Forex Market Updates & Commentary

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• New Home Sales rise stronger than expected
• Univ of Michigan Final estimate rises to 67.4
• Nov 25 2009 Forex Market Update
• Dec 01 2009 FXDD Online Training Register Here
• USDCHF trades below parity but rebounds as profit takers enter.
• Durable Goods weaker, Income up more than spending,Initial Claims fall
• USDJPY moving lower. Yen crosses get hit as well.
• Nov 24 2009 RE-BROADCAST of FXDD Online Training
• Dollar tumbles (EURUSD rises) overnight as Gold rises, Fed comment hangover, and other news weighs
• Bobbys Corner-Open Market-Nov.25.2009
• US Durable Goods Orders, Personal income/spending, Initial Claims, etc due out this morning
• Bundesbank’s Kotz on the wires…
• UK Revised GDP (q/q)
• Italian Retail Sales
• GfK German Consumer Climate

New Home Sales rise stronger than expected Posted: 25 Nov 2009 07:03 AM PST The the New Home Sales rose to a 430K annualized pace. This like the existing home sales seems which was also up strongly.  This may have been helped by the uncertainty from the 1st time home buyers incentive which was scheduled to expire in November. It was subsequently extended by the Obama administration.  The month supply fell to 6.7 months from 7.4 months.  This is down sharply from the 9.5 month supply from May. This suggests the supply is coming back in line as builders get rid of inventory. It has come at a cost, however, as the median sales price has moved down from over $260,000 in March 2007 to the current level at around $212,000

Univ of Michigan Final estimate rises to 67.4 Posted: 25 Nov 2009 06:56 AM PST The estimate was 67.  This is up from 66. The EURUSD has rebounded a bit off the better than expected data - although the upward momentum for the series has seemed to have stalled.

Nov 25 2009 Forex Market Update Posted: 25 Nov 2009 06:30 AM PST Click here to view the embedded video.

Dec 01 2009 FXDD Online Training Register Here Posted: 25 Nov 2009 06:29 AM PST REGISTER for the FXDD Online training on Tuesday DEC 01 2009 Here

USDCHF trades below parity but rebounds as profit takers enter. Posted: 25 Nov 2009 05:59 AM PST   The USDCHF has moved to parity versus the US$ on the back of the lower dollar (LOW reached the 0.9993). The USDCHF has not been this low since April 2008.  SNBs Roth comments were a little more positive yesterday which has helped the CHF.  We warned about this yesterday in our comments and indeed the market obliged with a move to the downside (CLICK HERE FOR THE POST).  The market may now be testing the Swiss National Banks patience, however, the EURCHF remains near 1.5100 which is likely to be their main concern.  As a result, they may be more tolerant of the decline against the US$ and not look to intervene. With the price back above the 1.000 level now at the 1.0005 level, a new break will be needed to push the price down further for the pair obviously. Resistance comes in at the 100 bar moving average on the 5 minute chart at the  1.0036 currently and the 1.0045 which is the 38.2% of the move down from yesterdays NY high to the low today.  Look for sellers against these levels.

Durable Goods weaker, Income up more than spending,Initial Claims fall Posted: 25 Nov 2009 05:36 AM PST The Durable Goods orders were worse than expectations at -0.6% for the headline and -1.3% for ex trans. The prior month was revised higher to 2.0% from 1.4% but overall the data was weak post the cash for clunker program.  The Initial Claims fell more than expected to 466K . This was the lowest level since September 2008.   This is better news for the labor market.   The Continuing Claims also fell 5.423 million, a decline of 190,000.  This is the 10th straight weekly decline and also suggests an improving employment picture.  The USDJPY rose off the data rising to to 87.67.   The USDJPY has additional resistance at the 87.83 level, the 100 hour MA at the 87.96 level currently and falling,  and of course the 88.00 level.  On the downside, the low at 87.38 and the 87.11/13 level should now provide support.   The better Initial Claims are countering the weaker Durable Goods and it seems and traders are covering some shorts. Some pressure is off the dollar for the time being - at least versus the USDJPY.  However, the upside levels still need to be breached to confirm the bottom.

USDJPY moving lower. Yen crosses get hit as well. Posted: 25 Nov 2009 05:33 AM PST The USDJPY continued its move lower and broke through the 88.00 level.  The price tracked lower in early trade, consolidated, tested the 100 bar MA on the 5 minute chart, and chose the downside.  The price was aided by comments out of Japan from the former lead foreign exchange advisor, Eisuke Sakakibara who said the USDJPY could fall to a level of 85.00.  The 88.00 level provided little in the way of support and the move to the downside continued.  The price has just reached a new low of 87.38. There is good support down at the 8711/13 level where lows from Dec 18 and Jan 21 2009 are found.

Nov 24 2009 RE-BROADCAST of FXDD Online Training Posted: 25 Nov 2009 05:13 AM PST Watch the Nov 24 2009 Training HERE Sign up for the Dec 1st 2009 FXDD Training - REGISTER HERE

Dollar tumbles (EURUSD rises) overnight as Gold rises, Fed comment hangover, and other news weighs Posted: 25 Nov 2009 04:56 AM PST The Feds comment in the meeting minutes about the dollars orderly decline started to gnaw at traders bearish bias.  This couple with some news out of China that they were reaccessing their forex policy and stimulus measures, that Russia was looking to move funds into the Canadian dollar, that Eisuke Sakakibar, formally Japan’s lead foreign exchange official, was cited as saying in a CNBC interview that the US dollar may fall against the Yen to perhaps the 85 level and that there was additional reports of interest from global nations to purchase gold from the IMF.  All of which has led to an assault on the US dollar.  The EURUSD started the day toeing the 100 bar MA line on the 5 minute chart and tracked higher, using the moving average line as support before breaking away from the line (blue line in the chart above) to the upside.  Along the way the price broke through resistance at 1.5000,  the 1.5017-20 area, and the recent high of 1.5047 and the 2009 high of 1.5062 on its way to the high of 1.5095.  The 1.5062 is now support for the pair.  The upside does not have much in the way of resistance going back to 2008 levels.  There are some lows at the 1.5140-45 level from Feb/Mar 2008, before the market started another leg to the upside that culminated in the EURUSD reaching its all time high price of 1.6019.  The chart below shows that period where the market last moved above the 1.5000 level from Feb to August 2008.     The bias is up.  The gains may consolidate,however, until the old high of 1.5062 is breached on the downside, the upside is still favored for the pair, but look for buyer on dips.  It is the day before Thanksgiving but with the dollar under assault, that is not the focus (at least until this afternoon).  Also although the US is off tomorrow, the rest of the world does work and the damage to the dollar is coming on the heals of action overseas not here.

Bobbys Corner-Open Market-Nov.25.2009 Posted: 25 Nov 2009 04:49 AM PST Good Morning: The USD weakened again, as investors show concern for the Feds lack of concern over the decline of the greenback. The Aussie rose along with commodities, as evidence shows that global economies are gaining traction, and are starting to rebound from the global recession. World equity markets rose, and US Futures are pointing to a higher opening on Wall Street this morning. The weak dollar not only boosted equity markets, but also pushed gold to a new record  price. Oil:$76.60                   Gold:$1179.70 Today’s Data: Durable Goods          exp: .5%              prior: 1.0% Jobless Claims          exp: 500K          prior: 505K  Pers Income:             exp: .1%              prior: 0.0  U of Mich Conf:        exp: 67.0           prior: 66.0 New Home Sales:     exp:404K           prior: 402K HAVE A GREAT DAY & GOOD LUCK

US Durable Goods Orders, Personal income/spending, Initial Claims, etc due out this morning Posted: 25 Nov 2009 04:12 AM PST Well, the US market won’t be going anywhere early this morning as a full calendar of economic releases are on tap.  Below is a quick rundown: Durable Goods Orders: Exp +0.5%, Ex Trans +0.7%.  Last month +1.4% and 1.2% respectively.  The estimate is for a gain of 0.5% and +0.7% for ex Transportation.   Four of the last 6 months have showed gains.  Durable Goods will tend to get a boost as sales of homes increase.  There has been a resurgence of existing home sales which have helped this sector.  Personal Income and Personal Spending:  Personal Income is expected to rise by 0.1% vs 0.0% last month. Personal Spending is expected to rise by 0.5% vs -0.5% decline last month.  Also released with the data is the savings rate.  Last month the savings reate rose to  3.3%.  However, it has been moving in a volatile fashion over the most of 2009.  Nevertheless, what you earn you can spend.  This month the expectation is people will be spending more than they earned.  This should decrease the savings rate. Nevertheless consumption account for 2/3 of US GDP so  the trend of spending is important (but will it last?).  Initial Claims and Continuing Claims: The weekly initial claims data comes out a day early due to the holiday tomorrow in the US. The expectation is for a slight fall to  500 k from 505K last week.  The Cont. Claims are expected to continue its fall to 5565K from 5611 K last week. This measure has fallen for 9 straight weeks from 6160 to the current level of 5611. PCE Core and PCE Deflator for October is also due at 8:30 AM. The expectation is for the MoM Core measure to show a gain of 0.1% vs 0.1% last month. The YoY is expected to rise to 1.4% from 1.3%. The PCE Deflator is expected to show a gain of 0.1%  vs a decline of -0.5% last month.  The Core PCE is the change in price in goods and services ex food and energy.

Bundesbank’s Kotz on the wires… Posted: 25 Nov 2009 04:09 AM PST Bundesbank’s Kotz has made the following comments this: German banks may lose further: EUR75 bln in loans Financial markets have recovered significantly Sees “perceptible” improvement in growth outlook. Says crisis can “by no means” be considered as over. ECB will use exit measure ‘when the time is ripe”. Kotz says EUR exchange rate isn’t a problem. German recovery is dependent on net trade. Competitiveness is more important now. German banks may lose another 90 bln euros.

UK Revised GDP (q/q) Posted: 25 Nov 2009 02:16 AM PST Revisions for UK third quarter GDP came in as expected.  The GBP, which has been on a steady climb against the USD during the session, went offered on the release. The details are as follows: GDP (QoQ) - Survey: -0.3%   Actual: -0.3%   Prior: -0.4% GDP (YoY) - Survey: -5.1%   Actual: -5.1%   Prior: -5.2% Private Consumption (3Q) - Survey: -0.2%   Actual:   Prior: -0.6% Government Spending (3Q) - Survey: 0.5%   Actual:   Prior: 0.6% Gross Fixed Capital Formation (3Q) - Survey: -3.3%   Actual:   Prior: -5.2% Exports (3Q) - Survey: 1.4%   Actual:   Prior: -1.4% Imports (3Q) - Survey: 2.0%   Actual:   Prior: -2.2% Index of Services (3mth/3mth) - Survey: -0.1%   Actual:   Prior: -0.1%

Italian Retail Sales Posted: 25 Nov 2009 01:02 AM PST September retail sales in Italy came in worse than expected monthly and better than expected year over year; the market showed a limited reaction to the data. The details are as follows: Retail Sales (MoM) - Survey: 0.1%   Actual: -0.1%   Prior: -0.1% Retail Sales (YoY) - Survey: -2.9%   Actual: -1.6&   Prior: -2.9%

GfK German Consumer Climate Posted: 24 Nov 2009 11:07 PM PST The GfK Consumer Confidence Survey for December came in at 3.7; worse than its forecast and prior release of 4.0. Upon this release the EUR popped above the 1.5000 handle pushing the high of the session to 1.5005 and has since settled back down to 1.4997.

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Forex Market Updates & Commentary

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• Richmond Fed comes in at +1 versus expectation of +8. Consumer Confidence better than expectations.
• November 24th 2009 FXDD Morning Forex Video is available for viewing
• Case Schiller Home Price Index comes in a little worse than expectations. GBPUSD comes down after testing the 1.6600 level.
• USDJPY falls as risk aversion leads to a flight into the JPY
• GDP comes in as expected at +2.8%. Consumption revised lower. Government up. Net Trade a negative and Investment also subtracts in the revision.
• GBPUSD suffers on the back of King comments but bounces as NY enters
• Bobbys Corner-Open Market-Nov.24,2009
• EURUSD moves up on NY buying as the market awaits the GDP data
• S & P Case Schiller due at 9:00. Consumer Confidence and Richmond Fed Man. Index comes out at 10 AM
• US GDP due out at 8:30 AM. A decline to +2.8% Annualized is expected.
• Eurozone Industrial Orders above estimates
• BOE Inflation Report; King inflation due to rise
• UK Economic Data
• German IFO
• Swiss Employment Level

Richmond Fed comes in at +1 versus expectation of +8. Consumer Confidence better than expectations. Posted: 24 Nov 2009 07:00 AM PST This is worse than expected while Conference Board Consumer Confidence comes in better at 49.5 vs 47.3.

November 24th 2009 FXDD Morning Forex Video is available for viewing Posted: 24 Nov 2009 06:53 AM PST Click here to view the embedded video.

Case Schiller Home Price Index comes in a little worse than expectations. GBPUSD comes down after testing the 1.6600 level. Posted: 24 Nov 2009 06:13 AM PST The expectations was for a -9.10 decline.  It came in at -9.36% for the top 20 cities. The dollar has improved a little off the release. with the EURUSD and GBPUSD back down a bit.  The GBPUSD reached a high of 1.6595 off the GDP data, finding sellers against the 1.6600 level.  The market simply finds that level to sell against or buy above.  There should be support against the 200 bar moving average on the 5 minute chart at 1. 6563 level.  Watch this level this morning for momentum clues.  A break below should lead to further pressure with downside confirmation on a break of the 100 bar MA at the 1.6544 level.   A move above the 1.6600 level targets the high for the day at 1.6617. Be patient today.

USDJPY falls as risk aversion leads to a flight into the JPY Posted: 24 Nov 2009 06:07 AM PST The USDJPY has moved to new lows on the back of the weaker GDP data. The price broke through the 88.56 low from yesterday and has moved to a low of 88.34. The 2009 low comes in at 88.00. This is the next target for the pair.  Risk aversion is helping to contribute to the losses.  The USDJPY has been in a narrow trading range over the last week.   The price yesterday broke briefly above the 100 hour MA for the first time since  November 13th. However, the momentum quickly reversed as resistance against 89.17 held.  This helped pave the way for the move lower overnight.  The pair will likely be influenced by what equities do this morning.  The S & P futures are showing a small gain of 2.3 while the Nasdaq is down  1 point. Dow futures are up 11 points currently before the opening at 9:30  Look for the target at 88.00 to find buyers against the level.  ON the topside, the 88.65 level where the 100bar MA on the 5 minute chart is found, should provide upside resistance.  The price has been tracking below the 100 bar MA for most of the trading day today.   As long as the price remains below this level, the bias is down for the pair.  The caveat is when the price moves toward the 88.00 level. I would expect profit takers to enter the market on dips toward that level.

GDP comes in as expected at +2.8%. Consumption revised lower. Government up. Net Trade a negative and Investment also subtracts in the revision. Posted: 24 Nov 2009 05:41 AM PST The revision to the GDP came in at +2.8% from +3.5% originally reported.  Personal Consumption on an annualized basis fell to 2.9% from 3.4%. The expectation was for a decline to 3.2%.  This contributed 2.07% to the 2.8% total gains.  Private investment contributed 0.91% (vs prior estimate of 1.22%).  The Net Exports subtracted -0.83%  which originally showed a decline of -0.53 and Government contributed 0.63% of the 2.8% gain.  In the initial report, this sector added 0.48%.  The Change in Inventories (which is a part of investment) contributed 0.87% to the overall +0.91% from total private investment.  It is expected that inventory replenishment will help growth going forward in the 4th quarter. Motor Vehicle purchases was responsible for 0.81% growth in the 3rd quarter. The cash for clunker program was a help to this in the 3rd quarter.   Governement is doing their part. One would think that with a lower dollar the Net Export contribution would be a positive for growth (or at least less of a negative as the US does continue to run a deficit from trade). However, the decline is indicative of the reliance on foreign goods and in particular the reliance on oil imports.  Imports alone contributed -2.53% to GDP while exports added 1.71%. Until that time when reliance on oil is decreased (or demand falls), the US will continue to have net trade issues and this will continue to be a negative for growth.

GBPUSD suffers on the back of King comments but bounces as NY enters Posted: 24 Nov 2009 05:30 AM PST The GBPUSD was down for most of the day on the back of a more negative assessment of the economy by Bank of England Governor Mervyn King.  The comments helped fuel expectations that additional quantitative easing measures might be needed down the road. This always tend to weaken the currency in question.  The market has rebounded from the low of 1.6496 as NY buying pushed the price up to 1.6590. The 1.6600 level once again has put on lid on the gain.  Going forward, look for resistance against the 1.6600 level.  A move above targets the 38.% retracement level and the 100 hour moving average  at the 1.6618 and 1.6630 level respectively. On the downside look for support at the 1.6543 level where the 100 bar MA on the 5 minute chart is found.

Bobbys Corner-Open Market-Nov.24,2009 Posted: 24 Nov 2009 05:16 AM PST Good Morning: The Euro gained overnight as the IFO survey of business sentiment data from Germany printed better than expected. The marketplace feels that the ECB will keep interest rates at the 1% level thru most of 2010.  Asian equity markets were lower, and European stocks are higher at this time.  US Futures are pointing to a higher opening this morning.   Banks stocks are weaker as speculation mounts that they are still in need of more capital. US Treasury markets is little changed. Oil:$77.44                            Gold:$1169.00 Today’s data: GDP-Q3                          exp: 2.9&              prior: 3.5% Case/Shiller:               exp: -9.2%            prior: -11.32% Cons Conf:                   exp:  47.5              prior; 47.7 Rich Fed:                     exp: 9.0                  prior: 7.0 2:30 PM- Minutes of FOMC Nov 4 meeting HAVE A GREAT DAY & GOOD LUCK

EURUSD moves up on NY buying as the market awaits the GDP data Posted: 24 Nov 2009 05:03 AM PST NY came in and took the EURUSD up 30 pips as the market awaits the US GDP data at 8:30 AM.  The move has culminated a down and up day so far that started with the pair  falling steadily to a low of 1.4888 before bouncing back higher - taking out the old high for the day at the 1.4970 on it’s way to the new day high of 1.4984.  German IFO data was better than expectations and EUROZONE Industrial Production also was better than expectations earlier today and helped contribute to the gain.  The overriding trend continues to have the pair flucuating with a 1.4800 to 1.5000 levels as the rough low to high range. From a technical basis, the hourly chart shows the up and down activity over the last week or so.  The movement has the 100 and 200 hour moving averages converged at the 1.4919 area and the 50% midpoint of the recent 1.5047 to 1.4801 range coming in at the 1.4924 level.   When the price broke below these moving averages earlier, momentum pushed the price to the low at 1.4888.  The climb back higher found initial resistance at the level, but was able to push through.  From that point, the market climbed above the 100 and 200 bar on the 5 minute chart - giving bulls the go ahead for further gains. The last spurt higher takes the price back up toward the 1.5000 level where yesterdays high was reached.  Above that level is resistance at 1.5015 and 1.5047. Through the number look for support at the 1.4945 to 1.4937 area where the 200 bar moving average (green line) and the 100 bar moving average on the 5 minute chart are found (blue line in the 5 minute chart above).  Below that the 1.4919 level once again should provide support. On the topside until the price breaks 1.5000, 1.5015 and 1.5047 nearly any price level between those values has the potential to stall the upside.

S & P Case Schiller due at 9:00. Consumer Confidence and Richmond Fed Man. Index comes out at 10 AM Posted: 24 Nov 2009 04:40 AM PST The monthly S & P Case Schiller Home Price index is due at 9:00 AM. The expectation is for a YoY decline of -9.10% from -11.32%.  This release shows the YoY decline in prices for the top 20 housing markets in the US.  The Conference Board Consumer Confidence for November will be released at 10 AM. The expectation for this release is for the index to decline to 47.5 from 47.7.  The index reached a low of 25.30 in February 2008. Since that time the release has moved higher in a up and down pattern   Also at 10 AM, the Richmond Fed Manufacturing index will be released. The Philly Fed Index was releassed last week better than expectations. The Empire Manufacturing index was released earlier and that came in worse than expected.  The Richmond Fed index is expected to show a small gain to 8 from 7.  The index reached a low of -55 in December 2008.  The recent peak was 14 in July, August and September.  Last month the index declined to 7.

US GDP due out at 8:30 AM. A decline to +2.8% Annualized is expected. Posted: 24 Nov 2009 04:12 AM PST   At 8:30 AM the US GDP for the 3rd quarter will be released. This is the second cut of the number, with the first estimate coming in at +3.5%.    That estimate was based on uncomplete data. This release will include such things as the Trade Balance data for September which was released on November 13th and showed a larger deficit. A larger deficit is a negative for GDP.  As a result, Net Exports will help contribute to a decline in the first estimate.  The expectation is for a decline to a gain of +2.8% from the original estimate of 3.5%. In addition to a negative effect from trade, Personal Consumption data - the largest component of GDP -  is also expected to be revised lower to + 3.2% from +3.4% on an annualized basis.  The GDP Price Index is expected to show a gain of 0.8% which is unchanged from the initial report.  Finally the Core PCE QoQ is expected to show a rise of 1.4% also unchanged from the prior release.  The release can be quite volatile as it will also include pieces for government and investment (i.e.  business investment, residential purchases, inventories go in this component piece).  It also includes inventories which in the first release contributed 0.94% to the GDP. Of the pieces which make up the 3.5% GDP, Personal Consumption contributed the most on an annualized basis. Below is breakdown on how much each component contributed to the 3.5% annualized GDP figure: Personal Consumption: +2.36% (67%) Gross Private Domestic Investment +1.22% (34%) Net Exports -0.53% (-15%) Governmant Consumption +0.48% (14%) The US GDP is presented on a Annualized Basis.  That is it takes the quarter on quarter change and annualizes that change.  So it tends to have more of an impact in the newspaper headlines.  That is, the 1st and 2nd quarters can show a decline but the 3rd quarter rebounds and the release shows a growth rate of 3.5% on the nightly news.  The true GDP growth for the year of 2009 is of course less once you factor in the declines in the 1st and 2nd quarter and annualize that value.     Most other country GDP releases are presented on a quarter on quarter change basis.   The Eurozone GDP estimate for example showed a gain of +0.4% for the quarter.

Eurozone Industrial Orders above estimates Posted: 24 Nov 2009 02:05 AM PST Eurozone Industrial Orders m/m came in at 1.5%, stronger than the 0.7% expected but weaker the prior reading of 2.0%. Eur/Usd received a small boost upon release as the pair trades above 1.4940. Eur/Gbp buyers also help strengthen Euro across the board, the pair is currently at its session high of .9050.

BOE Inflation Report; King inflation due to rise Posted: 24 Nov 2009 02:00 AM PST BOE Governer Mervyn King states that inflation is due to rise above 2.0% in short run and says spare capacity will continue to drag on inflation. The MPC has taken unprecedented actions to curb the the situation, according to King. King is encouraged by signs of recovery, but feels UK economy faces profound challenges. King says UK faces significant slack margin which should pull down inflation. King says a ‘credible plan’ needed to curb budget deficit.

UK Economic Data Posted: 24 Nov 2009 01:36 AM PST UK BBA Mortgage Approvals came in at 42,238, less than the estimated 44,000. Preliminary Business Investment q/q came in at -3.0%,  stronger  than the -3.5% expected. Not much change in GBP as the market awaits the Inflation Report Hearings out in about 15 minutes.

German IFO Posted: 24 Nov 2009 01:07 AM PST German IFO Business Climate came in at 93.9, stronger than the 92.5 estimate and 91.9 prior reading. German IFO Current Assessment came in at 89.1, stronger than the88.0 estimate and 87.3 prior reading. German IFO Expectations came in at 98.9, stronger than the 97.3 estimate and 96.8 prior reading. Strong numbers for the euro as we have seen gains against the Usd and Jpy on heels of release. Eur/Usd traded up to 1.4935 and Eur/Jpy 132.43. eur/Usd has given back some gains, currently trading at 1.4925 and eur/Jpy at 132.35.

Swiss Employment Level Posted: 24 Nov 2009 12:21 AM PST The Swiss Employment Level came in as expected at 3.96M which is an increase of 10,000 from last quarters reading. Usd/Chf currently trades at 1.0143 and Eur/Chf at 1.5115, unchanged from pre-release.

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Forex Market Updates & Commentary

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• US Existing Home sales rise higher than expected
• Nov 23th 2009 Forex Market Update
• $GBPUSD moves higher with lower dollar. Tough resistance at the 1.6668-71 level approaches.
• ECB Trichet speaking on newswires. Reiterates comments made over the weekend
• Canada Retail Sales better than expectations. USDCAD moves lower but holds the double bottom.
• $EURUSD boosted today by differing quantitative easing opinions and Gold
• Bobbys Corner-Open Market-Nov.23.2009
• Canada Retail Sales and US Existing Home Sales due this morning
• Eurozone PMI
• Eur/Usd finds resistance at Nov 18 high (1.4992)
• Sterling trading at 61.8% Fibo
• Usd/Jpy trades below Nov. 19 low (88.62)
• Gbp/Usd has started retracing Friday’s slide
• 11-23 Economic Calendar

US Existing Home sales rise higher than expected Posted: 23 Nov 2009 07:04 AM PST The US Existing Home Sales rose to an annualized sales rate of 6.1 million units. This is the highest sales pace since February 2007.  The months supply fell to 7 months which is the lowest months supply since also February 2007.  Last month the month supply was at 8.0 months.  The high reached 11.3 months.  A normal market is around 5-6 months.  The Median Sales Price fell to $173,100. The gain was a 10.1% gain from last month.   Lower prices and the $8000 incentive was cited as the reason for the increase.  The report is positive. However, the market continues to be supported by the selling of foreclosed or distressed properties which accounted for 30% of all sales.

Nov 23th 2009 Forex Market Update Posted: 23 Nov 2009 06:45 AM PST Click here to view the embedded video. Sign up early and secure your spot. FXDD’s Next Online Training will be on Tuesday Nov 24th 2009 4PM - REGISTER HERE

$GBPUSD moves higher with lower dollar. Tough resistance at the 1.6668-71 level approaches. Posted: 23 Nov 2009 06:36 AM PST The GBPUSD has moved sharply higher with the lower dollar today. The price is approaching a key resistance level however at the intersection of the 100 and 200 hour MA and the 50% Retracements of last weeks sharp decline. That resistance level comes at the 1.6668 to 1.6671 level.  This level is the next target for the pair and should provide good resistance/profit taking sellers as the level is approached, with stops on breaks above the key level.  On the downside, the 1.6600 level continues to be a level the market is interested in following.  The 38.2% retracement level of 1.6618 will also be a level to watch for support today. Looking at the shorter term 5 minute chart, the 100 bar MA (blue line in the chart below) is currently at the 1.6601 level and gives another reason for support on dips below. The price originally moved up strongly after using the 100 bar MA as a springboard on the downside in Far East trading.  The moving average has followed the trend move higher. A break of it, would be a signal the trend is consolidating and/or possibly reversing.

ECB Trichet speaking on newswires. Reiterates comments made over the weekend Posted: 23 Nov 2009 06:00 AM PST He comments that the ECB will continue to deliver price stability.  That the crisis has debilitated the real econonomy but there are signs of stabilization. He notes that the ECB will phase out the non standard measures slowly (this reiterates comments this weekend) but comments that ECB rates are currently appropriate. The EURUSD has moved up slightly on the comments but resistance at the 1.5000 level remains.  From a technical perspective the price has moved back away from the 100 bar MA on the 5 minute chart at the 1.4966 level currently. This is bullish for the pair intraday.

Canada Retail Sales better than expectations. USDCAD moves lower but holds the double bottom. Posted: 23 Nov 2009 05:44 AM PST The Canada Retail Sales were much better than expectations as it rose by 1.0% and +1.1% ex Autos versus expecations of +0.6% and +0.4% respectively.  Moreover, the prior months were revised higher to +1.0% and +0.7%.  The better data has led to a lower USDCAD (higher CAD$).  However, the lows for the day have held (double bottom at 1.0558).  Just prior to the release the price spiked higher but reversed. The pair should continue to be pressured with the combination of a weaker dollar and strong economic fundamentals from Canada.  Confirmation of the downside would come from a breaking of the double bottom at the 1.0558 level (see chart below).  On the topside, the bearish bias shifts if the price moves above the 100 hour moving average at the 1.0595 level (see blue line in the chart above).  In addition the 100 bar MA on the 5 minute chart is moving down toward this level which makes the level a key level for the bears. As a result, we should see sellers against this level on rallies.

$EURUSD boosted today by differing quantitative easing opinions and Gold Posted: 23 Nov 2009 05:29 AM PST Jean Claude Trichet announced over the weekend that the ECB is lightly tightening the eligibility criteria of the Asset Backed Securities it will accept as collateral at liquidity tenders next year.  This is a step toward unwinding the emergency policies it initiated in response to the financial crisis.  Meanwhile, the St Louis Fed President Bullard was on the wires say he favored extending the Feds Mortgage Backed Securities buying program.  Bullard is currently not a voting member on the FOMC but will be one starting in January. The combination of one decreasing (ECB) and one increasing (the Fed) sent the dollar lower against the EURO.   Sharply higher Gold is also benefitting the trend today (up $16 to a new record price). From a technical perspective, the price moved back toward the 1.5000 level, stopping at the 1.4990 level.  This was the same high reached last Wednesday.  The high from last week reached 1.5015 on Monday, but that spike higher was short lived. Last week, the price moved up and down with activity centered around a low around 1.4800 and a high at 1.5000.  The pair is contained by these two extremes.  The trading activity lends itself nicely to range trading as intraday, the pair had nice trend type moves.  Trading a trend longer than that has not panned out. As a result, paying attention to the 5 minute chart and the key moving averages has been the way to go. Looking at that chart, the price today consolidated in early Far East Trading, but after reaching a bottom of 1.4832, the upswing ensued. The price moved in between the 100 and 200 bar MA for an hour or so, and then broke higher.  The gains were pretty steady to the upside until the price reached the upside target from last weeks highs.  The pair has consolidated for the last 5-6 hours and now looks to test the 100 bar MA once again at the 1.4963 level.  The market is at a crossroad.  Does it look to extend higher using the moving average as a springboard higher, or does it correct lower toward the 1.4929 level where the 200 bar and the 38.2% retracement level is currently located (the 200 bar MA is rising so be aware of the moving support target).

Bobbys Corner-Open Market-Nov.23.2009 Posted: 23 Nov 2009 05:19 AM PST Good Morning: The USD and JPY are weaker this morning as  indications continue that worldwide central banks will keep interest rates low to help spur global economies, as the worst recession since World War 2 retreats.  Statements from various Fed Presidents have indicated that interest rates will stay low until 2010-2011.  This will keep the USD under pressure for the immediate future.  World equity markets rose.  US Futures are alos higher this morning. Gold reached another record overnight ($1067.88), and Copper reached a 14 month high. Oil:$78.46                            Gold:$1064.20 Today’s Data: Existing Home Sales:      exp: 5.7M          prior: 5.57M HAVAE A GREAT DAY & GOOD LUCK

Canada Retail Sales and US Existing Home Sales due this morning Posted: 23 Nov 2009 04:51 AM PST   As we enter the US Thanksgiving Day week (on Thursday), the economic calendar will start with the Canadian Retail Sales report which will be released at 8:30 AM.  The expectation is for a gain of 0.6% with Ex Auto sales coming in at +0.4%.  The Canadian Retail Sales have been improving 2009 as the global economy improves.  Gas station sales have helped the sales over the last 3 months with a 21.8% annualized gain.  However, over the same time period strong gains in pharmacy sales (+13%), Building Supplies (+3.9%) and Furniture and electronics (+3.1%) have also led to gains in ex auto sales increases in 3 of the last 4 months. At 10:00 AM this morning, the US Existing Home Sales for the month of October will be released. The expectation is for the annualized sales pace to rise to 5.7 million units. This is up from the 5.57 million pace last month and would represent a 2.3% MoM gain.  Be careful in interpreting the MoM % gain as there is usually a revision to the prior month that can skew the figures.  So watch the annualized rate to gauge the strength or weakness of the report.  A sales pace of 5.7 million would be the highest since July 2007.  The 1st time homeowners rebate program is helping sales - especially in the low price range.  Also released with the annualized sales pace is the months supply of homes on the market.  Last month, the supply of homes fell sharply to 7.8 months which is the lowest supply since March of 2007.  A movement lower would be good news for the housing market.  Watch this number. There is no estimate for this figure.

Eurozone PMI Posted: 23 Nov 2009 01:33 AM PST Eurozone Flash Manufacturing PMI came in at 51.0, slightly weaker than the 51.3 expected but stronger than the 50.7 prior reading. Earlier French Man. PMI fell short of estimates by 1.3 and German Man. PMI beat estimates by 0.4 thus the market was expecting a relatively flat reading. Eurozone Flash Services PMI came in at 53.2, stronger than the 52.7 expected and 52.6 prior reading. Earlier French Services PMI beat estimates by 2.7 and German beat the number by 0.5 so a positive reading was expected. Not much market reaction to figures as Eur/Usd has begun to pullback from earlier highs, now trading at 1.4975.

Eur/Usd finds resistance at Nov 18 high (1.4992) Posted: 23 Nov 2009 12:57 AM PST Eur/Usd has run up some 160 points from Sunday’s opening and currently is making a push towards 1.5000. The session high has been 1.4990 thus far and my guess is this may be a level of resistance coinciding with Nov. 18 highs. A break above should bring pair to 1.5015-20 level. If it holds look for a pullback to 1.4945-50 level.

Sterling trading at 61.8% Fibo Posted: 23 Nov 2009 12:37 AM PST Sterling is trading at the 61.8% Fibo of Friday’s high of 1.6674. Gbp/Usd is firming up as session moves on and the retracement that we soke of in previous post has been varified by the market. A clean break above 1.6592 should lead the pair up to short term resistance at 1.6634. If the 61.8% Fibo holds a pullback to 1.6567 is likely.

Usd/Jpy trades below Nov. 19 low (88.62) Posted: 22 Nov 2009 11:42 PM PST Usd/Jpy has made a new low of 88.56, below Nov. 19 low of 88.62. It has since rebounded slightly and currently is trading at 88.64. If the pair can hold above a move back to the 88.80-85 level is likely. There is not much support for the pair below 88.62 thus a clean break can bring the pair down to 88.00 - 10.

Gbp/Usd has started retracing Friday’s slide Posted: 22 Nov 2009 10:18 PM PST Gbp/Usd is trading at the 38.2% Fibo retracement (1.6541) of Friday’s high of 1.6674. If the pair can break above 1.6541 the next level to keep an eye on is the 50% fibo at 1.6567. If the pair stays below 1.6500-05 should lend light support. It is also interesting to note that the 200 hour M/A lies at 1.6676, a shade above Friday’s high of 1.6674. For longer term bulls this could be a target if the pair moves higher.

11-23 Economic Calendar Posted: 22 Nov 2009 09:03 PM PST

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