Month: June 2010

By Fast Brokers – The Aussie surged above key downtrend lines yesterday after employment changed data topped analyst expectations.  Additionally, Australia’s headline unemployment rate printed two basis points below analyst expectations.  Meanwhile, China’s trade balance revealed a larger than expected surplus, indicating demand for Chinese exports is strong.  Hence, China’s GDP growth rate could stay on track despite new retail state regulations, a positive for the Aussie due to Australia’s reliance on Chinese demand for its natural resources.  However, upward momentum in the Aussie has been capped at .85 right now after today’s data showed that prices in China are rising at a faster rate than anticipated while industrial production cools.  Therefore, China could be forced to raise rates and cool growth further despite rumblings in the EU.  Hence, China’s economic picture is not as rosy as yesterday’s trade balance data made it seem.  Regardless, gains in the Aussie from June lows are encouraging and stabilization in the EUR/USD and Cable is certainly positive.  We’ll have to wait and see whether the risk trade can extend this week’s upward momentum into a more substantial upswing.  Whether the risk trade ends the week on a positive note will depend on the outcome of upcoming U.S. consumption data with retail sales and consumer confidence on tap.  If U.S. consumption-related data tops analyst expectations this could boost the Aussie beyond .85.  On the other hand, disappointing U.S. data could keep the Aussie and risk trade as a whole at bay.

Technically speaking, the Aussie faces technical barriers in the form of intraday and 5/28 highs.  As for the downside, the Aussie has supports in the form of uptrend lines running from May lows along with 6/10 lows.

Price: .8468
Resistances:  .8469, .8500, .8523, .8547, .8565, .8587, .8617
Supports:  .8455, .8435, .8408, .8395, .8379, .8361, .8344
Psychological:  .85

(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 Fast Brokers – Gold has undergone a steady decline this week after setting fresh all-time highs.  The precious metal was unable to leave behind $1250/oz for the 2nd time in the past month and has since sunk back towards its psychological $1215/oz level after investors dipped back into the risk trade.  The EU news wires have been relatively quiet this week following last week’s worries concerning Hungary’s fiscal condition.  The break in news has allowed investors to hone in on fundamentals and return to risk since yesterday’s Asia data surprised to the topside.  However, this week’s decline in gold has been structured and gold maintains several layers of uptrend lines, meaning the precious metal’s uptrend is still healthy.  Both the Cable and Aussie have logged solid gains over the past two trading sessions while the EUR/USD creeps higher from May lows.  Meanwhile, investors are waiting for U.S. retail sales and consumer sentiment data, which should lead this week’s final trading session.  Additionally, although news from the EU has died down, investors should still keep an eye on the EU news wires since the potential for another negative development remains regardless of this week’s serenity.  Meanwhile, even though gold has exhibited a negative correlation with the risk trade this week, it wouldn’t be surprising if gold’s negative correlation with the dollar came back into play should the risk trade post a medium-term rebound.  Therefore, gold’s medium-term outlook could be positive as the precious metal benefits from a win-win position.

Technically speaking, gold faces technical barriers in the form of 6/10 and 6/8 highs.  Additionally, the psychological $1250/oz level should continue to serve as a solid technical barrier should it be reached.  As for the downside, gold has multiple uptrend lines serving as technical cushions along with 6/10 and 6/4 lows.  Furthermore, the psychological $1200/oz should serve as a solid technical support should it be tested.  Meanwhile, gold is running low on topside technical barriers, normally a positive sign for the near-term.

Present Price: $1220.00/ oz
Resistances: $1222.09/oz, $1225.20/oz, $1227.63/oz, $1229.56/oz, $1232.22/oz
Supports:  $1219.16/oz, $1215.42/oz, $1212.52/oz, $1210.36/oz, $1208.18/oz, $1204.80/oz
Psychological:  $1200/oz, $1250/oz

(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 Fast Brokers – The USD/JPY has been anchored between 91-92 despite this week’s strong risk rally.  Both the Cable and the Aussie have logged considerable gains over the past two trading sessions as bulls find salvation in a lack of developments in troubled EU economies.  Additionally, Australia employment and China export data both printed strong, boosting confidence in the sustainability of the global economic recovery.  However, China’s industrial production dragged and Chinese equity investors are still convinced that its economy is slowing.  Uncertainty in China could be keeping the USD/JPY at bay as investors aren’t quite ready to jump head first in the risk pool.  Meanwhile, Naoto Kan warned that Japan could face default if the government doesn’t get its fiscal house in order.  Therefore, it seems the fiscally conservative Kan is stepping forward rather than the Kan who previously favored a weaker Yen.  It seems Kan could be setting Japanese citizens up for higher taxes and budget tightening measures in order to help the DPJ gain momentum ahead of next month’s upper house parliamentary elections.  Fiscal conservation could prove to be a yen positive and could be another force keeping the USD/JPY range bound despite this week’s return to risk.  The risk trade will get another test today with the U.S. releasing retail sales and consumer sentiment figures.  Consumption related economic data tends to have a larger impact on the USD/JPY than other U.S. fundamentals since Japan’s economy is highly dependent on exports to the U.S.  Therefore, should U.S. retail sales surpass expectations this could help boost the USD/JPY towards previous June highs.  On the other hand, if today’s U.S. consumption data disappoints this could drag the USD/JPY back towards June lows.

Technically speaking, the USD/JPY faces multiple downtrend lines along with 6/7 and 6/4 highs.  As for the downside, the USD/JPY has technical supports in the form of multiple uptrend lines along with 6/7 and 6/1 lows.  Additionally, the highly psychological 90 level should serve as a solid technical support should it be tested.

Present Price: 91.56
Resistances: 91.70, 91.80, 91.97., 92.11, 92.25, 92.39, 92.58
Supports:  91.53, 91.38, 91.29, 91.13, 91, 90.86, 90.74, 90.62
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.

By Fast Brokers – The Cable continued Wednesday’s rally, surging back above 1.47 and is eyeing previous June highs as investors await UK manufacturing and PPI data.  Yesterday’s rally stemmed from encouraging Asia data.  Australian employment grew faster than anticipated while demand for Chinese exports surged.  Solid Asia data keeps hope alive that the wheels of the global economy are still rolling despite setbacks in the EU.  The U.S. will cap the week by releasing retail sales and consumer confidence data, meaning the trading week could end on a volatile note.  Last month’s UK manufacturing production was quite impressive and it will be interesting to see whether the recent wave of strong UK data continues.  The Pound has undergone considerable depreciation, so a corresponding increase in demand for UK manufactured goods would not be surprising.  More positive UK data could help the Cable overcome previous June highs barring a negative psychological event in the EU.  That being said, investors should keep a close eye on the EU news wire since even though no news is good news, the EU is still fiscally troubled and it is unknown whether another shoe will drop.  Yesterday’s BoE meeting was a nonevent as the central bank kept its monetary policy unchanged despite the discouraging developments in the EU.  Meanwhile, investors will have to wait until next week’s release of the BoE’s monetary policy meeting minutes in order to get a better idea of how King & Co. feel about the UK’s condition economically.  For the time being, all eyes will be on the broad-based risk trade to monitor just how far traders can extend the rally from May lows.

Technically speaking, the Cable still faces multiple downtrend lines along with 6/2 and 5/7 highs.  Additionally, the highly psychological 1.50 level would likely serve as a solid technical barrier should it be tested.  As for the downside, the Cable has fresh uptrend lines running through May and June lows along with 6/10 lows and the psychological 1.45 level should it be tested.

Present Price: 1.4707
Resistances: 1.4739, 1.4769, 1.4819, 1.4854, 1.4890, 1.4912
Supports: 1.4690, 1.4648, 1.4583, 1.4552, 1.4526, 1.4498
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 Fast Brokers – The EUR/USD is consolidating after climbing back above 1.20 in the wake of a return to a risk trade across the board.  No news in the EU has proven to be good news for the EUR/USD as sovereign concerns abate.  Additionally, solid data from Asia has given a boost of confidence to investors that the global economic recovery is on track despite weakness in the EU.  Both employment in Australia and demand for Chinese exports surpassed analyst expectations.  Since the EU has been relatively quiet on the data wire this week, positive fundamentals in Asia have allowed the risk trade to rebound and the Euro is following suit.  Meanwhile, the ECB kept its previous monetary policy unchanged and Trichet also gave a boost to investor confidence by upping the central bank’s expectations for EU GDP growth.  A depreciation of the Euro should boost demand for European made goods, buoying GDP despite budget cuts designed to smash speculators.  However, investors should remain cautious.  Just because there has been no news does not mean that conditions in PIIGS countries have changed fundamentally.  Serious problems remain and the potential for another negative development is on the table.  Regardless, stability in the EUR/USD is welcome and it will be interesting to see whether the currency pair can extend its new upward momentum.  The FX markets should end the week with a kick since the U.S. will release retail sales and consumer sentiment data.  An improvement in U.S. consumption could drive the risk trade higher, whereas a surprise setback in consumption-related data could drag the EUR/USD back towards 1.20.  1.20 is a key psychological level and it wouldn’t be surprising to see another near-term battle ensue.

By Forex Yard – The majors were mixed in this morning’s trading following positive economic data from China. However, the weeklong jump in the markets from greater risk taking appears to be losing steam as the EUR/USD and the GBP/USD failed to break significant resistance levels.

Chinese retail sales numbers jumped 18.7% on expectations of 18.6% increase in the previous year. This provided a spark for traders to add to their riskier positions. But inflationary data showed the Chinese economy may be overheating as year over year CPI rose to 3.1% on expectations of a rise of only 3.0%. The previous year had inflation climbing 2.8%. Traders are concerned that the Chinese government may take further steps to cool their economy, including a potential revaluation of the yuan.

The EUR/USD was higher at 1.2120 after an opening day price of 1.2100. The pair reached as high as 1.2139 but failed to make a significant breach of this resistance level. The cable was trading lower at 1.4650 from an opening price of 1.4709. The direction of the pair reversed following a failed breach of the 1.4750 resistance level.

This afternoon, traders will be anticipating key economic data from the U.S. Monthly core retail sales is due out at 12:30 GMT with economists’ forecasts for an increase of 0.1%. Positive numbers from the U.S. could help to increase traders risk appetite, thereby increasing the value of the euro. A break of the resistance line for the EUR/USD could propel the pair to its next resistance line at 1.2300. The same would apply to the GBP/USD with the next resistance at 1.4810.

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 ForexYard – Today the most anticipated weekly news event would determine markets direction today and possibly the beginning of next week trading. At 12:30GMT U.S. Core Retail Sales would give investors’ a signal about economic recovery. Figure is forecasted at 0.1% rise, lower than previous figure which came at 0.4%, any positive surprise is likely to prolong recent up trend of riskier currencies such as the EUR, GBP, CAD, and Crude Oil. The opposite would happen if data turns worse than expected.

Earlier today, UK reports would influence the first part of the trading session. UK Reports about Manufacturing Production and PPI Input, forecasted at 0.6% and -0.9% respectively are lower than the previous released. If data disappoints it may put an end to gbp/usd and eur/usd recent rally.

Although no central bank speeches are expected today, traders should monitor the media for interviews. It seems lately that remarks by central banks chairman’s or financial leaders have more impact over the markets than economic news.

Traders are advised to follow the eur/usd, gbp/usd, Gold, Crude Oil and usd/cad. These pairs and commodities have made substantial move yesterday and present an opportunity to profit, if they change direction, or if news are positive they might reach new weekly records.

08:30 GMT GBP – Manufacturing Production
The report is a leading indicator of economic health. During this time of growing fiscal debts, investor’s are looking for signs of economic growth or at least economic stability. Positive data would support yesterday’s Pound rally to end the week at weekly record high. Previous figure came at 0.1% above forecasts. Forecasts today are for 0.1% rise while previous figure is at 0.4%.

08:30 GMT GBP – PPI Input
Producer Price index (PPI) report is released ahead of CPI, and is a good indicator of consumer inflation. While there are fears of deflation this figure would take of some of the uncertainty. Forecasts are at -0.9%, such figure is not a healthy signal for UK’s economy, although it means that interest rates may remain low for some time.

12:30 GMT USD – Core Retail Sales
Core Retail Sales is the most anticipated figure for this week. This figure is excluding car sales. It is a clear indicator about the U.S. economic health. Positive outcome would no doubt increase investors’ confident and boost riskier currencies and market indices further. It measure consuming spending trends, when consumers spend economy should be growing.

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.

Source: ForexYard

The EUR/USD pair kicked off during yesterday’s trading session for a second consecutive day this week. Investors turned to buying the Euro after positive economic news in China. The pair received further support by Bernanke, who stated in his speech to act as needed to aid financial stability and economic growth, increasing the likelihood U.S. rates would remain at record lows even longer than previously anticipated.

British Pound and other riskier currencies gained yesterday after investors confidence improved following Trishet, ECB chairman and IMF chairman speeches. Investors put aside fears about Europe fiscal debts, after being assured by Trichet that more rescue plans would be issued if required.

Crude Oil also made a sharp rebound while price per barrel traded above $75 4 weeks high, and 300pips up compared to yesterday’s open price. Gold suffered from risk averse and price per ounce declined sharply to $1215, after hitting record high at the begging of the week.

Economic News

USD – Dollar Heavily Retreated Versus Riskier Currencies

The Dollar pulled back during yesterday’s trading session against its major counterparts while investors put aside fears about Europe Economy. Growing appetite for risk came in respond to speeches by Bernanke, U.S. central bank chairman, Trichet, Europe Central Bank Chairman and IMF, international Monetary Fund, chairman. All stated they would act to support their economies to ensure growth including keeping interest rates at record low levels.

The EUR/USD pair rose by more than 100pips since yesterday’s trade session, the pair crossed a significant support level and is expected to trade above 1.2075 at day start. The USD traded lower against the CAD, the pair is currently at 1.0330. The cad was supported by a sharp rise in crude oil price. The GBP/USD pair rose by 125pips, and although the pair is now lower than yesterday’s high it is trading above $1.4700 during Asia trading hours.

Looking ahead, today traders are advised to follow reports published at 12:30 GMT. U.S. will release retails sales data, which is forecasted to be lower than previous, therefore signaling economic recovery retreat. However, if they are at least above forecast it should boost the Euro further up.

EUR – ECB Meeting boosted the EUR/USD Pair

The Euro ended higher against the U.S. Dollar yesterday supported by Bernanke. In his speech he claimed that the U.S. is committed to ensuring the survival of the euro. The Euro also received local support from Trichet who approached the media right after the European Central Bank (ECB) meeting. Trichet announced that the ECB would buy back Europe bonds if necessary, this came less than 24 hours after a previous announcement stated they would not intervene in the bond market. Trichet also announced the ECB would keep rates at 1%, but this came with no surprise as it came with line of forecasts. The change in ECB strategy helped to boost the EUR against its major counterparts.

The Euro climbed 100pips versus the U.S. Dollar yesterday while investors gain renewed confidence in the European currency. The EUR/JPY pair was also up currently trading above 111. Fears of the European fiscal debts faded yesterday and in general investors responded by selling safe haven currencies and returning to riskier ones.

The faith in Euro might continue during today’s trading session if news published thorough the day come above forecasts. Traders should continue to monitor statements of financial leaders, because lately they influence the currency market even more than news events. No major speeches are planned today.

JPY – Yen Weakens vs. Majors

No major news came from Japan yesterday to influence the Japanese Yen currency. The Yen was weaker against its major counterparts, in accordance with investors’ selling safe haven currencies. Investors confident in EUR was lifted after Trichet announced the ECB would keep rates at 1%, and his re-assuring to buy bonds thus support the European countries with high debts if required.

Looking ahead, today there are no data releases by Japan. The Yen will continue to decline in case investors remain confident about the European economy and global recovery. The Yen would rise if fear take’s over again. Fear about the economy may result by lower than expected data released later today, new rating downgrade for Europe or new warning about Europe growing Fiscal debts would also support the Japanese Yen.

OIL – China’s Rising Exports and Uprising EUR boosted Crude Oil price

China’s positive economic data published early morning yesterday, helped boost Crude oil price to 4 weeks high above $75. Crude oil may still reach $77 dollar per barrel if good reports would continue to support global recovery.

Traders should pay attention today to UK Manufacturing Production report published at 8:30 GMT, forecasts are at 0.6% increase which is much lower than previous figure 2.3%. Due to the wide gap between previous and forecasted it is unlikely that data would surprise investor’s enough to send crude oil much higher than $77. At 12:30 GMT, U.S. Core Retail Sales may provide a boost to crude Oil price, if data turns out higher than 0.1% forecast.

Gold price on the other hand declined, after it reached as low as $1215 per ounce during yesterday’s trading session. Gold has recently gained from fears about the global economy. In fact Gold has turned to the new safe haven, gold price reached record high of $1250 the beginning of the week. Therefore it is no surprise to see gold price declining when fears fade off.

Technical News

EUR/USD

The daily chart’s RSI signals that this pair is being over-sold and will likely see strength added to the recent upward movement. However, a bearish cross on the hourly chart’s Slow Stochastic signals that a downward correction may be imminent in the nearest time frame. Waiting for a clearer signal may be the right strategy today.

GBP/USD

The price for this pair currently floats in the over-sold territory on the 4-hour chart’s RSI, indicating that an upward correction may occur later today. The recent bullish cross on the 4-hour chart’s Slow Stochastic supports this notion while the hourly chart’s Bollinger Bands are beginning to tighten, indicating that moderate price volatility is imminent. Going long with tight stops might be the right choice today

USD/JPY

It appears that the price has recently moved towards the upper border of the hourly chart’s Bollinger Bands, indicating that there is downward pressure. However, a bullish cross on the daily chart’s Slow Stochastic indicates that there may be some momentum left in the recent upward correction. It may be a good strategy to wait for a clearer signal from this pair.

USD/CHF

The bullish trend is loosing its steam and the pair seems to consolidate around the 1.1440 level. The daily chart’s RSI is already floating in an overbought territory suggesting that a recent upwards trend is loosing steam and a bearish correction is impending. Going short with tight stops appears to be preferable strategy

The Wild Card

USD/CAD

It appears a violent breach of the lower border on the daily chart’s Bollinger Bands has recently occurred, signaling that there is upward pressure on this pair. Supporting this notion is an imminent bullish cross on the daily chart’s Slow Stochastic and a recent bullish cross on the 4-hour chart’s Slow Stochastic. The RSI on the 4-hour chart also indicates that the price currently floats in the over-sold territory. Forex traders can benefit by entering long positions early and riding out this imminent upward price movement.

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 eToro – Better than expected global economic data pushed investors back into riskier assets, this pressed the Euro higher.  The EUR/USD needs to clear the 1.2120 resistance level to continue higher.

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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.

EURUSD’s bounce from 1.1876 extends to as high as 1.2147 level. Further rally is still possible later today and target would be at the upper border of the falling price channel on 4-hour chart. As long as the channel resistance holds, the price action from 1.1876 is treated as consolidation of downtrend from 1.3817 (Mar 17 high), and another fall to 1.1800 is still possible. However, a clear break above the channel resistance will indicate that the fall form 1.3817 has completed at 1.1876 already.

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