Month: February 2011

The list of events that could affect the trading of the euro in the current week is as follows:-

The US markets remained closed on Monday due to President’s Day holiday whereas in official data on manufacturing and services sector was published in euro zone. Germany and France also reported their manufacturing and services data separately.

Today on February 22nd a report on German consumer climate is to be published by Gfk a research group. In United States official data on consumer confidence will be reported by Conference Board while industry report on house prices will also be published. Data on manufacturing activity in Richmond is also to be published on Tuesday.

On February 23rd, 2011 official report on industrial new orders will be published in United Kingdom while United States will report is data on existing home sales.

On February 24th, 2011 United States will report data on durable goods and jobless claims as well as official report on new home sales. In euro zone Germany will report its fourth quarter

On Friday February 25th, 2011 the preliminary data on fourth quarter’s gross domestic product is to be reported by United States, moreover report on consumer sentiment and inflation expectations will also be published by University of Michigan.

Germany will report its initial data on consumer price inflation on Friday while France is expected to publish its report on consumer spending. In euro zone ECB is will report data on M3 money supply and private lending.

About the Author

Daily forex trading news written by Rehan from DailyForexTrade.com

A slew of recent analyses have shown mixed results for the EUR over the past several days, brought on by speculation surrounding Mid-East unrest; but how has the EUR compared with its British counterpart?

Despite Britain’s recent inflationary woes, the UK pound has actually remained relatively bullish versus most of its currency counterparts. The GBP/JPY was up this morning, trading near 134.80 before correcting back towards 134.55 prior to the opening of the European session.

The GBP/NZD was also trading much higher, though analysts expect this to be a result of the recent earthquake in New Zealand and not a signal of any particular strength in the sterling.

Looking at the pound in comparison with a number of other currencies, on the other hand, shows a weakening trend in GBP values. The pound has experienced declines against the Swiss franc (CHF), Canadian dollar (CAD), and recently the US dollar (USD).

Across the English Channel, the euro, while expected to actually benefit from the turmoil spreading throughout the Middle East, appears bearish versus the pound. The rapid buy-in on commodities, particularly Crude Oil, has the US dollar weakening, thus driving its Atlantic rival, the EUR, higher.

Positive data out of the euro zone has also given impetus to a relatively stable EUR, despite periodic, short-term downturns.

If we look closer at the EUR/GBP we can see that the pound does in fact appear to be outpacing its European neighbor. The pair has been trading within a long-term consolidation pattern, with a consolidation point residing between 0.8400 and 0.8450.

After falling below its 38.2% Fibonacci support line at 0.8480, the pair has seen continuous losses, pushing towards the subsequent Fib level near 0.8320. Given the historic strength of the consolidation pattern, which has been in development since last June, we can expect this pair to find solid support above the next Fib line, potentially bouncing back towards its consolidation zone after touching 0.8350.

This gives forex traders a great opportunity for setting entry positions around the expected targets. The short-term downward target for this pair appears to be 0.8350, with a bounce back target near 0.8450.

EUR/GBP – Daily Chart

The Kiwi was sharply lower following an earthquake that measured 6.3 on the Richter scale and sent buildings tumbling. The NZD/USD is currently testing the 0.7500 support line. A move below this level could trigger further selling to the 0.7350 mark.

Commodities such as gold, silver, and crude oil are higher across the board following violence in Libya, Bahrain, Yemen, and Iran, with increased risk of protests spreading to other nations in the region.

Today’s calendar events:

GBP – Public Sector Net Borrowing – 09:30 GMT
Expectations: -0.2B. Previous: 15.3B.
Increasing expectations of an interest rate hike by the BOE have the pound performing well against the US dollar. Strong bids for the currency should continue in the near term. Resistance for the GBP/USD is 1.6270. Support is Friday’s low of 1.6150.

CAD – Core Retail Sales – 13:30 GMT
Expectations: 0.7%. Previous: 1.0%.
The Canadian dollar is receiving more bids given its close correlation to oil prices which are at a 2.5 year high. Support for the USD/CAD is found at this year’s low of 0.9810. Resistance comes in at 0.9980.

USD – CB Consumer Confidence – 15:00 GMT
Expectations: 65.1. Previous: 60.6.
The dollar is up sharply in today’s morning trade. The EUR/USD has support and resistance that comes in at 1.3580 and 1.3740. A move lower could trigger stop losses and target the February low of 1.3430.

Being contained by 1.6277 resistance, GBPUSD pulled back from 1.6261, suggesting that a cycle top had been formed on 4-hour chart. Deeper decline could be expected in a couple of days and target would be at 1.5900 area. Initial resistance is now at 1.6261, only break above this level could trigger another rise towards 1.6500 zone.

Forex Signals

Good morning everyone! Speaking of mornings, I am very hungry since I haven’t had my breakfast yet. And guess what?! I smell (FOOD) from outside my hotel room. Literally! Anyway, today’s stock feature is about Alliance Select Foods, Inc. or FOOD in the Philippine Stock Exchange which was formerly known as Alliance Tuna International, Inc. or TUNA. In my entry last February 3 (kindly see it here), I suggested that FOOD could swing up to another level soon. However, that did not pan out well as it just continued to move in a side way fashion after springing to a high of PHP 1.85 from PHP 1.52 in a little more than a week’s time. Yesterday (February 21), though, a breakout from now a complex pennant formation happened!

As you can see from its daily chart, FOOD breached both the psychological PHP 1.80 level and the pennant’s resistance when it closed at its high of PHP 1.82 from an opening and low of PHP 1.74. Yesterday’s price action, in my opinion, is very bullish since it as mentioned it ended the day at its high. Notice the long green candle which some call as a bullish morubozu in Japanese terms. Yesterday’s move was also supported by a relatively high volume, indicating that a climb north would be sustained. Now, if buying interest remains (barring any negative market reaction from the present situation in the Middle East), FOOD could aim for its upside target of around PHP 2.12.

More on LaidTrades.com …

The exciting 2010 is already behind us and it’s high time that we discuss what is going to happen in the investment market in 2011. Without a crystal ball, it is always difficult to make predictions for the upcoming year, but some industry experts can certainly sit together to analyze some future market trends that would help the people take wise and informed decisions while investing in the forex market. If you have amassed a huge amount of unsecured debts and are looking for ways to get relief from debt, the concerns of this article will perhaps help you out.

The Euro debt crisis, various cycles of US quantitative easing and the political upheaval in Washington DC marked the economic activities in 2010. So what do we look forward for in 2011? Here are some possible outcomes for the currency market or the forex market and the entire world economies in 2011.

1. The US dollar: As the industry experts are all set to make their predictions on the global forex market, there has also been a simultaneous speculation about the US dollar. The first question asked by most of the investors is ‘how will the US dollar fare in this year’. However, the industry experts are of the opinion that the US dollar will stay on the quiet side till the mid of 2011 but it is expected to drop sharply in the month of October.

2. Will there be economic stability in 2011: The most asked question of 2011 is whether or not there will be any stability within the economy in 2011 so that it could help the forex market. Yes, the experts are of the opinion that everything will appear to be improving and there will be some unexpected progressions since October. However, these changes will again get back to a normal position till March 2012.

3. Austerity measures will crash the pound: There will be many austerity measures coming into effect in 2011 and such measures will hurt the value of the pound sterling. The austerity measures will take a toll on the employment scenario in Britain. The pound value is expected to continue downhill.

4. The Japanese Yen will lose some ground: The traders trading with the Japanese currency, Yen will soon go through a frustrating experience as the Yen will lose some ground in 2011. As there are too many events moving the Yen and unfortunately, the most important events are not moving it at all.

Apart from all the above mentioned forex market predictions, the experts are also of the opinion that the consumers are least likely to suffer from forex related scams. There will be more regulation that will be governing the forex market over the entire globe and therefore there will be fewer chances of such companies fooling the consumers. Therefore, if you are looking for instant relief from debt, make sure you invest in the forex market to earn huge returns and utilize the proceeds in paying off your financial obligations.

About the Author

Article by Charles Anderson

By Anton Eljwizat

Gold prices rose significantly in the last week and peaked at $1396.76 an ounce. Gold has made a significant upward correction, which can be directly correlated with the bullish trend of the EUR/USD cross. However, the daily chart is suggesting that a recent upward trend is losing steam and a bearish correction is impending. This recent activity has raised the stakes for traders. From here on, the forex and commodity markets will see very high volatility indeed.

• Below is the daily chart for gold by ForexYard.

• The technical indicators used are the Slow Stochastic, RSI and Williams Percent Range.

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

• Point 2: The Williams Percent Range has peaked at the 0 marker and has turned bearish; this means that there may actually be a strong level of downward pressure.

• Point 3: The RSI signals that the price of this pair currently floats in the over-bought territory, suggesting downward pressure.

Gold 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.

Seniorstrategist Ib Fredslund Madsen take a look at the week ahead.

And since the week is very thin on economic data and events, investors might look for direction in the Middle East, where things are developing day by day.

Legal information

Video courtesy of en.jyskebank.tv

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that futures speculators  decreased their short positions of the US dollar against the other major currencies. Non-commercial futures positions, those taken by hedge funds and large speculators, were overall net short the US dollar by $23.2 billion against other major currencies as of February 15th. This is a decline from the total short position of $26.3 billion on February 8th, according to the CFTC data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

This week’s data saw some notable changes with Japanese yen positions turning negative for the first time since June while Canadian dollar and British pound sterling positions rose sharply.

EuroFx: Currency speculators trimmed their net long positions in the euro against the U.S. dollar for a second consecutive week. Futures positions in the euro fell to a total of 32,464 long positions as of February 15th following a total of 34,734 long positions on February 8th. The graph below overlays the EUR/USD spot closing price of the Tuesday when COT trader positions are reported.

The COT report is published every Friday by the Commodity Futures Trading Commission (CFTC) 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. The graphs overlay the forex spot closing price of each Tuesday when COT trader positions are reported for each corresponding spot currency pair .

GBP: Speculators sharply increased their net long British pound sterling positions and long bets for the sterling rose for a fifth straight week as of February 15th to their highest position in over a year. Pound sterling contracts rose to a total of 52,572 long positions after totaling 24,475 long positions as of February 8th.

JPY: The Japanese yen net contracts decreased sharply as of February 15th to the lowest level since June 2010. Yen positions fell to a total of 18,548 short contracts. Yen positions had totaled 36,731 net long contracts reported on February 8th.

CHF: Swiss franc long positions rose back above 10,000 to a total of 10,518 long contracts as of February 15th. Franc contracts totaled a net of 8,181 long contracts on February 8th.

CAD: The Canadian dollar positions advanced sharply higher and increased for a third straight week to a total of 72,090 net long contracts. CAD long positions had registered 39,790 net longs on February 8th.

AUD: The Australian dollar long positions dipped after reaching their highest level since April last week. AUD contracts totaled a net amount of 65,514 long contracts as of February 15th after AUD positions had totaled 71,979 net long contracts on February 8th.

NZD: New Zealand dollar futures positions edged lower to a total of 9,810 long positions as of February 15th. NZD large speculator long positions had increased the previous week to a total of 10,857 long contracts on February 8th.

MXN: Mexican peso long contracts rose higher for a sixth consecutive week as of February 15th to 109,096 net long positions after totaling 103,812 longs the week prior on February 8th.

COT Data Summary as of February 15, 2011
Large Speculators Net Positions vs. the US Dollar

Euro: +32,464
British pound sterling: +52,572
Japanese yen: -18,548
Swiss franc: +10,518
Canadian dollar: +72,090
Australian dollar: +65,514
New Zealand dollar: +9,810
Mexican peso: +109,096

Further COT Resources from around the web:

• Forecast The FX Market With The COT Report

• The Only Indicator You Will Ever Need

By GCI Forex Research

Fundamental Outlook at 0800 GMT (EDT + 0400)

USD

Price action lacked conviction during the Asia session, despite the emergence of a partial agreement at the weekend G20 meeting. EURUSD traded 1.3666-1.3716, USDJPY 83.02-83.19. The S&P 500 finished up 0.19% with volumes hitting a three-week high. The G20 agreed on a set of economic indicators that could eventually be used to measure the scale of global imbalances. The list includes public debt and fiscal deficits, private debt and the savings rate, and the trade balance and net investment income flows and transfers. Newswires reported that China blocked the inclusion of FX reserves and the real effective exchange rate as two other indicators. The objective now is to set guideline levels for this list of indicators by the April meeting, but the communique stressed that these would only be indicative and would not represent firm targets. The text also repeated a commitment to enhance “exchange rate flexibility to better reflect underlying economic fundamentals” and to avoid both “persistent misalignment” and “disorderly movements” of exchange rates. Canada’s Finance Minister Flaherty said “there was no indication by China that they intended to be more flexible with their currency immediately”. US Treasury Secretary Geithner said that China’s currency “remains substantially undervalued”.
EUR

ECB Executive Board member Bini-Smaghi spoke overnight, but his remarks failed to excite the euro in the way they did on Friday. However, he did express concern that the rise in food prices may be permanent, which clearly qualifies as a hawkish remark.
On Friday Bini-Smaghi said that “as the economy gradually recovers and global inflationary pressures arise, the degree of accommodation of monetary policy has to be monitored and, if needed, corrected”. The remarks signaled no ambition to tighten policy in the near term but, coming on the heels of an above-consensus German PPI reading, the market interpreted them as hawkish.
ECB President Trichet said that the rising price of commodities and energy is being watched “very, very closely”, and that consequent inflationary pressures “are to be taken seriously”.
US Treasury Secretary Geithner said EU leaders made it clear at the G20 meeting that they would do “whatever it takes” to ensure Eurozone nations “and their banks” have access to Financing.
JPY

Finance Minister Noda said that Japan plans to continue buying bonds issued by the European Financial Stability Facility.

GBP

BoE Deputy Governor Tucker spoke on Friday night but confined his remarks to regulatory issues, and did not discuss monetary policy. The latest minutes show that Tucker favoured no policy adjustment in January. The minutes from the Feb. 10 policy meeting, which are due for release on Wednesday, will reveal whether he or other MPC members have since shifted their stance away from neutral.

CAD

BoC Governor Carney said it is possible that Q4 GDP growth could be firmer than the +2.3% y/y projected in the January monetary policy report.
Finance Minister Flaherty said that Canadian business overall “is comfortable” with the current level of the CAD.
The CAD weakened on Friday after headline and core CPI for January came in below consensus expectations.

AUD

AUDUSD briefly fell on Friday after China hiked its reserve ratio requirement by 50bp. As investors have become more accustomed to such hikes over the past year, the AUD has become progressively less troubled by them.

TECHNICAL OUTLOOK
EURUSD 1.3744 resistance.
EURUSD BULLISH Rise above 1.3696 has exposed 1.3744 ahead of 1.3826. Near-term support at 1.3546.
USDJPY BULLISH Pullback through 83.10 has exposed 82.89. While this level holds, expect recovery towards 83.98.
GBPUSD BULLISH The pair targets 1.6279/99 resistance zone. Support is defined at 1.6149.
USDCHF BEARISH Violation of 0.9451 triggers negative tone. Next support lies at 0.9329/01 area. Initial resistance at 0.9539.
AUDUSD BULLISH Momentum is positive; break above 1.0200 would expose 1.0256, support defined at 1.0018.
USDCAD BEARISH Move below 0.9816 would expose 0.9745/12 area. Near-term resistance at 0.9905.
EURCHF NEUTRAL Initial resistance is at 1.3029 ahead of 1.3131, support lies at 1.2867.
EURGBP BEARISH Remains heavy below 0.8450; a push below 0.8356 would expose 0.8332/13 zone.
EURJPY BULLISH Look for a break above114.94 for extension of the bull trend towards 115.42/68. Near-term support holds at 112.95.

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.