Month: March 2012

EUR/JPY Weekly outlook – 12 March – 16 March

Despite an initial fall for the pair early in the last trading week, the Yen’s weakness was once again confirmed with the latter part of the week seeing the bull’s taking control of the market pushing the pair higher. The weekly chart’s candle closed as a bullish pin suggesting traders may see a continuation of recent bullish momentum.

The chart below shows last week’s strong bullish pin. The pin bounced almost perfectly off a similar pin seen back in the summer of 2010 which resulted in a strong move higher. The next level of resistance comes in at the 111.50 area which could be a wise profit taking area for any long trades.

Friday’s price action produced a strong 4hr set up which is inline with the overall bullish bias for the pair. 3 inside bars were produced during the US session on Friday. Importantly, the inside bars were ‘coiled’ (meaning they are inside the range of each other sequentially) which confirms and strengthens a bullish move. The last 2 candles also were bullish pin bars which once again confirm a move higher could be expected.

The 4hr price action from Friday afternoon, showed a clear rejection of support sitting at the 107.80 area.

With the strong bullish price action being seen on both the weekly and 4hr charts we’ll be looking to buy the pair in anticipation of a continuation of recent bullish momentum.

Taking a trade from the weekly charts, we’ll look to buy on limit at 107 which is a 61.8% fib retracement from the weekly pin. Our stops will be placed at last week’s lows with an initial target being the next level of significant resistance which comes in at 111.50

Article by vantage-fx.com

Silver Weekly outlook – 12 March – 16 March

The spot silver market saw an ‘up and down’ week last week, with price initially falling lower and reversing later in the week with a push back higher. The weekly timeframe closed as a bullish pin bar suggesting traders may expect to see further bullish momentum in the coming week.

Similar to Gold, Silver’s initial push lower was stopped by a rejection of a key psychological and technical level. As you can see in the chart below, early trading saw a test and rejection of the area at 33.00 strengthening its relevance in the market.

The daily charts confirmed the weekly charts price action, with Friday closing as a bullish pin bar. Similar to the weekly charts, Fridays candle showed a clear rejection of 33.00. However, traders need to be aware of resistance at 34.50 which may hamper any move higher (at least for the short term).

Another possible stumbling block which may prevent the bulls pushing the metal higher is the falling trend line that can be seen on the weekly timeframe. Two week’s ago, the price did break above the trend line, however was unable to hold its break resulting in a close below. As you can see, last week’s candle closed just below the trend line confirming its strength.

Trading the metal may prove a difficult task in the near term. With the bullish price patterns being made less significant by strong resistance, traders may be advised to wait for further confirmation before buying the metal.

We’ll be looking at the lower timeframes for possible long entries as the week progresses taking into consideration the strong resistance levels.

Article by vantage-fx.com

Gold Analysis / EURUSD Analysis

Here are two of the scenarios we will be watching heading into the new week.

XAUUSD has rebounded from recent range lows.  A breakout above Fridays high could see a confirmation of the bullish outside day. It should be noted that any move to the upside is a retracement of the bearish enfulfing candle seen on the 29/2/2012 which was a huge day for gold bears as the precious metal dropped 4.8% during the London fix.  Price action on XAUUSD has played out nicely recently and the the inside day breakouts worked out well.

EURUSD has broken the ascending trend line as can be seen on the daily chart below.  Price is below the 20 day SMA and a sustained move lower would potentially see a confirmation of the bearish price action.  Risk trends still point towards further downside but the market is still heavily net short with the EURFX (CME) little changed according to recent COT data.  Any positive euro-zone data could see further short covering.

Any news, opinion, analysis, price quote or any other information should be taken as general market commentary only. This is not investment advice. Forex-FX-4X or any author will not accept liability for any damage, loss, including without limitation to, any profit loss, which may either arise directly or indirectly from use of such information.

By TraderVox.com

The single currency started the week on a weak note especially during the early Asian session sliding to a fresh low of 1.3077. But it covered the losses during the late Asian session and early European session. The pair is currently trading around 1.3113, almost flat for the day. The support may be seen at 1.3080 and below at 1.3000 levels. The resistance may be seen at 1.3160 and above 1.3220. Wholesale price index from Germany came as expected at 1% month over month.

Article provided TraderVox.com
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By TraderVox.com

When euro-area was in deep crisis, numerous economists predicted the end of the economic block. The Greece debt crisis looked insurmountable and this crisis was compounded by troubles in Italy, Spain, and Ireland, which looked to follow the way of Greece.

Analysts indicated that the best thing for Europe and Greece was for Greece to leave the union. But this was not what was in Draghi’s mind; after Greece successfully secured the bailout money needed to avoid default, Draghi gave the euro region financial institutions additional three-year loans that have boosted the economy in the region. The success of these loans has silenced many analysts who predicted fallout in the region.

One of the economists who admitted having irrational market panic at the end of 2011 is Holger Schnieding. He also recommended the ECB’s efforts that have brought some semblance of calm diminishing the breakup sentiments. According to John Normand, the currency might even trade at $1.34 by June this year. The continued focus on relieving credit crunch by the ECB officials has yielded fruits with euro gaining stability over the last three months. Investors are still keeping a close eye on events from Greece as some analysts still warn that the crisis is far from over.

Despite the success cited by Draghi on his March 8 statement, some analysts still believe that the euro might go down since the Greek debt crisis has shown that investors can lose money investing in bonds. Ian Stannard, a European Foreign Exchange Strategists pointed that Spanish bonds are looking awful and this might lead to another loss to investors. He also indicated that the need for further action by the ECB might have reduced hence making the currency prone to weakening.

The euro region economy is expected to decline by 0.4 percent in 2012, with recessions expected in countries such as Greece and Italy. Germany is expected to grow by 0.6 percent in the same year. On the other hand, the US economy is expected to grow by 2.2 percent hence making it the stronger economy. This may prompt investors to buy dollar assets as they seek safe haven currencies.

Article provided TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

By TraderVox.com

After declining on March 9 after the US Labor Report showing and increase in employment, the New Zealand and the Australian dollar are set to decline farther, today. This has just come hours before the Retail Sales Report is released later on during the day. The report is expected to show the Retail sales increased by 1.1 percent in the Month of February. The growing US economy is increasing demand for the greenback at the expense of the South Pacific currencies.

The kiwi pared against the Yen after advancing against the Japanese currency for the last three trading days. This happened hours after the largest dairy exporter, Fonterra Cooperative Group Ltd, cut its milk price target. In Australia, a report expected to be released tomorrow showing home loans declined in February is being viewed as indication that Australian economy may not be as good as the US economy. Many investors looking for safe haven assets are going for the US dollar as a result.

The US retail sales report is expected to show a great increase in car sales which has been boosted by the growing credit availability and high employment rate. However, as Bernanke has warned, the US oil prices are expected to push up the inflation and hinder consumer ability to purchase. Analysts in Sydney are indicated that the positive retail sales in US will offer support for the USD while affecting the AUD negatively.

The Australian and New Zealand dollar slid against the yen and the greenback on March 9, and this trend is expected to continue today when the US Commerce Department issues the Retail Sales report. Investors are, however, keeping a close eye on the performance of the Aussie after the report showing that the Australia’s home loans declined in the month of February. Hans Kunnen, an economist in Sydney said that the lower milk prices in New Zealand might not offer much support to the nation’s currency as sentiments towards commodity prices have weakened a notch. Investors will be keeping a close eye on the report from the US to determine whether the USD is the best safe haven currency for today.

Article provided TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

By TraderVox.com

A report released by the Labor Department on March 9 indicated that employers took in 227, 000 new employees in the February; this followed a bigger-than-expected intake of 284,000 employees in January. The report indicated that the unemployment rate has been held at a record low of 8.3 percent.

According to many analysts, the boost in employment over the last 3 months could have led to an increase in consumer spending in the US. A US retail sales report expected to be released later today is likely to show an increase of 1.1 percent for February, up from 0.4 percent recorded in January.

Economist such as Omair Sharif of RBS Securities LLC indicates that the strong retail sales for February could be as a result of the large number of jobs created by employers. The Fed’s low interest rate is seen to be working as the economy seems to be gaining stability each month. Retail Sales Report is released by the department of commerce every month to show consumer spending for each month.

A strong increase in consumer spending is an indicator of stability in an economy. In a report released on February 14, the retail sales were at $358.78 billion. Retail sales report, which excludes food services, has been on the rise since July 2010.

There has been a boost in car sales in the month of February. Among the companies that have recorded an increase in car sales include Chrysler Group LLC and General Motors. According to Don Johnson, the person in charge of sales in GM US, the increased number of sales is as a result of good credit availability and stronger employment.

The retail sales report is likely to show an increase in gasoline cost, which is one of the concerns Ben Bernanke, the Fed Chairman, indicated as a possible cause of inflation and reduce consumers’ spending ability.

Article provided TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

USDCAD stays in a trading range between 0.9841 and 1.0050. Lengthier sideways movement in the range would likely be seen over the next several days. As long as 1.0050 key resistance holds, the price action in the range is treated as consolidation of the downtrend from 1.0422 (Dec 14, 2011 high), and one more fall to 0.9700-0.9800 area is still possible after consolidation. On the other side, a break above 1.0050 will confirm that the downtrend had completed at 0.9841 already, then the following upward movement could bring price back to 1.0400 zone.

Daily Forex Forecast

A delegation from the International Energy Agency spent two days in Baghdad speaking with high-ranking officials in preparation for an end-of-year report on the country’s oil sector. By some estimates, Iraq could hold some of the largest oil reserves in the world and an international auction for oil and natural gas blocks is planned for May. Without a hydrocarbon law, and considering the fractured political system, the IEA’s report may be more about political obstacles than oil potential, however.

Baghdad announced triumphantly this week that oil production increased to more than 3 million barrels per day for the first time in more than 30 years. Exports, the government said, should increase substantially once a new floating oil terminal starts operations later this week. The IEA in December said crude oil production in Iraq could reach an average of 4.36 million bpd by 2016, about half of what Riyadh produces. The agency warned, however, that Iraq’s fractured political system might be as much of an obstacle as anything.

Iraq’s post-invasion political system has never been stable. Tensions in Baghdad flared up when Shiite Prime Minister Nouri al-Maliki accused his Sunni Vice President Tariq al-Hashemi of terrorism almost as soon as the last American troop left the country in December. Juan Cole, the man behind the influential blog Informed Comment, said the action by Maliki “was part of an effort to marginalize and humiliate his Sunni enemies, and a sign of unwillingness to seek a grand national bargain.”

Iraq may be a democratic country in theory but it certainly isn’t quick on the political front, especially when it comes to passing a long-delayed hydrocarbon law. Cole, a professor of history at the University of Michigan, described Iraqi politics as anything but stable.

“I wouldn’t hold my breath on getting anything accomplished on the oil law,” he said.

Maliki may be able to use his hard-ball tactics in an effort to get his way on things like the federal budget, but that doesn’t necessarily equate to widespread political influence across the rest of the country, said Cole.

Kurdish leaders objected profusely when it looked like Exxon Mobil would be left out of Iraq’s upcoming fourth international auction because of its contracts with the semiautonomous Kurdish government. Deputy Prime Minister Rowsch Nuri Shaways, a lawmaker from the Kurdistan Democratic Party, complained, in a statement, that Baghdad was somehow opposed to “economic openness” and the “promotion of trade.” Baghdad protests that any unilateral deals with the Kurdish government are illegal, though Cole said there isn’t much that the central government can do about it.

“The Iraqi government faces two big problems on petroleum development. It is still too weak to provide security reliably for the Western corporations and their employees,” he said. “And, it is still economically depressed enough to be afraid of being taken advantage of by a bidding process that favors the corporations — causing it to drive so hard a bargain that it has spooked potential investors.”

Iraq could be able to take advantage of its strategic position in the Middle East. Its Turkish neighbors to the north are keen to become an influential energy hub by playing host to some of the most ambitious oil and natural gas pipelines in the world. To Iraq’s south, the Strait of Hormuz transports about 20 percent of the oil traded globally.

“Politically, however, Iraq is landlocked,” said Cole.

Getting a federal budget passed this year might’ve been a temporary political victory for Maliki. Long term, however, it’s unlikely he’ll be able to make any claims to a political mandate in a country that relies so heavily on oil for its federal revenue. Baghdad has tilted at times toward Iran and higher oil prices may embolden the Shiite prime minister’s position. But Iraq might find itself in a geopolitical tug-of-war given Washington’s regional interests.

“Iraq is extremely vulnerable right now,” Cole warned.

The IEA is expectedto release its report on Iraq in October as a prelude to its full energy outlook for 2012. While expressing optimism about the prospects for the oil sector in post-war Iraq, IEA Executive Director Maria van der Hoeven said politics are getting in the way of broader developments. When asked what he would title the October report from the IEA, Cole just chuckled and said “slow progress.”

Source: http://oilprice.com/Energy/Energy-General/Iraq-Oil-Outlook-Overly-Ambitious.html

By. Daniel J. Graeber of Oilprice.com

Too much talk this week was about Apple, the release of the new iPad, the new $660 price target at Goldman Sachs, etc. But you know what else Apple did? It gave Silicon Valley the biggest real estate rental boom since the peak of the dot-com period. The Cupertino, CA based company expanded its space by 2.7m square feet in 2011 alone. Leasing broker Cassidy Turley estimates the rental cost in the area will rise another 11% in 2012 given the additional 700,000 square feet demand Apple might have this year. Silicon Valley’s office space rental price topped in last quarter of year 2000 at $77 per square foot. We’ll keep seeing price heading back to that direction as Apple continues to expand its headquarters. To summarize this week for you on this spotlight stock, Apple is now trading at $544 and change, just an inch below its 52-week high of 548.21.