Month: December 2010

By Forex Signs, Inc.

At the opening of today’s trade, CADCHF pair is looking at a downtrend. Price level opened at 0.9607, a 110 pips decrease from previous opening. At present, resistance at H1 chart is measured at 0.9621 while support is determined at 0.9592. So far, the candlesticks are moving sideways while it is keeping a bearish momentum. Previous trade made an impact as the pair plunged to 0.9592, and broke its previous support by 97 pips. The Alligator (13,8,5) intertwined then opened its mouth leading to a downward movement at 09:00 yesterday. Looking at technical indicators on H1 chart, currently, %R (14) is leveling down towards a neutral level since it had touched the -100 stage a couple of times since yesterday. Most likely, the market will calm for a while then it will go back to oversold level again. Also, Bill Williams’ Fractals recommends a sell signal since the fractal arrow up at 0.9611 is lower than the Alligator’s teeth which is at 0.9646. Anyhow, CCI (14) at the moment is playing on neutral grounds, if ever CCI touches a level higher than 50, there is a possibility that the trend will go up.

Strong Retail Sales Helping US Recovery

For the upcoming American session strong Retail Sales report for November may help the US economy on its recovery as early reports suggest an increase of 0.6% gain for the last month following October’s 1.2% rise in purchases. This is the fifth consecutive month that retail sales climbed as Americans began their holiday shopping and shows consumers are now playing a big role in the US recovery. Producer price index is also expected to climb 0.6% for November, slightly higher than 0.4% increase in October.

Another important event is the release of the FOMC statement, wherein the Fed would announce their interest rates. Economists expect the Fed to keep its current rates, and would focus more on the accompanying statement. With this report comes some backlash, as economists will wait if the Fed would expand its quantitative easing program this might pull the greenback down again and might trigger a sell-off.

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.

Risk disclaimer

Forex trading involves high risk. Before any trade, you should consider carefully the investment objectives and the level of risk. The data sent by mail is not necessarily real-time data or precise. Real-Forex is not liable for the losses resulting from the utilization of the data. Real-Forex (Finnocorp Trading Solution Ltd.) is not liable for losses or damages as a result of reliance on the information provided by e-mail or on the overall data, quotes, charts, signals buy / sell. It is hereby clarified that the investor must be aware of risks involved in trading in financial markets, which is a form of investment that may contain potential risks.

EUR/JPY

Daily graph: http://www.real-forex.com/charts-daily/DEC2010/EUR_JPY_DAILY_141210.JPG

A resistance at 111.58 was crossed yesterday after an uptrend started 2 weeks ago. The pair crossed that resistance and is expected to start this session above it.

It is important to notice again that it is not recommended to enter a “Long” position unless an ascending configuration is identified to confirm the trend on a 1H scaled graph. It is exactly what happened during the night session.

Potential trade

1H graph: http://www.real-forex.com/charts-daily/DEC2010/EUR_JPY_1H_141210.JPG

Actually, the pair is running a technical correction between 111.58 and 112.07. The required configuration should appear when the pair will break out the resistance of 112.07.

–        “Limit” order on “Long” position 10 pips above the mentioned resistance, meaning 112.17.

–        “Stop Loss” on the last dip occurred, meaning 111.61.

Since there is no resistance identifiable to place the “Take Profit”, we suggest placing it 66 pips above 1H resistance, the same quantity as for the “Stop Loss” of that trade, meaning:

–        1^st Degree to “Take Profits”: 112.73.

EUR/GBP

Daily graph: http://www.real-forex.com/charts-daily/DEC2010/EUR_GBP_DAILY_141210.JPG

Please notice the following event: After a downtrend started a few weeks ago, the pair closed at a support a little more higher than the previous floor which was 0.8336.

Actually this is a specific reversal downtrend called “double floor”, an indicator for a switch from downtrend to uptrend. An increasing configuration, required for confirmation, will appear when the resistance of 0.8529 will be crossed on the daily graph, creating the opportunity for a “Long” trade.

It is not recommended to place the order immediately after the cross. It would be safer waiting for the end of a small technical correction, and then place the order.

Have a profitable week!

Real Forex team.

In this segment,Tina Winther Frandsen, Senior Macroanalyst and author of Jyske Bank’s Global Growth Forcast for 2011, discusses some of the highlights of the new report.

The report can be downloaded from Jyskebank.com, from Tuesday, December 14.

The Danish version of the report can be dowloaded here.

Legal information

Video courtesy of http://en.jyskebank.tv/

GBPUSD remains in uptrend from 1.5484 and the rise extended to as high as 1.5896 level. Support is at the uptrend line on 4-hour chart, now at 1.5733, as long as the trend line support holds, uptrend is expected to continue and next target would be at 1.6000 area. Key support is at 1.5719, only break below this level could indicate that the upward move from 1.5484 is complete.

Daily Forex Analysis

By Jared Levy, Editor, Smart Investing Daily, TaipanPublishingGroup.com

Early last week I gave you four reasons to buy the S&P 500 market (SPX or SPY), and hopefully you had the chance to participate in the market’s recent gains. Aside from the somewhat positive fundamentals of both the macroeconomic improvements and individual companies’ improved fiscal health, we have year-end window dressing and some good old statistical (and superstitious) beliefs working in your favor, especially if you are a bull.

What I have not addressed yet are some of the key technical levels that you need to be aware of. In just about every stock trade I make, I am paying close attention to a minimum of two stock market charts (usually more). I don’t just analyze the stock that my investment is in, but also a large index, such as the SPX, OEX, NDX or similar.

Don’t Pay Attention to the Dow Jones Industrial Average

I do NOT use the Dow Jones Industrial Average, because I feel the index is flawed in that it concentrates on the price of the stock for its weight in the index as opposed to its real value. In addition, to me, 30 stocks out of the over 5,000 stocks that trade on major exchanges is just not a good sample size. But I digress…

The S&P 500 Can Show You the Market’s “Hand”

Out of all the commonly watched indexes out there, the S&P 500 or SPX is the preferred barometer of most professional traders, because of its breadth and diversity. The S&P 500 is a collection of about 500 stocks (it varies at times) that cross many sectors. The price levels of the S&P 500 are not only used as major support and resistance for traders, but they can send individual stocks higher or lower.

There is a unique characteristic about big indexes and ETFs like the SPX and SPY. You would think the index itself is just telling us where stocks are; in other words, it gets its value from the changes in the stocks. But because of arbitrage, the behavior of ETFs and the weighing of certain stocks within that index, it sometimes works the other way around. When roles reverse, the tail wags the dog, so to speak, and the index determines where many stocks are headed. I mean, why do you think experts are always quoting support and resistance levels in the indexes if they were only monitors for the hundreds of stocks within them?!

So today, I am going to tell you the levels you need to watch out for and where I think we may head from here.

Economic Calendar

This week’s economic docket is chock-full of data and potential market movers. Unlike last week, where the expectations were for quiet sailing, expect movement as we progress through the second week of December.

Check out the chart below for all the economic data and estimates due out this week.

Chart courtesy of forexfactory.com

View Larger Chart

The Levels You Need to Be Aware Of

The chart of the SPX below tells us much about the current trend and why we need to watch the 1,221 support level very carefully. That number was not only the former high made back in April, but it was also a support level formed back in July of 2008. The recent breakout about this level is and continues to be a bullish sign, but a violation below it could mean the SPX could drop to its next support level of 1,170. If you are currently long and notice the SPX breaking below 1,221, and if it’s looking like it might close below that level, you might want to evaluate that long position for an exit.

View Larger Chart

For now, barring any adverse data this week, the market is struggling higher. However, watch for late-day weakness and note the stochastic hanging out in the overbought area, which is typical, but not something to be ignored. Also keep your eye on the 20-day moving average compared to the 50-day moving average. Right now, the 20-day is on top, but converging into the 50. If they cross, that could be our signal that at least the short-term trend is over.

Don’t be greedy this week and make sure you tell your friends about Smart Investing Daily! And if you want a more in-depth understanding of how technical indicators work… even how to use them for trading, you should check out WaveStrength Options Weekly, a service run by Adam Lass. Here are more details.

About the Author

Jared Levy is Co-Editor of Smart Investing Daily, a free e-letter dedicated to guiding investors through the world of finance in order to make smart investing decisions. His passion is teaching the public how to successfully trade and invest while keeping risk low.

Jared has spent the past 15 years of his career in the finance and options industry, working as a retail money manager, a floor specialist for Fortune 1000 companies, and most recently a senior derivatives strategist. He was one of the Philadelphia Stock Exchange’s youngest-ever members to become a market maker on three major U.S. exchanges.

He has been featured in several industry publications and won an Emmy for his daily video “Trader Cast.” Jared serves as a CNBC Fast Money contributor and has appeared on Bloomberg, Fox Business, CNN Radio, Wall Street Journal radio and is regularly quoted by Reuters, The Wall Street Journal and Yahoo! Finance, among other publications.

By Sourav Sharma

It is money that governs life today. It is again money that forms the base of business, national/international trade. It is money that is the pedestal of survival. The utilization of money today is beyond measure. Money is measured in terms of currencies and currencies differ from nation to nation. The currency exchange rates also differ; the value may be equal or more or less depending on the currency. Millions of dollars, pounds, levs, pesos, euros, yens, francs, and more currencies are exchanged for trade, travel, and the like across the world. There is also a particular sector dedicated to the trading of currencies, termed as forex trading or foreign exchange trading. And currency exchange rates and currency converters are the life blood of this segment, leave aside their usage for other purposes. Forex traders also rely on currency exchange news to stay updated about the rise and fall of currency values.

You can know the foreign exchange rates using an online currency calculator. Business travelers and even leisure travelers including companies that deal in import and export find the online currency converter very useful. You need not have the software downloaded in your computer. All you need to do is to visit a financial platform or financial news portal that displays the online currency converter facilitating users to use it and find the currency exchange rates. Filling the details – it varies from portal to portal – but mainly you will have to fill three fields, one is the currency that you want to convert, the other is the currency which you want to get converted to and the third is the amount. News portals like Reuters India also runs an online currency converter in its site to enable users find currency exchange rates in no time. It lists the currencies of a number of countries across the world, those which are used frequently. You can also get a glimpse of the currency exchange news, information on forex trading, stock market and more in addition to news related to all segments here.

The forex trading sector is one of the highest revenue-generation segment for any nation. Business to the tune of trillions of currencies is traded each day via banks, govt. corporations, and other organizations. Forex traders always get glued to foreign exchange news so that their judgment turns out to be profitable and risks lowered.

About the Author

Sourav Sharma is freelance market analyst and is writing reviews articles on Currency Exchange News, Currency Exchange Rates, Online Currency Converter and Online Currency Calculator.

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Chicago Mercantile Exchange, showed that futures speculators continued to cut their short bets of the US dollar against the other major currencies for a fifth consecutive week. Non-commercial futures positions, those taken by hedge funds and large speculators, were overall net short the US dollar by $8.42 billion against other major currencies as of December 7th. This is down from a total short position of $8.55 billion on November 30th, according to data published by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

On an individual currency basis, speculators added to their long positions for the Australian dollar, Swiss franc and the Canadian dollar while decreasing positions in the euro, British pound sterling, Japanese yen, Mexican peso and the New Zealand dollar compared to the week before.

EuroFx: Currency specs increased their shorts of the euro against the U.S. dollar to 15,290 short contracts as of December 7th. This is approximately double the short positions on November 30th which saw 7,248 short contracts.

The COT report is published every Friday by the Chicago Mercantile Exchange (CME) and shows futures positions as of the previous Tuesday. It can be a useful tool for traders to gauge investor sentiment and to look for potential changes in the direction of a currency or commodity. Each currency contract is a quote for that currency directly against the U.S. dollar, where as a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and net long position expect that currency to rise versus the dollar. Open interest is the number of open contracts that have not been closed by a transaction or by delivery.

GBP: The British pound sterling positions fell for the third straight week with 12,920 short net contracts as of December 7th. This is a decline from 4,864 short contracts on November 30th and the second straight week speculators have been short the pound.

JPY: The Japanese yen net long contracts decreased to 23,288 long contracts as of December 7th from 30,006 net long contracts reported on November 30th.

CHF: Swiss franc long positions edged slightly higher to a total of 8,987 long contracts as of December 7th after totaling a net of 7,824 long contracts on November 30th.

CAD: The Canadian dollar positions increased as of December 7th. CAD long positions registered 33,722 contracts after totaling 19,155 net longs on November 30th.

AUD: The Australian dollar positions reversed and advanced higher following nine straight weeks of declining positions. AUD contracts increased to a net amount of 43,352 long contracts as of December 7th from 26,643 long contracts on November 30th.

NZD: New Zealand dollar futures positions declined for a third straight week as of December 7th. NZD long positions fell to a total of 18,261 long contracts after a total of 18,445 long contracts the week before.

MXN: Mexican peso long contracts dropped lower as of December 7th to 59,482 net long positions from 78,906 longs the week prior. The latest data is the third straight week of decreases for the Mexican peso speculative positions.

COT Data Summary as of December 7th, 2010
Large Speculators Net Positions vs. the US Dollar

Euro: -15,290 contracts
British pound sterling: -12,920 contracts
Australian dollar: +43,352 contracts
Canadian dollar: +33,722 contracts
Japanese yen: +23,288 contracts
Mexican peso: +59,482 contracts
New Zealand dollar: +18,261 contracts
Swiss franc: +8,987 contracts

Go to the Commitment of Traders CME raw futures data

Further COT Resources from around the web:

• Forecast The FX Market With The COT Report

• The Only Indicator You Will Ever Need

By Russell Glaser – The USD/JPY is currently moving towards its recent high of 84.40. A close above this level shows limited resistance until the September high. Long term time frames also signal a continuation of the move.

Following the pair’s breach of the long term downward sloping trend line (1) on the daily chart the pair has risen to the 84.40 level (2). Clearly defined support and resistance levels appear on the chart and a buy signal is supported by a long term technical sign.

An entry long may be initiated with a move above the 84.40 (2) level targeting the post intervention high at 85.90 (3). Further resistance at 88.10 (4) can be used as a long range target as resistance is lacking on both the daily and longer time frame charts. A long term downward sloping trend line on the weekly chart (not shown) may also provide resistance at 88.60.

Support can be found at both 83.45 (5) and 82.30 (6), as well as the rising trend lines off the October and November lows.

The monthly chart provides a hint at the potential long term future price action with a rising stochastic oscillator.

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.

By GCI Forex Research

Fundamental Outlook at 0800 GMT (EDT + 0400)

USD

The People’s Bank of China today interrupted a previously quiet European session with another increase in required reserve ratios, the sixth such move this year. Risk appetite has so far held up though, as markets took the announcement as less severe than a hike in China’s benchmark interest rates, which some had anticipated. In fact, the Australian and New Zealand dollars strengthend, with AUDSD and NZDUSD trading ranges of 0.9812-.9897 and 0.7462-.7529, respectively. US releases today include the trade balance, University of Michigan confidence and monthly budget statement.
The PBoC announcement came after strong trade data – both imports and exports expanded much more than expectations – and significant loan growth data, which points towards a high CPI print tomorrow. As price pressures continue to rise, the RRR hikes do seem like a case of postponing the inevitable, and a more orthodox rate hike is still likely before year-end.
Ongoing uncertainty in the Eurozone should keep the dollar supported and ECB policymakers, including Trichet himself, will be on the wires. EURUSD traded 1.3217-1.3283, USDJPY 83.52-83.87.
EUR

ECB Governing Council member Draghi said that the euro “is not in question” due to the sovereign debt crisis, adding that it is “one of the pillars of European economic integration”. He said that “sooner or later” the ECB is likely to return to the pre-crisis system of auctioning liquidity and that the ECB is discussing “concrete proposals” over how to handle banks that are currently dependent on ECB cash.
The Irish government announced yesterday that it will put the EU/IMF aid package to a parliamentary vote on December 15. Shortly afterwards, the opposition Labour party said it would vote against the deal while an independent member of parliament (MP) said that he and a fellow independent MP would vote in favour. We retain our bearish euro view.
GBP

UK producer price inflation rose by 0.3% m/m and 3.9% y/y against market expectations of 0.4% and 4.1%.

TECHNICAL OUTLOOK
EURUSD BEARISH Break of 1.3180 exposes 1.3149 ahead of 1.2969. Resistance at 1.3442.
USDJPY BULLISH Outlook is positive; recovery stalled below 84.41. Support at 83.46.
GBPUSD NEUTRAL 1.5892 and 1.5669 mark the near-term directional triggers.
USDCHF BEARISH Move below 0.9726 would expose 0.9670. Only a break through 0.9463 would confirm the bear trend. Resistance at 0.9916.
AUDUSD NEUTRAL Model is neutral; initial resistance at 0.9965, support at 0.9739/00.
USDCAD BEARISH Look for a break below 0.9978/31 support zone for confirmation of bear trend. Resistance at 1.0141.
EURCHF BEARISH Focus is on 1.2933; breach of the level would expose1.2766. Resistance at 1.3229.
EURGBP BEARISH Move below 0.8390 has exposed next support lying at 0.8335. Initial resistance defined at 0.8429.
EURJPY BEARISH Remains heavy below 111.98; initial support defined at 109.57 ahead of 108.35.

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.