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Market Analysis by Finexo.com

EURUSD
The Euro’s rally, which pushed the single currency to its highest level in more than seven weeks, stalled on Friday as market sentiments towards the Euro remained cautious and some traders bet that its recent upswing was too quick. After hitting a high of $1.2723 on Friday, the pair slipped to close at $1.2637 – up 1.56% from the beginning on the week.

The EUR/USD remained under selling pressure this morning. After slipping briefly below the $1.26 mark, the pair has since recovered; however, the key going forward is whether the pair can remain above its $1.2550 support level. If the Euro slips below that key level, it could trigger sell stops which could in turn cause a drop to $1.2450.

GBPUSD
The Pound slipped below its $1.5075-$1.5275 trading range last week, as investors began to lose patients with the currency following a weaker-than-expected U.K. home price data and the Bank of England’s decision to leave interest rates unchanged at 0.50%. The Sterling closed on Friday at $1.5059, its lowest price since July 1st, and down 0.63% from the beginning of the week.

This morning, Britain is scheduled to publish its Final GDP figure for the first quarter of 2010. The initial GDP released showed a small 0.1% growth, which was later revised to 0.3%. The final GDP figure is expected to confirm this latest upwards revision; however if the number is worse than predicted, investors could see additional selling pressure take place today.

AUD/USD
The AUD/USD tumbled from its highest level in nearly three weeks as peculations grew over the pair’s rapid rise. Last week, the Aussie stuck a 9-day high against the U.S Dollar amid a better than expected Australian employment rate, wider than anticipated trade surplus and a strong rally in global commodity prices. The Australian Dollar slipped to 0.8733 this morning, down 0.5% from last week’s close of 0.8776. The pair rose 4.3% over the course of last week.

Forex Market Review & Analysis by Finexo.com

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GBPUSD has reached the lower boundary of the rising price channel on 4-hour chart. As long as the channel support holds, the fall from 1.5240 is treated as consolidation of uptrend from 1.4346, and another rise to 1.5400 is still possible. On the downside, a clear break below the channel support will indicate that lengthier consolidation of uptrend is underway, then deeper decline towards 1.4873 key support could be seen.

Daily Forex Analysis

By CountingPips.com

Canadian employment data released today showed that jobs rose by more than expected in June and boosted the Canadian dollar sharply against the other major currencies. Today’s jobs report showed that employment rose by 93,000 workers in June following a gain of approximately 24,700 jobs in May, according to the monthly report by Statistics Canada.

The jobs data easily surpassed the market forecasts which were predicting an increase by approximately 20,000 workers for the month.

The Canadian dollar reacted positively to the news and quickly gained ground against the US dollar, euro, Japanese yen, British pound, Australian dollar, and the New Zealand dollar in the forex markets today. The Canadian currency now trades at its highest level against the US dollar since June 23rd at close to the 1.0315 exchange rate while also advancing to the highest levels against the Japanese yen and British pound sterling since June 28th.

The unemployment rate declined to 7.9 percent from 8.1 percent as the unemployment rate has now fallen below 8.0 percent for the first time since January 2009. In the period from July 2009 through June 2010, Canadian employment has advanced by 403,000 workers or 2.4 percent, according to the report.

Service-sector employment was the main driver for jobs in June with an increase by 103,000 hires while the goods-producing sector employment fell by 10,200 workers. The trade sector, health care & social assistance and business, building and other support services all showed increases for the month by approximately 20,000 jobs. The professional, scientific & technical services sector, accommodation and food services sector and the other services sector all had job gains of 11,000 or more in June.

The province of Ontario led the way in job growth for June with a gain of 60,000 jobs while Quebec also added 30,000 workers. Ontario employment has now increased for six straight months and by 187,000 workers since July 2009 while Quebec has increased its job growth by 117,000 workers since July 2009.

Other data released from Canada today showed that housing starts fell in June to an annualized rate of 189,300 from a revised 195,300 level in May, according to the Canada Mortgage and Housing Corporation. The data failed to meet market forecasts that were expecting 190,300 housing starts for the month.

Forex Chart: EUR/CAD Hourly – The euro falling sharply today against the Canadian dollar following the better than expected Canadian jobs report. The EUR/CAD now trades at its lowest level in over a week as the pair fell through its 200-hour moving average (red line) and into oversold territory on the relative strength indicator in today’s action.

By Russell Glaser – The GBP/USD has taken a pause this week while forming a rising channel line before making its next move. Technical indicators show the momentum of this bullish move is wavering, which could set up for a downward move in the price of the pair.

The cable continues to range trade between the prices of 1.5080 and 1.5240 as volatility in the pair has significantly fallen. The Average True Range (14) has dropped to 135 from its high of 260. Many times volatility drops off and the price action consolidates before a large breakout move in a currency pair occurs.

Currently the price is contained by the short term resistance line at 1.5240. A break above this line could send the pair higher to the 23.6% Fibonacci level at 1.5300 (R1). This is a retracement from the long term bearish trend that began in November. Following a breach of R1, the pair could trade higher at the next resistance level of 1.5520 (R2).

However, this is where the bullish move may end as the price approaches the downward sloping trend line and the 23.6% retracement level. This technical resistance should be enough to contain the rising price action.

A sell signal that is forming on the MACD Oscillator also hints at a price move lower. The momentum appears to be weakening as the MACD histogram is negative sloping and a bearish cross is forming, indicating the potential for downward movement in the pair.

Price targets for a move lower in the pair will be the support level at 1.5050 (S1), which also coincides with the lower end of the channel. The second price target with a long term focus will be the March low at 1.4780 (S2).

As the price approaches the long term trend line, combined with significant resistance levels, large swings in the price can occur. Combining the resistance levels along with the technical signal, being short looks to be the right move.

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.

Hello FX fans! In my blog back in June 24 (please check that entry here), I thought that the EURCAD would continue to slide as it traversed a nice looking descending channel. After just four days of trying to break through the downtrend resistance, the buyers eventually won, causing an immediate upsurge in prices. The euro soared over the Canadian dollar after the pair broke above the downtrend, marking a new monthly high at 1.3426.

At present, it appears that the pair is starting to lose its upward momentum. With the stochasting just turning south, traders could take some of their profits, causing the euro’s valuation to weaken again. Notice, though, that a potential inverted head and shoulders could be in the making. Are the euro bulls just laying off to set-up a possible uprising? It’s possible. In any case, if the pair continues to dip, its likely support would be around 1.2750. A break above 1.3500, on the other hand, could propel the pair all the way to 1.4500.

On the fundamental side, the projected 17,900 increase in Canada’s June employment change could lift he Loonie some more especially if the latest tally comes in better than expected. Canadian housing starts for the same month are also predicted to be at 193,000 which is an improvement on the previous month’s 189,000 count. Remember that Canada’s May building permits unexpectedly skidded by 10.8%. Should this slide continue in the following month, then there could be a downside surprise in the upcoming housing starts release later today. A worse than projected score here could then result in a loonie sell-off. In the longer run, weak Canadian data coupled with the present weakness of the USD could reflect positively on the EURCAD.

More on LaidTrades.com …

Good day forex people! Here’s an update on the EURAUD pair which I last posted way back on May 26 (kindly see that post here). As you can see on today’s chart, the pair has continued to slide when it hit a resistance just below 1.5500 after moving past above the shorter term downtrend line. It then fell only to rebound for awhile when it found some support at 1.4000. Its rise, however, was halted yet again by the same downtrend line. Given its overbought condition and the presence of a hidden bearish divergence, where the price registers lower lows and the stochastics mark higher highs, suggest a likely move lower. The 1.4000 marker would be its likely support if it continues to trek south. A break of the downtrend line, though, could bring it back near 1.5500.

The euro’s rally was recently overturned by the Aussie. Despite the decision of the Reserve Bank of Australia to keep its benchmark rate unchanged at 4.50%, traders still picked up the Aussie given the governor’s somewhat bullish outlook on the country’s economy. He mentioned that Australia will likely benefit China’s growth since the former is one of the biggest supplier of raw materials to the Chinese.

A couple of other economic reports supported the AUD. First is the better-than-expected May trade balance which came in at A$1.65 billion which was way over the A$0.53 billion projected. Its April’s number was also positively revised to A$1.12 billion from A$0.13 billion. Australia’s labor market also showed some improvements with firms adding another 45,900 workers in June (vs. 15.3k estimate), which pulled the country’s jobless rate down to 5.1% from 5.2%.

No other reports will come out of Australia for the rest of the week. France, on the other hand, will publish its May industrial production which is seen to have gained by 0.3% in after dipping by 0.3%. Germany recently posted an upside in the same account. Such could also be the case for France. In any case, a rise of at least 0.3% could give the euro some short term lift against its peers like the AUD. Between the euro zone and Australia, the latter, however, remains to be the stronger one. And between the euro and the Aussie, the latter remains to be the more attractive given its interest rate advantage (4.50% as against 1.0%).

More on LaidTrades.com …

By Dan Eduard – The euro seems to be locked into a bullish trend as investor confidence in the global economic recovery seems to be on the rise. How long this trend lasts will largely be determined by economic indicators from around the world.

Here is a roundup of the days main events:

8:30 GMT GBP – PPI Input

While being more volatile than the CPI, producer prices have also exceeded expectations, showing that inflation is on the rise in the U.K. Following last month’s drop of 0.6% in PPI Input (the main figure), a rise is expected now. Also PPI Output is expected to rise and boost the Pound.

Assuming that the PPI Input comes in at its forecasted level of 0.1%, traders can assume that the GBP will make some gains against its main currency rivals throughout today’s trading. At the same time, if a negative figure is released, investors may turn to safe-haven assets, thereby boosting the USD.

12:15 GMT CAD – Housing Starts

The Housing Starts Report is an annualized number of new residential buildings that began construction during the previous month. This figure might be disregarded if there’s a big surprise in the employment data. After topping 200K, the number of starts slowed down and dropped to 189K last month, causing some worries. We’ll now see if this was a one time drop or a change of trend for USD/CAD.

Should the Housing Starts figure come in at the forecasted 193K, traders can assume the CAD will move up against the greenback in afternoon trading. That being said, an unexpected drop could help the USD after a fairly bearish week.

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.

Source: ForexYard

The U.S currency declined against the EUR on Thursday after European Central Bank President Jean-Claude Trichet calmed investors’ concerns about European bank stress tests and the central bank’s liquidity programs. Positive employment data in the U.S. also encouraged investors to move away from the safe havens of the dollar, Japanese yen and gold and into equities.

Economic News

USD – Dollar Falls after Jobless Claims Data

The U.S dollar dropped against most of its major counterparts as the International Monetary Fund raised its global growth forecast and U.S. initial jobless claims dropped last week, spurring demand for higher-yielding assets. Initial claims for unemployment benefits in the U.S. decreased to 454k in the week ended July 3 from 475k in the previous week, the Labor Department reported.

Against the yen the greenback rose to 88.20 yen, up 0.6% on the day and edging further off a seven-month low of 86.96 yen hit at the start of the month, as yields on U.S. Treasuries rose, making them a bit more attractive to Japanese investors.

Today, a lack of news events will likely lead to a low liquidity situation in the marketplace. Traders are warned that in situations like these, erratic price movements can occur for seemingly no reason. With the USD fairly bearish at the moment, expect price changes to work against the greenback.

EUR – EUR Hits Session Highs

The European currency touched a 2 month high against the U.S dollar on Thursday as U.S. and Australian economic data restored faith in the global economic recovery and boosted appetite for higher-yielding currencies.

A report in the United States showing a drop in weekly jobless claims also helped support the euro-zone single currency and other riskier assets. The EUR climbed to as high as $1.2700, its highest since mid-May, and was last up 0.3% at $1.2672.

The EUR also appreciated on speculation that stress tests for European banks were assuming smaller losses on Greek bonds than some investors anticipated. European Central Bank President Trichet said that the publication of stress tests should be followed by action where needed. He also emphasized that the ECB is still providing unlimited liquidity to the financial system. Analysts said that a move to $1.30 in the EUR may hinge upon the results of the stress tests for the European Banks, but Trichet’s encouraging words should provide support for the currency in the next few days.

JPY – Risk Appetite Pushes the Yen Lower

The yen was one of the day’s biggest losers as gains in European and U.S. stocks prompted investors to shed long positions in Japan’s currency. Lower-yielding currencies like the yen tend to fare poorly when investors show a greater appetite for risk, seeking higher-yielding currencies and assets like stocks and commodities.

The yen traded near a 2 week low against the EUR as renewed signs the global economy is weathering Europe’s debt crisis sapped demand for the relative safety of the Japanese currency. The yen is set for its biggest weekly drop against the Australian dollar since December as Asian stocks extended a global rally after the European Central Bank President said the economic recovery is gaining momentum. Japan’s currency was at 77.57 against the Australian dollar from 77.52 yesterday, and is set for a 4.9 % drop this week.

Crude Oil – Oil Rises Above $75 a Barrel

Crude prices rose nearly 2% Thursday as positive sentiment about the global recovery dominated the market and an inventories report included a surprisingly large decrease in crude stockpiles. Crude oil gained $1.37 to settle at $75.44 a barrel. It was oil’s first rise above $75 a barrel in a week as markets were responding to an overall positive mood across most assets on Thursday.

The optimism stemmed from a positive read on the job market and a boost for global growth expectations from the International Monetary Fund, as well as comments from the European Central Bank soothing fears about bank stress tests.

Nevertheless, while the general trend for crude is bullish, the unleaded gas markets numbers continues to show lackluster demand and might put pressure on the entire energy complex in the days to come.

Technical News

EUR/USD

The price of this pair appears to be floating in the over-bought territory on the daily chart’s RSI indicating a downward correction may be imminent. The downward direction on the 4-hour chart’s RSI also supports this notion. When the downwards breach occurs, going short with tight stops appears to be preferable strategy.

GBP/USD

The pair has been range-trading for a while now, with no specific direction. The Daily chart’s Slow Stochastic providing us with mixed signals. All oscillators on the 4 hour chart do not provide a clear direction as well. Waiting for a clearer sign on the hourlies might be a good strategy today.

USD/JPY

The daily chart is showing mixed signals with its RSI fluctuating at the neutral territory. However, the 4-hour Chart’s RSI is already floating in the overbought 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/CHF

The 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 Stochastic Slow signals that a bullish reversal is imminent. Going long with tight stops may turn out to pay off today.

The Wild Card

AUD/USD

This pair’s sustained upward movement has finally pushed its price into the over-bought territory on the 8-hour chart’s RSI. Not only that, but there actually appears to be a bearish cross on the Slow Stochastic pointing to an imminent downward correction. Forex traders have the opportunity to wait for the downward breach on the hourlies and go short in order to ride out the impending wave.

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 eToro – The Euro rallied as investor saw the 17% stress on Greek bonds as relatively benign.  The Euro tested the 1.270, and is likely to continue to push higher toward 1.30 . 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.

The euro seems to be locked into a bullish trend as investor confidence in the global economic recovery seems to be on the rise. How long this trend lasts will largely be determined by economic indicators from around the world.

Here is a roundup of the days main events:

8:30 GMT GBP – PPI Input

While being more volatile than the CPI, producer prices have also exceeded expectations, showing that inflation is on the rise in the U.K. Following last month’s drop of 0.6% in PPI Input (the main figure), a rise is expected now. Also PPI Output is expected to rise and boost the Pound.

Assuming that the PPI Input comes in at its forecasted level of 0.1%, traders can assume that the GBP will make some gains against its main currency rivals throughout today’s trading. At the same time, if a negative figure is released, investors may turn to safe-haven assets, thereby boosting the USD.

12:15 GMT CAD – Housing Starts

The Housing Starts Report is an annualized number of new residential buildings that began construction during the previous month. This figure might be disregarded if there’s a big surprise in the employment data. After topping 200K, the number of starts slowed down and dropped to 189K last month, causing some worries. We’ll now see if this was a one time drop or a change of trend for USD/CAD.

Should the Housing Starts figure come in at the forecasted 193K, traders can assume the CAD will move up against the greenback in afternoon trading. That being said, an unexpected drop could help the USD after a fairly bearish week.