Month: December 2010

By GCI Forex Research

Fundamental Outlook at 0800 GMT (EDT + 0400)

USD

Markets have been rangebound in Asian hours. EURUSD traded 1.3207-1.3236 and USDJPY traded 84.14-84.34. Yesterday, equities closed lower, with the S&P 500 down by 0.51%. Ahead today, investors’ focus will shift to the release of US jobless claims and the Philly Fed business index. In addition the EU summit will start today. However we expect no major surprises related to the summit. Last but not least the SNB will decide on rates today, which should also be a non-event. Altogether our team expect sthe US dollar to remain supported until the end of the year and prefer to sell rallies in EURUSD.
EUR

According to the Portuguese Banking Association the domestic banking sector is solid and well capitalized and liquidity the only weakness. It was also said that there will not be any financing problems in 2011 and that the likelihood of a bailout is now lower than two months ago.
Eurogroup Chairman Juncker said that there is no reason for Italy to be penalized by the market. He also said the idea of a Euro Bond would be a systemic response to Eurozone problems and that a proposal will go ahead. However Germany has not changed its stance with respect to the creation of a common bond.
German Chancellor Merkel once again reminded investors that the private sector and the IMF will be involved in any Eurozone bailout in the future. Such comments are not new, but investors remain under a cloud of uncertainty as to whether restructuring will be needed or not before 2013.
Eurozone PMIs are due and should give an indication on how Eurozone GDP is shaping up, but sovereign concerns will remain the focus.
CHF

The SNB rate announcement is due today. We expect no change from the SNB and no major surprise from the accompanying statement. The franc will remain driven by external developments such as Eurozone woes and broader risk sentiment.

TECHNICAL OUTLOOK
EURUSD 1.3305/1.3292 support.
EURUSD NEUTRAL Pullback from 1.3499 has support at 1.3305/1.3292.
USDJPY BULLISH Focus is on 84.35/41 with little resistance above this till 85.40. Support at 82.84.
GBPUSD NEUTRAL Initial resistance at 1.5965, while support lies at 1.5720.
USDCHF BEARISH Violation of 0.9548 would expose 0.9463 key low. Resistance at 0.9726 previous low.
AUDUSD BULLISH Next resistance above 1.0031 lies at 1.0091. Support at 0.9833.
USDCAD BEARISH Focus on 0.9978/31 support zone; initial resistance defined at 1.0141.
EURCHF BEARISH Momentum is negative; the cross eyes 1.2766. Resistance at 1.3004.
EURGBP NEUTRAL Recovery eyes 0.8528, with initial support defined at 0.8433.
EURJPY NEUTRAL 113.67 and 110.49 mark the near-term directional triggers.

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 Forex Signs, Inc.

The USDJPY pair started today’s session with a soaring upward trend at the H1 chart. Price level opened at 84.24. The pair went down 2 pips then consolidated after. The insignificant decrease might be just a correction. Resistance level is quantified at 84.40 while support is at 82.33. The resistance level was just formed yesterday as the pair successfully broke the then resistance at 84.33 which was recorded in December 1. Yesterday seemed like just a continuation of a rebound uptrend since the pair had a bearish reversal two days ago. As the pair made a new resistance level, it is most likely to stay on a bullish sentiment towards the end of the trading session. Further, MACD (12, 26, 9) seems to be stable at signal 0.1360. It is nowhere near the neutral grounds. Looking at its historical data, there is a chance that MACD can reach signal as high as 0.2754 before it tries to calm down. Channelling to another indicator, %R (14) started a day exiting from the overbought level. As of the moment, the indicator is trying to reach level -50 but it had only touched -52.07 then and from there had a reversal. It may take a couple more candlesticks at the H1 chart for the price level to reach the maximum overbought level then go down at neutral grounds or even near the oversold base.

Strong Housing Figures May Continue the Greenback’s Rise Against Other Majors

For the upcoming American session, the strong housing market data is expected to help the US Dollar gain against other major currencies as Building Permits is expected to rise 0.57M for November, higher than the 0.55M reported for October. This annualized figure is very important for the housing market, as this is an excellent gauge of future construction activity, because obtaining a permit is among the first steps in constructing a new building. Housing Starts is also expected to improve, as economists expect an increase of 0.55M. This indicator is closely correlated with Building Permits but can produce a more expansive ripple effect on the US economy.

Aside from these, Unemployment Claims is also scheduled for release with economists hinting that the number would still be unchanged at 421.K. Although this number remains at its current level, it does not necessarily mean an increase of employment. The Philadelphia Fed Manufacturing Index, which surveys manufacturers in Philadelphia and gauges industry conditions, is expected to lower its reading from 22.5 to 15 for this month. A lower-than-expected figure could shake the markets and trigger another round of risk aversion.

About the Author

Forex Signs, Inc., Founded in 2006 in Wall Street, New York City, FSI relentlessly strives to be the premier Forex brokerage company in the industry by providing exclusive and unmatched trading and investment related services while constantly developing innovative solutions that cater to the vast requirements of both individual and institutional market participants.

By Forex Signs, Inc.

The pair AUDNZD remains within the bullish channel, as price is consolidating between immediate support level 1.3243 and immediate resistance level 1.3292. Although price is testing the immediate support, buy bias remains in the mid term as prices remain within the bullish channel. If price makes a break below the immediate support it could be on a bearish correction testing 1.3207. If price continues to break 1.3207 below the bottom line of the bullish channel it may lead to a bearish reversal and the buy bias would be insignificant. If price breaches the immediate resistance, it will confirm the bullish trend and buy bias.

Asian Session Outlook

The overall outcome of yesterday’s Asian session was bearish. The performance of Japanese yen flunked against USD and EUR, Kiwi fought really hard also but came short, and the Aussie flipped a little against USD however it soared high against euro. The pessimistic movements are most likely attributed to the recently released economic indicators and news gathered in their respective regions. The Tankan Manufacturing Index for instance excruciatingly hurt the yen as it dropped 3 points for the fourth quarter. While other indicators are still not released, the current events that occurred such as the bad weather that damaged the Canola farm in Aussie has placed its futures contract at risk and thus affect the export industry.

For today’s session, the Aussie dollar is hoping that the awaited release of HIA New Home Sales for the month of October has increased in order to help it appreciate in the market. Previous data given by the Housing Industry Association was noted at 2.4 percent from a -1.7. The augmentation moved AUD in an optimistic level at the time of release.

More, moving upward towards the land of the rising sun, traders are waiting for the Monetary Policy Statement. Yen is expectant that Bank of Japan will release a statement that can help the currency rebound against its counterparts. After the negative feedback by traders due to the release of Tankan Manufacturing Index, yen is positive that they can gain back traders’ confidence with Monetary Policy Statement. Forecast shows that BoJ won’t implement new measures that can harm value of yen.

About the Author

Forex Signs, Inc., Founded in 2006 in Wall Street, New York City, FSI relentlessly strives to be the premier Forex brokerage company in the industry by providing exclusive and unmatched trading and investment related services while constantly developing innovative solutions that cater to the vast requirements of both individual and institutional market participants.

Source: ForexYard

A threat by Moody’s to downgrade Spanish sovereign debt sent investors flocking to the dollar which in turn sparked a sell off in gold and silver prices. Crude oil prices were resistant to the commodity selling as better than expected inventory numbers helped support prices.

Economic News

USD – Dollar Rallies on Spain Worries

The US dollar regained its footing today as the greenback rose against the major currencies. The broad based rally was triggered following the announcement by Moody’s Investor Services of a potential future downgrade of Spanish sovereign debt.

Broad based gains were seen in the dollar versus the euro, pound, and yen as many of these pairs pushed through known stop loss levels. A pickup in positive US data releases (with the exception of the November non-farm payrolls release) has some forecasting an increase in US economic growth rates as the countries of the currencies mentioned above continue to struggle to maintain positive growth rates. This is underscored by today’s release of US industrial production numbers that came in as expected with an increase of 0.4%.

The EUR/USD was trading down at 1.3220 after opening the day at 1.3353. The GBP/USD is down sharply at 1.5550 from 1.5763. The USD/JPY traded at its highest level since September and finished the day at 84.31 after opening at 83.81. The S&P 500 finished the day down 0.51%.

Gold and silver prices were down sharply today following dollar buying with Gold dropping to $1379.50 after opening at $1396.68. Silver dropped to $28.80 following an opening price of $29.52.

Traders will be looking to the economic calendar today with major US economic data set to be released. US building permits and weekly unemployment claims will be published at 13:30 GMT along with the Philly Fed Manufacturing Index at 15:30 GMT. We may expect the recent streak of improving economic numbers to continue which could strengthen the dollar and send commodities lower.

Support and resistance for spot silver is found just below $28.00 and the recent high of $30.70.

EUR – Threat of Downgrade Sinks Euro; Swiss Interest Rate On Tap

Earlier in the day Moody’s Investor Services announced it had put Spain on review for a future potential downgrade of its sovereign debt due to its need for increased funding in the capital markets, a struggling banking sector, as well as the fiscal difficulties of other EU members. This was the driving factor in today’s trading as both the euro and the pound finished the day near their daily lows.

Spain and the EU continue to battle against contagion following agreements by both Greece and Ireland to accept joint EU/IMF bailouts in return for strict fiscal policy changes. Protests erupted today in Greece as the Greek government slashed transportation worker salaries by 10%. 20,000 union workers were estimated to have protested today as well as bank workers, teachers, and public electric workers. Firebombs were thrown at police outside the finance ministry and parliament.

The protests come on the eve of the European Union summit. Many traders are expecting new possibilities for dealing with the European fiscal crisis to be adopted from the meeting such as an increase in sovereign bond purchases by the European Central Bank.

Today will bring the release of the Libor Rate announcement followed by the monetary policy assessment from the Swiss National Bank (SNB). Interest rates are not expected to be changed from the 0.25% level. Earlier this week the Swiss government updated inflation and growth expectations and today the SNB will provide their own estimates which may be give guidance for economists and traders alike.

The Swiss franc shined this year and has performed well versus both the euro and the dollar. Further gains for the franc may be expected in the USD/CHF. A breach below the November support at 0.9550 may take the pair to the swing low on the daily chart at 0.9460.

JPY – USD/JPY Breaches Key Resistance Level

Following a broad based dollar rally today the USD/JPY moved above the 84.40 resistance level. The pair has tested this price a number of times in both November and December before failing to breach the resistance line.

Data released yesterday from Japan was on the positive note as the Tankan Manufacturing Index climbed to 5 on expectations of 4.

Yesterday the USD/JPY finished the day higher at 84.20 after opening the day at 83.81. The EUR/JPY was down at 111.40 following an opening day price of 111.93.

The USD/JPY continues to make new highs, indicating further bullishness may be in store for the pair. Traders may want to target the post intervention high of 85.90. Support comes in at 83.00 from the trend line rising off of the December lows.

Crude Oil – Crude Prices Rise on Positive Inventory Report

The price of spot crude oil was boosted yesterday after US weekly crude inventories showed sharp declines. Spot crude oil prices rose despite large gains for the dollar.

Yesterday the US Energy Information Administration released data showing crude oil inventories plummeted by 9.9M barrels in the previous week. Expectations were for a decline of only 2.7M barrels.

Spot crude oil ended the day up at $88.60 after opening the day at $87.92.

The gains in spot crude oil come despite a strong performance by the dollar in yesterday’s trading. The dollar rose versus the major currencies, especially the euro. Commodity prices typically have an inverse relationship with the dollar; as the dollar rises, oil prices tend to fall.

A bullish flag pattern appears on the daily chart with the recent price being contained by two downward sloping resistance and support lines above and below the price action beginning on December 6th. Traders may want to wait for a breakout above the resistance line and go long. The pattern shows a potential price appreciation of $6 to the $95 level.

Technical News

EUR/USD

The short squeeze appears to have ended with the last two days of declines for the pair. An opportunity to enter short into the downtrend could materialize following a breach below the December 9th low of 1.3160 with a target the November 30th low of 1.2970. A protective stop could be placed at 1.3230 above the rising support from the early December low.

GBP/USD

Yesterday’s shaved head candlestick paints an interesting picture. While this signal calls for further bearish movement with momentum to the downside, the current price action is running into the rising trend line off the May and June lows and has support at 1.5480. This coincides with the Nov 30th low and is close to the 50% retracement level from May to November move at 1.5500. Traders may want to be patient and wait for a bounce higher off of the trend line to confirm a continuation of the current uptrend.

USD/JPY

Yesterday the USD/JPY moved above the 84.40 resistance level, a price the pair has tested a number of times in both November and December but always failing to breach. The USD/JPY continues to make new highs, indicating further bullishness may be in store for the pair. Traders may want to target the post intervention high of 85.90. Support comes in at 83.00 from the trend line rising off of the December lows.

USD/CHF

For the past two days the pair failed to breach the 0.9550 support level. Some upward movement may be expected with resistance coming in at 0.9725, a level that has had significance multiple times since October. A short term falling trend line also may provide resistance. Today the level comes in at 0.9780.

The Wild Card

Crude Oil

A bullish flag pattern appears on the daily chart with the recent price being contained by downward sloping resistance and support lines above and below the price action beginning on December 6th. Forex Forex traders may want to wait for a breakout above the resistance line and go long. The pattern shows a potential price appreciation of $6 to the $95 level.

Forex Market Analysis provided by ForexYard.

© 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.

The US dollar has been on the climb against the Indian rupee for a second day in the forex markets on Wednesday, according to currency data near the end of the US session. The dollar managed to turn around early losses on Tuesday and closed approximately 25 points higher after a decline in Monday’s trading.

The USD/INR currency pair opened Wednesday near the 45.89 exchange rate level, according to currency data from Oanda. The pair reached an intraday high at the 46.23 exchange rate and currently trades just above the 46.10 level.

The dollar’s gains today has brought the USD/INR to its highest rating level since November 30th when the pair reached as high as 46.28.

USD/INR Daily Chart – The pair is currently trading back above the 200-day moving average (red line) for the first time in over two weeks. A previous resistance level is directly above at the 46.28 exchange rate.

About the Author

FxNewsIndia.com – Indian Rupee Forex News

By CountingPips.com

The British pound sterling has declined sharply today in forex trading as a government employment report declined by more than expected in the three months through October. The latest employment data showed that the UK lost 35,000 jobs and the unemployment rate rose to 7.9 percent in the August through October 2010 timeframe, according to the UK Office of National Statistics. This was the first time since April that the unemployment rate had increased and brought the number of unemployed workers to a total of 2.50 million.

The unemployment rate increase surpassed market forecasters by 0.2 percent as the consensus expected the rate to stay at the 7.7 percent level.

The British currency has felt the effects of today’s employment news and has been pummeled virtually across-the-board. The pound sterling has dropped versus the US dollar, euro, Japanese yen, Swiss franc, Canadian dollar and the Australian dollar, according to currency data in the afternoon of the US trading session.

GBP/USD Hourly Chart – The pound sterling has fallen against the US dollar by approximately 200 pips today as the GBP/USD currency pair has declined from the 1.5762 opening to currently trading near the 1.5543 exchange rate. The pair has now fallen to its lowest level since December 2nd.

European Foreign Exchange Investors to Benefit from Trade Leaders Investment Program

BOSTON, Dec. 14, 2010 – Currensee Inc., www.currensee.com, the new way to invest in world currency markets, today announced a Trade Leaders™ Investment Program partnership with one of Europe’s fastest growing foreign currency brokers, Askobid. Through the partnership, Askobid customers can now follow and automatically execute the trades of some of the most successful foreign exchange (Forex) traders, called Trade Leaders (www.currensee.com/leaderboard), from the Currensee Forex trading social network. Launched in October 2010, the Currensee Trade Leaders Investment Program is designed to make Forex trading more accessible and profitable for a wide audience of private investors without the need for specific expertise in foreign currency trading.

“Through partnerships with some of Europe’s finest brokers and banks, such as Askobid, we continue to feed the momentum that the Currensee Trade Leaders Investment Program has built since launch,” said Dave Lemont, CEO of Currensee. “It’s clear that the combination of our robust real-time trade and performance metrics and full account control delivers the confidence and credibility that investors require.”

Askobid, a cutting-edge MT4 broker, is based in Cyprus and growing rapidly across Europe and Asia. The Currensee Trade Leaders Investment Program enables Askobid to offer its customers the ability to create an automated portfolio of top performing Trade Leaders and replicate its successes when the Trade Leaders trade.

“The Currensee Trade Leaders Investment Program provides our customers an excellent opportunity to accelerate their success in the currency markets through a unique new way to automatically execute trades from top traders from around the world,” said Mark Leigh, education director of Askobid. “Our partnership with Currensee reflects our belief that proven performance and success, coupled with the right technology, gives traders and investors an advantage in the dynamic foreign exchange market.”

Currensee Trade Leaders are carefully selected from the more than 7,000-member Currensee Forex trading social network, which trades more than $50 billion in volume annually. Trade Leaders are carefully screened for historical performance, risk management and returns versus the S&P 500. Investors select and follow the Trade Leaders they want to invest in, add them to their portfolio and Currensee automatically executes the Trade Leaders’ trades in the investor’s account.

About Currensee
Currensee.com puts the power of investing in world currency markets in the hands of every investor. With the Currensee Trade Leaders™ Investment Program, investors follow and automatically execute the trades of top Currensee traders called Trade Leaders. Currensee Trade Leaders are handpicked from the thousands of members of the Currensee Forex trading social network and carefully screened for historical performance, risk management and returns versus the S&P 500. By investing in Trade Leaders, investors build their own personal automated Trade Leaders portfolios and have complete control over their investments at all times. Currensee strives to deliver profitability, transparency and control to investors around the world. Currensee is funded by North Bridge Venture Partners, Egan-Managed Capital and Vernon & Park Capital and is a member of the National Futures Association (NFA) and registered by the Financial Services Authority (FSA). For more information, visit us at www.currensee.com. Find us on Facebook, follow us on Twitter, and watch us on YouTube. It’s time to invest in the success of top currency traders.

About Askobid

Askobid is a fast growing financial broker, providing investors the ability to trade Forex, Commodities and CFDs in a supportive and transparent environment. Askobid offers highly competitive pricing and a choice of robust trading platforms designed to accommodate a wide spectrum of retail and corporate clients. Askobid was founded on the principle that knowledge, coupled with the right technology, is what profits in the foreign exchange market. Central to the Askobid experience is the award winning MetaTrader 4 – a renowned, feature rich platform capable of satisfying the most exacting of traders with its unparalleled execution, indicators and advanced charting tools. Askobid maintains the high standards demanded by international regulatory bodies, with the end goal of safe guarding clients and their funds, allowing them to focus on the task at hand – increasing their chances of investing successfully.

Dynegy (DYN) said today it has agreed to be acquired by investor Carl Icahns Icahn Enterprises (IEP) for $5.50 per share in cash, or about $665 million. The offer is 10% higher than Blackstones (BX) bid for Dynegy, and also a 10% premium to the stocks average closing price over the last 30 days.

Written by FastBrokers House
2010-12-15

We saw a modest rebound in the USD in the early part of the session but about half of those gains have now been given back after the market neared USD-selling levels in USD/JPY and EUR/USD.

USD/JPY has tried to follow the lead from US treasury yields (which have reached 7-month highs) but rallies have been met with very solid selling interest. The Tankan report did not have a major effect on the Nikkei or on the JPY. Ranges: USD/JPY 83.61/95, EUR/JPY 111.84/112.07

EUR/USD slid lower in line with the broadly higher USD but momentum was sparse. Bearishness in crosses like EUR/CHF have also added to the slightly soft tone today. Ranges: EUR/USD 1.3337/82, EUR/CHF 1.2827/52

The AUD has slid lower today despite some moderately bullish factors such as Chinese FDI, colling of chat regarding Chinese rate hikes and some strong dmestic consumer sentiment. Ranges: .9933/93

Cable and EUR/GBP have been uneventful. Ranges: 1.5743/80, .8470/90

Market Commentary provided by FastBrokers.

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.

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This morning the Office for National Statistics made the unappealing announcement that UK unemployment rose for the first time in six months last month. 35k additional people became unemployed putting the total number above 2.5m for the first time since May.

On the back of that release sterling has fallen sharply against the euro today: three days ago the GBPEUR exchange rate was nearing 1.20 but this afternoon it has tumbled to 1.17.

This perhaps demonstrates what economic commentators have been saying for some months: that market optimism toward sterling has been dependent on a string of solid economic releases, and could sour the moment things begin to look worse in the UK.

The Real Test

Of course the real test for sterling will come next year when the Coalition Government’s program of cuts come into effect. These are expected to generate even higher unemployment figures (especially in the public sector) and could exacerbate negative feeling toward sterling if the economy doesn’t react positively.

The US for example has decided that combating the deficit is secondary to cutting unemployment and generating economic growth. Hence it has initiated a program of economic stimulus including tax cuts for the near future. This puts the UK (and much of Europe where nations such as Portugal and Ireland are pursuing austerity programs) at odds with the US approach.

by Peter Lavelle with foreign currency exchange specialist Pure FX.