Month: December 2010

By CountingPips.com

The United States trade deficit decreased by more than expected in October as a result of increased exports and decreased imports, according to a release by the Commerce Department today. The U.S. trade deficit declined by $5.9 billion or 13.2 percent as the deficit leveled at $38.7 billion in October following a revised deficit of $44.6 billion in September. September’s deficit was originally reported at 44.0 billion last month.

The trade data surpassed market forecasts that were expecting a deficit of approximately $43.8 billion for the month.

The U.S. exported a total of $158.7 billion worth of goods and services in October which was an increase of $4.9 billion from September’s total. Imports of goods and services fell to a total of $197.4 billion compared with a total of $198.4 billion in September for a decline of $1.0 billion.

The politically sensitive U.S. trade deficit with China edged lower in October with a $25.5 billion shortfall following a deficit of $27.8 billion in September. Other notable U.S. trade deficits were with the European Union at $7.1 billion, Mexico at $5.8 billion, Japan at $5.7 billion and OPEC also at $5.7 billion.

The U.S. trade surpluses with other countries for September included Hong Kong at $1.9 billion, Singapore at $0.6 billion, Australia at $1.3 billion and Egypt at $0.5 billion.

U.S. Dollar mostly lower in forex trading

The U.S. dollar has been trending slightly lower in trading in the forex markets following today’s trade deficit while the American stock markets are a tad higher. The dollar has edged higher versus the Japanese yen while declining against the Australian dollar, British pound sterling, Swiss franc and the Canadian dollar, according to currency data by Oanda just after noon in the US trading session. The euro and the New Zealand dollar are both currently trading closet to  unchanged against the American currency.

The U.S. stock markets, meanwhile, are slightly up today with the Dow Jones gaining by approximately 10 points, the Nasdaq up by approximately 8 points and the S&P 500 higher by just around 3 points at time of writing.

Oil has traded lower by $0.99 to $87.38 per barrel while gold futures have dropped sharply by $14.60 to the $1377.50 per ounce level.

The copperprice is currently trading at record levels above 9.000 dollar.

Hear why and if we’re going to see copper even higher. Senior Strategist Ib Fredslund Madsen is in the studio.

Want to read more on Jyske Banks commodity-outlook? Go here.

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By Greg Holden – The British pound’s recent gains against the US dollar were short-lived yesterday as the pair found strong resistance at 1.5820.

The Fibonacci retracement lines drawn on our daily chart suggest that this price level is actually a significant statistical barrier for the pair as the 61.8% line.

We can see on the chart below that traders took profit at the 1.5820 level as the pair touched this Fibonacci line.

Our Stochastic (slow) on the daily chart below also supports the notion that downward pressure is mounting.

Traders may want to take advantage of these long-term fluctuations by entering short positions to capture the retracement back towards the 50% line at 1.5533.

The fundamental side appears to support this downward notion as well.

A Fitch downgrade of Ireland has put financial strain on the euro zone and UK, helping the US dollar gain ground against its Atlantic rivals.

GBP/USD – Daily Chart

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 dollar was largely unchanged for most of the Asia session given the relative absence of news. EURUSD traded 1.3217-1.3271, USDJPY 83.52-83.87. Trade data out of China was extremely strong however. Ordinarily this would have boosted global risk appetite, but market attention focused instead on the policy tightening measures that might soon be deployed to promote sustainable economic growth. As a result, the AUD and the EUR failed to stage much of a rally on the numbers. Treasury yields were slightly lower following a better than anticipated auction of $13bn of 30y Treasurys. Initial jobless claims declined by more than expected and wholesale inventories were slightly higher in October, with an upward revision to the September reading. Upcoming US data releases include the trade balance, the monthly budget statement and the University of Michigan Consumer Confidence index. Ongoing uncertainty in the Eurozone should keep the dollar supported.
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 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.
Fitch downgraded Ireland by 3 notches to BBB+ in light of the additional fiscal costs of bank restructuring. This was largely in line with expectations, and the market was somewhat consoled by the stable outlook assigned. Moody’s is currently conducting a ratings review, and is expected to announce its decision over the coming weeks.
Fitch also said that Eurozone credit fundamentals are better than markets show, and said it does not envisage a Eurozone break-up.
GBP

As expected, the BOE left their benchmark rate unchanged at 0.5%, and as a consequence offered no statement. Our UK economist expects rate hikes in Q3 of next year.

TECHNICAL OUTLOOK
USDJPY stalled at 84.41
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 Initial resistance at 1.5841 with support at 1.5669/56.
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 Sustained break through 0.9978/31 support zone required for extension of the bear trend towards 0.9820. 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.

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DISCLAIMER: GCI’s Daily Market Commentary is provided for informational purposes only. The information contained in these reports is gathered from reputable news sources and is not intended to be U.S.ed as investment advice. GCI assumes no responsibility or liability from gains or losses incurred by the information herein contained.

By Forex Signs, Inc.

The USDCHF pair has been playing the same trend movement at H1 chart since the start of the week aside from Tuesday; it eventuates a bullish breakout at the middle of the day then goes down a few pips back before the trade ends. However, Tuesday’s sudden downward reversal may have been just a correction to a week-long upward trend with resistance of 0.9913. At the time of writing, the pair is moving sideways at H1 chart with resistance level of 0.9842 and support of 0.9832. The pair is expected to pursue a bullish trend after it touches support line. However, Bill Williams’Alligator at H1 chart indicates that the trend is bearish. The jaw, teeth, and lips are appropriately aligned. Yet despite a strong signal of selling the pair, %R (14) had a reversal from touching an oversold momentum going neutral. Having said this, there is still a possibility that the trend for today will just repeat yesterday. Chances are, at any point sooner, the trend will breakdown into a bullish momentum.

GBPCHF Testing 1.5516

GBPCHF has not made any significant technical move yesterday. Looking at the medium term chart, price action remains in consolidation at the immediate support level of 1.5472 and immediate resistance level of 1.5516 within the bearish channel. Currently, price action is testing the immediate resistance level. Trading bias, in the medium term chart, remains on the downside particularly if the price was able to break below immediate support level targeting 1.5408. On the other hand, a break above immediate resistance level could trigger a minor correction. However, if price breaks the 1.5592 level above the bearish channel, this might signal a bullish reversal. RSI (14) for the medium term chart shows price is within neutral territory, suggesting that price momentum may go both ways.

American Session Outlook

The American session currencies, particularly the US dollar made an impact against their European and Asian counterparts in yesterday’s trade. The bullish breakout of the Greenback is most likely because of the positive outcome of their weekly Jobless Claims. The number of U.S. workers filing new applications for unemployment benefits fell by 17,000 last week to 421,000, the Labor Department reported yesterday. However, the Greenback was not able to hold its momentum; it went a few pips lower then alleviated there. This movement may partially be influenced by speculations that the US treasury market is starting to normalize. Since the start of October, the yield on the 10-year note has jumped nearly 100 basis points to around 3.25% this week. The US dollar could have possibly taken a beating but then again, it was supported by the report of Unemployment Claims.

In the meantime, the Canadian dollar played sideways against its major trading pairs apart from the euro. EURCAD dropped 119 pips at H1 chart during the first 3 hours of the trading then recovered just before the session ended. However, the pair moved sideways at 38.2 percent of Fibonacci retracement. The performance of CAD against EUR may have been influenced by the selling of crude oil to Europe.

At today’s trading session, the Greenback is expected to advance as Bureau of Economic Analysis is set to release data regarding Trade Balance. Trade deficit in US has probably changed a bit in October as export rose and dollar weakened. Other reports show that Consumer Confidence may have climbed this month and the cost of imported goods rose at a slower pace in November. If trade balance reaches forecasted value or more then the Greenback is most likely to sky-high today. Meanwhile, the Loonie is expected to perform the same because its forecasted trade deficit is higher by 0.5B than previous.

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 Greg Holden – The EUR/USD appears to be recovering mildly after yesterday’s sharp plummet. Fitch Ratings agency downgraded Ireland’s sovereign debt, pushing the euro to recent lows. The pair fell as low as 1.3163 yesterday before recovering back to the 1.3250 price level. If today’s trade balance and consumer sentiment reports from the US and Canada come in as positive as expected, the US dollar could continue its bullishness against the EUR.

Here is a roundup of today’s leading events:

13:30 GMT: USD & CAD – Trade Balance

The American and Canadian trade balance figures are set to be published today at 13:30 GMT and the news could help both currencies extend recent bullish gains made against their European counterparts if the reports come as expected. The trade balance measures the difference between imports and exports of a country and reflects levels of demand for the nation’s goods.

14:55 GMT: USD – UoM Consumer Sentiment

The University of Michigan (UoM) Consumer Sentiment report is a leading indicator of consumer sentiment and consumer spending. It surveys approximately 500 consumers regarding spending, outlook, and optimism regarding the future. If the report comes as expected, or higher, the USD could see some added bullishness before markets close for the weekend.

Source: ForexYard

The dollar was down on the day versus the majors as a successful 30-year Treasury bond sale helped bring down US bond yields. Traders are looking towards two key data releases in the New York session to finish the week.

Also influencing the market is the recent compromise between the Obama administration and Congress. The agreement will extend Bush era tax cuts into the next two years which has caused some economists to up their US GDP forecasts and cut unemployment estimates.

The EUR/USD was trading near its opening price of 1.3250. The USD/JPY is trading lower at 83.50 after opening the place of 83.67. The GBP/USD is higher at 1.5835, after an opening day price of 1.5778. The Aussie dollar was up at 0.9882 after opening the day at 0.9851.

Recent comments by the Euro block ministers supported the enactment of new legislation to come to a political solution for Europe’s fiscal problems and stressed the avoidance of relying on European Central Bank sovereign bond purchases.

Ireland’s government continues to debate next year’s budget. The passage of the budget is one requirement needed to receive the 85 billion euro bailout package from the EU/IMF.

New York trading will have key US economic data on tap with trade balance data due at 13:30 GMT followed by consumer sentiment numbers at 14:55 GMT. Better than expected releases could reverse the losses for the dollar. Support and resistance levels for the USD/JPY come in at 82.80 and 84.40.

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.

Being contained by 84.40 resistance, USDJPY pulled back from 84.30. However, the fall from 84.30 is likely consolidation of uptrend, another rise to re-test 84.40 key resistance is still possible later today, a break above this level will indicate that the uptrend from 80.30 has resumed, then next target would be at 85.00 area.

Daily Forex Forecast

Forex Pros – The U.S. Dollar was lower against the Canadian Dollar on Thursday.

USD/CAD was trading at 1.0107, down 0.08% at time of writing.

The pair was likely to find support at 1.0012, Tuesday’s low, and resistance at 1.0141, Wednesday’s high.

Meanwhile, the U.S. Dollar was up against the Euro and the British Pound, with EUR/USD shedding 0.21% to hit 1.3234 and GBP/USD falling 0.29% to hit 1.5758.

About the Author

ForexPros.com
Forex Pros offers a diverse set of professional tools for Forex, Futures and CFDs. These include real-time data streams, technical and fundamental analysis by in-house experts, and a widely used economic calendar.

By CountingPips.com

The U.S. dollar has been mixed in the forex markets on a day with little U.S. economic data released while the American stock markets have also shown mixed results so far today. The dollar has advanced versus the euro and the British pound sterling while declining against the Australian dollar, New Zealand dollar, Japanese yen and the Swiss franc, according to data in the afternoon of the US session. The Canadian dollar is currently trading virtually unchanged against the American currency from the opening day exchange rates.

The U.S. stock markets, meanwhile, are having a mixed session today with the Dow gaining declining by around 20 points, the Nasdaq increasing by over 5 points and the S&P 500 is up by just under 3 points at time of writing.

Oil has traded virtually unchanged at $88.37 per barrel while gold futures have increased by $3.10 to trade at the $1,385.60 per ounce level.

Weekly Jobless Claims fall more than expected

U.S. weekly jobless claims decreased by more than expected in the week that ended on December 4th, according to a release by the U.S. Labor Department today. New jobless claims fell by 17,000 workers to a total of 421,000 unemployed workers. The 4-week moving average of unemployed workers decreased by 4,000 workers from the previous week to a total of 431,500 and fell for a fifth straight week.

Market forecasts were expecting weekly jobless claims to edge down to 425,000 workers following the prior week’s revised 438,000 claims.

Workers seeking continuing claims for unemployment benefits for the week ending November 27th also decreased for the week. Continuing claims fell by 191,000 workers to a total of 4,086,000 unemployed workers. The four week moving average of continuing claims dropped by 64,250 workers to a total of 4,226,000.