Month: March 2011

Source: ForexYard

The euro rose to a near 4-month high against the U.S. dollar on Wednesday on prospects the European Central Bank (ECB) will today emphasize a readiness to raise record-low interest rates amid increasing price pressures.

Economic News

USD – U.S. Dollar Weakens on all Fronts

The U.S. dollar fell against most of its major counterparts yesterday, reaching the weakest level versus the euro since November as oil rose above $100 a barrel for a second day amid unrest in North Africa and the Middle East. By yesterday’s close, the dollar fell 0.6% against the EUR to 1.3863. The greenback was little changed against the JPY at 81.80, after earlier sliding 0.4%.

The greenback slumped versus the euro as Federal Reserve Chairman Ben Bernanke wouldn’t rule out another round of asset purchases to spur the economy. Bernanke, in congressional testimony yesterday, signaled he’ll keep the Fed on course to finish $600 billion of Treasury purchases through June. Another round of buys “has to be a decision” of the Federal Open Market Committee, and “depends again on our mandate” for stable prices and maximum employment, he said in response to a question. Bernanke said he doesn’t want to see the economy to relapse into recession.

Another leading indicator released yesterday was the U.S. ADP Non- Farm Employment Change figure. This number handedly beat last month’s result but failed to provide strength to the dollar as investors may be waiting for key data due to be released today to implement their trading strategies.

Looking ahead to today, there are few news releases coming out of the U.S. These include the Unemployment Claims and ISM Non-Manufacturing PMI at 13:30 GMT and 15:00 GMT, respectively. Better-than-expected results may help the dollar recover some of yesterday’s losses against a number of its crosses, such as the EUR and GBP. On the other hand, if the results turn out to be lower than forecast, then the dollar may record a fairly bearish session in today’s trading. Traders should pay close attention to the market as there is an opportunity for traders to capitalize on the fluctuations which are likely to follow these releases.

EUR – EUR Rises on Interest Rate Expectations

The euro rose to a near 4-month high against the U.S. dollar on Wednesday and looked set to extend gains on growing expectations interest rates in the euro zone will rise earlier than those in the United States. By yesterday’s close, the EUR rose against the USD, pushing the oft-traded currency pair to 1.3860. The 17-nation currency experience similar behavior against the GBP and closed at 0.8490.

European Central Bank (ECB) policymakers meet on Thursday, and with euro zone inflation well above its target, markets see the central bank sharpening its anti-inflation rhetoric. But gains in the common currency risk a correction as geopolitical turmoil continues to fuel uncertainty and higher energy prices, causing stocks to tumble on Wednesday.

Investors may look for the unusual price volatility to continue in the EUR/USD as the pair attempts to stabilize and find new support and resistance lines. Large price jumps such as these are not commonplace and present terrific opportunities to take advantage of the price swings for large profitable gains.

JPY – Yen Lower vs. Major Currency Pairs

The JPY saw a bearish trading session yesterday, losing ground against most of its currency crosses. The JPY fell sharply against the EUR, pushing the oft-traded currency pair to 113.45. The Japanese yen experience similar behavior against the GBP and closed at 133.50.

Today, the JPY will be absent from the economic calendar, and traders should follow overseas events in order to determine the JPY’s direction for today. Special attention should be given to the U.S. Unemployment Claims that will be published at 13:30 GMT, and will be today’s leading publication which will also affect the yen’s crosses.

Crude Oil – Crude Oil Prices Continue to Rise

Oil rose to settle at its highest level since August 2008 on Wednesday, a price near $102.60 a barrel, after an airstrike near Libya’s oil infrastructure raised more fears the OPEC nation’s oil sector could become a target in embattled leader Muammar Gaddafi’s efforts to hold power.

News of the strike in Brega, near to Libyan oil terminal, added to two weeks of fears the unrest could spill over into other large oil producers in the region. Oil markets remained focused on the turmoil in the Middle East, which could signal another threat to global oil supplies after the Libyan revolt cut exports.

As for today, traders should first and foremost follow the developments in the Middle East, as this issue will continue to impact oil prices in the near future. Traders are also advised to follow the U.S. Unemployment Claims report, which is scheduled for today at 13:30 GMT, as this report tends to have a direct impact on the market.

Technical News

EUR/USD

The pair has recorded much bullish behavior in the past several days. However, the technical data indicates that this trend may reverse anytime soon. For example, the 4-hour chart’s Stochastic (slow) signals that a bearish reversal is imminent. Going short with tight stops might be a wise choice today.

GBP/USD

The 4-hour chart is showing mixed signals with its RSI fluctuating in the neutral territory. However, the 8- hour chart’s RSI is already floating in the over-bought territory indicating that a bearish correction might take place in the nearest future. Going short with tight stops might be the right strategy today.

USD/JPY

The price of this pair appears to be floating in the over-sold territory on the daily chart’s RSI indicating an upward correction may be imminent. The upward direction on the Stochastic (slow) also supports this notion. When the upwards breach occurs, going long with tight stops appears to be preferable strategy.

USD/CHF

This pair has recorded much bearish behavior in the past several days. However, the technical data indicates that this trend may reverse anytime soon. For example, the daily chart’s RSI signals that a bullish reversal is imminent. An upward trend today is also supported by the 4-hour chart’s Stochastic (slow). Going long with tight stops may turn out to pay off today.

The Wild Card

Crude Oil

Crude Oil prices rose significantly in the past month and peaked at $102.60 a barrel. However, the daily chart’s RSI is floating in the over-bought territory suggesting that the recent upwards trend is losing steam and a bearish correction is impending. This might be a good opportunity for forex traders to enter the trend at a very early stage.

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

The EUR experienced one of its most bullish trading days in recent weeks on Wednesday. The EUR made significant gains against many of its most traded currency pairs, such as the GBP, JPY and USD.

Today’s busy calendar will have forex traders highly active in the upcoming European and American sessions. The euro zone will publish their interest rate decisions along with monetary policy statements. The US will later publish its trade balance and weekly unemployment claims and ISM Non-Manufacturing PMI report prior to tomorrow’s very significant NFP figure.

Here is a roundup of today’s leading events:

12:45 GMT: EUR – Minimum Bid Rate

The release of the European Central Bank’s (ECB) latest decision regarding its short-term interest rates will no doubt have a heavy effect on the value of the EUR. Predicting the movement of the 17-nation currency following such reports is, however, highly difficult given the volatility typically experienced around this event. Traders should make sure to protect their positions today and expect sharp movements in the market.

13:30 GMT: USD – US Unemployment Claims

This indicator reflects the number of individuals who filed for unemployment insurance for the first time during the past week, and is considered to be the broadest measure of economic health. If the end result will show a better than forecast figure the USD might get boosted.

15:00 GMT: USD – US ISM Non-Manufacturing PMI

This indicator measures the level of a diffusion index based on surveyed purchasing managers, excluding the manufacturing industry. As leading indicators of economic health, businesses react quickly to market conditions and this report has a direct correlation with the strength of the US economy. Today’s forecast is for higher growth than last month, indicating that a positive return to economic normalcy is beginning to get underway. Such an outcome should boost the USD.

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 greenback remained under pressure on Wednesday especially versus the single currency as investors and traders are expecting a prompt decision of raising interest rates by European Central Bank to address the region’s inflation.

The euro gained to 1.3861 against the US dollar on Wednesday as compared to 1.3777 on Tuesday’s North American trading session. The single currency however posted losses in Asian trading session versus the greenback. The Euro is expected to find support at 1.32 against the US dollar however its resistance is expected at 1.40.

Moreover key meeting of ECB is also expected on Thursday in which it is expected the region’s central bank will announce to keep its interest rate at 1 percent which happens to be the lowest in history. However many expect a substantial interest rate hike in coming months for the euro zone.

Chief executive of IG Markets Dan Cook commented, “If oil prices stay dramatically higher for another three or four months, then we might see a hike, It’s just a matter of time before we see those things come back into the headlines and the economy isn’t strong enough.”

The dollar index DXY which measures the US dollar performance versus its six major currency rivals dropped to 76.685 on Wednesday’s North American trading session as compared to 77.049 on late Tuesday.

The British Pound also gained against the US dollar to 1.6329 as compared to 1.6260 on Tuesday late trading hours.

The US dollar also declined 0.4 percent against the Swiss franc on Wednesday. Against the Japanese Yen the greenback witnessed the correction to 81.90 on Wednesday as compared to 81.93 on Tuesday.

About the Author

Daily forex trading news written by Rehan from DailyForexTrade.com

On the daily graph the price ranges between 0-78.6, from this point forward  a break out will lead its way automatically to the level of 127.2.

At the lowest point – break down of 0.8350 will bring to a target of 0.8180.

At the highest point – break out of 0.8600 will bring to a target of 0.8760.

Due to the fact that the price is in the middle, the stop loss will be decided only after a clear movement to one of the sides from the Fibonacci levels.

RISK DISCLAIMER

Forex trading involves high risk. Before any trade, you should consider carefully the investment objectives and the level of risk. The data sent by mail is not necessarily real-time data or precise. Real-Forex is not liable for the losses resulting from the utilization of the data. Real-Forex (Finnocorp Trading Solution Ltd

.) is not liable for losses or damages as a result of reliance on the information provided by e-mail or on the overall data, quotes, charts, signals buy / sell. It is hereby clarified that the investor must be aware of risks involved in trading in financial markets, which is a form of investment that may contain potential risks.

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Since the start of 2011, the EUR/CAD has been fluctuating within an ever-tightening range. The consolidation point for this trend appears to be just below 1.3600.

Looking over the technical indicators it seems worthwhile to point out that current momentum is bullish and we have what appears to be a relatively clear target at 1.3600 prior to any sharp movements.

This price target is well within reach today. Given the flurry of events on today’s calendar, especially out of the euro zone, there is a strong possibility that the EUR will gain the needed boost to touch this consolidation point.

The Stochastic (slow) on the chart below shows a cross just above the over-sold region, making it a weaker indication of upward mobility, but a bullish signal nonetheless.

The MACD also reveals what could be a bearish cross, countering the limited upward strength shown on the Stochastic indicator.

Since the price is within 100 points of its consolidation target, these conflicting signals make sense. There is enough data to support the upward move towards this point, but not enough to justify breaching that target.

It seems more likely that traders will witness a downturn in the pair once the consolidation price target is reached today. This is also supported by rising Crude Oil prices, which often support the value of the Canadian dollar (CAD).

EUR/CAD – Daily Chart

USDJPY is in consolidation of downtrend from 83.96. As long as 82.23 resistance holds, downtrend could be expected to resume, and another fall towards 81.13 previous low support is possible. However, a break above 82.23 key resistance will indicate that a cycle bottom has been formed on 4-hour chart, and the fall from 83.96 has completed, then the following upward movement could bring price back to 93.00 zone.

Forex Signal

Options Report

B&G Foods (BGS) shares are higher on Wednesday after the food producer reported that fourth quarter earnings surged higher on prices increases and volume growth. Net income increased to $14.3 million, or 29 cents per share, versus $1.3 million, or 3 cents per share in the same period a year ago, beating eastimates.

Stocks managed to climb back into positive territory, despite another spike in oil prices. The ADP Employment Report showed a solid growth last month, with the private sector adding 217,000 jobs on a seasonally adjusted basis.

The gold and silver markets rallied dramatically to the upside as concerns and worries over oil supplies, inflation, and general nervousness in the world markets pushed both metals into new high ground.

I have just completed a new short video where I share with you my upside target zones for gold. The video only takes a few minutes to watch and emphasizes how important technical analysis is in the gold market. Our weekly Trade Triangles have been long gold from $1,368 and it looks as though that position is going to work out well.

We also refer back to a video that I made on September 20th last year, which underscores the importance of cyclic work in the gold market and, how if these same cycles hold true, can predict with a fair degree of certainty when the next cyclic high is going to occur.

I reveal all of this in this new short video that I think you’ll find both informative and educational. Take a look at the short video here:

If you’d like to share this video with your friends, please feel free to do so.

All the best,
Adam Hewison
President of INO.com
Co-founder of MarketClub