Month: December 2010

By Russell Glaser

The EUR/USD is under pressure once again with the pair moving closer to key support levels. A breach below these supports may trigger further technical selling.

After a short squeeze pushed the pair as high as 1.3500, the selling of the pair has resumed with the price action contained inside a consolidation zone. The consolidation is evident by the weak ADX of 21 and a flat 20-day simple moving average. While the move lower has not been as active as the month of May at the height of the Greek debt crisis, the downtrend is reemerging.

Since late last week the pair has moved lower between the 38% (1.3370) and 50% (1.3080) Fibonacci retracement levels from the June to November move. A downward sloping line supports the recent price declines. The 50% retracement is the first key technical level in the downtrend.

The second technical support rests at the 200-day moving average that comes in today at 1.3030. This key support is well within reach of today’s trading. A move below this may trigger further technical selling.

Once a breach of the moving average has occurred, the next targets for the pair will be the September 6th high at 1.2920 followed by the 61.8% Fib retracement level at 1.2800.

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.

Written by FastBrokers House

It has been a very similar day to yesterday with one sharp move higher in the EUR/USD mid-morning and otherwise the markets stayed unmoved.

EUR/USD spent much of the morning session below 1.3100 with crosses like EUR/CHF and EUR/AUD making new historical lows in the last 24 hours. There was a sharp 50 pip move higher from 1.3085 to 1.3135 which would not have needed much impetus as liquidity is again very poor. EUR/USD has consolidated for the last few hours and at times hasn’t traded for extended periods as interest diminishes. Ranges: EUR/USD 1.3082/1.3142, EUR/CHF 1.2534/85

AUD/USD moved to session highs as the EUR/AUD selling dominated in early trade but the dominant buyer of AUD who has been present over the last 48 hours did not appear today and the rally slackened off. Ranges: AUD/USD .9952/88

USD/JPY has not reacted to either the trade data or the Korean tensions, trading sideways in an 83.74/88 range

Cable has been similarly inactive with much of the EUR rally showing up in the cross. Ranges: Cable 1.5460/87,  EUR/GBP .8461/90.

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.

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 Forex Signs, Inc.

Since the double top reversal pattern of USDCHF pair noted last week, the pair has been continuously striding down. At the opening of today’s session, the price level opened at 0.9580. The initial price is not the pair’s resistance level. Seven candle sticks after at H1 chart, the pair had a bearish breakout. The fall went further down as the following candle stick tries to create new support level at 0.9542. In the previous trade, an Elliot wave was perceived at H1 chart. Before the trade ended yesterday, the price level had a reversal which only reached 50 percent of wave iii using the Fibonacci retracement. Today, if Elliot wave will be followed, at the time of writing, the pair is at wave i. Chances are, the trend is still pursuing a bearish market. For three days now, the %R (14) is lingering at an oversold level. It tried to go away but only reached values between -60 and -50. The fluctuating increases are most likely to be corrections only. However, once the signal touches a little above -50, there is a slight chance of a bullish reversal. To further test the downward trend, the Alligator indicator strongly indicates a sell activity as the lips of the gator is placed under its teeth. The distances of each part are significant and there are no clues that the gator will sleep at any time today.

US Dollar May Rally Against the Loonie With Good Economic Data

Economists believe that the US dollar may be able to mount a rally with good economic data before the Christmas break, starting off with final GDP. This quarterly report is expected to post another increase of 2.8 percent after last quarter’s report of 2.5 percent. This increase in GDP may be attributed to the unexpected inventory growth. Existing home sales is also expected to go increase to 4.72M from its last report of 4.43M. This increase gives an impression that the housing market is getting stable. If these indicators give out a better than anticipated numbers, expect the US dollar to make progress.

Meanwhile, Canada has no scheduled economic report for today, but any reports that might affect risk sentiment towards this currency should give some movement to the Loonie.

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.

UK GDP rose below expectations in Q3 of 2011 according to figures released by the Office of National Statistics this morning.

UK GDP rose 0.7% against expectations of 0.8% owing to lower than expected activity in the manufacturing and construction sectors.

Sterling fell to 1.1737 against the euro following the announcement.

by Peter Lavelle with foreign currency exchange specialist Pure FX.

By Anton Eljwizat

The GBP has dropped significantly versus the CHF in the past week, and it is currently traded around 1.4820 levels. And now as evident in the data below, the 4-hour chart is giving bullish signals, indicating that GBP/CHF pair might go up. Forex traders can take advantage of this impending movement by having their Entry Orders in place to capture this reversal.

• Below is the 4-hour chart of the GBP/CHF currency pair.

• The technical indicators that are used are the William Percent Range, Relative Strength Index (RSI), and Slow Stochastic.

• Point 1: The Slow Stochastic indicates an impending bullish cross, signaling that the next move may be in an upward direction.

• Point 2: The Relative Strength Index (RSI) indicates that the price of this cross currently floats in the oversold territory, signaling upward pressure.

• Point 3: The Williams Percent Range shows that this pair was heavily over-sold peaked near the highest mark it could reach, and then turned a corner and now stands in a bullish posture.

GBP/CHF 4-Hour 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.

The important news yesterday was an announcement by the Treasury that UK public sector borrowing in November ballooned above expectations. The Coalition Government borrowed £23.3 billion in November compared to £17.4 billion in November last year in departments including Health and Defence.

This has raised concerns that the Coalition Government is seriously off-course to meet its spending reduction plans, and this morning the GBPEUR exchange rate has dropped to 1.1760.

In the EMU meanwhile this morning the markets are concerned that Portugal faces a credit rating reduction from Moody’s. This doesn’t reflect the solvency of the Portuguese Government but concerns that the Government’s austerity budget could seriously affect growth in 2011.

Echoing this sentiment, this morning respected economist at Citigroup Willem Buiter has commented saying that the ECB-IMF rescue loans can only perpetuate the EMU debt crisis. This is because the interest repayments are too high to allow the indebted nations to return to economic health.

In short the outlook for the euro in 2011 does not look positive at present.

In upcoming news the minutes from the Bank of England meeting this month are released this morning. These could reflect concerns that the Bank is taking inadequate steps to deal with soaring UK inflation, and might also negatively affect sterling.

In the US meanwhile there are several announcements today including the GDP index for Q3 and Home Sales data. These provide insight into the state of the US economic recovery, and depending on the figures could boost the dollar.

by Peter Lavelle with foreign currency exchange specialist Pure FX.

Source: ForexYard

The euro fell once again yesterday, following concerns that Portugal and Greece might face a credit downgrade within the near future. This also had a positive impact on commodities, especially crude oil, which is now trading near $90 a barrel.

Economic News

USD – Dollar Continues To Strengthen On All Fronts

The U.S. dollar strengthened yesterday against most of the major currencies. The dollar gained about 100 pips against the euro, and the EUR/USD fell to the 1.3075 level. The dollar gained about 100 pips against the British pound as well, and about 60 pips vs. the Japanese yen.

The dollar rallied yesterday amid woes of further credit downgrades in Europe. The fragile condition of several European nations, continues to threaten the stability of the euro-zone, and as a result turns investors to put their faith in the greenback as an alternative investment.

In addition, estimations that the Commerce Department will correct its release today, and will say that the U.S. economy grew more than previously calculated in the third quarter, have also contributed to the dollar’s bullishness.

Looking ahead to today, the most significant economic release seems to the U.S. Existing Home Sales. This report measures the number of buildings that were sold during November. If the end result will beat projections for 4.72M sold homes, this will indicate that the housing sector in the U.S. is recovering, and has potential to support the dollar.

EUR – Euro Tumbles amid Concerns of Further Credit Downgrades In the Region

The euro fell against most of its major currency counterparts during yesterday’s trading session. The euro dropped about 100 pips against the dollar, trading near a more than two-week low against it. The euro also fell about 60 pips vs. the Japanese yen.

The euro continues to lose ground against the major currencies as the cost of protecting the sovereign bonds of both Greece and Portugal rose yesterday. Investors fear that following Ireland’s credit cut, Greece and Portugal might face a credit downgrade as well. In addition, the ongoing concerns that the Irish bailout wasn’t the last financial bailout required by the euro-zone continue to linger. The worse scenario is that the euro-zone will fail to rescue yet another economy, a situation that may lead to the end of the euro. As long as this type of concerns remains, the euro might see further bearishness against its major rivals.

As for today, traders are advised to follow updates regarding the European fragile economies, especially about a possible credit downgrade of Portugal, which might take place soon. Traders should take under consideration that such a credit cut is has potential to have a quick and significant bearish reaction on the euro.

JPY – Yen Rises Vs. Euro and Pound; Weakens Vs. Dollar

The Japanese yen saw mixed results against the major currencies on Tuesday’s trading session. The yen gained about 60 pips against the euro, and the EUR/JPY pair is once again trading below the 110.0 level; the yen saw similar gains against the British pound as well. On the other hand, the yen fell about 60 pips vs. the U.S. dollar.

The yen’s fluctuations have reflected the general mood in the market. The yen gained vs. the European currencies following the ever-deepening concerns regarding the euro-zone’s stability. The latest reports regarding a possible credit cut of Portugal and Greece have intensified this trend.

The yen slightly fell against the greenback due to estimations that the Commerce Department will correct its release today, and will state that the U.S. economy grew more than previously calculated in the third quarter.

Looking ahead to today, traders are advised to follow the leading publications from the U.S. and the euro-zone as these are likely to affect the market today. Special attention should be given to reports regarding a possible credit downgrade in Europe, as unusual volatility might take place as a result.

Crude Oil – Crude Oil Reaches $90 a Barrel

Crude oil continued to rally on Tuesday and is currently trading near $90 a barrel. Crude oil gained about 100 pips yesterday, from $89 .10 a barrel, and has completed a total 250 pips rise since December 17.

Crude oil closed yesterday at $89.82 a barrel, the highest closing price since October 7, 2008. Crude prices continue to rise on speculations that the U.S. economy is strengthening. The rising Standard & Poor’s 500 Index, which is trading in level not seen since 2008, is also pushing energy prices upwards on estimations that demand for oil will increase in the U.S., the world’s largest energy consumer.

As for today, traders are advised to follow the leading releases from the U.S. and the euro-zone as these are likely to have a large impact on oil prices. Traders should also follow the U.S. Crude Oil Inventories release, which is scheduled for 15:30 GMT, as this release tends to have an instant impact on the market.

Technical News

EUR/USD

The pair has fallen about 400 pips over the past 8 days, and is currently trading near the 1.3130 level. Nevertheless, as the RSI on the 4-hour chart is pointing up, in addition to a bullish cross of the Slow Stochastic, it appears that the pair might see a bullish correction. Going long with tight stops might be the right strategy today.

GBP/USD

The cable began yesterday’s session with a rise of about 60 pips, only to see a 130 pips fall soon after. Currently, as both the MACD and the RSI on the daily chart are providing bearish indications, it seems that another bearish session might be expected.

USD/JPY

The range-trading proceeds for the USD/JPY pair, and the pair is now trading within the middle of the range, near the 83.75 level. The current movement is bearish, and the pair appears to approach the 82.50 level. If the pair will drop below this level, it has potential to fall towards the 82.50 level.

USD/CHF

There is a very distinct bearish channel formed on the 4-hour chart, as the pair is now floating in the middle of it. The Bollinger Bands on the 1-hour chart are tightening, indicating that a sharp movement could be expected. As the RSI on the 1-day chart is about to reach the 30-line, it appears that going long might be the right choice today.

The Wild Card

Crude Oil

Crude oil rose to as high as $90.05 a barrel yesterday, the commodity’s highest level since October 2008. Currently, as all oscillators on the daily chart are pointing up, it looks that crude oil might reach higher today, with potential to reach the $92.00 level. This might be a great opportunity for forex traders to join a very popular trend.

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.

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.

**Whoever took the “Short” trade on EUR/CHF from the previous session reached the first degree to “Take Profit” of 36 pips. Although the destination we are mentioning are small, but the the prob for the pair to reach them is quite high.

USD/CAD

Daily graph: http://www.real-forex.com/charts-daily/DEC2010/CAD_DAILY_221210.JPG

During the last session, a double top appeared on the daily graph at the resistance of 1.0211. Although this resistance is not very strong, but several stops occurred on it for the last few months.

A two-day stop on a resistance may suggest a soon reversal and a new short-term trend. However such an opportunity requires some confirmation. A possible confirmation is trough the identification of a decreasing configuration on a 1H graph.

Potential trade

1H graph: http://www.real-forex.com/charts-daily/DEC2010/CAD_1H_221210.JPG

An additional double-top appear on the 1H graph on the resistance of 1.0208, another indicator for reversal. Once the support at 1.0152 will be broken down, the required configuration should appear, giving the alert for the time to order the trade.

–        “Limit” order on “Short” position 10 pips below the support mentioned, meaning:  1.0142

–        “Stop Loss” on the last peak appeared, which is: 1.0208

–        1^st Degree to “Take Profit” on the following support: 1.0101

GBP/JPY

Daily graph: http://www.real-forex.com/charts-daily/DEC2010/GBP_JPY_DAILY_221210.JPG

For the last few weeks, the pair is moving aside between 129.39 (support) and 134.00 (resistance). During the last session, the pair reached the support mentioned. This level has the title of support since the beginning of November, and is therefore strong.

Actually, the pair can either:

–        Break down the support (not very likely) and start a new downtrend, the opportunity for a “Short” Trade.

–        Stop on the support for one or two sessions and reverse its current trend for a few sessions, the opportunity to go “Long”.

–        Test the support once again (vain breach of the support) and start a new uptrend.

Have a profitable day

Real – Forex team

Shareholders of the DMCI Holdings, Inc. or DMC in the Philippine Stock Exchange must have been partying all season long because of the unbelievable performance of the stock. Imagine, DMC only started trading at below PHP 10.00 in January 2010. And before you know it, DMC shares already reached a high of PHP 41.00 last November. Incredible! Anyway, after reaching the said high, DMC appears to have lost its upward momentum and has been trading flat ever since. Are shareholders just cashing their profits? Are we seeing a start of a downtrend? Or is DMC just gathering enough legs to propel itself to the sky once again?

From a technical perspective, after topping at PHP 41.00, DMC has been consolidating into a symmetrical triangle or a inverted head and shoulders (continuation) pattern. An upside breakout is more likely than a breakdown since the pattern is coming off an uptrend. Therefore, if DMC moves above the triangle’s resistance or the head and shoulder’s neckline, then it could easily revisit its former high. Now, a break above PHP 41.00 could send it to uncharted territories. Is this possible? Of course, especially since the long term uptrend of the stock is very much intact. So what I’m going to do is to wait for a breakout which is confirmed by surge in volume before getting in.

More on LaidTrades.com …

The last two months has been very good for the oil stocks of the Philippine Stock Exchange, particularly Phoenix Petroleum and Petron Corporation. Petron has exploded from a low of about 6.80 in November 2010 to a high of 17.40 in today’s trading, forming a pennant pattern on its way. Anyway, that’s a gain of more than 250% in less than two months! Wow. Similarly, Phoenix has risen from 7.00 to a high of 13.80 during the same time frame. After reaching the said high, PNX, however, has consolidated into pennant or a symmetrical triangle pattern. The question now is, will PNX break out the same way that PCOR did?

From a technical point of view, that’s very likely since trading action is already taking up about three-quarters of the pattern. So if PNX breaks the resistance of the pennant or the triangle, it could jet all the way up to 17.00-18.00 (gauged by projecting the height of the pennant’s pole from point of possible breakout).

More on LaidTrades.com …