InvestMacro FX

By Brad Stafford

We’re often asked at MarketClub just how to play short-term pops. Regardless if you are look at stocks, futures, or the forex market, it’s always the same… MarketClub Alerts.

With these Alerts you are getting a warning of a major move. It’s not that you are reacting to fundamentals, it’s just that when the technicals align, you are the first to know.

You see, no matter what happens, what methods you use, or what markets you trade, the following is always true: If you’re the first to know, you’re the first to profit!

This applies to our trading strategy, MarketClub Alerts, and the steps we need to take to capture profits and stay on the winning side of those short-term moves.

Please enjoy the video, as always its with our compliments.

See the Video Here.

Brad Stafford
Director of Marketing
MarketClub

Source: ForexYard

Investors are looking to U.S. GDP data and the Federal Reserve to be released on Wednesday for further signs of recovery in the world’s biggest economy. The Federal Reserve ends its 2 day meeting on Wednesday and while rates are already near zero, analysts will be looking for any extension of quantitative easing and for any comments supporting a theory of green shoots of recovery appearing in the U.S economy. The Fed is due to issue a statement around 1815 GMT.

Economic News

USD – USD Consolidating towards Heavy Volatility

After Monday’s sharp gains against the EUR, the U.S. Dollar experienced a steady depreciation against the 16-nation currency throughout Tuesday, declining back towards 1.3200 after seeing a weekly low of 1.2966. The USD also saw depreciation against almost all currency pairs, except the JPY.

Interesting to take note of is a few general trends in pairs, such as the GBP/USD and USD/CHF, which seem to be trading in a tightening range, indicating that there is an anxious anticipation for tomorrow’s interest rate decision from the US Federal Reserve Board. With a decision on the US Federal Funds Rate expected tomorrow at 18:15 GMT, traders may witness some sharp volatility in these pairs directly after the announcement. With the exceedingly positive figure seen in the CB Consumer Confidence report yesterday, mixed with some other general indicators which also point up, is there a possibility that the Fed would consider increasing interest rates?

Today will indeed be an interesting day to keep tabs on the movement of the greenback. Considering the Advanced GDP report is due, along with Crude Oil Inventories, which has had a moderate impact lately, the USD is due for heavy volatility. Traders will definitely need to program reminders into their schedule telling them to login to their platforms today and capture some of the sharp movements that many are expecting.

EUR – EUR and GBP Riding Favorable Winds

So much positive economic data has been emerging in recent weeks that risk appetite seems to have made a moderate recovery. As a result, the EUR has posted steady gains over the past 24 hours. Building back up towards 1.3200 against the USD and 1.2700 against the JPY, the 16-nation currency appears to be on the receiving end of portfolio diversification and Euro-Zone confidence.

With a number of indicators showing a drastic increase in consumer confidence throughout the Euro-Zone’s largest economies, it comes as no surprise that the EUR is trending upwards against all of its currency rivals. However, as there appears to be hardly any news coming from Europe today, the EUR may be put on the back-burner as the US economy leads the pack in economic indicators. The U.S. Federal Funds Rate decision will be released tomorrow and no doubt will be one of the primary driving forces in today’s market.

While news regarding the EUR may be light this week, the British Pound will not go unnoticed. Much of the European news being released this week may show that the British economy is on track for recovery. It seems about time as Britain appeared to be one of the worst hit economies in this recent recession. If Britain is indeed recovering, the rest of Europe shouldn’t be much further off. Watching the indicators emanating from the UK may help traders gauge the direction of the prevailing winds over Europe. So far, European trends appear to be pointing up.

JPY – JPY Set Back from Increased Risk Appetite

As world tourism faces a further set-back due to the outbreak of swine flu in 7 countries, the value of the JPY as a safe-haven from economic risks appears to have continued to drop. The rise in risk appetite, and a continuation of the negative outlook in Japan, has pushed the JPY lower against most of its currency rivals, save the USD. Dropping towards the 127.00 level against the EUR and the 141.00 level versus the Pound, the JPY appears like it may level off in the near future.

With a decision from a number of Pacific countries arriving this week on interest rates, traders have the potential to see a level of volatility in the JPY and NZD which is typically uncommon. Traders should look to the Reserve Bank of New Zealand (RBNZ) today, as it is set to announce a decision on its national interest rate. Most expectations are for a 50 basis point rate-cut. The Bank of Japan (BoJ) is also set to announce its latest monetary policy regarding interest rates on Thursday, although this decision will not likely carry much volatility as Japan has held its rates steady for some time now.

Crude Oil – Crude Oil Declines on Demand Concerns

Crude Oil prices fell for a second straight day on concerns that the outbreak of swine flu would delay an economic recovery and further dampen energy demand. Fears of pandemics have slowed the global economy in the past and officials with the World Health Organization, while raising alert levels yesterday, and warned against overreacting. The fear is that the outbreak could discourage people from traveling, lead to closed factories and further hurt the economy and oil consumption.

Oil prices rose sharply last month from $40 to above $54 taking their cue from a rally in equity markets. But a new sign of a prolonged recession which has crushed energy demand around the world is again pushing prices lower below the psychological price level of $50.

Technical News

EUR/USD

The pair is continuing to provide mixed results, and is now trading around the 1.3190 level. The daily chart demonstrates a flat line ever since yesterday. The4 hour chart’s Slow Stochastic is showing no crosses, which indicate that the bullish trend may continue. Going long appears to be preferable today

GBP/USD

The typical range trading on the daily chart continues. Both the hourly RSI and Slow Stochastic are floating in neutral territory. However, the hourly chart’s RSI is already floating in the oversold territory. It appears that the possible next move might be a bullish one. In that case traders are advised to swing in after the breach.

USD/JPY

The 4 hour chart shows the pair does not have a distinct direction, since the chart appears to be quite horizontal. However, the beginning of a bearish move can be detected on the hourly chart, and the Slow Stochastic shows that the bearish momentum still has more room. Going short with tight stops appears to be preferable

USD/CHF

The typical range trading on the daily chart continues. Both the Daily RSI and the Slow Stochastic are floating in neutral territory. As well on the hourly charts the indicators are providing mixed signals with now specific direction. Good strategy might be to wait for a clearer sign before entering the market on this pair.

The Wild Card – Gold

There is still a bearish configuration on the daily chart, indicating that the momentum is still down. However, hourly chart’s Slow Stochastic is about to enter an oversold territory, indicating that there might be a minor bullish correction before a broader bearish move resumes. forex traders can maximize profits by selling on highs and taking advantage of a general bearish trend.

Forex Market Analysis provided by Forex Yard.

© 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 CountingPips.com

The Swiss franc has reached its highest exchange rate against the euro today since March 12th when the Swiss National Bank (SNB) intervened in the forex market for the first time in 15 years. Can we expect the SNB to jump in again anytime soon?

On March 12th, the SNB reduced its interest rate to a new record low at 0.25 percent and announced that the bank will be intervening in the forex market “to prevent any further appreciation of the Swiss franc against the euro.” The euro (EUR/CHF) skyrocketed versus the franc that day from approximately the 1.4800 exchange level to just above the 1.5300 level(see chart).

The SNB has resorted to currency intervention in order to fight the risk of deflation in Switzerland and because most conventional monetary policy tools like interest rate reductions have been exhausted.

On April 17th, SNB President Jean-Pierre Roth reiterated the bank’s policy to sell Swiss francs in the forex market and stated the bank was going to continue intervention if needed, saying, “In view of the risk of deflation, decisive action was called for, and we will continue to pursue this strategy for as long as the risk remains.”

Today, the euro has fallen versus the franc to its lowest exchange rate post-intervention at approximately 1.5023. Since the SNB seems strongly committed on keeping the franc weak, we can probably expect some intervention sooner or later but at what level?  The big 1.5000 francs per euro level looms closely and may be a worthwhile guess but could it be closer to the March 12th opening level around 1.4800?

We can only wait and see….

U.S. home prices continued to decline in February but did not register a new record fall for the first time in 16 months according to the Standard & Poors/Case-Shiller index released today.  The Standard & Poor’s/Case-Shiller Home Price Index measures sale prices of existing single-family homes nationally and tracks 10-city and 20-city composite home price measurements.

The February home prices report showed that the 20-city composite index fell an annual 18.6 percent while the 10-city composite index declined by 18.8 percent when compared to last year. The home price declines just beat market forecasts and were barely above January’s record annual declines. January’s home prices registered a 19.4 percent fall in the 10-city index and a 19.0 percent drop in the 20-city index.

The areas hardest hit in February were Phoenix, Las Vegas and San Francisco with annual declines of 35.2 percent, 31.7 percent and 31.0 percent, respectively. On an annual basis, none of the 20 metropolitan areas measured showed house price increases with Dallas and Denver being the areas with the lowest declines at 4.5 percent and 5.7 percent, respectively. On a monthly basis, Cleveland registered the largest house price decline with a fall of 5.0 percent while Dallas registered the smallest decline for the month with a dip of 0.3 percent.

David M. Blitzer, Chairman of the Index Committee at S & P, commented in the report saying, “All 20 metro areas recorded a monthly decline in February, but 16 of the 20 metro areas saw an improvement in their monthly returns compared to January. Nine of the 20 metro areas showed improvement in their annual returns compared to their returns in January. Furthermore, this is the first month since October 2007 where the 10- and 20-City Composites did not post a record annual decline.”

U.S. Consumer Confidence gains in April.

U.S. Consumer Confidence rose to its highest point since November according to the Conference Board Consumer Confidence Index released today. The consumer index, representing responses from 5,000 U.S. households, showed that consumer confidence increased to a 39.2 score this month following a revised 26.9 score in March. The 12.3 point increase easily surpassed market forecasts that were expecting consumer confidence to edge up by 3 points to a 29.9 score for the month and the April score marked the highest level since the 44.7 score produced in November.

The other two parts of the survey also saw increases in April.  The present situation section of the index increased to 23.7 from 21.9 in February while the expectations index jumped from 30.2 in March to 49.5 this month.

Lynn Franco, the Director of The Conference Board Consumer Research Center commented in the report on the increased readings, “Consumer Confidence rose in April to its highest reading in 2009, driven primarily by a significant improvement in the short-term outlook. The Present Situation Index posted a moderate gain, a sign that conditions have not deteriorated further, and may even moderately improve, in the second quarter. The sharp increase in the Expectations Index suggests that consumers believe the economy is nearing a bottom, however, this Index still remains well below levels associated with strong economic growth.”

Forex – U.S. dollar mostly lower in Forex Trading today.

The U.S. dollar has been under pressure in forex trading today against the major currencies.  The dollar has declined versus the euro, Australian dollar, New Zealand dollar and Swiss franc while showing a slight gain versus the Japanese yen and the Canadian dollar. At time of writing the dollar was virtually unchanged against the British pound sterling.

The euro has advanced versus the USD as the EUR/USD trades at 1.3121 in the afternoon of the US trading session at 1:56pm EST after opening the day at 1.3023 according to currency data from Oanda.

The dollar has edged up against the Japanese yen today as the USD/JPY has increased from its 96.32 opening to trading at 96.51.

The dollar has also gained slightly against the Canadian dollar after opening at 1.2188 earlier today to trading at 1.2207 later. Meanwhile, the USD has also declined against the Swiss franc as the USD/CHF has gone from 1.1562 to trading at 1.1448.

The Australian dollar has rebounded after a fall yesterday versus the USD as the AUD/USD trades at 0.7065 after opening today at 0.7047 while the New Zealand dollar has also increased versus the USD as the NZD/USD trades at 0.5586 after opening the day’s trading at 0.5568.

USD/CHF Chart – The US Dollar falling sharply today versus the Swiss Franc in Forex Trading after increasing from the beginning of the week.

By GCI Fx Research

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The euro depreciated marginally vis-à-vis the U.S. dollar today as the single currency tested bids around the US$ 1.2965 level and was capped around the US$ 1.3040 level.  The common currency moved higher early in the North American session as traders continue to evaluate the growing global swine flu crisis.  Dealers are also paying very close attention to the U.S. financial sector following a Wall Street Journal story the U.S. government will ask Citigroup and Bank of America to raise billions more in capital after the results of the banks’ stress tests are released next Monday.  Most of the nineteen largest banks in the U.S. are said to be well-capitalized but there will definitely be cases where the government strongly encourages the banks to raise additional capital and this expectation could hang heavily over the market for the next several days.  The World Health Organization lifted its level of influenza pandemic alert to “phase four” from “phase three,” evidencing an increasing likelihood the risk of a pandemic has increased.  Data released in the U.S. today saw the February S&P Case-Shiller home price index off 18.6% while Redbook retail sales were up +1.6% m/m in the first three weeks of April. Other data to be released today include April consumer confidence and the April Richmond Fed manufacturing index.  In eurozone news, traders are speculating Germany’s consumer price index may have increased in April after data from four of the country’s regions showed higher price pressures.  Also, French consumer confidence ticked up in April.  Euro bids are cited around the US$ 1.2765 level.

¥/ CNY

The yen appreciated vis-à-vis the U.S. dollar today as the greenback tested bids around the ¥95.60 level and was capped around the ¥96.75 level.  Data released in Japan overnight saw March overall retail sales off 3.9% y/y, the seventh consecutive month of declines.  Despite ongoing poor economic data, the yen continues to power higher on account of a worsening of the global swine flu contagion, an economic and health risk that risks becoming a global pandemic.  The Nikkei 225 stock index lost 2.67% to close at ¥8,493.77.  U.S. dollar offers are cited around the ¥104.15 level.  The euro moved lower vis-à-vis the yen as the single currency tested bids around the ¥124.35 level and was capped around the ¥126.05 level.  The British pound moved lower vis-à-vis the yen as sterling tested bids around the ¥139.00 figure while the Swiss franc moved lower vis-à-vis the yen and tested bids around the ¥82.65 level.  The Chinese yuan appreciated vis-à-vis the U.S. dollar today as the greenback closed at CNY 6.8270 in the over-the-counter market, down from CNY 6.8275.

₤

The British pound appreciated vis-à-vis the U.S. dollar today as cable tested offers around the US$ 1.4685 level and was supported around the $1.4515 level.  Data released in the U.K. saw the April CBI distributive trades survey improve markedly to +3 in April from -44 in March, a fifteen-month high.  The U.K. Treasury reported there is a low risk of deflation in the U.K.  Cable bids are cited around the US$ 1.4350 level.  The euro came off vis-à-vis the British pound as the single currency tested bids around the ₤0.8970 level and was supported around the ₤0.8880 level.

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.

By Fast Brokers

The EUR/USD tumbled yesterday, collapsing through several key supports, including the highly psychological 1.30 level.  EU economic data has outperformed over the past week, making Monday’s large decline all the more worrying.  The EUR/USD is presently fighting to stay above April lows in order to avoid a fundamental collapse.  The outbreak of Swine Flu is hitting the Euro particularly hard as investors run towards the Dollar and Yen for cover.  The currency pair should continue to follow its positive correlation with U.S. equities to a tee due to the lack of economic data from the EU.  The WSJ announced that the stress tests may show C and BAC will require more capital, meaning the economic worries persist.  Hence, if the S&P futures stumble under the pressure of our downtrend lines, the EUR/USD may be inclined to follow suit.  We could see a battle in the 1.30 area today as investors hesitate to let the psychological level go.  On the other hand, if the EUR/USD were to leave 1.30 and our 1st tier uptrend line behind, we could see the current selloff pick up speed.  We have a negative stance on the EUR/USD trend-wise with the Swine Flu putting the brakes on an economic recovery.  If the flu were to reach epidemic status, the EUR/USD may be forced beneath April lows.

Fundamentally, we find supports of 1.2987, 1.2949, 1.2920, 1.2892, and 1.2866.  To the topside, we see resistances of 1.3044, 1.3072, 1.3123, 1.3167, and 1.3199.  Although 1.30 is serving as a cushion right now, it could soon become a psychological barrier.  The EUR/USD is currently exchanging at 1.2988.

Market Commentary provided by Fast Brokers.

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither 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 Fast Brokers

The Pound is finding relative strength as the Euro crumbles due to surprisingly higher than expected realized sales data.  Hence, British consumer sentiment got an extraordinary boost last month, most likely due to stability in equities.  The GBP/USD is reaping the benefits by hanging above the psychological 1.45 mark in the face of a Dollar run in reaction to the Swine Flu.  Despite the positive consolidation in the Cable, investors should take note of the WSJ’s announcement that Citibank and BofA may require more capital.  It seems problems in the financial industry could continue, exposing the GBP/USD to a possible fire sale due to Britain’s heavy reliance on financial services for economic production.  Meanwhile, our 2nd tier downtrend line and 1.50 loom in the distance, mocking any near-term strength in the currency pair.  On a positive note, at least we got some optimistic economic data from Britain and the Cable has held above April lows.  Therefore, the ingredients for a near-term pop are in the mix.  However, the performance of the GBP/USD ultimately depends on its positive correlation with U.S. equities.  As a result, the outlook isn’t looking so hot as long as the S&P futures play with fire.

Fundamentally, we hold our resistances of 1.4626, 1.4677, 1.4730, 1.4773, and 1.4826.  To the downside, we maintain our supports of 1.4567, 1.4532, 1.4481, 1.44437, and 1.4387.  1.45 serves as a psychological cushion with 1.50 acting as a key psychological barrier. The GBP/USD is currently exchanging at 1.4622.

Market Commentary provided by Fast Brokers.

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither 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 Fast Brokers

The USD/JPY has dropped below our previous 1st tier trend line, and this should be a great cause of concern for the bulls.  We could really see the selloff pickup speed today as investors sprint towards the Dollar and Yen for safety from the Swine Flu.  Our previous 1st tier uptrend line and 1st tier downtrend lines are reaching an inflection point today, creating a perfect storm for the USD/JPY.  The all around strength of the Yen comes despite an extremely negative economic outlook from Japan.  Japan sees industrial production and exports declining 23.4% and 27.6% in the fiscal year vs. previous estimates of 4.8% and 3.2% declines, respectively.  Not to mention Japan foresees a 3.3% drop in GDP and an unemployment rate of 5.2%.  To make matters worse, Japan expected the CPI to drop much more than expected with deflation taking control of prices.  These are horrible numbers folks, and they show the global economic crisis may be far from over.  One might expect the Dollar to appreciate on the news of the Japanese economy worsening since the currency pair is being priced on the comparative economic performance between the two nations.  However, investors are showing the estimates from Japan imply the U.S. will have its fair share trouble as well.  The plummeting level of exports only highlights the economic struggles of America. The downtrend seems to be in the driver’s seat right now and we have a negative outlook on the USD/JPY.

Fundamentally, we find resistances of 97.11, 97.98, 98.56, 99.20, and 99.79.  To the downside, we see supports of 96.33, 95.55, 95.04, 94.48, and 93.57.  The 100 level serves as a key psychological barrier with 95 acting as a psychological cushion.  The USD/JPY is currently exchanging at 96.15.

Market Commentary provided by Fast Brokers.

Disclaimer: FastBrokers’ market commentary is provided for information purposes only and under no circumstances should be regardedneither 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.

Japanese Retail Sales decreased in March for the seventh straight month according to a report by the Japanese Ministry of Economy, Trade and Industry released overnight. March retail sales fell 3.9 percent to 11.7 trillion yen on an annual basis following February’s 5.7 percent annual decrease and January’s 2.4 percent annual fall.

On a seasonally adjusted monthly basis, retail sales fell 1.1 percent in March after declining by a revised 0.2 percent in February.  On a quarterly basis, Japanese retail sales decreased by 4.0 percent in the first quarter of 2009 to 32.5 trillion yen.

The retail sales data fell more than forecasted on a monthly basis in March as expectations were for a 0.4 percent monthly decline. Retail sales fell less than forecasted on an annual basis with market forecasts predicting a 4.7 percent annual decline.

Retail sales at large retailers, including department stores and supermarkets, fell 8.1 percent on an annual basis in March and about equaled February’s decline. Also showing declines in March were sales of clothing, machinery & appliances, cars and fuel.

Source: ForexYard

Traders continue to be influenced by the pandemic of Swine Flu in Mexico. Fears of reduced short term economic activity have traders moving out of riskier, higher yielding currencies into the safe haven Dollar and Yen. Crude Oil prices also fell yesterday as investors fear a weakening demand for international travel.

Economic News

USD – Dollar Climbs As Swine flu Spreads

Yesterday’s trading in the currency market was highly influenced by the outbreak of swine flu in Mexico. Worries about a spreading outbreak drove losses in equity markets, and with that came forex traders buying safe haven currencies. As such, the Dollar and the Yen were the prime beneficiaries. The Dollar rose sharply against the EUR as comments by the European Central Bank (ECB) President sunk the European currency along with other risk sensitive currencies. However, the Dollar fell against the JPY.

The flu pandemic has been driving trading in the financial markets the past two days. A void of economic data has also created opportunities for markets to head south. Trading has been characterized as extremely risk averse. Losses in equity markets and moves to the Dollar and Yen were seen as an example of this trading behavior. However, this pattern may be only short lived as an important economic indicator is set to be released tomorrow.

The Conference Board will release its Consumer Confidence index at 2:00pm GMT. The survey is a leading indicator of consumer spending and is an excellent gauge of current economic conditions and the overall economic situation. The release of the survey typically creates a volatile trading environment, affecting not only the USD pairs but also the value of Crude Oil and Gold. A survey with a result greater than the forecasted value of 29.6 could send the EUR/USD below the 1.2950 mark.

EUR – ECB Remarks Punish the EUR

The EUR suffered its largest 1-day drop versus the Dollar in a month on comments from two members of the European Central Bank (ECB). ECB Governing Council member Ewald Nowotny remarked there is the potential to hold European Interest Rates at a low for the foreseeable future. Later in the day ECB President Jean-Claude Trichet declared that the ECB will announce at its next scheduled meeting on May 7th a new program of quantitative easing. This sent the EUR/USD plunging to 1.3024 from 1.3166. The EUR/JPY also suffered during yesterday’s risk adverse trading session, ending the day at 125.43 from 127.18.

It is expected that the ECB will lower Interest Rates by 25 basis points to 1% at their next meeting. No further comments were made by Trichet of the proposed unconventional measures for monetary policy. However, further weakening may be seen in many of the EUR pairs in the coming days. This is likely to be more apparent if traders continue to flock to safe haven currencies, such as the USD and JPY as the Swine Flue pandemic continues to spread.

Throughout the day today Preliminary Consumer Price Index numbers will be released. This data is the Euro-Zone’s earliest inflation numbers and could help to lower the EUR during today’s trading. The EUR currency crosses are also likely to be affected by important economic news events coming out of the U.S. and Britain. These include the U.S. CB Consumer Confidence at 2:00 pm GMT and the British CBI Realized Sales at 10:00 am GMT.

JPY – JPY Safe-Haven Status Restored

The Yen showed signs of a return to its risk haven status of old as fears of Swine Flu have traders moving out of riskier, higher yielding currencies into the safe haven of the Yen. The logic of this move is a wider outbreak of the flu may increase the amount of time the global economy will need to recover from the current recession. In light of these market conditions, the Yen continues to strengthen. The USD/JPY fell for a 9th day in a row to settle at 96.30 from 96.59. The Yen also climbed against the GBP, ending the day at 140.69 from 140.97.

Japanese banks will be closed for a Bank Holiday today. Major institutional banks are key contributors to liquidity in the forex market. With their closure, price moves can become exaggerated by currency speculators. This can provide ripe opportunities for forex traders to take advantage of the unusual price volatility today. Additionally, traders are likely to take advantage of this more during times of important data releases coming out of the key industrialized nations today.

Crude Oil – Crude Oil Dips on Swine Flu Fears

The price of Crude Oil fluctuated greatly yesterday as worries of Swine Flu took hold of the market. Crude Oil dipped as low as $47.98, though it failed to break a key support level. The price finally settled at 49.37 from an opening price of $50.34. Worries that any economic recovery could be delayed due to transportation restrictions or the flow of human capital would severely hurt Crude Oil demand and sank the price of Oil yesterday.

The long term impact of Swine flu could have a muted impact. As such we could see a fair value of Crude Oil near the mid $40 range. Notably higher Crude Oil inventories during the warmer months is implying that fuel consumption will be significantly lower in the upcoming peak travel season. In the meantime, better-than-expected economic data from the U.S. and Euro-zone may help prevent Crude prices from slipping further into the red.

Technical News

EUR/USD

Since the beginning of the week the pair has entered a bearish trend, dropping from 1.3300 down to 1.3000. And now, as all the oscillators on the 4-hour chart are pointing down, it appears that the bearish movement might have more room to go.

GBP/USD

The 4-hour chart shows that the cable has been range-trading for over a week now, failing to breach through the 1.4500 level. However, a bearish cross on the daily chart’s Slow Stochastic suggests that the breach might happen today, with the potential of falling to the 1.4400 level.

USD/JPY

There is a very distinct bearish chart forming on the daily chart, as the pair is now floating in the middle of it. The pair is now testing the 95.50 level, and if it falls below this level, it might reach as low as 93.80.

USD/CHF

The pair saw an extremely bullish session yesterday, as it climbed almost 250 pips. Currently, A double doji formation on the 4-hour chart indicates that a sharp move is expected, and as the MACD is giving bullish signals, it seems that going long could be the right choice today.

The Wild Card – Gold

After peaking at almost $920 an ounce, gold has entered a bearish momentum once again, and is currently trading for about $897.00 an ounce. Currently, as a bearish cross is taking place on the daily chart’s Slow Stochastic, it appears that the bearish trend has more steam in it. This might be a good opportunity for forex traders to join a very popular trend.

Forex Market Analysis provided by Forex Yard.

© 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.