Month: July 2010

By eToro – The 1.30 level has proved to be robust resistance, as the Euro has failed to gain ground despite multiple attempts at higher levels.  The Euro is likely to grind higher and test 1.3095.

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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.

Yesterday’s trading ended flat for the EUR/USD pair but volatility was high. Traders moved from selling the EUR before European session started, to buying the EUR before U.S. trading session started and eventually the pair finished near the day opening rate. The pair ranged $1.2965 to $1.3040.

Any move below 1.2965, would signal a correction while any move above 1.3040 would signal another rally. Other currencies such as the EUR/JPY and USD/JPY are beginning to form correction signals.

It is still early to decide if yesterday was a beginning of a correction or a single day of profit taking. Looking for today, lack of important news events is expected to keep trading calm as analysts’ learn yesterday’s data, but tomorrow more news from the U.S. should put more light on the economy.

Volatility should rise toward next week which is the first week of August and hold plenty of macro data and important news events. Traders should start to plan trades and positions for next week as it is going have a lot of impact on currencies and we are likely to wildness large movements in prices.

Here is a roundup of the day’s main economic indicators:

• 12:30 GMT, U.S. Unemployment Claims – This report measures the number of individuals who filed for unemployment insurance for the first time during the past week. If the end result will be lower than the expected 457,000 – the Dollar might rise against the majors.

USDJPY’s bounce from 86.26 extended to as high as 88.11 level. Further rise towards the upper boundary of the falling price channel on 4-hour chart is still possible, and next cycle top is nearing. Key support is at 86.80, a break below this level will indicate that a cycle top has been formed at 88.11, then the following downward movement could bring price towards 84.82 (2009 low).

Daily Forex Forecast

By Adam Hewison – In today’s video we look at the technical aspects of Amazon and see
what’s causing it not to go up at this point in time.

Analyzing the market in-depth, we can see that Amazon has hurt itself
technically. According to the chart, we can anticipate that it is going
to take some time to repair or even overcome the current level resistance.

This new short video outlines the areas we feel must be challenged to
change the present trend. We also look at some downside target zones that
may be possible for this stock.

As always our videos are free to watch and there are no registration
requirements.

We would love to hear your thoughts on Amazon.

Watch the New Video Now….

All the best,
Adam Hewison
President of INO.com
Co-founder of MarketClub

By CountingPips.com

Durable goods orders fell unexpectedly in June and for a second month in a row, according to a report released by the U.S. Commerce Department today. New orders for durable goods orders declined by 1.0 percent or by $2.0 billion to a seasonally adjusted total of $190.5 billion in June. Today’s report follows a revised decrease of 0.8 percent in new orders for May. Contributing to the slowdown in orders for June was a 25.6 percent decrease in orders for commercial aircraft as transportation equipment fell by 2.4 percent for the month.

Durable goods are assets that are generally considered to last more than three years. Despite June’s decrease, new orders for durable goods are still 16.5 percent above the June 2009 level.

Today’s data came in worse than the market forecasts that were expecting durable goods orders to increase by approximately 1.0 percent for the month.

New orders for durable goods, excluding transportation, dipped by 0.6 percent in June following a revised increase by 1.2 percent in May. Market forecasts were predicting an increase of 0.4 percent in durable goods minus transportation.

Shipments of durable goods were down for a second straight month in June by 0.3 percent and unfilled orders fell 0.1 percent while durable good inventories increased by 0.9 percent, advancing for a sixth consecutive month. June nondefense orders for new goods declined by 1.6 percent while defense orders for capital goods fell by 6.8 percent.

FOREX: US Dollar mostly lower today, Stocks muted in early trading

The U.S. dollar has been mostly lower in forex trading this morning against the other major currencies while the U.S. stock markets have been close to unchanged from the opening bell. The dollar has gained today versus the Australian dollar and New Zealand dollar while falling against the euro, British pound, Canadian dollar, Japanese yen and the Swiss franc, according to currency data by Oanda.

The U.S. stock markets, meanwhile, have edged slightly lower so far this morning with the Dow Jones falling by 20 points, the Nasdaq decreasing 5 points and the S&P 500 down by 3 points. Oil has edged lower by $0.66 to $76.84 while gold is virtually unchanged and trades at the $1,158.00 per ounce level.

By Greg Holden – The recovery of the euro appears to have gotten underway, with previous psychological barriers being broken daily this week. We’ve already seen breaches on the EUR/USD, EUR/CHF, and the EUR/CAD; it appears like we now have a breakout forming on the EUR/JPY as well.

This pair was flat for a number of months, but appears, as of the past week, to have broken out of its sideways trading behavior and is climbing higher.

Technical Analysis

– The chart below is the EUR/JPY daily chart provided by ForexYard. The indicators shown are the Relative Strength Index (RSI), MACD/OsMA, and Fibonacci retracement lines were drawn.

– As we can see in the chart, the price is currently testing the 23.6% Fibonacci retracement level and may possess the momentum to break past, as per our indicators and general market news.

– Both the RSI and MACD are floating in neutral territory, but within a clear upward channel. While this doesn’t provide us with the strongest indication of direction, it gives us an idea of the statistically average movement. More importantly, it does not give us an indication that it will correct downward and re-enter the flat trading range.

– Fundamentally speaking, the euro zone has recently seen a wave of bank stress tests which regional banks appear to have no problem passing. Sentiment throughout Europe is improving and the euro is climbing steadily as a result. This has led to a boost in risk appetite which drives typical safe-havens (such as the JPY) downward.

– If we see the price break through the 23.6% level, priced at 114.75, we may expect to see the price rising towards the next significant level at the 38.2% line, with a price target just below 120.00. For those interested, that’s 500+ pips of profit with the proper trade!

EUR/JPY – Daily 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.

UBS, a diversified global financial services company, soared by 8.91% to $16.50 per share yesterday when the company reported a better-than-expected second quarter earnings. Sentiment on the stock was downbeat during the second quarter as evidenced by the stock’s decline because of the scare that was brought about by the debt crisis in the euro zone. Business especially among financial firms may have been subdued at that time because of the reluctance of the banks to trade and even lend out. Still, the bank, alongside some other banks like Deutsche, was able to beat the market’s earnings forecast.

The surprise upside in the company’s earnings caused its shares to gap up. As you can see from the chart, it actually beat the odds by breaking above the rising wedge formation instead of breaking down. Remember that a rising wedge is usually a bearish pattern which only indicate a rally prices. Yesterday’s price action, however, made me somewhat bullish on the stock now than before since the move allowed it to escape the 200-day moving average net. But with the RSI in the extreme overbought level, UBS could range or even retrace for awhile before making a move towards its previous high at just above 17.50. If it weakens, the resistance of the rising wedge, the bottom of the gap, and the 200-day moving average should keep it from falling any further.

More on LaidTrades.com …

Against the US dollar, the euro has been showing a lot of strength as of late (kindly see my post here). The EURJPY, on the other hand, was a pace or two behind. While the EURUSD was already moving north, its cousin was still stuck in consolidation mode. Just recently, though, the latter appears to have broken free. As you can see from the chart, the pair has just broken out from an inverted head and shoulders pattern. Now, will it follow the EURUSD? Will it be able to break above the long term downtrend line as well? In any case, its upside target as a result of the breakout is now seen to be at 120.00. A previous support and the downtrend line, however, lie at that level which will make it a notch tougher for the pair break. Nonetheless, a move above this could send up to 128.00. A failure to do so, on the flip side, could pull it back to the neckline of the inverted head and shoulders.

Fundamentally, the expected uptick in Germany’s month-over-month CPI in July (from 0.1% to 0.2%) and in the euro zone’s year-over-year CPI in July as well (from 1.4% to 1.8%) could bolster the demand for the euro. Remember that the European Central Bank or the ECB uses inflation figures as a basis of their monetary policy. So with inflation, confidence, and the equities markets going up plus the apparent silence in the the euro zone with regards to their fiscal situation, the ECB could at least consider tightening their monetary stance sooner than initially seen.

In Japan, the 3.3% year-over-year projected jump in retail sales for the month of June could spark some short term risk taking in the Japanese markets, leading investors to sell or borrow some yen which we know has a very low cost of 0.10% to fund their investments in equities. At the same time, the continued slide in the country’s consumer prices (Tokyo CPI seen to be at -1.2%) could also place some selling pressure on the yen.

More on LaidTrades.com …

By Russell Glaser – The price of spot crude oil failed to breach the $80 resistance level yesterday. Following higher prices for the commodity the price fell sharply on poor economic data and a lack of a rally in equities.

Spot crude oil prices finished the day down at $77.18, after opening the day at $78.90. The price of spot crude oil reached as high as 79.65 before dropping. The commodity has not traded at this high of a price since June 21st. Traders have been targeting the $80 resistance level when the last failed attempt to break the price range occurred.

Yesterday’s release of disappointing U.S. consumer confidence numbers triggered the sell off in the commodity the moment that equity markets began to drop. The CB Consumer Confidence Index reported a weak reading of 50.4 on market expectations of 51.3.

U.S. stocks fell in step with the release and the Dow Jones Industrials Average finished up marginally higher by 0.12%.

Today traders will be eyeing the release of the weekly U.S. crude oil inventories report from the U.S. Energy Information Administration. This report will help identify a consistent trend of a short term drop in crude oil supplies. Previous reports have shown falling supplies in crude oil stocks as refineries have reduced output in light of the global economic slowdown.

Expectations are for a decrease of 1.4M barrels of crude oil. An output on par with economists’ forecasts may help push spot crude oil prices higher to the resistance line at $78.50.

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.

Forex Market Review by Finexo.com

The Dollar appreciated against the most of its major counterparts on Tuesday, as a drop in U.S. consumer sentiment to a five-month low cut risk appetite. Yesterday, the CB Consumer Confidence index for July fell to 50.4, below its expected reading of 51.3, as Americans become increasingly concerned over the stability of their jobs and their wages.  Meanwhile, a separate report showed that home prices rose more than predicted in May as a government tax credit underpinned sales.

Up ahead today, U.S fundamentals will again play an important role in the direction of the major currency pairs. US Durable Goods Orders are expected to provide evidence in support of the current recovery trend. Last month, the Core manufacturing figure rose by 1.6%; this time around, analysts expected a slightly smaller increase of 0.6%, which highlights the recent weakness in consumer confidence, and could potentially lead to more risk aversion.

Meanwhile, the Australian Dollar fell by the most in more than a week as a report showed consumer prices increased at a slower than predicted pace, increasing speculations that the  central bank will hold interest rates unchanged in August. Also up ahead today, the New Zealand Rate central bank rate statement. Last time, the RBNZ increased the key interest rate by 0.25bps to 2.75%. This time around, another rise to 3% is expected.

EUR/USD

Yesterday, the EUR/USD rose to a fresh 11 week high of $1.3045; however the pair was unable to hold about the $1.30 key level and quickly slipped back down to $1.294. This morning, the Euro successfully broke the $1.30 resistance line, edging up against the Dollar to hit $1.3016 during the late Asian sessions. Sentiments towards the pair remain bullish, with most technical indicators supporting an upward move.  A move towards the $1.3095 resistance level, the highest price since May 10th, could encourage more short covering on the pair and clear the path for more gains to come.

GBP/USD

The GBP/USD rose for fourth consecutive day today as the pair extending its rally to hit a high 5-month high of $1.5600. The recent rise in risk appetite is expected to continue to feed the rising Pound , while any drawbacks on US data will potentially weigh down on the Dollar.

Today, Bank of England Governor Mervyn King will appear before the Treasury Select Committee and will lay out the current situation in Britain. Investors are advised to pay close attention to the BOE Governor’s tone.  Recent improvement in UK data, including an increase in the number of jobs, a jump in GDP, a rise in inflation could indicate a hawkish stance, which could suggest a future interest rate hike, and thus an increase the value of the Pound. However, if King appears to take a more cautious tone, it could lead to a decline for the British currency.

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.