preventing deflation, not raising inflation expectations. He also notes the Fed has the ability to affect asset prices with policy actions. Problems lie in the flight to safety and liquidity, even at less concerning levels. FED’s Bullard: expects positive US growth in the second half of 2009. Expects TALF program to halt if everything goes well by the end of the first half of 2010. Must avoid Japan’s style inflation. Asset Backed Security purchases stemming from monetary expansion has spurred deflationary pressures. Fed can pay interest on reserves to keep inflation under control. He does not see “double dip” in US recession. Sees slow US recovery due to sluggish household spending and the excessive recovery period needed for financial sector.

ECB Comments From Jackson Hole Symposium Posted: 23 Aug 2009 04:08 PM PDT ECB’s Stark: “There is a risk that rates remain too low for too long a period of time”. He believes that firmly anchoring inflation expectations has been “a big achievement”. ECB’s Trichet: sees signs that the economy is emerging from “free fall”, but he believes that they can not rule out a “very bumpy road ahead of us”. ECB will unwind its emergency policy actions quickly once the economy improves. He has no doubt that the ECB would keep prices stable, even during the economic crisis. “The ECB has acquired a reputation for moving interest rates in a steady and persistent fashion over time. This is a conscious choice”. ECB’s Liikanen: ECB does not need to reassess its monetary policy stance. Says the “freefall is over, but we must remember the level of economic activity is still below what it was a year ago”. He still expects unemployment to continue to rise and for uncertainty to remain in the economic outlook. ECB’s Nowotny: recent data have been positive, but may not be sustainable; “don’t see any need for immediate reactions” from the ECB. Expects Euro-Zone economic expansion in 2010.

Yen Opens Weaker Posted: 23 Aug 2009 03:44 PM PDT The Yen opened the week in the far east with same momentum to the downside with which it ended last week as Gold and US equity futures regain their bid. The EUR/JPY pair broke last weeks highs from Friday and went through the 4-100hr moving average and has just traded off the 61.8% retracement which we will look to provide some resistance.

Japanese Weekend News Update Posted: 23 Aug 2009 03:10 PM PDT According to the Kyodo poll, Japan’s opposition the DPJ party, is expected to win next weekend’s general elections in Japan by a substantial margin. Projections forecast the DPJ winning over 300 of the 480 seats in lower house elections. BOJ’s Shirakawa stated that monetary policy alone cannot prevent bubbles and that central banks must coordinate more.

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Forex Market Updates & Commentary

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• August 21, 2009 Midday Forex Report
• ECB Weber and Trichet downplays the growth green shoots
• EURUSD bounces of target support at 1.4272 but downside favored
• The top failed and the downside took charge for the GBPUSD
• USDJPY moves higher. Resistance ahead at 94.69 with better resistance against the 94.94/96 level
• EURUSD tests the 100 bar MA on the 5 minute chart on the 1.4304 level
• USDJPY breaks higher on better data/Bernanke

August 21, 2009 Midday Forex Report Posted: 21 Aug 2009 10:22 AM PDT Click here to view the embedded video.

ECB Weber and Trichet downplays the growth green shoots Posted: 21 Aug 2009 09:01 AM PDT ECB’s Weber on the newswires is quoted as saying the steep downturn in Germany economy has halted and that  there are signs of stabilization.  However, he does warn that it  may take 10 years to recover to prior levels seen in the last 5-6 years. He suggests it is too early to withdraw stimulus. Meanwhile ECB’s Trichet was also on the wires saying that there is an enormous amout of work is left to do to stabilize the economic situation. Furthermore, he is concerned all the “green shoots” talk is not in any way indicative of a back to normal economy.

EURUSD bounces of target support at 1.4272 but downside favored Posted: 21 Aug 2009 08:26 AM PDT The EURUSD fell through the support level at the 1.4304 to 1.4312  level and headed toward the target support level at the 1.4272 level (see prior post) . The low reached 1.4276 and has bounced back toward the 1.4300 level again.   The downside remains favored with upside most likely contained by the 1.4304 to 1.4312 level.  I would not expect the price to  move back above this level, however.   Look for seller against the level as the story of higher stocks and higher dollar takes hold.

The top failed and the downside took charge for the GBPUSD Posted: 21 Aug 2009 08:14 AM PDT Although the 1.6589 to 1.6605 key resistance was broken, sometimes it is the failures that provide the best opportunity. In this case the price broke through the 1.6605 top level and squeezed up to a high of 1.6622.  The multiple levels of resistance above loomed large and instead of moving higher with the rising stock market, buying dollars took over.   We warned of a break lower and when the price moved below the key support again (at 1.6589), the market sold off (see prior post)  The pair is back down testing the 200 and 100 hour MA at the 1.6488 and 1.6473 levels respectively.  Look for some initial buying against these levels.   Upside resistance comes in at the 1.6505 level.   A move below should not be faded.

USDJPY moves higher. Resistance ahead at 94.69 with better resistance against the 94.94/96 level Posted: 21 Aug 2009 07:56 AM PDT The USDJPY is bumping up against the 38.2% retracement level of the trend move down from the high on August 12th.  The level comes in at 94.69.  A break above will target the 200 hour MA currently at the 94.94 level.  This level also corresponds with the 200 day MA which is at the 94.96 level today.  Keep this level in mind.

EURUSD tests the 100 bar MA on the 5 minute chart on the 1.4304 level Posted: 21 Aug 2009 07:33 AM PDT Watch the 1.4304 level.  Buyers have emerged against the level. However, another dip below should solicit selling with the target at 1.4272 area.  (61.8% retracement and 200 bar MA currenly - green line) Corrective moves should find sellers against the 1.4436 to 1.4444 area where there are a series of lows and highs today on the 5 minute chart (see chart below).   Expect stops if the price is able to move above these levels.

USDJPY breaks higher on better data/Bernanke Posted: 21 Aug 2009 07:17 AM PDT More upbeat comments from Bernanke (politicing for reappointment) and stronger Existing Home sales has pushed the USDJPY through the 100 and 200 bar MA on the 5 minute chart at the 94.76 to 94.84 price respectively (see prior post).  The pair is moving sharply higher and is testing the 100 hour MA at the 95.33 level.  Look for some profit taking at the level.  Watch for support at 94.19.  This was the close for yesterday.  IF this holds the upside resistance (i.e. 100 hour MA level) should be breached.

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Forex Market Updates & Commentary

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• GBPUSD moving above the 1.6605 ceiling level
• Existing Homes sales come out better then expected
• USDJPY remains pressured as the dollar remains pressured pre Bernanke speach at 10 AM
• GBPUSD stays below key resistance at 1.6589 10 1.6605…for now
• August 21 2009 Morning Forex Report
• Bobbys Corner-Open Market-Aug.21.2009
• Eurozone PMI
• German PMI stronger than expected
• Gbp/Usd below 100 hour M/A
• 8-21 Economic Calendar
• EUR/USD Fading into the Weekend?
• JPY Making a Push
• China News Update
• US News Update from Jackson Hole Wyoming
• NZD Visitor Arrivals m/m

GBPUSD moving above the 1.6605 ceiling level Posted: 21 Aug 2009 07:05 AM PDT The GBPUSD is breaking through the resistance at the 1.6605 level and moving higher.  The 1.6605 level should now provide support for the pair.

Existing Homes sales come out better then expected Posted: 21 Aug 2009 07:01 AM PDT Existing Home sales come out at 5.24 million vs expection of 5.0 Million annualized rate. The month supply 9.4 months.  Still sticky.  Median price down 15% YoY. The dollar has moved up against the USDJPY. The pair is running against resistance at the 200 bar MA and 100 bar MA at hte 93.76 to 93.84 area.  A break above should solicit additional short covering but look for seller initially.

USDJPY remains pressured as the dollar remains pressured pre Bernanke speach at 10 AM Posted: 21 Aug 2009 06:47 AM PDT The USDJPY has maintained its bearish bias as the dollar remains pressured overall. The market seems a bit worried about the Fed’s exit strategy plan. Chairman Bernanke speaks later this morning at the Economic Summit in Wyoming today (at 10AM) and it seems the market is looking for details of an exit strategy.  I am not sure he knows thefull specific  plan yet.  Sure he can speak about cutting back on the quantitative measures and the widening down of the bond purchases (they already indicated that the 300 billion bond purchase would wind down in October). However, rate changes are a different story.  Also the unknown of the unwinding of bond purchases is also a slippery slope.  Will rates go up as a result?  What does that do to the economy?  Is the economy healthy enough or is the recovery just an inventory thing?  All of which creates uncertainty and that should continue to hurt the dollar as uncertainty prevails.  From a technical perspective, the USDJPY has been using the 100 hour MA as resistance level since August 13th.  The move since that time has taken the pair down from around 96.50 to the low today of 93.42.  The pair today tested the 1moving average comes in today tat hte 94.34 level currently and this level will need to be breached to ease some of the bearish bias.  On the shorter term 5 minute chart the price just printed  a new low of 93.42, moving below the prior low at 93.47.  The move lower should have solicited further declines. Howevr, the price has moved back above the 93.47 level.  This could be a clue a short term bottom is in place.  A move back toward intraday resistance at the 93.76 level currently (blue line in chart above) can not be ruled out.  A break of the low, should lead to lower levels for the pair.

GBPUSD stays below key resistance at 1.6589 10 1.6605…for now Posted: 21 Aug 2009 06:13 AM PDT The GBPUSD has been able to stay below the resistance ceiling against the 1.6589 to 1.6605 area after an initial sell off overnight.   The high reached so far has taken the pair to t he 1.6580 level.  A break of the key area - starting with the 1.6589 level - should lead to further gains for the pair as dollar selling continues to take hold.  The pair was largely contained by resistance at the 1.6525 are yesterday.  The failure to move higher initially led to a sharp decline  in the pair in early trade today.  However as stocks bottomed and economic data in the EUROZONE came out better than expected the GBPUSD joined the upside move.  The market used the 100 bar MA on the 5 minute chart as a spring board toward the key resistance at the 1.6525 level  Once that level was broken, the pair had another surge to the highs for the day.   The stalling at the highs is not surprising.   Look for support intraday against the 1.6517- 1.6525 level.  A break of this level will not be welcomed and should lead to further selling pressure.  The upside has the aforementioned hurdles to get through.  If they are breached the next upside target would be 1.6631

August 21 2009 Morning Forex Report Posted: 21 Aug 2009 05:40 AM PDT Click here to view the embedded video.

Bobbys Corner-Open Market-Aug.21.2009 Posted: 21 Aug 2009 05:15 AM PDT Good Morning: Better than expected service data from Germany along with increased manufacturing data from France fueled the Euro in overnight trading. Positive data reinforces speculation that the global meltdown is easing. News overnight that China will be instituting tighter bank lending practices left the Asian session mixed.  The positive news from the EuroZone has added to the Euro and pushed equities higher. US Futures are also higher this morning.  Metals and oil are also higher. Oil:$73.94                                  Gold:$944.50Today’s data: Existing Home Sales:               exp: 4.99M            prior: 4.89M   HAVE A GREAT DAY-GREAT WEEKEND & GOOD LUCK

Eurozone PMI Posted: 21 Aug 2009 01:03 AM PDT Eurozone manufacturing PMI came in at 47.9, stronger than the 47.8 expected. Services PMI came in at 49.5, stronger than the 46.6 expected. Good numbers for euro at face value though I think the release of the French and German PMI’s earlier in the session has stolen the thunder of these results with Eur/Usd trading close to highs upon release.

German PMI stronger than expected Posted: 21 Aug 2009 12:31 AM PDT German manufacturing PMI came in at 49.0, better than the 47.1 projected. German services PMI came in at 54.1, better than the 48.8 projected. Good numbers for Euro as Eur/Usd makes new highs breaching 1.4270.

Gbp/Usd below 100 hour M/A Posted: 20 Aug 2009 09:17 PM PDT Gbp/Usd is now trading below its 100 hour M/A of 1.6455. Next level of support is 1.6430 which is a remembered level of support/resistance in recent weeks of trading. If it breaks below 1.6430 sterling can tumble down to 1.6375-80 level, which is area of recent lows.

8-21 Economic Calendar Posted: 20 Aug 2009 08:29 PM PDT

EUR/USD Fading into the Weekend? Posted: 20 Aug 2009 06:36 PM PDT With an empty news calendar in Asia and an extremely light calendar in NY tomorrow the Euro has a lot of room to the downside, not withstanding any large orders which helped drive the currency higher a few NY mornings ago. The first support level on the horizon looks to be the 50% retracement level of the short-term move, which should coincide with the 200 hr moving average in the very near term.

JPY Making a Push Posted: 20 Aug 2009 06:13 PM PDT The Yen has caught a bid to open trading in the far east as yields on treasuries fall and equities trade lower. On a short-term perspective of the EUR/JPY we see the pair approaching the 100 hr moving average as it broke the trendline. A break here could lead us toward the lower end of the 132 handle.

China News Update Posted: 20 Aug 2009 05:53 PM PDT Former PBoC member and economist Yu Yongding says that the  Bank of China should try to reduce its level of intervention on the exchange rate as much as possible.  Eventually the Yuan should be demanded as a reserve currency, but they are far away from this stage.

US News Update from Jackson Hole Wyoming Posted: 20 Aug 2009 05:47 PM PDT The University of Harvard’s Feldstein commented during a CNBC interview that it would be a mistake for the Fed to raise rates at now with unemployment expected to continue to rise and disposable personal income falling. Former Fed Governor Mishkin commented that he feels strongly that Bernanke needs to be reappointed. Fed’s Hoeing commented that the Fed has addressed much of the crisis, but the focus now falls on how to proceed forward in removing the stimulus at the right time. He added that the mood at this year’s Jackson Hole conference is the worst is behind us.

NZD Visitor Arrivals m/m Posted: 20 Aug 2009 03:47 PM PDT The New Zealand Visitor Arrivals (MoM) came out at 3.9%; much better than its prior release of -3.8%. The market had little to no reaction to this number as the Kiwi trades off session highs against the USD and is currently trading at .6771.

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