Month: May 2013

As the saying goes, there are many possible reasons for an insider to sell a stock, but only one reason to buy — they expect to make money. So let’s look at two noteworthy recent insider buys.

The markets were advancing this morning following positive news regarding US home prices. The Case-Shiller Index advanced 10.9% in March, marking the largest gain since 2006.

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By CountingPips.com

The US dollar’s strength cooled off a bit in the forex markets last week after two straight weeks of gains. The dollar continued its rise against the Australian dollar, British pound sterling and the Canadian dollar while falling against the euro, Japanese yen and the Swiss franc. The New Zealand dollar was virtually unchanged against the USD.

Looking ahead to the upcoming week, we have a shortened week as we start with a Monday holiday in both the US and the UK. See commentary on forex pairs below followed by the weekly economic highlights.

Major Currency Pair Commentary:

EUR/USD: The euro rebounded against the dollar last week after declining for the previous two weeks. The pair found support near the 1.2850 level on the week and rallied to a high point just shy of 1.3000 on both Wednesday and Friday. This week the outlook very much revolves around the important 1.3000 level and whether prices trade above or below this level. Significant level of support is seen in the 1.2850 — 1.2875 area and then further below at 1.2800 — 1.2775 area.

GBP/USD: The British pound fell against the US Dollar for a third consecutive week and just missed bottoming at the 1.5000 level (low of 1.5013). Slower consumer inflation data hampered the currency earlier in the week and U.K. GDP came in to match economist expectations later in the week. For levels going forward, upside momentum would likely see resistance into the 1.5225 — 1.5250 area while downward momentum would possibly see support coming in at the 1.5080 — 1.5100 area. The major psychological level of 1.50 could very well be tested this week.

USD/JPY: The US dollar reached its highest level against the Japanese yen since 2008 last week above 103.50 level before a sharp retracement brought this currency pair lower. Further decline will bring up a bulls vs. bears showdown at the major 100.00 support level that proved to be such a barrier for prices to scale in April.

USD/CHF: The Swiss franc gained against the US dollar last week after two weeks of dollar strength. The pair topped out at about an 11-month high above the 0.9800 level and trades currently close to the 0.9600 price. On a continued decline lower, pair will likely run into the previous support and resistance areas at the 0.9550 and 0.9500 levels. Upside momentum will see the 0.9650 level possibly come into play before previous support and resistance of 0.9700 and then 0.9750 level.

USD/CAD: US Dollar closed higher against the Canadian dollar for the third straight week and touched the highest level since June 2012. Interestingly enough on the weekly charts, the week’s closing price stayed within the upper trendline of the weekly wedge pattern. Is this the week to break it? For further upside momentum, we would need to scale the 1.0325 — 1.0350 level before 1.0400 presents possible resistance.  Levels coming into play on the downside start with the 1.0250 — 1.0280 and then 1.0200 — 1.0175.

AUD/USD: The Aussie fell against the US dollar for a third consecutive week and closed right near the 0.9650 support level. The pair has been heavily sold off in the past three weeks and has fallen to its lowest level in almost a year. It will be worth watching to see if a base of support materializes at the 0.9650 level as we have seen this area provide support numerous times over the last two trading years. If this pair continues to decrease, we could see prices fall all the way to the 0.9380 — 0.9400 support area.

NZD/USD: This pair was basically unchanged last week and sits at the 0.8087 currency price. Levels coming into play include support level at the 0.8050 area before the major level of 0.80 support shows up. Higher up the scale we see 0.8150 level that has been previous support and resistance and then the major 0.8200 area.

This Week’s Economic Calendar highlights:

Monday, May 27th

USA Holiday

UK Holiday

Tuesday, May 28th

United States — consumer confidence
euro zone — German retail sales
China — leading index
Switzerland — trade balance

Wednesday, May 29

Japan — BOJ speech
euro zone — German employment data
euro zone — German consumer price index
Canada — Bank of Canada interest rate decision

Thursday, May 30

United States — GDP first quarter
United States — personal consumption
United States — weekly jobless claims
United States — pending home sales
Japan — national consumer price index
Switzerland — GDP report

Friday, May 31

China — manufacturing PMI
euro zone — consumer price index
Canada — GDP report
United States — personal consumption expenditure
United States — University of Michigan confidence survey

See our full economic calendar for more events.

Written by Zac Storella, CountingPips Forex Blog & Currency Pair Technical Analysis

By CountingPips.com

The weekly Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures traders sharply extended their total bullish bets of the US dollar again last week. Total US dollar long positions have risen for three consecutive weeks and are now at the highest level since 2008 when Reuters started calculating total amount of positions, according to Reuters.

Non-commercial large futures traders, including hedge funds and large International Monetary Market speculators, increased their overall US dollar long positions to a total of $41.0 billion as of Tuesday May 21st. This was a rise from the total long position of $32.27 billion registered on May 14th, according to position calculations by Reuters that derives this total by the amount of US dollar positions against the combined positions of euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

What is the COT Report:

The weekly cot report summarizes the total trader positions for open contracts in the futures trading markets. The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators).

Individual Currencies Large Speculators Positions in Futures:

The individual currency speculator net positions saw an advance for just the Canadian dollar last week while the euro, British pound sterling, Japanese yen, Swiss franc, New Zealand dollar, Australian dollar and the Mexican peso all had a declining number of net large trader contracts for the week.

Individual Currency Charts: (Please Click on Chart to Enlarge)

EuroFX:

EuroFX: Large trader positions for the euro dropped sharply last week and fell for a third consecutive week. Euro contracts decreased to a total net position of -80,949 contracts in the data reported for May 21st following the previous week’s total of -46,921 net contracts on May 14th.

Last Six Weeks of Large Trader Positions: EURO

British Pound Sterling:

GBP: British pound spec positions declined last week for a third straight week and to the lowest level of 2013. British pound speculative positions declined last week to a total of -76,976 net contracts on May 21st following a total of to -65,355 contracts reported for May 14th.

Last Six Weeks of Large Trader Positions: Pound Sterling

Japanese Yen:

JPY: Japanese yen net speculative contracts also fell last week for third straight week and to the lowest overall position in 2013. Japanese yen positions decreased to a total of -95,186 net contracts on May 21st following a total of -88,407 net short contracts on May 14th.

Last Six Weeks of Large Trader Positions: Yen

Swiss Franc:

CHF: Swiss franc large speculator positions fell for a second straight week last week and declined to the lowest level of 2013. Net positions for the Swiss currency futures decreased to a total of -19,930 contracts on May 21st following a total of -15,410 net contracts reported for May 14th.

Last Six Weeks of Large Trader Positions: Franc

Canadian Dollar:

CAD: Canadian dollar positions improved last week for a fifth consecutive week after falling to a new low level for 2013 on April 16th. Canadian dollar positions improved to a total of -33,852 contracts as of May 21st following a total of -44,417 net contracts that were reported for May 14th.

Last Six Weeks of Large Trader Positions: CAD

Australian Dollar:

AUD: Australian dollar large speculator positions dropped sharply again last week to decline for an eighth consecutive week. Aussie speculative futures positions dropped to a total net amount of -32,409 contracts on May 21st after totaling -13,450 net contracts as of May 14th. This is the second week of negative Aussie large spec contracts after having been in positive territory since June 26, 2012.

Last Six Weeks of Large Trader Positions: AUD

New Zealand Dollar:

NZD: New Zealand dollar large speculator bets decreased last week to fall for a third consecutive week. NZD contracts fell lower to a total of +17,782 net long contracts as of May 21st following a total of +23,216 net long contracts on May 14th.

Last Six Weeks of Large Trader Positions: NZD

Mexican Peso:

MXN: Mexican peso speculative contracts fell lower last week after increasing the previous week. Peso positions declined to a total of +136,863 net speculative positions as of May 21st following a total of +140,319 contracts that were reported for May 14th.

Last Six Weeks of Large Trader Positions: MXN

The Commitment of Traders report is published every Friday by the Commodity Futures Trading Commission (CFTC) and shows futures positions data that was reported as of the previous Tuesday (3 days behind).

Each currency contract is a quote for that currency directly against the U.S. dollar, a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and a 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.)

See more information and explanation on the weekly COT report from the CFTC website.

Article by CountingPips.com

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