Month: June 2010

By eToro – The Euro rallied almost a big figure after a solid Spanish Auction, to end the trading session close to 1.24. The correction will likely continue to 1.2500 and then 1.2650.

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Forex Market Analysis provided by eToro

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AUDUSD remains in uptrend from 0.8080 and the price action from 0.8666 is more likely consolidation of uptrend. Another rise is still possible after consolidation and next target would be at 0.8800-0.8850 area. Key support is at 0.8505, only fall below this level will indicate that the uptrend from 0.8080 is complete.

Forex Analysis

By CountingPips.com

The euro continued to climb higher in forex trading against the U.S. dollar today as the EUR/USD currency pair touched its highest level since May 28th. The European common currency has now increased for eight out of the last ten days (vs. the dollar) as its rebounds from a four-year lowpoint reached on June 6th at the 1.1876 exchange rate. Today, the EUR/USD pair opened the day near the 1.2300 mark and dipped in early trading to 1.2242 before being supported around 1.2550 and turning higher. The high for the day was at 1.2411 and marked the euro’s highest level since May 28th when the pair reached an intraday high of 1.2453.

Staying above the 1.2330 level (2008 low point) will be crucial to see further upside potential in the EUR/USD with the 1.2600 level looming as potential resistance. The 1.2600 area has acted as previous support/resistance area and the 38.2 fibo retracement from 1.3817 to 1.1876 is right around the 1.2615 level. Below 1.2330, the 1.2150 level (recent support) and 21-day simple moving average (1.2225, green line) levels are of potential support while a break below the 1.2150 level will provide downside pressure for a retest of the 1.1876 level.

EUR/USD Daily Chart

By GCI Forex Research

Fundamental Outlook at 1400 GMT (EDT + 0400)

€

The euro appreciated vis-à-vis the U.S. dollar today as the single currency tested offers around the US$ 1.2410 level and was supported around the $1.2240 level.  The common currency continued its ascent and reached its highest level since 28 May as dealers reacted positively to a successful €3 billion Spanish bond auction and news that Bank of Spain will publish the details of the stress tests on its banks and banking system.  European Union officials will convene in Brussels to discuss economic issues and the Stability and Growth Pact.  There is an initiative among some European leaders to publish the stress tests on all European banks.  The European Central Bank released its June monthly bulletin today and it was nearly identical to remarks made by ECB President Trichet last week after the ECB kept its main refinancing rate unchanged at 1.0%.  The EU and the International Monetary Fund reported Greece is making good progress to reduce its deficit pursuant to its €110 billion rescue package.  The EU will also seek a global transaction tax.  Germany’s Kiel Institute today predicted the ECB will hike rates in Q4 2011.  Data released in the eurozone today saw April construction output decline 0.3% m/m and fall 6.1% y/y.  In U.S. news, data released today saw May headline consumer price inflation off 0.2% m/m and up 2.0% y/y while the ex-food and energy component was up 0.1% m/m and 0.9% y/y.  These data reflect the fact that core inflation remains very tame.  Other data saw weekly initial jobless claims climb to 472,000 from 460,000 while continuing jobless claims increased to 4.571 million.  Other data saw the June Philadelphia Fed index decline to 8.0 from 21.4 and May leading indicators improved to 0.4% from 0.0%.  Finally, the Q1 current account balance worsened to –US$ 109.0 billion from the revised previous level of –US$ 100.9 billion.  U.S. legislators are seeking to force the Fed to make greater disclosures.  Euro offers are cited around the US$ 1.2460 level.

¥/ CNY

The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥90.95 level and was capped around the ¥91.45 level.  A Reuters survey is noting Japanese manufacturers are the most optimistic they have been in a couple of years and this could preface an improvement in next month’s Bank of Japan Tankan survey.  Japanese household assets are now at their highest level in nearly two years and Japanese companies are sitting on a record amount of cash totaling about ¥202.7 trillion.  Households’ financial assets surged 3.1% y/y to ¥1.453 trillion and these data evidence the degree to which companies and consumer are hoarding cash.  Moreover, the household data reflect the significant deflation problem in Japan where final private demand remains anemic.  Yesterday, Bank of Japan kept its economic assessment unchanged after improving its assessment in May following better capital spending and foreign trade. Other data released overnight saw the April leading index remain steady at 101.7 while the April coincident index fell to 101.3.  Minutes from the BoJ May Policy Board meeting will be released tonight. The Nikkei 225 stock index lost 0.67% to close at ¥9,999.40.  The euro moved higher vis-à-vis the yen as the single currency tested offers around the ¥113.15 level and was supported around the ¥111.65 level.  The British pound moved higher vis-à-vis the yen as sterling tested offers around the ¥135.45 level while the Swiss franc moved higher vis-à-vis the yen and tested offers around the ¥82.05 level. In Chinese news, the U.S. dollar depreciated vis-à-vis the Chinese yuan as the greenback closed at CNY 6.8291 in the over-the-counter market, down from CNY 6.8334.  People’s Bank of China sold one-year bills at an unchanged yield overnight for the first time in nearly three weeks and this is a signal from the central bank they are not contemplating raising rates now.  A PBoC survey released overnight indicated a record number of Chinese households have called home prices “unacceptable” on account of dissatisfaction with the level of inflation.  PBoC promoted Du Jinfu to be a Vice Governor.

£

The British pound appreciated vis-à-vis the U.S. dollar today as cable tested offers around the US$ 1.4835 level and was supported around the US$ 1.4645 level. Data released in the U.K. today saw May headline retail sales climb 0.6% m/m and 2.2% y/y while the ex-auto fuel component was up 0.5% m/m and 3.4% y/y.  Also, June CBI trends total orders worsened to -23 from the previous -18 reading.  Chancellor of the Exchequer Osborne spoke last night and said the U.K. government plans to abolish the Financial Services Authority and provide most of its power to the Bank of England.  Osborne plans to replace the regulator with three entities over the next two years.  Critics have suggested Brussels will still call the shorts and this amounts to little more than re-branding of regulatory duties.  Hector Sants is becoming a new Deputy Governor at Bank of England.  BoE Governor King indicated he welcomes the central bank’s new responsibilities and indicated policy will be tightened at an appropriate time, noting rates may be lifted before bonds are sold.  The April ILO unemployment rate ticked lower to 7.9%.  The euro appreciated vis-à-vis the British pound as the single currency tested offers around the £0.8380 level and was supported around the £0.8335 level.

CHF

The Swiss franc appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the CHF 1.1110 level and was capped around the CHF 1.1330 level.  As expected, Swiss National Bank kept its three-month Swiss franc Libor target rate unchanged at 0.25%. Swiss National Bank Chairman Hildebrand effectively eased its stance on the Swiss franc today, saying the risks of deflation have “largely disappeared.”  SNB also warned it cannot keep interest rates at a record low in the medium term without engendering inflation.  Traders interpreted these comments as an indication SNB will be less likely to intervene by buying euro for francs.  SNB also raised its 2010 economic growth forecast to 2.0% from about 1.5% in March.  SNB also sees CPI around 2.2% in 2012 and accelerating to 3.1% in early 2013.  Data released in Switzerland today saw Q1 industrial production off 7.8% q/q and up 5.3% y/y.  U.S. dollar offers are cited around the CHF 1.1470 level.  The euro came off vis-à-vis the Swiss franc as the single currency tested bids around the CHF 1.3755 level while the British pound moved lower vis-à-vis the Swiss franc and tested bids around the CHF 1.6430 level.

Forex Daily Market Commentary provided by GCI Financial Ltd.

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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 Russell Glaser – The euro is beginning to stage a comeback against the dollar as the EUR/USD has come off of its lowest point in four years. For those traders who have been bearish on the euro and using a simple trending system as is described below, the time has come to close those positions as a technical indicator is providing a signal to liquidate.

One of the easiest and most common trending systems to use is the Double Crossover Method. This simple system uses two moving averages. The most-used combinations are the 5 and 20 days, along with the 10 and 50 days. Some traders also prefer to use a different moving average. Some prefer the exponential moving average or the weighted moving average.

For the EUR/USD daily chart below, we will be using the 5 and 20 day simple moving averages.

A buy signal is given when the faster, 5 day moving average (green) line crosses above the slower, 20 day moving average line (red).

A sell signal is given when the faster, 5 day moving average line (green) crosses above the slower, 20 day moving average line (red).

Since December when the current bearish trend began, the system has provided 4 signals to sell the EUR/USD. The respective time periods a trade would have remained open would have been noted on the chart below.

I don’t advocate opening a trade in the direction of the signal every time. Obviously those traders who opened at the short signals would have faired much better than those who opened only long positions, or those who opened at every buy and every sell signal.

Certainly other parameters must factor into the equation before a trader takes a position in the market. As the markets may only be in a trending phase 50% of the time, with the other half of the time spent in a range trading period, traders need to identify where the long term trend is and if indeed the market is showing signs of a trending environment.

One tool for identifying the trend is the ADX indicator. This discussion won’t dive into the specifics of the ADX indicator, but it is used to identify a trending environment versus a range trading environment.

Looking to the far right edge of the chart below, traders can see the 5 day moving average line crossing above the 20 day moving average line. Once a cross is made, this is a signal to close out short positions.

Instead of immediately opening a new long position, traders may want to wait for the next time the 5 day moving average crosses below the 20 day moving average, and go short.

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.

By Fast Brokers – The Cable is battling its psychological 1.48 level once again after bouncing off of intraday lows in the wake of an uptick in UK retail sales data.  The improvement in consumption comes after another solid claimant count change figure, both encouraging developments in regards to the sustainability of the UK’s economic recovery.  Although the UK will release mortgage approvals and public sector borrowing data tomorrow, the remainder of the trading week should be about the EU and U.S.  Spain is fighting the flames of this week’s rumors that it will need a liquidity lifeline by announcing the government will release the bank stress test results.  Meanwhile, EU leaders are meeting today for a one day summit as the discuss how to create a more unified and stable financial system throughout the union.  If leaders leave the summit with a coordinated response this could help bolster confidence in the Euro and help lift the risk trade across the board as the FX markets participate in a psychological tug of war.  In addition to developments in the EU, investors will also be paying close attention to today’s U.S. data set.  The U.S. will release CPI, weekly unemployment claims and the Philly Index.  The key figure will likely be CPI.  If prices rise faster than anticipated this could place a bit of downward pressure on the Cable over concern that the Fed may have to raise rates sooner than anticipated.  On the other hand, if inflation stays in check then this will get the Fed the green light to keep the gates of liquidity open, a positive for the Cable.  In all, despite the fact that considerable economic headwinds remain, investors are gaining more confidence by the day in the risk trade as the Cable and most other dollar pairs regain more ground from May lows.

Technically speaking, the Cable faces downtrend lines running through April highs along with 6/14 highs and the psychological 1.48 level.  As for the downside, the Cable is developing a new near-term support structure, including downtrend lines running through May and June lows.  The Cable also has technical supports in the form of 6/14 and 6/11 lows along with the 1.47 and 1.46 level should they be tested.

Present Price: 1.4800
Resistances: 1.4810, 1.4854, 1.4890, 1.4912, 1.4953, 1.4988
Supports: 1.4750, 1.4720, 1.4680, 1.4628, 1.4585, 1.4544
Psychological: 1.50, 1.45, June 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 regarded neither 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 Dan Eduard – For our technical analysis today, we will be looking at a not so frequently traded pair. While GBP/NZD has been steadily declining over the last 10 days, it appears that sterling is now poised for a comeback.

In our analysis, we will be examining the 4-hour chart provided by ForexYard. The technical indicators we will be using are Bollinger Bands, Stochastic Slow and Relative Strength Index (RSI).

1. The currency pair is currently trading right on the lower Bollinger Band, which usually serves as an indication that a bullish trend may occur in the immediate future.

2. A cross in the Stochastic Slow lines at the 20 level helps support our theory. Typically, when a cross occurs at this low of a point, an upward trend begins to develop.

3. Finally, traders can see that the RSI level is currently right on the lower support line. Traders can further take this as a sign that a bullish correction will take place shortly, further confirming our original hypothesis.

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.

By Fast Brokers – The EUR/USD is popping higher from its recent consolidation despite the fact that the spread between Spanish and German bonds have reached an all-time high.  Spain still managed to auction off over $3 billion worth of bonds, boosting investor confidence that Spain will be able to support itself on the open market.  Additionally, investors are feeling confident after news that Spain plans on releasing the results of its bank stress tests.  Spain going public with its stress test results is leading some investors to believe that its financial industry may not be in as bad of shape as previously anticipated.  Meanwhile, EU leaders are meeting for a one day summit to discuss means of better coordinating financial policy throughout the union.  Leaders are emphasizing greater financial regulation and investors will be paying close attention to comments emanating from the summit.  Overall, it seems the Euro is receiving a steady inflow of money as the currency outperforms the Pound, highlighted by a solid bounce in the EUR/GBP.  Investors are now waiting for America’s data set, which includes CPI, the Philly Index, and weekly unemployment claims.  The data wire will be relatively quiet tomorrow, meaning today’s U.S. data and results from the EU summit should be the driving forces across the board over the remainder of the trading week.

Technically speaking, the EUR/USD still faces downtrend lines, though the near-term barriers are withering.  The EUR/USD does face topside obstacles in the form of intraday and 5/28 highs.  Additionally, the psychological 1.25 level could serve as a solid barrier should it be tested.  As for the downside, the EUR/USD has growing near-term uptrend lines serving as technical cushions along with intraday and 6/15 lows.

Present Price: 1.2387
Resistances: 1.2415, 1.2437, 1.2466, 1.2488, 1.2526, 1.2546, 1.2562
Supports:   1.2380, 1.2357, 1.2332, 1.2313, 1.2294, 1.2267, 1.2243
Psychological: June lows and highs, 1.23, 1.25, 1.20

(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 regarded neither 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.

Market Analysis by Finexo.com

Today is expected to be a very busy say, as many key numbers and events are scheduled to be released.  The Swiss central bank is expected to keep its benchmark interest at 0.25%; however, SNB rhetoric on a future course of action could be significant.

Across the Atlantic, the U.S will release its CPI figure as well as the Philly Fed manufacturing index. Both of these key economic numbers could be helpful in determining a future monetary policy action by the Fed. Better than expected numbers could boost the dollar, as the Fed would be less concerned about the frailty US economy, and would instead be more focused on an exit strategy.

EURUSD

After failing to break above the 1.2350 mark, it appears that the Euro’s rally may be coming to a halt.  The single currency fell yesterday, as renewed concerns about Spain’s fiscal situation as well as the European banking system pulled the currency down from its two week high.

Traders will be watching the Spanish bond auction today after the spread of Spanish government bond yields over benchmark bonds soared to a an all time high yesterday – the country is scheduled to sell 2020 and 2041 year bonds. Moreover, any commentary from the EU summit today, in terms of policy gauging to address EU debt problems, could have a significant impact on the single currency zone.

Support/Resistance 1.2255/1.2310

GBPUSD

The pound lost ground yesterday, despite the improvement in UK Jobs numbers. Yesterday’s claimant Count Change, which shows the number of people claiming unemployment benefits, dropped by 31K people – the fourth month in a row that such an improvement is seen. Nonetheless, the cable retreated from a high of around 1.4850 to find support at 1.4690.

Up ahead, today’s release of the monthly Retail Sales for May could have a significant impact on the British currency. This major consumer related figure increased slightly in the past two month, reflecting the nation’s weak economic growth. This time around, the market predicts a slight rise of 0.1%. While a better than expected number could boost the Pound, a drop in the number could bring the currency under renewed selling pressure.

Support/Resistance 1.4690/1.4760

Forex Market Review & Analysis by Finexo.com

Disclaimer: Trading the foreign exchange (Forex) carries a high level of risk, and may not be suitable for all investors. All information and opinions contained on this website are to be used for general informational purposes only and do not consitute investment advice.

By Fast Brokers – The USD/JPY is still in hibernation and edging lower towards 91 despite another solid pop in the EUR/USD.  The USD/JPY’s lack of participation to the topside amidst the recent risk rally is a bit disconcerting since they are normally positively correlated.  However, the USD/JPY is still range bound and the currency pair could move in either direction, so we will have to wait and see how conditions in the FX markets develop.  News has been light out of Japan today as investors await next month’s upper house elections.  Focus remains on the EU as Spain fights investor uncertainty by announcing it will release the results from its bank stress tests.  Additionally, EU leaders are meeting for a one day summit in an effort to exemplify an essence of coordination throughout the union while shoring up investor confidence.  However, tripwires are still on the ground as the gap between Spanish and German bond yields reach all-time highs.  Attention will shift to the U.S. later as earnings trickle in and the government releases CPI, Philly Index, and weekly unemployment claims data.  If the U.S. data set comes in positive this should help buoy the USD/JPY.  The BoJ will release its monetary policy meeting minutes tomorrow and it will be interesting to see if the central bank addresses the government’s deflation concerns.  The data wire will be relatively quiet around the globe tomorrow, meaning the FX markets will likely be driven by today’s U.S. data and any psychological developments in the EU.

Technically speaking, the USD/JPY faces multiple downtrend lines along with 6/14 and 6/4 highs.  As for the downside, the USD/JPY has technical supports in the form of multiple uptrend lines along with 6/10 and 6/1 lows.  Additionally, the highly psychological 90 level should serve as a solid technical support should it be tested.

Present Price: 91.22
Resistances: 91.45, 91.58, 91.70, 91.85, 91.97., 92.11, 92.25
Supports:   91.13, 91, 90.86, 90.74, 90.62, 90.50, 90.31, 90.20
Psychological:  .90, .92, June 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 regarded neither 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.