Month: March 2011

List of major events that could affect the trading of the pair GBP/USD for the week ending March 11th, 2011 are as follows:

Today official data on consumer credit was published in United States. On Tuesday March 8th, 2011 data on retail sales and house prices will be released in United Kingdom while United States will report its official report on economic optimism.

On Wednesday March 9th, 2011official report on UK’s trade balance will be published which shows the difference between country’s imported and exported goods in the last month. In United States report on crude oil inventories will be published.

On March 10th, 2011official report on manufacturing production will be released in United Kingdom which is regarded as the major indicator of economic progress. Moreover Bank of England will announce its future plans for the key lending rate.

United States will report its key data on initial jobless claims on Thursday along with comprehensive report on country’s trade balance.

On March 11th, 2011Governer Bank of England Mervyn King will make a public speech which will be followed closely to assess the future direction of UK’s monetary policy. Official report on producer price inflation will also be released in United Kingdom.

In United States several reports will be published which will include data on retail sales, data on business inventories and detailed reports on consumer sentiments and inflation expectations which will be published by University of Michigan. The respective reports represent the key data for measuring overall country’s economic progress.

About the Author

Daily forex trading news written by Rehan from DailyForexTrade.com

Don’t say that I did not warn you: Ayala Corporation – led Globe Telecom, Inc. or GLO in the Philippine Stock Exchange looks to be headed for a steep fall. Let me show you why.

Back in February 17, 2011, I already raised the red flag on GLO when it was still trading above the neckline of a massive head and shoulders formation (kindly see my previous post here). Since that time, GLO’s situation went worse as it slipped and eventually broke below the PHP 700.00 support (where the neckline lies) last on February 23. For awhile, GLO attempted to rally back above PHP 700.00 but the selling pressure on that level was too great. Again, GLO fell below it as it closed at PHP 664.00 last Friday.

Now, GLO could still reverse its bad future if it is able to rebound above the PHP 700.00 marker in the days to come. But it will take a lot of buying interest for it to go over that area since it is a price level that held for more than 10 years. And given these times of risk aversion due to the political tension in Egypt, it is unlikely that the market will buy into the equities markets and specifically into GLO with such confidence. So with GLO’s recent move, it is now quite possible that it will fall even lower. Based on its chart, its next level of support is around PHP 400.00. Its downside target meanwhile is much lower, given the height of the pattern. That’s why its scary. Therefore, it is best to just avoid this stock. Better yet, why not short it if your broker will allow you to do so.

More on LaidTrades.com …

The price of global crude oil once again reached $100.00 per barrel and has been trading in that area more roughly more than a week now. Will it continue to go higher? Let us see.

In my last post on WTI crude oil last February 1, 2011 (kindly see it here), it was only exchanging at around $92.84 per barrel. However, it was already trading within a right angled and broadening descending triangle formation therefore a breakout from such could swing it all the way to $100 dollar per barrel. Three weeks after, on February 21, the breakout happened when it pierced right through the $92.50 resistance. The move was also boosted by a bullish breakaway gap that occurred the day before. WTI crude oil eventually reached its minimum price target of $100 per barrel and even peaked at $103.40 on February 24. Since then, though, crude oil, somewhat eased and is now just trading just above $100.00.

Given its overbought condition, as indicated in the stochastics, crude oil could consolidate and move sideways for awhile before either swinging north or south. The bullish breakaway gap that occurred weeks ago, however, suggests that move higher is more likely. You see, a bullish breakaway gap is usually followed by another gap in that direction, a runaway gap. That has not occurred yet. In any case, a break of last week’s high could send it towards $110.00.

When the price of oil becomes more expensive, it’s generally bearish for the markets because oil or the “black gold” is considered as the blood that flows in the global economy. Majority of the industries in the world run on oil or other petroleum products. Therefore, an increase in its price would make business for these industries more expensive as well.

More on LaidTrades.com …

The Japanese yen experienced one of its most bullish trading days in recent weeks yesterday. The JPY made significant gains against many of its most traded currency pairs, such as the GBP and CHF.

As for today, there are no major economic data releases on the calendar from the U.S. However, Europe and Canada appear to be releasing the bulk of today’s news, which means we may see a day of trading with low liquidity and therefore increased volatility. Day-traders can take advantage of these intense trading days by swinging within the larger-than-normal price fluctuations.

Here are today’s leading events:

11:00 GMT: German Factory Orders
Previous: -3.4%. Forecast: 2.6%.

This monthly report measures the change in the total value of new purchase orders placed with manufacturers. As a leading indicator of production, this report has a direct correlation with the strength of the euro zone economy. Today’s forecast is expected to be higher than last month, indicating a positive return to economic normalcy is beginning to get underway. Such an outcome should boost the EUR.

12:15 GMT- Canadian Housing Starts
Previous: 170K. Forecast: 174K.

This report reflects the annualized number of new residential building that began construction during the previous month. If the end result will be positive, the CAD is likely to strengthen as a result.

GBPUSD broke below 1.6215 support, suggesting that a cycle top has been formed at 1.6343 level on 4-hour chart. Pullback towards the uptrend line from 1.5751 to 1.6030 would likely be seen in a couple of days. As long as the trend line support holds, the fall from 1.6343 is treated as consolidation of uptrend from 1.5344, and another rise towards 1.6400 is still possible after consolidation.

Daily Forex Forecast

By Sara Nunnally, Editor, Smart Investing Daily, taipanpublishinggroup.com

Crude oil prices are approaching a 2 1/2 year high, ending at $105.79 on Friday… a gain of 1.3%.

Take a look at this chart:

View larger chart

Over the past five months — until late February — crude oil prices trended higher within the channel drawn in green. Even during the Egyptian uprising, prices stayed within the channel, and actually slid all the way back below $90 a barrel.

Then Libya took center stage. Gadhafi has lost control of key oil infrastructure and as much as 75% of production has been cut.

That sent prices screeching through $95 a barrel and breaking out of that green channel…

But prices didn’t stop there.

Since the beginning of March, crude oil prices have breached $100 a barrel, and are now scraping $106. It’s been a wild ride over the past two weeks… and we’re not done yet.

Take a look at the area I marked in blue on the chart.

We see some consolidation after crude oil prices popped through the upper limits of the channel. This has created a Flag Formation.

These chart patterns have an amazing “success” rate resulting in higher prices. According to Bulkowski’s Encyclopedia of Chart Patterns, flags have a 0% failure rate, meaning that in all the hundreds of flag patterns Bulkowski analyzed, all of them climbed at least 5% higher.

Bulkowski’s quick to point out that these formations do fail, just that he didn’t find any that did.

What does this mean? Simply, higher crude oil prices. The flag formation has an average rise of 69%. Does that mean we’ll see oil prices at $179 — more than $30 a barrel higher than record prices from back in 2008? Not yet, but oil’s not done rising.

We’re in uncharted territory here with crude oil prices climbing so swiftly, and as long as the Libyan uprising continues, oil prices will continue to rise.

(Investing doesn’t have to be complicated. Sign up for Smart Investing Daily and let me and my fellow editor Jared Levy simplify the stock market for you with our easy-to-understand investment articles.)

As of March 2, 2011, the Energy Information Administration reports gasoline prices up more than $0.68 from last year. At the same time, gasoline stocks dropped by 3.6 million barrels, though stocks are still up 2.8 million barrels from last year.

This has a lot of people concerned… And it’s not just the U.S.

Spain announced that it was lowering speed limits in order to save fuel. It’s one of 20 actions the government is taking to curb consumption because of higher prices. In all, the country is expected to save $2.3 billion a year.

And the country — which is still mired in debt from a collapsed housing market and the global financial crisis — isn’t wasting any time. These measures will be put into place today.

Here in the U.S., some folks are calling on President Obama to open the Strategic Petroleum Reserve (SPR) to help lower prices.

Right now, our SPR is filled to capacity with 726.5 million barrels of oil. At our current rate of consumption, that equates to about 38 days’ worth of oil. There’s no real estimate to how much oil President Obama would release, if he decides to open up the SPR at all…

Both President George H.W. Bush and President George W. Bush opened up the reserve to help lower prices, and they were successful. The first President Bush opened it up during Operation Desert Storm in 1991. The SPR ended up selling 17.3 million barrels to 13 companies.

George W. Bush opened up the SPR in the wake of Hurricane Katrina. In September 2005, the government sold 11 million barrels to five companies.

So how much of an effect did these sales have?

The first President Bush’s SPR release sent crude oil prices from $32.25 to $21.48 overnight. The second President Bush’s release had a slower affect… Oil prices went from $69.50 just before the announcement to $64.21 at the end of the sale.

We don’t know what kind of effect another SPR sale could have during this time of crisis, particularly because we don’t know when the situation in Libya will be resolved, and we don’t know if any other strategic oil producers will experience uprisings of their own.

This uncertainty may keep oil prices high, no matter what happens with the SPR.

And that means some areas could see $4 gas in the very near future. The recovery that knocked unemployment numbers back below 9% and sent factory orders up 3.1% will be under severe pressure.

That, of course, will send more and more investors to safe investments, like gold and silver. But I want to remind you of Jared’s article from Feb. 25… Jared told you about the Oil Services HOLDRS ETF (OIH:NYSE), and there’s still time to take a look at this ETF before it catches up with oil prices.

Jared said that if oil prices get as high as $120, we could see the OIH run as high as $200. That’s a 23% gain from current prices, and it could come fairly quickly if oil keeps up this pace.

Editor’s Note: It Can Happen in Just 72 Hours… There’s an event that could rattle the very foundations of America unlike any other… and it has very little to do with the value of the U.S. dollar. Get the details here…

About the Author

Sara is Managing Editor of Smart Investing Daily. As Senior Research Director and global correspondent, Sara Nunnally’s diverse resume includes studies in art history, computer science and financial research. She has appeared on news media such as Forbes on Fox, Fox News Live, and CNBC’s Squawk Box, as well as numerous radio shows around the country. Most recently, Sara co-authored a book with Sandy Franks called, Barbarians of Wealth.

As Senior Research Director, global correspondent and managing editor of Smart Investing Daily, Sara has traveled all over the world in search of the best investment opportunities to recommend to her readers, be they in developed economies like France and Italy, in emerging markets like the Czech Republic and Poland, or in frontier terrain like Vietnam and Morocco. Her unique “holistic” approach of boots-on-the-ground research has given her an edge in today’s financial marketplace as she searches for the next investment opportunities in hot sectors like alternative energy, currency markets and commodities.

Written by FastBrokers House

Dollar looking generally soft as we start the week, although fairly steady versus swissy. USD/CHF unchanged around .9245/50.

EUR/USD up at 1.4030 from early 1.3975, having been as high as 1.4037 so far.  News that Moody’s had downgraded Greece caused a dip to 1.3955 area which duly ran into strong Middle Eastern buying.  Middle Eastern buying was a feature of EUR/USD’s rally last week and we’ve started the new week as we finished the last. Oil up another two bucks.  Plenty of them  petro dollars to diversify.

Talk of barrier option interest now at 1.4050.

Cable up at 1.6320 from early 1.6250.  Hedge fund buying helped us get above 1.6300 and stops were tripped through 1.6305 on way to 1.6342 session high.

Talk of 1.6350 barrier option interest, and sell orders protecting that interest  have so far capped cable’s rally.  Stops, not surprisingly, said to lie just above 1.6350.

USD/JPY marginally easier, down at 82.08 from early 82.20.  Talk of buy orders 81.50/70, stops below there.  Sell orders 82.40./50, stops above there.

AUD/USD up at 1.0175 from early 1.0130.  Talk of sell orders layered 10200 upto 1.0250.

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 Russell Glaser

Record commodity prices have been a sharp reminder of how uprisings in the Middle East are playing out in the commodity markets. Currently crude oil, gold, and silver all stand at their 2011 highs.

Violence continues in Libya with an all-out civil war being fought in the streets as rebel groups are confronted by Libyan security forces loyal to Col. Muammar el-Qaddafi. Reports of government forces using helicopters, and tanks backed by air support have raised the level of violence in the region. Rebel leaders have since confirmed their commitment to upholding the previous regime’s oil contractual obligations.

In Yemen, a reported 200,000 protestors demonstrated on Friday, requesting for President Saleh to resign.
In Saudi Arabia, a day of rage has been planned but the calls for protests have been met by sharp comments from government officials. Officially the government has banned all protests have said any attempts to gather and protest will be dispersed by security forces.

The instability of some of the largest oil producing nations has caused a spike in not only spot crude oil prices but also in gold and silver as well. These events appear to be prolonged and will continue to pressure commodity prices higher on the instability in the region.

Spot crude oil prices have spiked and have since moved above a key retracement level. Last week’s close was above the 61.8% Fibonacci retracement at $103.75 from the collapse in crude oil prices in 2008. As such, new targets for spot crude oil prices may be found at the $110 level and $122.

Gold continues to make new highs with the price action in February displaying a sharp rising trend that has eclipsed the recent consolidation pattern from late October to early February. Last week’s close above the previous all-time high of $1,431 hints at further gains for the commodity. Support comes in at $1,431 and $1,392, as well as the range between the mid February highs and the mid-December low between $1,367 and $1,360.

Earlier today spot silver pushed to a new all-time high above the $36 level and looks to continue to rise. A strong trading session on Friday led to the weekly candlestick closing as a shaved head, indicating momentum is to the upside. Any move lower in the commodity could fall to $34.30, with further support locate in a range between $31.60 and the January high of 31.20.

Forex Market Analysis provided by ForexYard.

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The release of a 3.3% growth in Canada’s GDP for Q4, 2010, appears to show moderate strength returning to Canada’s economy, above what was previously expected.

A surge in exports due to increased economic activity in the United States, as well as heightened global demand for industrial metals and crude oil, has helped support Canadian economic growth. High oil prices are also feeding a strong uptick in the Canadian dollar (CAD).

The USD/CAD pushed below its 23.6% Fibonacci level (weekly chart), its lowest price since Feb. 2008. This descent well below parity has helped boost Canada’s buying power in world markets, but will eventually gouge its exports. For the time being, Canada is reaping the benefits of healthy growth.

USD/CAD – Weekly Chart

The Loonie’s pairing against other currencies, however, reveals not only healthy growth, but stability. Versus the Japanese yen and Swiss franc, two global safe-havens, the CAD has found solid support from its 23.6% Fib level and is trading in its most stable range between this line and the 38.2% resistance level. This has granted Canada a relative advantage against these two financial powerhouses and further enhanced its economic foundation.

CAD/JPY – Weekly Chart

CAD/CHF – Weekly Chart

A number of economists have expressed recent concern for this surge in economic growth, however. This is because Canadian exports will begin to confront challenges brought on by its doggedly-persistent currency growth and seemingly-weaker output in industrial production.

Though this sentiment weighs on speculation, three other forces strongly support the recent boom in Canadian optimism. The first is export growth, which was at its highest growth level in over six years. The second is consumer spending which has been increasing beyond forecasts over the past twelve months, with the exception of last month’s 0.1% lower-than-forecast figure. The third is inflation which remains at or above desired levels, according to the Bank of Canada (BOC).

Analysts appear unanimous in the judgment that Canada’s recovery is confirmed and running ahead of forecasts. However, many have conditioned this judgment with a concern that the Loonie’s surging growth rate may hinder exports over the next two quarters. And, as expressed above, the relatively lower output in Canada’s industrial sector has raised flags among many investors.

Nevertheless, the CAD appears to be a solid investment over the next several months.

Written by FastBrokers House

Despite some strong moves on other markets, the FX market has remained very quiet indeed.

EUR/USD opened at 1.3985 and tried on two occasions to rally through 1.4000 but encountered quite heavy offers. Dips were contained by 1.3960. Order books are quite light which might explain the inactivity.

AUD/USD has been capped by persistent talk of heavy selling interest above 1.0200 but the dips have also been limited. AUD/NZD opened the week above previous 20 year highs but lacked momentum to drive higher. Ranges: 1.0120/58

The JPY was unaffected by political tensions in Tokyo and has managed to make some modest gains as falling equity markets led to some mild risk averse trading. USD/JPY 82.12/40 and EUR/JPY 114.78/115.28

Cable has traded with a heavy tone for much of the session, 1.6240/82 and EUR/GBP .8591/.8608.

The CHF has also made small gains on the crosses.

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.