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By eToro – The Euro continued to correct, moving down slightly as investors continued to move into the dollar.  The Euro should consolidate as the bottom end of the Bollinger Band and bounce from this level. Click here to read the full daily Review

Forex Market Analysis provided by eToro

Disclaimer: Trading in the Foreign Exchange market might carry potential rewards, but also potential risks. You must be aware of the risks and are willing to accept them in order to trade in the foreign exchange market. Don’t trade with money you can’t afford to lose.

After touching the upper border of the price channel on 4-hour chart, USDCHF pulled back from 1.0624, taking price back to test 1.0461 key support, a breakdown below this level could trigger another fall towards 1.0331 previous low. However, the price action in the trading range between 1.0461 and 1.0624 could possibly be consolidation of uptrend from 1.0331, as long as 1.0461 key support holds, one more rise to test 1.0675 key resistance is still possible.

Daily Forex Signals

By Adam Hewison – I just finished a short video in which I discovered an eerily similar pattern in the NASDAQ. If the pattern repeats then it certainly is going to be a rough third and fourth-quarter for most investors.

In this short three minute video I give you exact points and the formation that I’ve seen that could make a huge difference to most people’s portfolios.

Please feel free to comment with your thoughts on this market.

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

Q&A with an experienced Elliott wave trader reveals seven common trading mistakes.

By Elliott Wave International

To be a successful trader demands knowledge.

If you’d prefer to become an unsuccessful trader, you can start by making the following common trading mistakes, detailed by a professional who spent 25 years in portfolio management, trading and forecasting in the financial capital of the world, New York City.

In 2002, Wayne Gorman, long-time Elliott wave trader and current head of trader education at Elliott Wave International, left his 35th floor Manhattan apartment and moved to the quiet of North Georgia. He’s been sharing his knowledge and skills with aspiring traders ever since — in both online seminars and before live audiences around the world.

Wayne graciously agreed to a Q&A about trading mistakes. In his interview, Wayne reveals seven common mistakes traders make.

——–

EWI: Could you name two mistakes frequently made by stock traders?

Wayne Gorman: (mistake 1) The first big mistake is the flawed logic of extrapolation. Many traders and investors assume that a trend will remain in force until an “event” comes along to change it. But market trends are not like billiard balls on a pool table. This false assumption will put you on the wrong side of the market more times than not, especially at major turning points.

(mistake 2) The second big mistake is to suppose that news events drive market trends. In fact, the opposite is true: economic, political and social events lag market trends.

EWI: What are two common mistakes among options traders?

WG: (mistake 3) One common mistake is to buy puts or calls that are way “out of the money,” with no other transactions to compliment them. Unless your timing is absolutely perfect — and who has perfect timing? — your chance of success is low. It’s like buying a lottery ticket.

(mistake 4) Another common mistake is to buy options with too little time left to expiration. With less than one month to expiration, the time decay begins to accelerate and the chances of success diminish.

EWI: Please name a frequent mistake among traders who aim to catch the beginning of a particular Elliott wave.

WG: (mistake 5) In the middle of a corrective pattern, it’s common to run out of patience while waiting for confirmation of a trend change. You have to give corrective patterns time to unfold before you jump in. This requires discipline, and a solid understanding of the many ways corrective patterns can unfold.

EWI: What’s the biggest misconception among traders about using Elliott waves?

WG: (mistake 6) Too many traders think Elliott wave is a trading system that tells you exactly where to enter and exit a particular market. That’s the biggest misconception. The reality is that it’s an analytical and forecasting tool, which helps you develop and use your own trading system, based on your own personal risk tolerance.

EWI: What technical indicators do you believe traders over-rely on, and why?

WG: (mistake 7) Traders tend to over-rely on momentum indicators such as RSI, Stochastics and MACD to precisely spot turning points. But to paraphrase Mark Twain, markets can stay overbought or oversold a lot longer than either you or I can remain solvent.

EWI: How would you characterize today’s market action, and do you teach courses that address this environment?

WG: This is a difficult stock market in the near term. Prices haven’t strayed far from where they began in January. The action has yet to break out significantly to the downside or upside. This situation may not last much longer. I can suggest these online courses to deal with the current situation, and to prepare for the next big move:

• How to Spot Trading Opportunities, Parts 1 and 2
• How to Trade Choppy, Sideways Markets
• 5 Options Strategies Every Elliott Wave Trader Should Know
• Trading the Line – How to Use Trendlines to Spot Reversals and Ride Trends

By CountingPips.com

The U.S. dollar has been mixed in forex market trading today against the other major currencies while the American stock markets have fallen for a second consecutive day. The dollar has gained ground versus the euro, Australian dollar, British pound, Japanese yen, and New Zealand dollar while losing ground against the Swiss franc and Canadian dollar in forex trading action. Yesterday, the US dollar was stronger almost across the board on risk aversion following the Federal Reserve’s comments that the economic recovery has slowed.

The U.S. stock markets, meanwhile, have had a negative day so far with the Dow declining by approximately 50 points, the Nasdaq decreasing by over 15 points while the S&P 500 is down by over 5 points at time of writing. Oil has moved lower by $1.57 to $76.45 per barrel while gold has surged higher by $15.80 to trade at the $1,213.30 per ounce level.

Today’s economic news schedule was light with weekly jobless claims making up the only major US release today. Jobless claims increased unexpectedly in the week that ended on August 7th, according to data by the U.S. Labor Department. New jobless claims rose by 2,000 workers to a total of 484,000 unemployed workers while the 4-week moving average of unemployed workers increased by 14,250 workers from the previous week to a total of 473,500.

Market forecasts were expecting jobless claims to fall to 465,000 workers following the prior week’s 482,000 number of claims.

Workers seeking continuing claims for unemployment benefits for the week ending July 31st decreased for the week by 118,000 workers to a total of 4,452,000 unemployed workers. The four week moving average of continuing claims dropped by 64,500 workers to a total of 4,518,500.

FOREX: EUR/USD Daily Chart – The Euro trading lower against the US Dollar in forex trading after hitting its highest exchange rate in almost three months last week. The EUR/USD fell to its lowest level since July 22nd today and is on its way to be declining for the week after six straight gaining weeks. Today’s decline bounced off the 50.0 percent fibonacci level near the 1.2780 exchange rate (on the decline from April 12th at the 1.3691 to June 7th low at 1.1876) and just above the rising trendline that started on June 7th low.

By Adam Hewison – It’s déjà vu all over again”. Is one of Yogi Berra’s famous original quotes and the same can be said for the DOW right now.

The weekly chart on the DOW is flashing the same Japanese candlestick signal that it had earlier in April of this year. Back then the DOW dropped from 11,200 to 9,700 in the space of just 10 weeks!

If nothing else watch this video as this could be one of the most important weeks for the DOW and its future. The video runs three minutes.  You will find it both interesting and educational from both a Fibonacci and Japanese candlestick point of view.

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

By Russell Glaser – Following a dramatic downtrend for the USD/CHF, the pair has been caught in a range trading environment. This provides an opportunity to short the USD/CHF between two previously tested support and resistance levels.

The USD/CHF is consolidating from the previous bearish trend that occurred from June until July. Prices for the pair have been found consistently trading between the 61.8% and the 76.4% Fibonacci retracement from the last bullish trend the pair experienced during the period of November 2009 until the height at 1.1729 in June of this year.

The Slow Stochastic oscillator is in the midst of forming a bearish cross, indicating the next move may be to the downside.

The 7-day Momentum indicator is downward sloping and is approaching the 100 level. A move below the 100 line will confirm the sell signal.

Traders can use this range trading environment to enter short on the USD/CHF with a target near the lower Fibonacci level at the price of 1.0350.

Should the pair breakout above the 61.8% Fibonacci retracement level, a protective stop should be placed at the daily high from July 12th at 1.0675.

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 Finexo.com – The fallout from the Fed’s decision earlier this week, which demonstrated slow economic growth, is still felt by investors as they revise their strategies for a sluggish market. In this regard, investors are modifying their portfolios by eschewing stocks, commodities and volatile currencies and are seeking safe-haven investments such as treasury bonds, the yen and the dollar.

Disappointing indicators continue to be released that support the Fed’s assessment of a downward sloping economy. Yesterday, the US Department of Commerce announced that the US trade deficit widened by nearly 18.8 percent to $49.9 billion in June. Economic recovery in the UK was also cast into doubt as the BoE said economic growth this year will be smaller than expected.

The yen was the only currency to maintain strength against the dollar following an optimistic statement from the Bank of Japan. Mid-session, the USDJPY hit a 15-year record low at 84.70, amid reports that the Japanese government would take measures to weaken the currency, which eventually failed to materialize.

EURUSD

Amid fears of a global economic slowdown in US and China, insecurity and nervousness surrounded the euro and investors favored short positions against the single European unit, and sought refugee in the greenback. The Euro fell from 1.3100 to as low as 1.2830 putting an end to the uptrend that started in June. On the lookout for Friday, traders will be paying close attention to the release of German GDP data in second quarter. It remains to be seen whether European fundamentals will inject confidence into market sentiments, or will follow the way of their US, British and Asian counterparts.

GBPUSD

Continuing reports on the weak state of the UK economy are increasing selling pressure on the pound. The Cable lost almost 200 pips to trade below 1.5700 as economists responded to the disappointing UK unemployment figures. The pound continued to decline further after the BoE revised down its growth provision for 2011 from 3.4% to 2.7%. On the whole, as the UK emergency austerity budget is set to kick in, fears abound of tighter home credit conditions and of a rocky road to economic recovery.

Forex Market Review & Analysis by Finexo.com

Disclaimer: Trading the foreign exchange (Forex) carries a high level of risk, and may not be suitable for all investors.

Source: ForexYard

Fears about global growth prospects fueled strong gains by the USD and JPY against most of their counterparts as investors turned to safe haven currencies following a stream of negative economic data from the U.S, China and the U.K.

Economic News

USD – USD Rallies on Negative Global Growth Prospects

The U.S Dollar rallied versus all counterparts except the Japanese yen on Wednesday as equities declined and investors turned to the safe heaven currencies on concerns about the stability of global growth. The USD surged against the EUR after the Federal Reserve said Tuesday that U.S. economic growth slowed, exacerbating concerns the global economic recovery will stall.

The Dollar appreciated despite the release of worse than expected U.S trade deficit data. The U.S. trade deficit expanded $7.9 billion to $49.9 billion, from a revised $42 billion in May. Markets were also shaken by a round of weak data from China; showing a decline in Chinese industrial output and weak retail sales. The Chinese economy is seen as crucial to global economic recovery, along with the world’s largest economy, the U.S.

For today, traders are advised to follow the release of the weekly unemployment claims data, released at 12:30 GMT. A worse then expected result will likely intensify the current negative market sentiment, supporting the dollar and JPY further.

EUR – EUR at Two Week Low versus USD

The EUR dropped 2.3% versus the dollar, falling below $1.29, the biggest single-day fall versus the USD since December 2008. The U.K. pound tumbled against the USD after the Bank of England cut its forecasts for U.K. economic growth and long-term inflation. The pound fell below $1.57 for the first time in August. Poor performing employment numbers from the U.K. reinforced concerns about the strength of the British economic recovery, putting further pressure on the pound.

Late Wednesday, the EUR was at $1.2882 from $1.3187 late Tuesday and at Y109.45 from Y112.58. The U.K. Pound was at $1.5650 from $1.5886.

Today traders are advised to follow the release of the European Industrial Production report, due at 9:00 GMT; worse than expected result can put further pressure on the EUR/USD pair.

JPY – Yen Rallies on Flee to Safety

The Japanese yen traded near a 15-year high versus the USD and rallied against the EUR as concern over the sustainability of the global economic recovery spurred demand for safe heaven assets.

The JPY appreciated against all of its 16 major counterparts after U.S. data Wednesday showed a widening trade deficit and a European report today is expected to show industrial production grew at a slower pace in July. The Australian and New Zealand Dollars fell for a fourth day as commodity prices continue to decline.

The Yen climbed to 109.32 per EUR in today’s early trading from 109.74 in New York yesterday, after earlier reaching 109.24, the highest level since July 6. It is trading at 85.05 per USD from 85.32 yesterday, when it touched 84.73, the strongest since July 5, 1995.

OIL – Crude Drops Below $78 a Barrel

Crude futures fell 2.8%, following the release of a U.S. government inventories report which showed gasoline stockpiles rose for the seventh-straight week, spurring concerns the faltering global recovery cannot support demand.

Light, sweet crude for September delivery settled down $2.23 at $78.02 a barrel on the New York Mercantile Exchange, after falling as low as $77.90. Currently Spot Oil is trading near the $77 a barrel level.

The drop in Oil was triggered by poor economic data from China and Japan along with growing concerns about the flailing U.S economic recovery. A continuous rise in Oil inventories as the U.S. nears the end of the summer driving season adds to concerns about faltering demand.

Technical News

EUR/USD

The pair is in the midst of a bearish correction and yesterday reached a 3-week low as the pair fell to the 1.2830 level. Currently, a bearish cross of the MACD on the daily chart suggests that the bearish move might continue today. Going short might be the preferable choice.

GBP/USD

There is a very distinct bearish chart formed on the 1-hour chart, and the cable is currently floating in the middle of it. The 4-hour chart shows bullish signals from the RSI and the Slow Stochastic, which indicates that a mild bullish movement might take place. Going long with tight stop could be a good strategy.

USD/JPY

The pair continues with the bearish momentum that was initiated 4 months ago, and yesterday has dropped to the 84.92 level. Today, the bearish trend is likely to proceed with a target price of 84.20.

USD/CHF

The pair gained about 150 pips in yesterday’s trading session and has peaked at the 1.0624 level. At the moment, the RSI on the 4-hour chart has dropped below the 70 line, indicating that a bearish correction might take place, with potential to reach the 1.0500 level.

The Wild Card

Platinum

Platinum saw further bearishness during yesterday’s trading, and the commodity is currently trading near the 1508.00 level. As the MACD and the RSI continue to point down, the bearish move seems to have more steam in it. This might be a great opportunity for forex traders to join a very popular trend.

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.