Month: June 2009

By GCI Fx Research

€

The euro came off vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.4000 figure and was capped around the $1.4150 level.  Three main factors contributed to the sell-off in the common currency.  First, EMU-16 May M3 money supply growth registered a twelve-year low with growth in loans to the private sector slowing to +1.8% from +2.4% in April.  Overall credit growth decelerated to +4.0% from +4.4% in April.  These data suggest that the fiscal and monetary stimuli being created in the eurozone are not reaching companies and consumers with banks apparently hording a lot of the liquidity.  Second, EMU-16 consumer prices were off year-over-year in June, the first negative reading since at least January 1997.  Eurozone CPI was off 0.1% y/y but this decline was less than expected and was anticipated by the European Central Bank on account of base year effects. Furthermore, the ECB is forecasting consumer price inflation costs will begin to rise again by the end of the year.  Nonetheless, today’s data suggest the ECB will not necessarily be in any hurry to lift borrowing costs further.  Third, Germany’s labour market continued to weaken this month with the number of jobless now around 3.410 million and the unemployment rate at 8.3%.  Some economists believe the number of unemployed workers may eclipse the politically-sensitive 4.0 million barrier by the end of 2009.  In U.S. news, many economic data were released. First, June consumer confidence printed at 49.3, down from a revised 54.8 in June and worse than expected.  Second, the June Chicago Purchasing Managers’ index improved to 39.9 from 34.9 in May with improvements in the production, inventories, employment, and prices paid sub-indices.  Third, the S&P/ CaseShiller home price incex fell to 139.18 in April from a revised 139.97 in March with composite home prices off 18.12% y/y from a revised -18.72% y/y in March.  The big news in the U.S. this week will be the June non-farm payrolls data that will be released on Thursday.   Euro bids are cited around the US$ 1.3435 level.

¥/ CNY

The yen depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the ¥96.50 level and was supported around the ¥95.30 level.  Prime Minister Aso reported Bank of Japan’s monetary policy is not as effective during a recession where there are deflationary pressures evident.  Finance minister Yosano said one cannot assume bond yields will remain this low, especially when drafting the budget for the next fiscal year.  Yosano added the budget ceiling for the next fiscal year will be a record ¥52.7 trillion and said the impact of fiscal and monetary stimuli on the Japanese economy are not fully known.  Additionally, Yosano said the government is significantly concerned about unemployment.  It was reported overnight that the May unemployment rate ticked up to 5.2% from 5.0% in April while May household spending were up +0.3% m/m and off 1.3% y/y. Moreover, May overall housing starts were down a drastic 30.8% y/y and total May construction orders were off a staggering 41.9% y/y to ¥454.8 billion.  The Nikkei 225 stock index climbed 1.79% to close at ¥9,958.44.  U.S. dollar offers are cited around the ¥104.15 level.  The euro weakened vis-à-vis the yen as the single currency tested bids around the ¥134.35 level and was capped the ¥135.95 level.  The British pound moved higher vis-à-vis the yen as sterling tested bids around the ¥158.20 level while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥88.10 level. In Chinese news, the U.S. dollar moved lower vis-à-vis the Chinese yuan as the greenback closed at CNY 6.8295 in the over-the-counter market, down from CNY 6.8325.

₤

The British pound depreciated vis-à-vis the U.S. dollar today as cable tested bids around the US$ 1.6420 level and was capped around the $1.6745 level.  Bank of England Deputy Governor Tucker today indicated banks need to “radically  simplify their structures and provide more information about what funds they would use in an emergency.”  The U.K. Treasury today reported the BoE and the Financial Services Authority will obtain new powers to help prevent future crises.  There has been widespread media reports over the past couple of days indicating the U.K. Treasury will not change the central bank’s mandate to keep inflation under control  but will give the FSA new powers to control banks’ balance sheets.  Data released in the U.K. today saw the Q1 current account deficit narrow to -₤8.5 billion from -₤8.8 billion in Q4.  Also, Q1 gross domestic product was off 2.4% q/q and 4.9% y/y, the largest decline in 50 years, while Q1 total business investment was off 7.6% q/q and 9.7% y/y.  Additionally, Nationwide reported June house prices were up 0.9% m/m and off 9.3% y/y.  Cable bids are cited around the US$ 1.6125 level.  The euro moved higher vis-à-vis the British pound as the single currency tested offers around the ₤0.8535 level and was supported around the ₤0.8435 level.

CHF

The Swiss franc depreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the CHF 1.0775 level and was capped around the CHF 1.0890 level.  Technically, today’s intraday low was right around the 61.8% retracement of the move from CHF 1.0630 to CHF 1.1020.  Data released in Switzerland today saw the UBS May consumption indicator decline to 0.77 from 0.91 in April.  U.S. dollar offers are cited around the CHF 1.1165 level.  The euro weakened vis-à-vis the Swiss franc as the single currency tested bids around the CHF 1.5230 level while the British pound moved lower vis-à-vis the Swiss franc and tested bids around the CHF 1.7855 level.

Daily Market Commentary provided by GCI Financial Ltd.

GCI Financial Ltd (”GCI”) is a regulated securities and commodities trading firm, specializing in online Foreign Exchange (”Forex”) brokerage. GCI executes billions of dollars per month in foreign exchange transactions alone. In addition to Forex, GCI is a primary market maker in Contracts for Difference (”CFDs”) on shares, indices and futures, and offers one of the fastest growing online CFD trading services. GCI has over 10,000 clients worldwide, including individual traders, institutions, and money managers. GCI provides an advanced, secure, and comprehensive online trading system. Client funds are insured and held in a separate customer account. In addition, GCI Financial Ltd maintains Net Capital in excess of minimum regulatory requirements.

DISCLAIMER: GCI’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.

By CountingPips.com

The United Kingdom Gross Domestic Product was revised lower today and fell by the most in fifty years in the first quarter of 2009 according to a report by the Office of National Statistics. The U.K. real GDP data showed that quarterly GDP fell by 2.4 percent in the January through March quarter following a  decline of 1.6 percent in the fourth quarter of 2008. The GDP decline was worse than the previously reported estimates of a 1.9 percent contraction and marked the largest decrease since the 2.6 percent fall in the second quarter of 1958.

On an annual basis, the first quarter GDP fell by 4.9 percent from the level of the first quarter of 2008 and marked the largest annual decline since 1948 when records were first kept. The 2008 fourth quarter registered a decline of 2.0 percent. Today’s data surpassed economic forecasts which were expecting the quarterly GDP to decline by approximately 2.1 percent and the annual GDP rate to fall by 4.3 percent.

The British pound has felt the effects of the news and has fallen versus most of the major currencies in forex trading today. The pound, at time of writing, has declined by over 150 pips against the dollar, by 45 pips versus the euro and by almost 100 pips against the Japanese yen.

GBP/USD Chart – Pound Sterling falling in forex trading versus the US Dollar today and trading under the 100 hour moving average

Our detailed commentary from last week both before and after the FOMC statement on Wednesday noted that we believe that the Fed’s comments would lead to USD strength in coming weeks. So far our theory has been tested as USD has fallen to levels that printed before the FOMC statement. EUR/USD is trading at 1.4110, USD/JPY at 96.11, and importantly GBP/USD cracked through the 1.6725 level. So we are on guard for any further USD weakness as we think we are at levels that could cause a long-covering push lower on USD (meaning higher EUR/USD and GBP/USD).

Lets not forget that our post FOMC statement theory of stronger USD is a long-term plan. If EUR/USD closes the week significantly higher that the 1.4100 level……and if GBP/USD can regain and hold the 1.6700 levels, then we may have to re-assess our strong USD expectations for the next few weeks. But for now we keep our strong USD plan in place.

Another challenge to our strong post FOMC strong USD theory is that the movement in the US 10 year note seems to have already made its large move. The US 10 year note yielded just above 4.00% about three weeks ago and is now hovering around the 3.5% level. As we noted last week, that is a huge move in a short time period.

We think the yield on the US 10 year note will have to break below 3.50% for much further USD strength. 3.50% is an important psychological level, yet we are seeing and hearing more and more commentary about rates moving towards the 3.00% level. This does conflict with our view of the 10 year yields by years end (we think higher), but with the extremely volatile trading of the 10 year note in the last 12 months, its possible we will see lower rates in the short term and then a move higher towards the end of the year.

This is the stuff we love about the global capital markets; they are like a spider web. If you pull on one corner of a spider’s web, then rest of the web has to shift to accommodate the external action. But the web does not move in a linear manner, the web’s movements depend on so many factors that it is never easy to determine which shape the web will have in the future.

Stay Nimble!

Stephen Leahy
Back Bay FX Services, LLC
www.backbayfx.com

We have overlaid the below chart of daily price action in spot Gold with our favorite Bollinger Band (“BB”) settings. Within an overall trend of Gold moving higher, we have noted that recently any break through the midline (currently at 943.50) to the upside has been the start of a strong move higher. Moves through the mid-line to the downside have had limited runs lower.

We are watching where spot Gold closes (17:00 EST) both today and tomorrow to see if we can break higher and go for a strong run that will test the 980 – 1,000 levels. A close above 946 today or tomorrow will be enough to justify a long position for us.

Stay Nimble!

Stephen Leahy
Back Bay FX Services, LLC
www.backbayfx.com

Thanks to FX Solutions for the below image.

Source: ForexYard

An extremely bullish day for the equity markets pushed investors back to riskier assets and away from the safe haven USD and JPY, causing them to plummet against their riskier counterparts. The rally in equities along with a weak Dollar has also helped push Oil prices above $73 for the first time in over a week. Today’s numerous economic data releases from the U.S, Euro-Zone and Japan promise another volatile trading day and will help determine if the current trends will continue throughout the week.

Economic News

USD – Dollar Plummets as Wall Street Rallies

The Dollar plummeted against the major currencies on Monday, as Wall Street rallied. The bullishness in the U.S. stock market also spread to Britain and the Euro-Zone. The Dow Jones rose by over 1%, while the S&P extended its best rally since 1998. Amongst the biggest gainers were banking stocks. The bullish stock market led to a fall in the Dollar across the board, as traders ditched the safe-haven USD for riskier assets in Monday’s trading. This was exasperated due to traders wishing to further their profits in stocks as the quarter comes to an end.

The USD slipped about 80 pips vs. the EUR to finish trading at 1.4115. This was helped as Euro-Zone economic confidence increased more than expected this month. The Dollar’s behavior was much the same against the Pound, as the GBP/USD pair rose 160 pips to the 1.6634 level. The GBP’s strength may have been owed to its dependence on U.S. economic optimism. However, against the JPY the greenback extended its rally for the second day, as investors dropped the “ultra” safe-haven Yen for the “less” safe-haven USD.

Looking ahead today, there is plenty of economic news that is likely to help determine the volatility in the forex market. The releases from the U.S. are set to be the key to today. Traders are advised to pay attention to the Chicago PMI at 13:45 GMT and CB Consumer Confidence at 14:00 GMT. It is also advisable to follow the direction of the equity market, as this could be a key factor in determining the Dollar’s strength later

EUR – GBP Boosted by U.S. Optimism

The Pound recorded a volatile, but bullish trading session yesterday against its major crosses, as it benefited from the optimism from the U.S. The rally in the British stock market was encouraged by Wall Street’s rally. What has been much of a pattern recently has seen the Pound rising whenever equities make significant gains in the U.S. and Britain. This may be explained by Britain’s dependence on the financial sector. With this sector doing well yesterday in the equities market lent the Pound a boost, helping us understand much of the behavior of the cable.

Both the GBP and EUR posted gains against the USD and JPY. The EUR/GBP was
32 pips lower at 0.8482. It seems that if global economies continue to prove, then we may see this pair continue to approach the 0.8400 level in the short-medium term.
The EUR was also helped yesterday by strong economic confidence figures from the Euro-Zone. This is a further signal that the economic situation in the Euro-Zone isn’t as dire as some analysts originally forecast.

Today, there is plenty of data coming out of Britain and the Euro-Zone that is likely to determine the GBP and EUR crosses in today’s trading against the major currencies. From Britain there is the release of the Nationwide HPI at 6:00 GMT and Current Account and GDP data at 8:30 GMT. From the Euro-Zone there is the publication of German Unemployment Change figures at 7:55 GMT and the CPI Flash Estimate at 9:00 GMT.

JPY – JPY Tumbles on Waning Safe-Haven Status

The Japanese Yen tumbled on Monday, as the Japanese and global equities recorded significant gains. Investors also lost confidence in the JPY yesterday, as Japan released figures showing that unemployment is at a 5-year high of 5.2%. Japan’s government fears it will hit 6% by mid-2010. Much of the JPY’s weakness is due to
traders dropping the safe-haven JPY for more risky assets. As of late, this seems to be equities and commodities.

The Yen slid for a second day against the USD by about 50 pips to 95.92. The EUR/JPY cross slipped to135.38 from 133.90. Against the GBP, the Yen slipped 235
pips to 159.63. The Yen’s volatile movement is set to continue in today’s trading. Later today, this will be even more so with the release of the important Japanese Tankan Manufacturing Index and Tankan Non-Manufacturing Index at 23:50 GMT.

Crude Oil – Crude Oil Surges Past $72 a Barrel

The price of Crude Oil surged passed $72 a barrel yesterday, rising an astonishing $4 to $72.68. This was fueled by 3 dominant factors. Firstly, there was yet another rebel attack in Nigeria, forcing the Shell Oil Company to close one of its refineries yesterday. Additionally, there was a bullish U.S. and European stock market session, leading to a boom in commodities, as investors sold-off safe-haven assets such as the U.S. Dollar.

Yesterday’s gains came on the back of some bearishness in Crude in recent days, as the commodity failed to hold above $70 a barrel. Recent reports by the International Energy Agency revealed that demand will wane for the foreseeable future. However, OPEC is unlikely to cut supply in their next meeting in September. If there are more positive economic signs from the U.S. in the next 2 days, then Crude could hit $75 by the end of the week.

Technical News

EUR/USD

A bearish cross appears to be forming on the 4-hour chart’s Slow Stochastic, suggesting a downward movement may be in the works. The price also floats in the over-bought territory on the daily chart, which supports this downward notion. Going short might be a wise choice today.

GBP/USD

The recent upward spike has pushed most indicators into the over-bought territory while also generating a number of bearish crosses on all charts. Waiting for the momentum to die down, and then going short would be a good decision today.

USD/JPY

With most indicators floating in neutral territory, this pair appears directionless. The bullish cross on the hourly chart’s Slow Stochastic signifies an imminent upward move; however, the bearish cross on the 4-hour chart’s Slow Stochastic suggests otherwise. Waiting for a clearer direction for this pair may be a good choice.

USD/CHF

This pair’s 4-hour chart shows an imminent bullish cross on the Slow Stochastic, which implies a coming upward correction. As the price floats near the over-sold territory on this chart’s RSI, the upward notion seems justified. Going long with tight stops might be a preferable strategy.

The Wild Card – USD/ZAR

This pair has entered a long and steady downward trend and doesn’t appear to be stopping. After the Bollinger Bands on the hourly chart tightened, a volatile downward movement occurred and there now appears to be bullish crosses on the 4-hour and daily chart’s Slow Stochastic and MACD. Contrary to these indications, however, is the fact that the downward momentum still has plenty of room to run. Sticking with the downtrend, forex traders should enter their short positions and finish riding out this profitable move.

Forex Market Analysis provided by Forex Yard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

In Scandinavian news this week we have a few factors to consider. First is the purchase of 4 billion Thai Baht by Sweden which has helped boost Sweden’s market share and ability to conduct more long-term business in the South-Asian markets. Immediate impact, on the other hand, was a drop in the value of the SEK, which analysts anticipate will reverse in the near future.

Norway’s currency also appears damaged by recent volatility in the Crude Oil markets as the NOK is tied with commodities. If Crude Oil loses its support above $70 a barrel, as it has done repeatedly these days, we could see the Norwegian Krone take another hit. Good news for the NOK, however, is the sudden sharp rise in oil prices during the last 24 hours, which has helped push the commodities-tied currency to modest strength.

We can verify the connection to commodities by seeing the relatively flat-trading EUR/NOK as opposed to the strong fluctuations of the USD/NOK, which signifies a link to oil. If it fails to make a solid breach of its recent downtrend against the USD, traders should anticipate a sharply falling NOK in the days ahead (See chart below for technical analysis).

Overall, the Scandinavian currencies, with the exception of the Danish Krone, are losing strength to the USD and EUR as a rise in risk aversion damages these high-yielding currencies. The uncertainty of commodities markets puts a damper on currencies like the NOK. Also, the portfolio diversification of Swedish banks doesn’t appear to be over, which will lead to a short-term downfall in the SEK. Once the economy begins to pick up we should see a recovery for these currencies, which is the good news at the end of a bleak article such as this.

USD/NOK – 4-Hour Chart

– Above is the 4-hour chart of the USD/NOK by ForexYard.

– The indicators used are the Stochastic and MACD.

– Point 1: The recent uptrend appears to have been breached, suggesting a downward movement.

– Point 2: The bullish cross on the Stochastic suggests an impending upward correction.

– Point 3: As the price has crossed into the territory below 0.0, there is a chance that a bullish cross is in the works, supporting the notion of an upward move.

– While the downtrend appears to be broken, this may NOT be the case. The indicators presented here suggest that an upward movement is impending, which means this pair may have just been testing the lower border. Expect bullishness.

By CountingPips.com

The U.S. dollar has been mostly lower in forex trading today against the other major currencies on a day without a major news release.  The dollar has for the most part stayed within recent trading ranges as currency pair movements have been very tame today . The dollar has been weaker versus the euro, British pound, Australian dollar, Swiss franc and New Zealand dollar while trading higher versus the Japanese yen.  The American currency has been about unchanged against the Canadian dollar.

The euro has advanced versus the dollar today as the EUR/USD has increased from its 1.4028 opening(00:00 GMT) to trading at 1.4080 in the late afternoon of the U.S. trading session at 4:19pm EDT according to currency data from Oanda.

The British pound has risen today as the GBP/USD has advanced from its 1.6474 opening exchange rate to trading at 1.6566 usd per gbp.

The dollar has traded higher versus the Japanese yen today and the pair is trading at 96.03 after opening at the day at the 95.45 exchange rate.

The dollar has been virtually unchanged today versus the Canadian loonie as the USD/CAD trades at the exchange rate of 1.1567 after opening the day at 1.1564.

The dollar has fallen against the Swiss franc as the USD/CHF trades at 1.0828 after opening at 1.0864 today.

The Australian and New Zealand dollars have both advanced higher today against the USD. The AUD/USD has climbed from its 0.8023 opening rate to trading at 0.8081 later this afternoon.  The NZD/USD has increased from its 0.6433 opening to trading at 0.6503 later today.

USD/JPY Chart – The US Dollar rises today versus the Japanese Yen in forex trading and advancing above the 96.00 exchange rate.

By GCI Fx Research

€

The euro extended recent gains vis-à-vis the U.S. dollar today as the single currency tested offers around the US$ 1.4100 figure and was supported around the $1.3980 level.  Australasian dealers sold the common currency but European and North American dealers lifted the pair higher on improving eurozone economic data that saw June overall economic sentiment rise sharply to 73.3 from 70.2 in May.  This represented the third consecutive monthly increase.  German Chancellor Merkel reported the German economy “might reach the bottom of the crisis soon, but the international crisis won’t be over with.”  European Economic and Monetary Affairs Commissioner Alumnia reported “There is a need to do stress tests  (at banks), in a coordinated way (across Europe), so that we can send information that is as clear as possible to financial markets.  There is a deficit of transparency about the real state of the balance sheets of many banks which creates uncertainty.”  In U.S. news, the Chicago Fed reported its National Activity Index weakened to -2.30 in May from -2.27 in April.  June non-farm payrolls data will be released on Thursday.  Euro bids are cited around the US$ 1.3435 level.

¥/ CNY

The yen depreciated vis-à-vis the U.S. dollar today as the greenback tested offers around the ¥96.00 figure and was supported around the ¥95.10 level.  Bank of Japan Governor Shirakawa reported “No central bankers believe that a bubble can or should be prevented by monetary policy alone.”  BoJ Deputy Governor Yamaguchi reported price stability is a key objective for the central bank and added Japan’s economy is not in a deflationary spiral.  Yamaguchi added the core consumer price index decline will moderate from this summer.  Prime Minister Aso on Friday said he hopes to avoid an increase in long-term interest rates.  Data released in Japan overnight saw May industrial output up 5.9% m/m and off 29.5% y/y, the third consecutive monthly increase.  Also, Japan registered a merchandise trade deficit of ¥37.87 billion in the first ten days of June. Additionally, May overall retail sales were off 2.8% y/y.  The Nikkei 225 stock index lost 0.95% to close at ¥9,783.47.  U.S. dollar offers are cited around the ¥104.15 level.  The euro strengthened vis-à-vis the yen as the single currency tested offers around the ¥135.50 level and was supported the ¥133.35 level.  The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥159.25 level while the Swiss franc moved higher vis-à-vis the yen and tested offers around the ¥88.80 level. In Chinese news, the U.S. dollar moved lower vis-à-vis the Chinese yuan as the greenback closed at CNY 6.8325 in the over-the-counter market, down from CNY 6.8360.  China ruled out “sudden” changes to its foreign exchange reserves policy and suggested the U.S. dollar may continue to dominate global trade. People’s Bank of China Governor Zhou added China’s reserves policy is “always quite stable.”

₤

The British pound appreciated vis-à-vis the U.S. dollar today as cable tested offers around the US$ 1.6575 level and was supported around the $1.6425 level.  Many data were released in the U.K. today.  First, the M4 money supply was up an revised 0.2% m/m and 16.6% y/y in May.  Second, it was reported that U.K. net mortgage lending reached a record low in May.  Net lending growth to individuals fell to ₤600 million from ₤1.1 billion. U.K. banks have not increased their lending activities significantly deposit ₤125 billion in fresh liquidity from Bank of England and capital injections from the government.  CBI reported the U.K.’s financial services sector will likely improve in the third quarter after 21 months of contraction.  Cable bids are cited around the US$ 1.6125 level.  The euro moved lower vis-à-vis the British pound as the single currency tested bids around the ₤0.8475 level and was capped around the ₤0.8525 level.

Daily Market Commentary provided by GCI Financial Ltd.

GCI Financial Ltd (”GCI”) is a regulated securities and commodities trading firm, specializing in online Foreign Exchange (”Forex”) brokerage. GCI executes billions of dollars per month in foreign exchange transactions alone. In addition to Forex, GCI is a primary market maker in Contracts for Difference (”CFDs”) on shares, indices and futures, and offers one of the fastest growing online CFD trading services. GCI has over 10,000 clients worldwide, including individual traders, institutions, and money managers. GCI provides an advanced, secure, and comprehensive online trading system. Client funds are insured and held in a separate customer account. In addition, GCI Financial Ltd maintains Net Capital in excess of minimum regulatory requirements.

DISCLAIMER: GCI’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.

By Fast Brokers – Gold is following the consolidation of the Dollar and U.S. equities while ignoring the pop in crude.  The precious metal seems range bound for the immediate-term as investors await the heavily-weighted economic data coming later in the week.  Gold has logged larger volume on its down-bars than up-bars on the 1-hour during its upswing beginning dating 6/23, while volume on the 4-hour has been rather tame.  Therefore, the present upturn of gold has been limited to a sub-$950/oz reality.  As a result, the near-term momentum is tilted in favor of the bears as the GBP/USD and EUR/USD fight near-term downtrends of their own.  The overall behavior of gold reflects that of the market as a whole with investors uncertain whether to bank on a global economic recovery or a new leg down.  We expect volatility to pick-up beginning late Tuesday/Wednesday with key unemployment, housing, and manufacturing data pouring in from around the globe along.  Additionally, the ECB will make a monetary policy decision on Thursday.  Hence, while gold may be subdued for the immediate-term, investors shouldn’t get too complacent.  The near-term key for gold to the downside will be holding 6/15 and 6/16 lows.  Important near-term barriers to the upside are our 1st and 2nd tier downtrend lines along with 6/26 highs.

Present Price: $935.60/oz

Resistances: $936.01/oz, $939.02/oz, $941.85/oz, $943.88/oz, $945.75/oz

Supports: $932.48/oz, $929.77/oz, $927.98/oz, $$925.24/oz, $923.59/oz

Psychological: $900/oz, $950/oz

Market Commentary provided by Fast Brokers.

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.

Risk Disclosure: There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.

By Fast Brokers – The USD/JPY continues to tease investors as it fails to follow through on its threats of a large pullback.  We’ve seen rising volume to the upside followed by climbing volume to the downside, hence the relatively tight trading range.  Despite being in the position drop towards our 1st tier uptrend line, the USD/JPY continually experiences support at just the right moment.  Therefore, the USD/JPY seems to exemplify the investor indecisiveness present across the marketplace as a whole.  The USD/JPY may wait for the market to make its broad-based direction decision before the currency pair makes a game-changing movement of its own.  The data and news coming this week has the potential to jolt the FX markets since investors will receive heavily-weighted data from across the globe.  Japan will get the ball rolling with average cash earnings late Monday followed by the Tankan number on Tuesday.  Investors are expecting an improvement to -43 in the Tankan since last week’s BSI manufacturing index and Japan’s trade balance were slightly better than expected.

Despite its relative stability over the past couple months, the USD/JPY remains in a vulnerable position.  The probability of a retracement to our 1st tier uptrend line becomes more probable by the day as the trend line creeps towards price.  Any technical failure of our 1st tier uptrend line could imply the beginning of a new leg down in the USD/JPY, which would inflict considerable damage upon Japan’s already fragile economy.  Furthermore, there are several strong downtrend lines and the highly psychological 100 level the currency pair must brave through, no easy feat.  Regardless, the USD/JPY’s supports are in place and it is difficult to pass judgment on the currency pair until it sends a clear directional message.

Present Price: 95.38

Resistances: 95.73, 96.33, 96.90, 97.45, 98.05

Supports: 94.99, 94.45, 93.76, 93.32, 92.46

Psychological: 90, 95, 100

Market Commentary provided by Fast Brokers.

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.

Risk Disclosure: There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.