Month: January 2011

By CountingPips.com

The British pound sterling has advanced against many of its currency rivals today in forex trading as monthly inflation data came in higher than expected. The British currency has been gaining ground on the Japanese yen, US dollar, Canadian dollar, Swiss franc and the Australian dollar while the pound has lost some ground to the euro in today’s FX markets action.

Inflation data released out of the UK today increased more than expected in December and brought the inflation rate to an 8-month high, according to the report by National Statistics. The U.K.’s consumer price index increased by 1.0 percent in December following a November increase of 0.4 percent.

The gain in December was the highest monthly increase on record and brought the annual rate of inflation to 3.7 percent following an annual rate of 3.3 percent in November.

Economic forecasts had expected the monthly inflation increase to measure 0.7 percent and the annual rate to reach 3.4 percent. Increases in the prices of air transport, fuel, gas and food contributed to the inflation advance.

The record increase has prompted speculation that the Bank of England may need to act and raise rates to combat inflationary pressures as inflation is above the bank’s preferred 2 percent target.

The pound sterling responded by gaining close to 100 pips against the Japanese yen and US dollar today while jumping over 150 pips versus the Canadian dollar.

GBP/CAD Daily Chart – The British pound sterling rising sharply today versus the Canadian dollar in forex trading to trade at its highest level since December 15th. After breaking through resistance above the 1.5830 level the GBP/CAD may advance to test the 1.6000 exchange rate.

We entered the year 2011 amid a flurry of global reevaluations. Many investors were inquiring about the stability of Europe amid the bailout of Ireland all while the Korean peninsula began to intensify its militant rhetoric and posturing. On the other side of the globe, US President Barack Obama had recently agreed to an extension and expansion of the Republican-favored tax cuts, sparking speculation about the recovery of the American economy over the long run.

If you were looking for a report which would summarize these events, and provide a framework for forecasting the coming year’s economic progress based on their impact, then we have what you’re looking for!

Our Chief Market Analyst, Greg Holden, recently undertook the task of compiling as much fundamental data as possible to explain what happened in 2010 in order to give his renowned 2011 economic forecast.

In this edition of ForexYard’s In-Depth Analysis, Mr. Holden covers the sharp price swings among the major currencies last year, particularly the EUR, USD and GBP. He also analyzed the rise of the Swiss franc (CHF) as a global safe-haven away from even the US dollar.

Minor commentary was added regarding the Korean escalation and China’s recent expansionary moves, but what is most useful is the concluding segment of each chapter and sub-chapter, providing valued insight into what investors may expect as 2011 gets underway.

Don’t miss out on this unique opportunity to learn from the best in the business. Download a copy of our In-Depth Analysis today and better prepare yourself for a year of lucrative profits in the forex market.

The oilprice just keeps on rising and rising. Currently trading around 91 dollars a barrel the oilprice is at the highest level in more than two years.

Senior Strategist Ib Fredslund Madsen explains why Jyske Bank sees oil even higher going forward.

Download the latest version of Softs & Hards here.

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Courtesy of en.jyskebank.tv

Written by FastBrokers House
2011-01-18 00:00

There was a sense of risk aversion in the market in the morning session and this saw pairs like AUD/JPY and EUR/JPY get sold quite aggressively. EUR/USD had opened around 1.3290 but couldn’t rise despite the flurry of positive comments from EU’s Rehn and Juncker. EUR/USD fell to a low of 1.3253 but persistent buying from Asian central banks at that level is helping to form a base. We then saw the usual short-covering into the late afternoon session with neither bulls nor bears overly committed to their positioning. Ranges: EUR/USD 1.3253/1.3323, EUR/CHF 1.2789/1.2833

Cable benefitted early in the session from some aggressive EUR/GBP selling as the cross broke below .8345 and the pound also benefitted from the strong consumer confidence data. Cable opened in Asia on its session lows and has traded slowly higher without pullback. Ranges: Cable 1.5877/1.5939, EUR/GBP .8333/70

AUD/USD fell in early trade when the risk aversion was to the fore but with the pair mid-range between the .9800/1.0020 range edges, nobody was over committing. Short covering has taken us back to the opening level at .9935. Range: .9899/.9947

USD/JPY has again ground it’s way lower inside a tight 30 pip range. Ranges: USD/JPY 82.49/79, EUR/JPY 109.60/94.

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 Anton Eljwizat

Crude Oil prices rose significantly in the last two days and peaked at $92.77 per barrel. However, daily chart’s Williams Percent Range is floating in an overbought territory suggesting that a recent upwards trend is loosing steam and a bearish correction is impending. In addition, there actually appears to be a bearish cross on the Slow Stochastic pointing to an imminent downward correction. Forex traders may have a good opportunity today to gain from the crude oil’s impending descent by going short on this pair today.

• The next resistance levels are found at the $93, $93.20 and $93.50 levels
• The next support levels are $92.40, $92.05 and $91.75 levels.

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 Anton Eljwizat

This pair is showing a price just beginning to ascend out of the over-sold region on the daily RSI, suggesting a momentum shift may be occurring to the latest string of downward movements. The imminent bullish crosses on the daily Stochastic (slow) oscillators also suggest that forex traders may have a great opportunity to catch a trend reversal in action. When the price swings back upward, going long with tight stops could turn out to be highly profitable.

• The next resistance levels are found at the 11.9700 levels
• The next support levels are 11.9300 levels.

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 the US holiday on holiday yesterday the Asia session was deprived of its usual directional guidance, and price action was consequently relatively subdued. The absence of news throughout the session kept markets relatively quiet, although sterling benefited from a slight improvement in UK economic data. EURUSD traded 1.3253-1.3338, USDJPY 82.46-82.78. No tier-one US data was released yesterday, but we did hear from one Fed speaker. Philadelphia Fed President Plosser said that the Fed’s QE program could end sooner than expected if conditions were to call for it, and he expressed his support for the concept of inflation targeting. Plosser added that he doesn’t know when the policy rate will be hiked for the first time, but he would not rule out a rate hike this year.
EUR

The meeting of the 17 Eurozone finance ministers produced lots of headlines but no market-moving decisions. There is clearly some difference of opinion over how urgently Europe’s financial rescue infrastructure needs to be overhauled, and how extensive any modifications should be. Belgian Finance Minister Reynders said he would be in favour of doubling the rescue fund’s lending capacity, and that discussions on this could begin immediately. Germany’s Finance Minister Schaeuble and Austria’s Finance Minister Proell maintained there was no need for such urgency. French Finance Minister Lagarde said that the EFSF should be “replaced and reinforced” and that EU states should submit a draft blueprint for a new design by March. Irish Finance Minister Lenihan said he was keen to make progress on the question of the interest rate applied to monies drawn down. Discussions continue later today when all 27 EU finance ministers are due to meet.
The first EFSF bond is due to be issued next week with a 5-year maturity and a size in the range of €3-5 bn. EFSF CEO Regling said he is confident the issue will help to restore stability in the bond markets and will protect the euro. He envisages a further two benchmark bond issues later this year specifically to fund the Ireland support program.
ECB Governing Council member Orphanides said that markets may have over-reacted to comments made at the ECB’s press conference on Thursday and that the policy board is not “overly hawkish”. He added that if a new-look EFSF were equipped to buy government bonds, some of the ECB’s non-standard measures might no longer be necessary. The ECB settled €2.313 bn worth of bonds purchases last week, up from €113 mn the week before.
GBP

Sterling found a bid after better than expected economic data for December. The RICS house price balance came in at -39% (cons. -44%, prev. -44%), while consumer confidence climbed to 53 (cons. 44, prev. 45).
CAD

Finance Minister Flaherty announced a tightening of mortgage lending rules to discourage excessive borrowing. He said the new rules are preventative, and aimed at avoiding the kind of housing problems that have been seen in other countries. Flaherty added that the timing of his announcement had nothing to do with the Bank of Canada’s policy decision, which is due later today. The consensus expects no change to the policy rate.

TECHNICAL OUTLOOK
GBPUSD breaks 1.5911/35.
EURUSD BULLISH Upside potential holds below 1.3500, a move above this level would signal a strong bull trend and expose 1.3575 next. Near-term support lies at 1.3232.
USDJPY BEARISH Focus is on 82.31, breach of this level would expose 81.89. Resistance is at 83.67.
GBPUSD BULLISH Break of 1.5911/35 area has exposed 1.6074/94 zone. Initial support defined at 1.5810.
USDCHF BULLISH Focus remains on the upside with resistance at 0.9784 ahead of 0.9852. On the downside, break of 0.9605 has exposed new support level at 0.9542.
AUDUSD BEARISH The pair found support at 0.9804 ahead of 0.9753; resistance at 1.0020.
USDCAD BEARISH Pressure on upper end of the zone 0.9849/25, break of this area would expose 0.9712. Resistance is at 0.9977 reaction high.
EURCHF BULLISH Rise through 1.2952 would expose 1.3038; initial support at 1.2757.
EURGBP BEARISH Downward momentum, the pair targets 0.8313 ahead of 0.8285. Resistance at 0.8455 yesterday’s high.
EURJPY BULLISH As long as support at 109.48 holds, expect recovery towards 111.12 and 112.19 next.

Forex 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.

Source: ForexYard

The euro’s downturn against its rivals yesterday was brought on at the start of this week’s trading by reduced optimism regarding the EU rescue fund’s expansion. Some analysts were disappointed that the finance ministers of the 17-nation bloc did not take further measures to bolster the bailout mechanism during their latest meeting. This temporary setback pushed the EUR down against most of its rivals yesterday.

Economic News

USD – TIC Long-Term Purchases May Boost USD Today

US banks were off yesterday in celebration of Martin Luther King Jr. Day, resulting in a relatively more volatile market. The US dollar experienced mixed results against its currency rivals during those thin trading conditions.

Against the euro, the greenback traded up slightly, experiencing mild bullishness and ending the day near the 1.3275 mark. The GBP/USD, on the other hand, moved upward, indicating a modest downturn for the buck versus its British counterpart. The pair ended the trading day just over 1.5900.

The American markets will reopen today with one economic report which traders should be on the lookout for. Treasury International Capital (TIC) will be releasing its monthly report on long-term foreign purchases of domestic securities today at 14:00 GMT, and should reveal a significant growth in demand for the USD. This may provide a modest boost to the USD against its currency rivals unless the report fails to meet expectations.

EUR – EUR and GBP Set for Volatility from CPI and ZEW Reports

The euro’s mild downturn against its rivals was brought on at the start of this week’s trading by reduced optimism regarding the EU rescue fund’s expansion. Some analysts were disappointed that the finance ministers of the 17-nation bloc did not take further measures to bolster the bailout mechanism. This temporary setback pushed the EUR down against most of its rivals yesterday.

The GBP/EUR was perhaps the hardest hit among the euro’s pairs, trading near the 0.8340 mark this morning from as high as 0.8500 last Friday. The EUR/USD saw a mild downturn, hitting just below 1.3300 before closing out Monday’s trading.

Looking ahead to today, one can see a number of significant economic events on the calendar from Britain and the euro zone. The CPI and RPI inflation reports from Britain should kick-start the European session with a dose of volatility, possibly pushing the British pound higher against its rivals in early morning trading.

The ZEW reports from Germany and the broader euro zone should add to what Britain’s inflationary figures start. The close proximity of these two reports means that traders should be on guard in today’s early hours as sharp swings in value may be imminent.

JPY – Yen Mixed as Japanese Household Confidence Dips

The JPY saw mixed results yesterday as European currencies led the market. With the euro bearish against most of its rivals, the EUR/JPY also moved down mildly to open today’s Asian session just below 109.80. Against the USD, the yen remained in a bearish, range-trading pattern. The pair ended Monday at 82.56.

Japan published its household confidence report yesterday which revealed a slight decrease in household sentiment, but not enough to impact the yen in any significant way. The Tertiary Industry Activity report expected tonight at 23:50 GMT will help signal the level of demand for Japanese industrial goods and provide better direction for the island currency. Until then, traders should follow the news from Europe and the United States for an accurate assessment of JPY values.

Crude Oil – Oil Prices Climb towards $92; Downward Correction Expected

The price for a barrel of Crude Oil continued climbing yesterday, topping $91.90 before closing out the trading day. Recent speculation has begun to evaluate the possible risk of rising oil prices to the global economic recovery, but little has been done at this point to intentionally push prices either direction.

With US markets closed in observance of Martin Luther King Jr. Day, the greenback saw mixed results and oil prices remained steady between $91.50 and $92.00 a barrel yesterday. With the US economy coming back online today, traders should anticipate a possible strengthening of the buck with the TIC Long-Term Purchases report expected to show a modest boost in USD demand. If this report adds strength to the dollar, it is possible the price of oil could see a downward correction through most of the trading day.

Technical News

EUR/USD

Most indicators on this pair show the price floating in neutral territory. However, the daily Stochastic (slow) appears to be signaling a fresh bearish cross, suggesting a downturn may be imminent. Going short with tight stops may be a wise move today.

GPB/USD

The price on this pair appears to have recently entered the over-bought region on the daily Relative Strength Index (RSI), indicating bearish pressure. A fresh bearish cross on the daily Stochastic (slow) supports this notion. Going short appears preferable today.

USD/JPY

This pair’s indicators mostly reveal neutrality. The only indication of direction appears to be an imminent bullish cross on the daily MACD. The technical indicators show mixed sentiment and it may therefore be wise to wait for a clearer signal before entering on this pair today.

USD/CHF

The price of the USD/CHF seems to have recently jumped into the over-bought region on the daily RSI, suggesting downward pressure is mounting. However, the daily MACD shows a bullish cross, and the daily Stochastic (slow) has what appears to be an impending bullish cross. These mixed signals suggest that traders may want to wait for a clearer signal before opening a position on this pair.

The Wild Card

Crude Oil

There appears to be a recent bearish cross on the daily and weekly Stochastic (slow) and daily MACD, highlighting significant downward momentum building on this commodity’s price. The weekly RSI has the price floating just beneath the over-bought region, suggesting that more pressure is on the way. Forex traders may want to take this opportunity to catch the downward correction on Crude Oil, which appears to be imminent.

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 Yan Petters

Following the better than expected end result of the British Consumer Price Index (CPI), the British pound strengthened against most of its major currency rivals. As a result, the GBP/JPY pair climbed about 70 pips within 20 minutes, and is currently trading near the 132.30 level. In addition, the Fibonacci Retracement lines suggest that the bullish movement is likely to proceed.

• The chart below is the GBP/JPY 4-hour chart by ForexYard.
• A very distinct bullish channel has formed on the chart, and the pair is currently trading in the midst of it.
• The pair has just crossed the Fibonacci retracement 76.4% line, placed at the 132.15 level.
• This indicates that the pair has potential to proceed towards the 100% line, located at the 134.20 level.
• A bullish cross on the Slow Stochastic also suggests that the bullish move has more steam in it.
• In addition, the Bollinger Bands appear to be tightening, suggesting that another sharp movement could be impending.
• Nevertheless, traders should notice that the RSI is currently pointing down, and is about to fall below the 70-line. If the RSI will indeed cross the 70-line, it will signal that the bullish move will be replaced with a bearish correction.
• The next resistance levels are located at: 132.65, 133.05, 133.40 and 134.20
• The next support levels are located at: 131.80, 131.25 and 130.90

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.

The British Pound surged 2 percent versus the greenback in the last week on the expectations of high interest rates and stable purchasing by Asian central banks.

The pair GBP/USD reached 1.5855 against the US dollar reporting the increase of 2.18 percent for the last week. The pair is expected to experience support at 1.5717 whereas resistance is expected around the level of 1.591.

Following is the list of major events and factors that could have a significant impact on trading of GBP/USD.

The US markets are to be close on Monday January 17th, 2011 because of Martin Luther King Day. In United Kingdom report on house prices is to be published.

On Tuesday January 18th, 2011 data on consumer confidence will released in UK and Royal Institute of Chartered Surveyors will announce data on house prices. On the very day official report on consumer price inflation will also published. Whereas in United States will release its official manufacturing data and balance of domestic and foreign investment.

Data on UK’s employment change, unemployment rate, average earnings and key indicator on consumer inflation will be reported on January 19th, 2011. These economic indicators are to define the direction and forecast of Britain’s economy.

In United States report on building permits will be published indicating country’s construction activity.

On January 20th, 2011 the United Kingdom will release a report on expected industrial orders whereas in United States key data on jobless claims, home sales and manufacturing activity will be published.

On Friday January 21st, 2011 official report of retail sales and preliminary mortgage approvals will be published in United Kingdom. These reports are the primary measures of consumer spending and demand of housing markets in Britain respectively.

About the Author

Daily forex trading news written by Rehan from DailyForexTrade.com