FOREX: Dollar gains vs Euro for 5th straight week. Futures Traders increase Euro shorts

By CountingPips.com

The U.S. dollar continued its rise versus the euro this week in the forex markets while futures bets against the euro climbed to a record high level. The U.S. dollar rose by approximately 46 pips against the euro for the week as the Greek debt crisis and the uncertainty surrounding a potential bailout helped keep the European common currency on it’s downward trajectory. The week ending on February 12th marked the euro’s fifth straight week of decline against the American currency with the euro falling to an eight and a half month lowpoint.

Futures bets against the euro climbed to a record high as of February 9th, according to the Commitments of Traders (COT) data released on Friday by the Chicago Mercantile Exchange. Non-commercial futures positions, those taken by hedge funds and large speculators, were net short the euro against the U.S. dollar by 57,152 contracts after being net short the euro by 43,741 contracts the week before. Net short euro positions have now increased for four consecutive  weeks.

The COT report is published every Friday by the Chicago Mercantile Exchange and shows futures positions as of the previous Tuesday.  It is a useful tool for traders to gauge investor sentiment and to look for potential changes in direction of a currency or commodity.

The U.S. dollar had a mixed week versus the other major currencies in forex trading, breaking its recent weekly trends. The USD rose versus the Japanese yen and Swiss franc while falling against the British pound, Canadian dollar, Australian dollar and New Zealand dollar, according to currency data from Oanda. The American currency had increased against the British pound, Canadian dollar and the New Zealand USD Forex Tradingdollar for three straight weeks prior to this week’s fall and the Australian dollar had declined for four straight weeks before a turnaround.

The largest gain for the dollar this week was against the Japanese yen with a 69 pip increase followed by the 46 pip advance versus the euro (see chart). The dollar declined by over 200 pips against the Canadian dollar and by almost 200 pips versus the Australian dollar.

Next week will be a short week in the forex markets as many countries have holidays. There is the President’s day holiday in the U.S. on Monday, the Family Day holiday in Canada on Monday and the Swiss markets will be closed all week for Carnival. The Lunar New Year will close markets in South Korea, Hong Kong, Singapore, Malaysia, Taiwan, China and Vietnam on Monday with some of these markets staying closed for the week.

Retail Sales data out of the U.K. and Canada will be released while Japan’s interest rate decision and Gross Domestic Product report are also scheduled this week. The U.S. will see economic releases of Empire State manufacturing data, leading indicators, long-term TIC flows, housing starts/building permits and the Federal Open Market Committee’s meeting minutes.

EUR/USD Daily Chart – The EUR/USD currency pair dropped to the 1.3531 exchange rate level on Friday for the first time since May 19th of 2009, only a few months after reaching a 2009 high on November 25th at the 1.5143 level. This pair started its decline in early December and fell below the 200-day simple moving average (in red) on January 19th.

Bob Prechter’s “Conquer The Crash”: Eight Chapters For Free

By Nico Isaac – When EWI President Robert Prechter sat down to write the first edition of “Conquer The Crash” in 2002, the idea that the United States would enter a period of what news authorities coined “economic Armageddon” several years later was unheard of.

Flashing back, the major blue-chip averages were rebounding off a historic bottom, the notorious dot.com bust was making way for a powerful housing boom, Fannie Mae’s chief executive was named “the most confident CEO in America,” then President George Bush was enjoying a 60%-plus approval rating, Gulf War II hadn’t begun yet, and when it did, a “quick and easy victory” was supposed to follow, and the Federal Reserve was largely credited with slaying the big, bad bear via the sharp blade of monetary policy.
Five years later, the tables turned. The U.S. housing market endured its worst downturn since the Great Depression; Fannie Mae’s CEO was ousted amidst a mortgage crisis of incalculable damage. George W. Bush left the oval office with a record low approval rating of 25%, and the expected “cakewalk” victory in Iraq became a “quagmire” and national dilemma.

Anticipating these and other “shocks” to the global system is the unparalleled achievement of “Conquer The Crash.” Here, the following excerpts from the book put any doubt to rest:

Housing: “What screams bubble – giant historic bubble – in real estate is the system-wide extension of massive amount of credit.” And “Home equity loans are brewing a terrible disaster.”

Bonds: “The unprecedented mass of vulnerable bonds extant today is on the verge of a waterfall of downgrading.”

Fannie Mae & Freddie Mac: “Investors in these companies’ stocks and bonds will be just as surprised when the stock prices and bond ratings collapse.”

Politics: “Look for nations and states to split and shrink.” And — “The Middle East should be a complete disaster.”

Credit Expansion Schemes “have always ended in a bust.” And — “Like the discomfort of drug addiction withdrawal, the discomfort of credit addiction withdrawal cannot be avoided.”

Banks: “Banks are not just lent to the hilt, they’re past it. In a fearful market, liquidity even on these so called ‘securities’ [corporate, municipal, and mortgage-backed bonds] will dry up.” (176)

If the tools in Bob Prechter’s analytical toolbox, namely Elliott wave analysis and socionomics (Prechter’s new science of social prediction based on the Wave Principle), enabled him to foresee these “sea changes” in the economic, social, and political landscape — the only question is: What else do the pages of the “Conquer The Crash” reveal?
Well, your opportunity to find out just got a whole lot easier. Right now, you can download the 8-chapter Conquer the Crash Collection, free. It includes:

Chapter 10: Money, Credit And The Federal Reserve Banking System
Chapter 13: Can The Fed Stop Deflation?
Chapter 23: What To do With Your Pension Plan
Chapter 28: How To Identify A Safe Haven
Chapter 29: Calling In Loans & Paying Off Debt
Chapter 30: What You Should Do If You Run A Business
Chapter 32: Should You Rely On The Government To Protect You?
Chapter 33: Short List of Imperative ‘Do’s’ & ‘Don’ts”

Visit Elliott Wave International to learn more about the free Conquer the Crash Collection.


Nico Isaac writes for Elliott Wave International, a market forecasting and technical analysis firm.

FOREX: Retail Sales rise more than unexpected in January. EUR/USD trades at 1.3600.

By CountingPips.com

U.S. Retail Sales rose more than unexpected in the month of January as consumer spending on retail goods increased following a small decline in sales for December. Advance estimates of retail sales showed that sales increased by 0.5 percent to a total of $355.8 billion in January, according to the report by the U.S. Commerce Department released today. December’s retail sales data was revised higher to show a decrease of 0.1 percent after the original report showed a 0.3 percent decline.

December’s sales data was a disappointment in the heart of the holiday shopping season and followed November’s retail sales that had surged by almost 2 percent.

The January retail sales data was better than the 0.3 percent increase that the market forecasters were expecting. The increased retail sales bodes well for the domestic economic recovery as consumer spending accounts for roughly two-thirds of economic activity in the U.S.

On an annual basis, January’s retail sales level was 4.7 percent higher than the January 2009 sales level following an annual increase of 5.5 percent in December.

Core retail sales, excluding automobile sales and parts, increased by 0.6 percent in January after the revised data showed that core sales fell by 0.2 percent in December. On an annual basis, core sales increased by 4.6 percent in January from the January 2009 level following an annual gain of 5.1 percent in December.

Contributing to the higher retail sales numbers for January was a 1.5 percent increase in general merchandise stores while nonstore retailers registered an increase of 1.6 percent. Food and beverage store sales gained by 0.8 percent,  electronics & appliance stores sales rose by 1.2 percent and sporting goods, hobby, book & music store sales climbed by 1.0 percent.

US Dollar rises in Forex Trading today

The U.S. dollar has been trading higher in the forex markets today against the other major currencies. The dollar has made gains today versus the euro, Swiss franc, British pound, Canadian dollar, New Zealand dollar, Australian dollar and the Japanese yen as of 1:27 pm EST in the US trading session.

The U.S. stock markets, meanwhile, have been negative so far today with the Dow Jones decreasing by over 80 points, the Nasdaq falling over 7 points and the S&P 500 down by over 8 points at time of writing.  Oil has declined by $1.70 to trade at $73.58 while gold has decreased by $3.70 to trade at the $1,090.50 per ounce level.

EUR/USD 1-Hour Chart – The Euro decreasing versus the US Dollar today in forex trading and hanging around the 1.3600 level.  The EUR/USD  touched  the 1.3531 level today for the first time since may 19th, 2009 on the continued pressure over the Greek sovereign debt situation.  The euro is falling for the third straight day versus the USD and looks to be on its way to falling against the dollar for the fifth consecutive week.

Secrets of the 52 Week High Rule: New Video

Hello, this is Adam Hewison and I’m coming to you live from the digital studios of MarketClub.

Over 30 years ago I learned from a very successful trader, a trade secret I’ve never shared on the web before.  In fact, I only shared this trading secret with a few friends during that time.

Watch the New Video Here….

I learned this trading secret from a trader named Bill… I am keeping his last name private as Bill is a very low-key guy and shuns any publicity.

Using his special trading technique, Bill made millions and millions of dollars from his office. Now for the first time, I am going to share with you the exact same technique that Bill used so successfully for so many years. The best part is that this technique is still working more than 30 years after I learned about it. Now it’s time for the next
generation of traders to learn Bill’s secret.

Watch the New Video Here….

Bill didn’t even have a name for this killer trading technique. I named
it “The 52-week new highs on Friday rule”.

The video is free to watch and there are no registration requirements. I hope you enjoy the video and make a comment on our blog about how you feel about the crude oil market.

All the best,

Adam Hewison

President, INO.com
Co-creator, MarketClub

Is Gold Poised to Go Higher or Lower?

By Adam Hewison – A lot of folks are calling in and e-mailing our company in regards to the gold market, so I thought I would create a new video showing you where we stand..

This short video shows two important elements that are in play right now and how they could determine the next big trend in gold.

The video is free to watch and there are no registration requirements. I hope you enjoy the video and make a comment on the blog about how you feel about this market.

Watch the New Video Here…

All the best,

Adam Hewison
President, INO.com
Co-creator, MarketClub

USD/JPY Pops Following Strong U.S. Retail Sales Data

By Fast Brokers – The USD/JPY is extending its intraday gains in reaction to stronger than expected U.S. retail sales data.  The increase in U.S. consumption is a positive for the economy and improves the outlook for demand for Japanese made goods.  The USD/JPY was already performing well today in reaction to disappointing EU GDP data and another hike in China’s required reserve ratio.  The slowdown in the EU economy and tighter liquidity measures from China are both negative developments for the risk trade and resulted in a leg up in the Dollar.  The USD/JPY opted to participate since the Dollar is being favored over the Yen due to stronger U.S. economic data, implying the Fed could tighten liquidity before the BoJ.  Meanwhile, investors are awaiting Prelim UoM Consumer Sentiment data.  The UoM data usually has a considerable impact on the Dollar, meaning the FX markets could remain volatile as the trading week comes to a close.  Although U.S. markets will be closed on Monday for a bank holiday, Japan will release its Prelim GDP during Monday’s Asia trading session.  Therefore the USD/JPY could be particularly volatile on Monday despite many investors taking the day off.  Analysts are expecting Prelim GDP to print at 1.0%, compared to a downward revised 0.3% the last time around.

Technically speaking, we’ve shifted our trend lines to compensate for the USD/JPY’s upward movement over the past 24 hours.  There are still multiple downtrend lines we can form to serve as technical barriers.  Our 3rd tier could carry some extra weight since it runs through previous February highs.  The USD/JPY is currently trading back above its psychological 90 level.  However, we’ve seen how influential the 90 trading zone can be, meaning the USD/JPY could have trouble breaking free.  As for the downside, the USD/JPY has multiple uptrend lines serving as technical cushions along with 2/3, 2/11, and 2/10 lows.

Present Price: 90.30

Resistances: 90.32, 90.46, 90.70, 90.70, 90.82, 90.94

Supports: 90.15, 89.99, 89.86, 89.72, 89.62., 89.50

Psychological: 90, February highs and lows

(click chart to enlarge)

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.

AUD/USD Sinks Following China News

By Fast Brokers – The AUD/USD reversed sharply from its psychological .89 level after China shocked markets by increasing its required reserve ration by 50 basis points.  By taking more hawkish monetary action a day before the Chinese New Year the government could be sending a message that it will pursue a more conservative monetary policy during the year of the tiger.  The FX markets received China’s message loud and clear with the Dollar appreciating across the board.  The Aussie also came under heavy selling pressure despite this week’s impressive employment data.  Australia’s commodity-reliant economy is dependent upon demand from China.  Hence, tighter liquidity in China could slow economic growth, thereby decreasing demand for Australia’s commodities and discouraging the RBA from raising rates by as much as it would like.  Meanwhile, today’s EU data set disappointed with Prelim GDP data missing the mark.  The disconcerting EU data added further downward pressure on the AUD/USD as the Dollar rallied in reaction.  However, the Greenback has weakened a bit after U.S. retail sales surpassed analyst expectations.  Hence, it will be interesting to see how the FX markets react to upcoming Prelim UoM Consumer Sentiment data.  The data wire will be relatively quiet on Monday since the U.S. and China will be on holiday.  Japan will release its Prelim GDP data during Monday’s Asia trading session, and if the numbers should deviate from analyst estimates this could yield a bit of volatility in the Dollar.  Australia will enter the fray on Wednesday by releasing the RBA’s meeting minutes along with NAB Business Confidence data.

Technically speaking, the Aussie still has multiple downtrend lines serving as technical barriers along with 2/11, 1/29, and 1/28 highs.  Furthermore, the psychological .89 level could serve as a technical barrier should it be retested.  As for the downside, the AUD/USD as multiple uptrend lines serving as technical cushions along with intraday and 2/10 lows.

Price: .8825

Resistances:   .8826, .8849, .8885, .8901, .8911, .8935

Supports: .8808, .8796, .8778, .8764, .8744

Psychological: .88, .89, February highs and lows.

(click chart to enlarge)

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.

GBP/USD Holds Above February Lows as Investors Await U.S. Data

By Fast Brokers – The Cable sold off sharply from intraday highs and our 4th tier downtrend line after EU GDP data disappointed and China surprised markets by raising its required reserve ratio by another 50 basis points.  Uncertainty and underperformance in the EU continues to rattle FX markets, resulting in another wave of Dollar strength.  Additionally, China may be sending a message that it plans on pursuing a more conservative monetary policy during the year of the tiger by tightening liquidity a day before the Chinese New Year.  Tighter monetary policy in China could have a considerable impact on global growth considering China has been an engine driving the economic recovery from the nadir of the Great Recession.  Therefore, hawkish monetary policy actions can have a profound impact on the FX markets, as implied by a large leg up in the Dollar following China’s announcement.   Meanwhile, investors are awaiting retail sales and consumer confidence data from the U.S.  The UK has been quiet on the data front since the release of the BoE’s inflation report.  Therefore, broad-based movements in the Dollar could continue to drive the Cable for the time being.  Speaking of the BoE’s inflation report, it is encouraging that the Cable has been able to hold above its previous February lows considering the volatility in the Euro.  After all, the BoE did downgrade its outlook for 2010 UK GDP and inflation growth.  However, should today’s U.S. data prove to be positive for the Dollar the Cable may opt to retest its February lows.  Meanwhile, the Cable is building up a solid base above its psychological 1.55 level.

Technically speaking, the Cable has multiple downtrend lines serving as technical barriers along with intraday and 2/10 highs.  As for the downside, the Cable has multiple uptrend liens serving as technical cushions along with 2/2 lows and the psychological 1.55 level should it be tested.

Present Price: 1.5620

Resistances: 1.5621, 1.5640, 1.5659, 1.5684, 1.5717, 1.5744

Supports: 1.5593, 1.5572, 1.5558, 1.5533, 1.5502

Psychological: 1.55

(click chart to enlarge)

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.

EUR/USD Dives Lower after Disappointing GDP Data and China

By Fast Brokers – The EUR/USD is tumbling lower again with a large down-bar on the 4-hour.  The Euro came under selling pressure after Germany’s Prelim GDP printed flat, or 2 basis points below analyst expectations.  Additionally, French Prelim Service Payrolls, Italian Prelim GDP, EU Flash GDP and EU Industrial Production all disappointed.  The only silver lining in today’s data set was 0.6% GDP growth in France.  However, growth in France didn’t prove strong enough to counter overall weakness in the EU, highlighted by a 0.1% EU Flash GDP number.  Also troubling is the huge pullback in Industrial Production (-1.7%).  Such data reverts back to numbers we saw during the summer of 2009.  Meanwhile, China surprised markets by announcing another 50 basis point rate hike in the required reserve ratio.  China may be sending a message by tightening liquidity the day before the Chinese New Year, particularly that the government plans on being more fiscally responsible during the year of the tiger.  Also, Chinese equity markets will be closed for a week, delaying a reaction from the SCI as the news sinks in.  Investors are currently awaiting upcoming retail sales and consumer confidence data from the U.S.  Considering the volatility we’ve witnessed in the FX markets thus far today, it wouldn’t be surprising if this data set yields considerable activity in the Dollar and U.S. equities.  Strong U.S. economic data could send investors towards the Dollar amid economic uncertainty around the globe.  Additionally, weak data releases could also benefit the Dollar as investors run for risk.   Therefore, it will be interesting to see how the trading session plays out.

Technically speaking, the EUR/USD faces topside technical barriers in the form of multiple downtrend lines along with intraday, 2/8 and 2/11 highs.  As for the downside, the EUR/USD has multiple uptrend lines serving as technical cushions along with 2/5 lows and the psychological 1.35 level should it be tested.

Present Price: 1.3578

Resistances: 1.3592, 1.3617, 1.3645, 1.3664, 1.3693, 1.3721

Supports:  1.3563, 1.3534, 1.3517, 1.3483, 1.3453, 1.3421

Psychological: February highs and lows, 1.35

(click chart to enlarge)

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.

New Video: How to Spot BIG Trends

By Adam Hewison – Every trader and investor I know would love to buy at the bottom and sell at the top. The reality is that this is not a winning solution, nor is it possible to do this on a consistent basis.

Go to the Video…

What we look for at MarketClub is to catch the sweet spot of the trend. The sweet spot is the 70% to 80% that’s in the middle of a trend.

I’ve been in this business a long time and know enough people in the industry to know that nobody buys the bottom and sells at the top. If they tell you that’s what they do on a consistent basis, run a country mile because they are exaggerating their capabilities.

In this short video, we look at crude oil and how you can spot the big trends using MarketClub’s “Trade Triangle” technology. I think you’ll find the video informative, educational, and it will give you an insight into how we look at the markets.

Watch the Big Trends Video…

The video is free to watch and there are no registration requirements. I hope you enjoy the video and make a comment on our blog about how you feel about the crude oil market.

All the best,

Adam Hewison

President, INO.com
Co-creator, MarketClub