Month: February 2010

By Elliott Wave International – Watch this classic video from Elliott Wave International’s Chief Currency Strategist, Jim Martens, to see how useful the basics of Elliott wave analysis can be. Jim explains how the same basic pattern that R.N. Elliott discovered back in the 1930s is often all you need to make informed market forecasts.

Then access Jim Marten’s intraday and end-of-day Forex forecasts, completely free from Elliott Wave International. The independent market forecasting firm is offering free access (a $199 value) through February 10. Get your free Forex forecasts now.

Get your free Forex forecasts now.

About the Publisher, Elliott Wave International
Founded in 1979 by Robert R. Prechter Jr., Elliott Wave International (EWI) is the world’s largest market forecasting firm. Its staff of full-time analysts provides 24-hour-a-day market analysis to institutional and private investors around the world.

It’s not the news that creates forex market trends — it’s how traders interpret the news.

By Vadim Pokhlebkin

Today, the EUR/USD stands well below its November peak of $1.51. Find out what Elliott wave patterns are suggesting for the trend ahead now — FREE. You can access EWI’s intraday and end-of-day Forex forecasts right now through next Wednesday, February 10. This unique free opportunity only lasts a short time, so don’t delay! Learn more about EWIs FreeWeek here.

What moves currency markets? “The news” is how most forex traders would undoubtedly answer. Economic, political, you name it — events around the world are almost universally believed to shape trends in currencies.

A January 14 news story, for example, was high up on the roster of events that supposedly have a major impact on the euro-dollar exchange rate. That morning, the European Central Bank announced it was leaving the “interest rate unchanged at the record low of 1% for an eighth successive month.” (FT.com)

The euro fell against the U.S. dollar after the news. But could it have rallied instead? You bet. In fact, traditional forex analysis says it should have. Here’s why.

Analysts always say that the higher a country’s interest rates, the more attractive its assets are to foreign investors — and, in turn, the stronger its currency. Well, U.S. interest rates are now at 0-.25% and in Europe, at 1%, they are 3 to 4 times higher. Isn’t that wildly bullish for the EUR? Apparently not, and wait till you hear why — because in today’s announcement ECB president Jean-Claude Trichet warned that European recovery would be “bumpy.” Ha!

By no means is this the first time a supposedly bullish event failed to lift the market. On June 6, 2007, for example, the ECB raised interest rates. Bullish, right? But the euro didn’t gain that day, either — the U.S. dollar did.

Watch forex markets with these “inconsistencies” in mind and you’ll see them often. In time you realize that it’s not news that creates market trends — it’s how traders interpret the news. That’s a subtle — but hugely important — distinction.

So the real question becomes: What determines how traders interpret the news? The Elliott Wave Principle answers that question head-on: social mood — i.e., how they collectively feel. Currency traders in a bullish mood disregard bad news and buy, leaving it to analysts to “explain” why. Bearishly-biased traders find “reasons” to sell even after the rosiest of economic reports.

If you know traders’ bias, you know the trend. How do you know? Watch Elliott wave patterns in forex charts – it’s reflected in there, on all time frames.

Today, the EUR/USD stands well below its November peak of $1.51. Find out what Elliott wave patterns are suggesting for the trend ahead now — FREE. You can access EWI’s intraday and end-of-day Forex forecasts right now through next Wednesday, February 10. This unique free opportunity only lasts a short time, so don’t delay! Learn more about EWIs FreeWeek here.

By CountingPips.com

U.S. Nonfarm Payrolls employment data released today showed that jobs fell in the month of January by more than expected while the December’s jobs data was revised higher to show more job losses that month. The Department of Labor nonfarm payrolls report showed that employment fell by 20,000 workers in January to total of 14.8 million unemployed workers. Today’s employment data was worse than expected as market forecasts were predicting an increase by 15,000 workers for the month.

Despite the monthly decline, the unemployment rate dropped from 10 percent to 9.7 percent. The rate decrease was unexpected as market forecasts predicted the rate to stay at the 10 percent level.

December’s employment totals were revised from an original estimate of 85,000 jobs lost to 150,000 jobs lost for the month. The November jobs report, which turned out to be the first monthly gain in almost two years, was revised in December to show a gain of 4,000 jobs and was revised again in the January report to show an increase of 64,000 workers.

In the two years since the recession began in December 2007, the number of unemployed workers has increased by 8.4 million and the unemployment rate has advanced from 5.0 percent to 9.7 percent.

The goods-producing sector was the hardest hit by job losses for the month as this sector lost 60,000 total jobs with the the construction sector losing 75,000 jobs while the manufacturing sector added 11,000 jobs.

The service-providing sector gained 15,000 total workers in January. The ambulatory health care services sector added 15,000 jobs and the retail trade sector increased by 42,000 jobs. Transportation and warehousing lost 19,000 jobs while financial activities shed 16,000 workers. Government hiring increased by 33,000 workers in January.

By Anton Eljwizat – Platinum prices have dropped significantly in the last few days as the commodity currently trades at $1467. The current bearish trend is expected to come to an end anytime soon, and a bullish correction may be in the making as described below. Traders are strongly advised to take advantage of the trend at an early stage.

• Point 1: The RSI signals that the price of this pair currently floats in the over-sold territory, suggesting upward pressure.

• Point 2: The Slow Stochastic indicates a bullish cross, signaling that the next move may be in an upward direction.

• Point 3: The Williams Percent Range has peaked near at the -100 marker, which means that there may actually be a strong level of upward pressure.

• The volatile downward movement which occurred prior to this upward correction has generated these indicators, and there appears to be room for this correction to continue.

Platinum 4-hour chart

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.

USDJPY Setup before Non-Farms

USD/JPY was offered today, after it came to light that many hedge funds and Asian accounts sold off their European government bond exposure.  EUR/JPY sold off this morning with most saying that this added momentum to the big sell-off earlier today.  Looks like stops were hit under .9000 which was just under a significant support area of the 200 hour Moving Average and trend-line support.    It seems that many have taken a risk-off stance today which led JPY to strengthen as well.  At this point in time, we are currently consolidating on the hourly chart after a low was made at 88.53 and is now seen as immediate key support, and the top of the consolidation (immediate resistance R1) seen around .8918 as a pennant continuation pattern is currently being made.  Ahead of the Non -Farm Payroll numbers and Unemployment Rate Data (see below) that is coming out at 8:30 A.M. EST any USD strength pushing the pair above immediate resistance could yield to R2 (89.58), R3 (89.89) and R4 (around .9000/20) which could be seen as good resistance points to position for another ride down.  Noticeably, these are also Fibonacci Retracements from the ride down from February 3^rd at 11:00 am EST at .9216.   On the downside immediate key resistance is seen at the low around .8853 with next support levels to be found on the daily chart around .8800 and .8738.

Remember after big news events there’s usually a knee-jerk reaction in the markets so be careful with your trading making sure to use stops and limits and see if you can time yourself on pullbacks and retracements for better entries.  Even though news may come out clear cut better or worse than expected sometimes the markets may decipher them differently and it may react in an unpredictable fashion .  Non-Farm Payrolls for January are expected to come in at 15K, with a previous number at -85K, and unemployment at 10%, with previous at 10% due out at 8:30 A.M. EST (see calendar)

Most analysts in the U.S. are still concentrating on the fact that the employment and housing market are still in a slump, and a sign of good times to come won’t be reflected until these numbers get better.

So as I usually finish, remember the 10 trading rules:

1.  Never Let a Winner Turn Into a Loser
2. Logic Wins, Impulse Kills
3. Never Risk More Than 2% per Trade
4. Trigger Fundamentally, Enter and Exit Technically
5. Always Pair Strong With Weak
6. Being Right but Being Early Simply Means That You Are Wrong
7. Know the Difference Between Scaling In and Adding to a Loser
8. What is Mathematically Optimal Is Psychologically Impossible
9. Risk Can Be Predetermined, but Reward Is Unpredictable
10. No Excuses, Ever

Views in my postings are purely opinion and are not meant to be taken as trading advice.

Charts powered by FX Solutions Accucharts

Forex Glossary by FX Words

Pennant- In technical analysis, refers to a chart pattern occurring when the trading range formed by successive highs and lows narrows over time.   Usually indicative of a continuation in the market.

Non-Farm Employment Change- Change in the number of employed people during the previous month, excluding the farming industry.  Usually reased monthly, on the first Friday after the month ends

Resistance-

In technical analysis, key support/resistance levels are used as buy and sell signals when markets are ranging. Generally, the strength of support & resistance levels are measured by how many times the price reaches a specific level, but fails to break through. Also should a level have been tested a number of times previously, traders will often watch for a breakout to come.

Support-

In technical analysis, key support/resistance levels are used as buy and sell signals when markets are ranging. Generally, the strength of support & resistance levels are measured by how many times the price reaches a specific level, but fails to break through. Also should a level have been tested a number of times previously, traders will often watch for a breakout to come.

Beginner’s Trader’s Corner by- Basil Fayadh, Technical Analysis

Daily Forex Market Analysis provided by eToro

Disclaimer: Trading in the Foreign Exchange market might carry potential rewards, but also potential risks. You must be aware of the risks and are willing to accept them in order to trade in the foreign exchange market. Don’t trade with money you can’t afford to lose.

© 2009 eToro Blog.

Source: ForexYard

Following an intense trading session, on which gold dropped below $1,060 an ounce, crude oil declined to $72.40 a barrel and the EUR/USD fell to the 1.3670 level, another exciting trading day is expected before the weekend begins. The U.S Non-Farm Payrolls is scheduled today at 13:30 GMT, and as always promises to create extraordinary volatility in the market.

Economic News

USD – Dollar Reaches 9-Month High against the Euro

The Dollar rallied against the Euro yesterday, gaining over 200 pips. The EUR/USD pair reached a 9-month low as a result, dropping to the 1.3670 level. The Dollar also gained about 200 pips vs. the Pound today, marking an extremely bullish session.

The Dollar’s bullish trend continued yesterday. It appears that the risk-aversion is currently dominating the market, as the Dollar seems to surge regardless of the data published from the U.S. economy. Over the last two weeks the Dollar rose due to an improving housing sector, a halt in unemployment growth and rising inflation. However today, the Dollar rallied following a batch of disappointing data, including worse than expected employment figures. The weekly Unemployment Claims rose by 8,000 during the past week to 480,000 people who filed for unemployment insurance for the first time during the past week. Currently the Dollar’s bullish momentum seems be quite solid, and somewhat immune to negative data.

Nevertheless, today’s trading session can put a stop to the bullish trend or significantly extend it. Today is the first Friday of the month, and as such the U.S. Non-Farm Employment Change report is expected. Analysts forecast that today’s publication will provide the first positive figures since January of 2008. This will be yet another strong indication that the U.S. economy is recovering at a faster pace than expected. This has potential to boost the Dollar once again today against the major currencies, especially the Euro and the Pound. However, an unexpected negative end result could initiate a reversal in the market, and forex traders should be prepared for harsh volatility today.

EUR – Euro Tumbles as Interest Rates Remain at 1.00%

During yesterday’s trading session, the Euro dropped against all the major currencies. The Euro is currently traded at a 9-month low against the Dollar, as the EUR/USD pair dropped over 200 pips, reaching the 1.3670 level.

The Euro’s decline was initiated today when the European Central Bank (ECB) announced that the Minimum Bid Rates, which are the European Interest Rates for February, will be left at record low of 1.00%. The Euro dropped sharply as a result, expressing investors’ desire to see an interest rates hike in the Euro-Zone. In addition, following Greece’s deficit concerns, the ECB President Jean-Claude Trichet said today the many Euro-Zone countries will have large, sharply fiscal imbalances. There are currently concrete worries that the Euro-Zone’s leading economies will be damaged as a result of the difficulties of the smaller economies, turning investors to look for safer currencies such as the Dollar and the Yen.

Looking ahead to today, the most interesting data from the Euro-Zone looks to be the German Industrial Production figures for December. Analysts forecast that the Industrial Production, which measures the value of output produced by manufacturers, rose by 0.6% on December. If the actual result will be similar, it is likely to support the Euro.

JPY – EUR/JPY Drops to an 11-Month Low

The Yen soared against all the major currencies during yesterday’s trading session. The Yen gained over 200 pips against the Dollar today and over 400 pips against the Euro, sending the EUR/JPY pair to an 11-month low.

The Yen’s remarkable bullish session came predominantly as a result of fears regarding the Euro-Zone’s worsening fiscal problems. The European Central Bank announced today that several countries might have fiscal imbalances this year, turning investors to search for safer assets. In addition, the Yen also strengthened against the Dollar, following disappointing U.S. employment data which were published yesterday. It now seems that as long as the current risk aversion inclination will continue to dominate the market, the Yen will continue to strengthen.

As for today, there is no significant news publications expected from the Japanese economy. Therefore traders are advised to follow the main data from the U.S. economy. Special attention should be given to the Non-Farm payrolls report that is likely to have the strongest impact on the market today.

OIL – Crude Oil Drops to $72.40 a Barrel

Crude oil dropped close to 5% of its value today. Crude oil dropped from $77 a barrel to $72.40. This has marked the biggest single-day drop in more than six months.

Crude oil dropped yesterday, as debts concerns in Europe along with the unexpected increase of U.S. weekly employment claims may hurt the long-term demand for energy. Crude oil prices rose during most of the week on optimism regarding the global economic recovery. However, recent notifications that several European countries suffer from excessive deficits have ended the optimism. In addition, the Dollar’s bullish trend also weakened oil. Crude oil is valued in Dollars, and when the Dollar sees a sharp rise, crude oil tends to drop as a result.

Looking ahead to today, traders are advised to follow closely the major publications from the U.S. economy as they are likely to impact oil the most. Today’s most significant data will be the U.S. Non-Farm Employment Change, and this publication is likely to have an immediate affect on crude oil.

Technical News

EUR/USD

The weekly chart shows a strong bearish trend with no signs of slowing. Both the 7-day and 14-day Relative Strength indicator are trading sharply below the 30 level and have not yet made a move to rise. The price has broken its 50% retracement level from the previous bullish trend at a price of 1.3746 and now could fall to the 68% retracement level to 1.3296.

GBP/USD

The daily chart displays a downward sloping MACD histogram, indicating the momentum of the pair is moving lower. The sharp downward trend has arrived at the significant support level of 1.5715. The previous bearish move ended at this price level. If the pair is able to breach this support line, we could see the price move lower to the next significant support level of 1.5350.

USD/JPY

The weekly chart shows a significant bearish trend that may have room to extend. The MACD shows a potential bearish cross forming with a downward sloping histogram, hinting at a further lower price move. The price move began at the upper border on the Bollinger Band and has since crossed the 20-day moving average line. This shows the potential for further price declines, perhaps to the lower Bollinger Band at a level of 87.30.

USD/CHF

The strong bullish trend shown on the 4-hour chart may now be overbought and those who were long may want to trip their exposure. The 4-hour shows a bearish cross has formed on the Slow Stochastic Oscillator, indicating the potential for price move lower. The Momentum Oscillator has reached the upper boundary and has begun to turn lower, supporting the potential lower price move. The Relative Strength Index has moved into the overbought region but has yet to break the rising trend line or the upper boundary. Traders may want to wait for the break of the 70 line to close their long positions or go short on the pair.

The Wild Card

Silver

Silver has experienced a significant downward price move that has now broken a long term trend line that began in November 2008. The price breach also passed the significant support level of 16.22. Forex and commodity traders who are short on silver may want to set their next price target at the new support level of 16.40.

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.

EURUSD drops sharply from 1.4026 and reaches the lower border of the falling price channel on 4-hour chart. Minor consolidation of downtrend could be expected later today, however, another fall towards 1.3600 is still possible after consolidation. Resistance remains a the top of the price channel, only a clear break above the channel resistance could indicate that the fall from 1.4579 has completed.

Daily Forex Forecast

By GCI Forex Research

Fundamental Outlook at 1500 GMT (EDT + 0500)

€

The euro depreciated sharply vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.3725 level and was capped around the $1.3900 figure.  Several factors contributed to common currency’s weakness and the dollar’s strength.  First, there is growing concern that eurozone debt will continue to weaken.  Credit default swaps in the so-called “PIIGS” countries – Portugal, Ireland, Italy, Greece, and Spain – blew out 15 – 40 pips further today.  Second, the European Central Bank kept its benchmark interest rate at 1.0%, as expected.  ECB President Trichet said the ECB is “confident the Greek government will take all the decisions that will permit” Greece to reduce its budget deficit, including tax rises, public-sector wage freezes, and pension reform.  Third, dealers are nervous ahead of tomorrow’s U.S. January non-farm payrolls report amid reports there will be a sizable downward revision to previous calculations.  Fourth, G7 officials are convening in northern Canada from tomorrow and it is not known if officials will address the ballooning deficits in many countries or exchange rate misalignments.  Fifth, New York State Attorney General Cuomo announced lawsuits against Bank of America and former CEO Ken Lewis regarding its acquisition of Merrill Lynch.  Sixth, there have been some notable credit downgrades including one impacting Warren Buffett and warnings about the U.S.’s credit outlook.  Data released in the eurozone today saw German factory orders decrease 0.2% m/m and climb 8.4% y/y.  In U.S. news, data released today saw Q4 non-farm productivity up 6.2%, down from a revised 7.2%, while Q4 unit labour costs came off 4.4%, down from a revised -1.5%.  Additionally, weekly initial jobless claims worsened to 480,000 from a revised 472,000 and continuing jobless claims increased to 4.602 million from a revised 4.600 million.  Also, December factory orders printed at 1.0%, unchanged from the revised November print.  In addition to tomorrow’s non-farm payrolls data, December consumer credit data will be released.  Euro bids are cited around the US$ 1.3530 level.

¥/ CNY

The yen appreciated sharply vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥88.55 level and was capped around the ¥91.05 level.  The yen moved sharply higher across the board as traders shunned risk following a major sell-off in international equities markets, gold, crude oil, and other commodities.  Bank of Japan Governor Shirakawa will attend the Group of Seven meeting from tomorrow in northern Canada and will likely team up with finance minister Kan to express Japan’s dissatisfaction with China’s yuan currency policy.  BoJ Policy Board member Nakamura today called on the government to improve the country’s fiscal health and said it would be “disastrous” if interest rates move higher on debt woes.  Furthermore, Nakamura reported the downward pressure on prices in Japan will continue.  Data released in Japan yesterday saw January PMI services decline to 54.5 from 56.8 in December.  The Nikkei 225 stock index lost 0.46% to close at ¥10,355.98.  U.S. dollar offers are cited around the ¥94.75 level.  The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥121.55 level and was capped around the ¥126.45 level.  The British pound moved lower vis-à-vis the yen as sterling tested bids around the ¥139.35 level while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥82.95 level. In Chinese news, the U.S. dollar appreciated vis-à-vis the Chinese yuan as the greenback closed at CNY 6.8268 in the over-the-counter market, up from CNY 6.8266. Beijing reacted coolly today to pressure from the Obama administration regarding its yuan currency, saying “it is China’s own business.” Li also said there “will not be any sudden or major yen appreciation.”  It was reported that new Chinese loans last month exceeded CNY 1.5 trillion.

₤

The British pound moved lower vis-à-vis the U.S. dollar today as cable tested bids around the US$ 1.5730 level and was capped around the $1.5920 level.  As expected, Bank of England’s Monetary Policy Committee voted to keep its benchmark Bank Rate unchanged at 0.50% and decided to pause its ₤200 billion asset purchase program for the first time since March 2009.  BoE kept the door open to enact more purchases if need be in the future.  Dealers are increasingly concerned about the growing level of U.K. deficits and debt.  Data released in the U.K. overnight saw Halifax house prices up 0.6% m/m and 3.6% y/y.  Cable bids are cited around the US$ 1.5720 level.  The euro moved lower vis-à-vis the British pound as the single currency tested offers around the ₤0.8710 level and was capped around the ₤0.8755 level.

Forex 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 U.S. dollar and Japanese yen traded sharply higher in the forex markets and the U.S. stock markets registered steep declines as investor risk aversion was the dominate theme in trading today. The continuing fiscal problems in Greece as well as concern about the debt levels of Portugal and Spain weighed heavily on the euro today while the higher yielding currencies were affected by poor economic news.

The safe haven currencies (U.S. dollar and Japanese yen) were sent to higher levels versus the euro, British pound sterling, Australian dollar, New Zealand dollar, Canadian dollar and the Swiss franc in the forex markets. The U.S. dollar did fall sharply against the yen in head-to-head trading as the USD/JPY currency pair dropped under the 89.00 level to trade at its lowest level since December 14th.

The Japanese yen touched an 11-month high against the euro and the U.S. dollar reached over an 8-month high versus the European common currency.

The American currency made a multi-month high against the Canadian loonie as the USD/CAD pair reached the 1.0757 level for the first time since November 8th. The dollar also marked its highest point versus the Australian dollar since October 2nd at the 0.8607 level and climbed to its highest exchange rate versus the New Zealand dollar since September 4th at 0.6844.

The U.S. stock markets, meanwhile, ended the day with sharp declines as the Dow Jones industrial average fell by roughly 268 points and marked its largest declining day in 2010. The Nasdaq decreased by 65.48 points and the S&P 500 declined by 34.17 points. Oil fell lower by $3.95 to trade at $73.03 and gold plunged by $47.40 to the $1,064.00 per ounce level.

The U.S. weekly jobless claims release, coming one day ahead of Friday’s non-farm payrolls report, showed that new jobless claims increased last week by 8,000 workers a total of 480,000 unemployed workers. The 4-week moving average of unemployed workers also increased, gaining by 11,750 from the prior week to a total of 468,750. Friday’s market-moving job report should create further volatility in the markets and signal how well the U.S. economic recovery is progressing.

Out of Europe this morning, the Bank of England and the European Central Bank held their interest rates steady as widely expected at 0.50 percent and 1.00 percent, respectively. The Bank of England maintained their bond buying program at £200 billion but said that “further purchases would be made should the outlook warrant them.”

News out of the Asia-Pacific region this morning also helped to dampen risk appetite mood as Australian retail sales fell unexpectedly in December and New Zealand’s jobless rate jumped to a 10-year high in the 4th quarter of 2009. Australia’s retail sales declined by 0.7 percent after a 1.5 percent revised gain in November and surpassed market forecasts that were calling for a 0.2 percent rise.  New Zealand’s unemployment rate reached 7.3 percent in the 4th quarter, its highest level since the second quarter 1999. New Zealand’s job totals declined by 0.1 percent in the quarter and by 2.4 percent on an annual basis.

EUR/JPY 1-Hour Chart -The Euro dropping like a stone today versus the Japanese Yen in forex trading. The EUR/JPY fell approximately 400 pips today to touch its lowest exchange rate since February 24th, 2009.

The British Pound fell broadly against its major currency pairs today, following the Bank of England’s (BOE) decision to pause its 200 billion-Pound bond purchase plan. The decision to put a halt to the plan, the first time such a move has been made since its inception last March, was seen as a tactical move in order to gauge the British economic recovery. Furthermore, the BOE is apparently worried about future inflation as well as what will happen with the British budget deficit following the upcoming elections in May.

Following the decision, the Pound fell against both the Yen and U.S. Dollar. GBP/JPY tumbled from 142.50 earlier today, to its current level of 140.45. Similarly, GBP/USD went from 1.5860 in mid-day trading, to its current level of 1.5750.

Tomorrow, traders will want to pay attention to the British monthly PPI Input report, set to be released at 09:30 GMT. The report measures the difference in prices of goods and raw materials, and is seen as a major indicator of British economic health. With a predicted rise over last months figure, Sterling may be able to recoup some of it’s loses from today.