Month: February 2011

What’s cooking in the Philippine Stock Exchange as of late? Well, Alliance Select Foods, Inc. or FOOD looks to be on a brink of another major upswing! For those who does not know this company, it used to be known as Alliance Tuna International, Inc. (TUNA). It’s a company that is engaged in tuna processing, canning, and export of canned tuna products from General Santos City in Mindanao across the globe. During the past two years, it bought stakes in PT International Alliance Foods Indonesia (PTIAFI) and Prime Foods New Zealand (PFNZ) to enhance its international reach and product diversification.

So like I said, it appears that a major bullish move is about to happen at least from a technical point of view. As you can see from its chart, FOOD has been forming a pennant pattern after making some headlines during the past two weeks when it suddenly erupted from PHP 1.52 last January 6 to reach a high of PHP 1.850 yesterday (February 2) and earlier today (February 3). Participation in this issue has also increased as can be seen in its volume during the same period. This suggests that people with knowledge could be seeing something worth their money. Now, a break above the mentioned high could send FOOD skyrocketing towards PHP 2.18 (gauged by projecting the height of the pennant’s pole from PHP 1.85. So my suggestion is better keep an eye or two on this one as this may swing for a home run sooner  than later.

More on LaidTrades.com …

I want to wish everyone Kung Hei Fat Choi or a Happy Chinese New Year as we enter the year of the metallic rabbit. And why not celebrate it with a bottle or two of San Miguel Beer? Well, it’s not exactly like the Tsingtao Beer of China but it’s actually way better! San Miguel Brewery or SMB in the Philippine Stock Exchange is the largest producer of beer in the Philippines. Its flagship brand, San Miguel Pale Pilsen, is exported not only in Asia but all over the world. Having said that, drinking some not only makes people light on their heads but it could also have them profit a buck or two.

Back in January 10, I mentioned that something could be brewing with SMB (kindly see my post here). Back then, I thought that it was already poised for an upside breakout from either an ascending triangle or a pennant pattern. However, that did not happen until earlier today (February 3, 2011) when it rose by 10% from an opening of PHP 29.00 to a closing of PHP 33.00. As you can see from its chart above, the breakout was accompanied by a relative rise in volume. It also closed on its high which signifies optimism among its buyers. Moreover, the MACD also made a bullish crossover, suggesting that SMB could start to ascend once more. So given today’s price action, an upside target of PHP 41.50 or even PHP 50.60 could be derived.

Cheers!

More on LaidTrades.com …

By Anton Eljwizat

The EUR/AUD pair has experienced much bearishness in the last few days as it currently trades at 1.3380. The current bearish trend is expected to come to an end anytime soon, and a bullish correction may be in the making. I will illustrate below that the EUR/AUD may very well be heading for a reversal. Traders are strongly advised to take advantage of the trend at an early stage.

• Below is the 4-hour chart of the EUR/AUD 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 a bullish cross, signaling that the next move may be in an upward direction.

• Point 2: The RSI signals that the price of this pair currently floats in the over-sold territory, suggesting upward pressure.

• Point 3: The Williams Percent Ranges is showing that this pair is heavily over-sold and may be experiencing strong upward pressure.

• The volatile downward movement which occurred prior to this upward correction has generated these indicators, and there appears to be room for this correction to continue.

EUR/AUD 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.

By GCI Forex Research

Fundamental Outlook at 0800 GMT (EDT + 0400)

USD

With much of Asia still on holiday, FX price action was largely subdued overnight. However, AUDUSD did receive a strong boost when the RBA kept the forecasts for 2011 and 2012 inflation unchanged, despite the flooding. EURUSD traded 1.3609-1.3652, USDJPY 81.45-81.70. Fed Chairman Bernanke’s economic assessment largely echoed the latest FOMC statement. The Nikkei-225 is up just over 1% at the time of writing.
US data supported our analysts’ call for faster Q1 growth as non-manufacturing ISM surged to the highest level since 2005, and was well above expectations. We continue to expect real GDP growth in the current Q1 to accelerate to 4.2% from 3.2% in Q4 despite the unusually inclement weather that is temporarily delaying/postponing some economic activity. New jobless claims fell slightly more than anticipated to 415k. Wintry weather has resulted in unusually choppy data in January and we expect the weather to also affect the January payrolls. Our US economists forecast a +80k rise in headline payrolls, well below the consensus of +143k.
EUR

The messages conveyed by European Central Bank President Trichet at the Feb. 3 press conference were pretty much the same as those of the Jan. 13 press conference. However, what the FX market was inclined to hear and how it interpreted Trichet on each occasion made all the difference to the euro. Going into last month’s meeting the market expected nothing new and heard hawkishness. EURUSD popped. This time the market expected hawkishness and heard nothing new. EURUSD dropped. Like last month, Trichet put inflation front and center in his remarks. But while he again noted evidence of short-term upward pressure, mostly because of energy prices, he qualified this by saying that the current situation didn’t appear to pose any danger to price stability over the medium term. He then emphasized that it’s the immediate term that counts. There were no hints of dovishness but certainly not enough hawkishness to meet market expectations.
German Chancellor Merkel said there will be no concrete decisions at the upcoming EU summit though she did say the Eurozone has to take important steps by the end of March on stability, growth and competitiveness because if the euro fails, Europe fails.
Services PMIs were mixed. Germany’s reading rose to 60.3 from December, close to all time highs, and the French print rose to 57.8. However, peripheral readings are stabilizing but remain far from the levels of the Eurozone core. Eurozone retail sales declined unexpectedly by 0.6% m/m, but this could have resulted from poor weather.
GBP

Sterling was supported by the Services PMI which came in above consensus at 54.50, and rose substantially from the prior reading of 49.7.
CHF

Our analysts pushed back their SNB policy rate move forecast to June, from March. Although the latest Swiss economic indicators have been anything but disastrous, Swiss franc strength has weighed on officials. The SNB has kept policy expansive as judged by lower short-term rates. Our main scenario now calls for a an increase in the SNB’s 3m CHF Libor target by 25bp to 50bp at the June MPA.
AUD

The RBA’s Statement on Monetary Policy concluded that the economic impact of the floods would be temporary, echoing comments made in Tuesday’s policy statement. The 2010 GDP forecast was revised down to 2.75% from the previous estimate of 3.5%, but the 2011 GDP forecast was raised to 4.25% from 3.75% previously. No change was made to the 2011 or 2012 forecasts for core inflation.
CAD

Our Canadian economists expect a modest net increase in employment of 10.0k (consensus 15.0k). Canadian Finance Minister Flaherty has already warned of potential challenges regarding jobless numbers, which seems to support our below-consensus forecast.

TECHNICAL OUTLOOK
EURUSD stalls in front of 1.3888/1.3948.
EURUSD BULLISH Stalled in front of 1.3888/1.3948 resistance zone. Initial support lies at 1.3571.
USDJPY BEARISH Support lies at 81.31, break below this would expose 80.93 next. Resistance at 82.15.
GBPUSD BULLISH Focus is on 1.6299 key high with scope for 1.6379 next. Support lies at 1.6010.
USDCHF BEARISH While initial resistance is at 0.9526, focus is on 0.9329/01 support zone.
AUDUSD BULLISH Breach of 1.0149 has put focus on key resistance 1.0256 next. Support lies at 1.0083 yesterday’s low.
USDCAD BEARISH Momentum is negative; break of 0.9861/38 support area would expose 0.9820. Near term resistance at 0.9978.
EURCHF BULLISH Rise through 1.3002 has exposed 1.3069 ahead of 1.3118. Support at 1.2781.
EURGBP NEUTRAL Sharp fall through 0.8510 puts pressure on 0.8433, break of this would expose 0.8413 next. On the upside initial resistance is defined at 0.8533.
EURJPY NEUTRAL Decline through 111.28 has turned the model to neutral; 112.92 and 110.32 mark the near term directional triggers.

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.

Source: ForexYard

The euro came off its recent highs following dovish ECB comments and strong employment data from the US. If yesterday’s economic data is any hint of today’s payroll numbers, the dollar rally may prove to have legs.

Economic News

USD – Dollar Mixed After Strong US Economic Data

The greenback did not see a fluent direction in the market on the back of better than expected US economic data.

The US trading session was filled with strong economic reports that saw US unemployment claims fall to 415K from 457K for the previous week. Economists had expected 420K new jobless claims. ISM Non-Manufacturing PMI was significantly stronger, up to 59.4 after an expected 57.4 mark. Any reading above the 50.0 level represents growth in the economy. US factory orders also unexpectedly rose by 0.2% on expectations of a 0.2% decline.

Strong economic data combined with the ECB interest rate decision had the USD mixed versus the majors. Versus the euro the dollar saw its strongest gains of the new year. The EUR/USD closed the day down at 1.3625 from 1.3794. The GBP/USD finished the day lower but not before the pair pushed near a three month high at 1.6277 and the pair ended at 1.6140 from 1.6184. The AUD/USD was trading firmer at 1.0170 from 1.0103.

The market’s attention will now shift to the all-important US Non-Farm Payrolls report which is due out today at 13:30. Economists forecast the US economy added 138K new jobs in the month of January but the unemployment rate is expected to rise from 9.5% from 9.4%. Strong employment data from the US may have significant ramifications on the dollar and the Feds outlook on the economy. Should better than expected non-farm data show an improving employment scenario, the Fed may begin to pull back on their loose monetary policy which would be a positive for the dollar.

Initial support for the EUR/USD comes in at 1.3570, followed by 1.3500. Resistance is located at this week’s high of 1.3860.

EUR – Euro Falls On Trichet Comments

The European Central Bank left their benchmark interest rate steady earlier today at 1.0% while the euro sold off following the announcement and the selling picked up speed during the Q&A session with ECB President Jean Claude Trichet.

During the comment session, Trichet told reporters risks to the economic outlook remain tilted to the downside while the medium term outlook for inflation is balanced but could move higher. The selling of the euro intensified following Trichet’s comment that interest rates remained at an appropriate level and the recent data has not changed the assessment by the ECB.

The euro was sold across the board yesterday with the EUR/USD falling as low as 1.3608 before recovering to 1.3625. The pair opened the day at 1.3795. The EUR/CHF was also down sharply at 1.2887 from 1.2971.

As traders’ expectations for an interest rate increase in the euro zone get pushed back further into the future, the value of the EUR/USD will decline. However, expectations remain for rising European rates. The next meeting for the ECB could spur further euro gains, as could an extension of the Federal Reserve’s loose monetary policy.

JPY – Yen Continues to Strengthen

The yen saw high volatility yesterday, influenced by strong US economic data and the ECB interest rate decision. However, the pair ended the day near its opening price.

The USD/JPY traded at one point in the day as high as 82.05 before ending the day down slightly at 81.55. The pair began yesterday trading at 81.63. Better than expected employment and non-manufacturing data had the yen on its back foot as the dollar began to strengthen. However, towards the end of the day the gains in the pair failed to hold. A similar situation arose following the downgrade in the sovereign credit rating of Japan last week.

The inability of the USD/JPY to make new highs does not bode well for the pair and the bias is to the downside. Support for the pair is found at 81.30, followed by the December low of 80.90. Resistance is located at yesterday’s high of 82.05 and the January 27th high at 83.20.

Oil – Crude Could Rise On Positive Employment Numbers

Spot crude oil prices dipped yesterday following a rising dollar. Traders remain focused on economic data and geopolitical events in the Middle East.

The price of spot crude oil ended the day at $90.75 after an opening day price of $91.34. The commodity traded as low as $90 but held at the support level.

Influencing traders to sell the commodity was stronger than expected US employment data as well as better US factory order numbers. This helped to push the dollar up, making crude oil prices more expensive for those that hold currencies other than the dollar.

Crude prices have undergone a period of higher than usual volatility following the outbreak of mass protests in Egypt which sparked close to an $8 rally. However, spot crude oil prices failed to move above its previous high of $93.00

Today crude prices will be influenced by the release of US Non-Farm Payrolls. Better than expected employment data may provide traders with a reason to reverse yesterday’s declines in the price. Support for spot crude oil is found at $90.00 and $87.00. Resistance is located at the $93 level.

Technical News

EUR/USD

The two day decline in the value of the EUR/USD looks to have found support at a rising support line underneath the late January lows. This may be an opportunity to enter long on the pair with a first target at this week’s high of 1.3860.

GBP/USD

The pair is currently testing the resistance level of 1.63, a price last seen in November. A breach of this level would then set the stage for a test of the 2010 high of 1.6460.

USD/JPY

The inability of the USD/JPY to make new highs does not bode well for the pair and the bias is to the downside. Support for the pair is found at 81.30, followed by the December low of 80.90. Resistance is located at yesterday’s high of 82.05 and the January 27th high at 83.20.

USD/CHF

With only minor divergences, the pair has consistently traded below the downward sloping trend line off the May 2010 high. Currently the price has reverted back to this trend line, making for a possible entry opportunity short with a target the swing low at 0.9300.

The Wild Card

Crude Oil

Following an almost $8 gain in crude oil prices, a bullish flag pattern has formed on the daily chart. The chart pattern suggests forex traders may target the $98.40 level should a breakout occur to the upside.

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.

Microsoft (MSFT) may sell debt as soon as today to reward shareholders, reports Bloomberg. Citing a regulatory filing, the proceeds may be used for expenditures, stock buybacks, andor acquisitions. According to a person familiar with the transaction, the company may issue 5-, 10-, and 30-year senior unsecured debt in benchmark size.

The euro has declined against the US dollar in the forex markets today after reaching a medium-term top in Tuesday’s trading at the 1.3861 exchange rate. The EUR/USD has fallen for a second straight day and was sold off heavily today on dovish comments for  interest rates from European Central Bank Pres. Jean-Claude Trichet. The euro/dollar pair opened the day at the 1.3793 exchange rate and marked an intraday low point at 1.3610.

EUR/USD Daily Chart – The EUR/USD pair has been rejected lower the past two days after the recent high Tuesday and looks primed to test lower levels. The RSI indicator has turned down from close to overbought levels to a 55 reading while the MACD indicator forecasts a potential moving average crossover. If the pair breaks through support around 1.3580, we can look for a test of the 1.3500 level and lower previous (November) support at the 1.3450 level.

Article by FxNewsEurope, Euro Forex News

This morning, Diamond Offshore Drilling (DO) declared both its regular dividend of 12.5 cents per share, as well as its special dividend of 75 cents per share, maintaining the amount paid to shareholders last quarter. Based on the current stock price, investors can expect a yield of about 4.8% going forward.

Energy shares are mostly lower in mid-day trading as crude oil futures decline but trade above the $90-a-barrel mark. Light, sweet crude oil for March delivery traded down $0.26, or 0.3%, to $90.58 a barrel. In mid-day news, ADRs of Royal Dutch Shell (RDS.A) are down after the European oil major reported earnings that came short of what analysts were expecting. Meanwhile, Tesoro (TSO) shares are down after Reuters reported that the US refiner said that a fire last month at the company’s 58,000 barrel per day refinery in North Dakota had a minimal impact on production. The refinery has reportedly run beyond its planned rates and repairs are expected to finished in March, the report said.

By CountingPips.com

The US dollar has been gaining on most of the major currencies in forex trading action while the euro has fallen sharply as the European Central Bank held its interest rate steady earlier today. The dollar has increased on the day versus the euro, British pound, Canadian dollar, Japanese yen, New Zealand dollar and the Swiss franc while the American currency has fallen against the Australian dollar, according currency data from Oanda in the afternoon of the US trading session.

The US stock markets have been moderately higher in today’s session with the Dow gaining by approximately 20 points, the Nasdaq increasing over 4 points and the S&P 500 up by close to 3 points at time of writing.  Oil has edged lower to $90.62 per barrel while gold futures have jumped $18.20 to $1,349.70 per ounce.

News out of Europe today focused on the European Central Bank which held its interest rate steady as widely expected by market forecasts and economists. ECB President Jean-Claude Trichet’s comments on the European economy helped weaken the euro as Trichet dampened expectations of an interest rate increase. Trichet commented that, “inflationary pressures over the medium to long term should remain contained” and “the current key ECB interest rates still remain appropriate.” Traders took Trichet’s comments as dovish for interest rates and sold the euro in today’s market.

Economic news releases today in the US showed that new weekly jobless claims declined more than expected through January 29th. Jobless claims fell by 42,000 workers to bring the jobless claims to a total of 415,000 workers last week. Continuing claims also fell for the week by 84,000 workers.

The ISM non-manufacturing survey was also released today and showed that service sector economic activity rose more than expected to a score of 59.4 in January. This follows a score of 57.1 in December and beat market forecasts looking for a 57.2 score for the month.

EUR/USD Chart – The euro falling sharply today versus the dollar in trading as the EUR/USD came under pressure on  the comments from ECB President Jean-Claude Trichet.  The euro had reached a recent high versus the dollar in yesterday’s trading near the 1.3860 level before today’s decline.