Video courtesy of ForexCT – A leading Australian forex broker, liscensed by the Australian Securities & Investments Commission, offers the MetaTrader4 and PROfit Platform to retail traders. Other services include Segregated Accounts, Trading workshops, Tutorials, and Commodities trading.
Video courtesy of ForexCT – A leading Australian forex broker, liscensed by the Australian Securities & Investments Commission, offers the MetaTrader4 and PROfit Platform to retail traders. Other services include Segregated Accounts, Trading workshops, Tutorials, and Commodities trading.
With Friday’s Non-Farm Payroll (NFP) figure revealing surprise stagnation in the US employment sector, traders appear more reluctant to go into the greenback in order to stave off further losses in their portfolios. The euro zone has so far benefited from this shift as a weaker dollar versus the region’s main currency should give Europeans more buying power in the days ahead.
The US dollar experienced strongly bearish results since last Friday as traders began to shift away from the greenback following the non-farm employment data released that showed a stagnating American economy. The results so far have been for the value of the USD to drop like a stone versus its currency counterparts, and the euro looks poised to capture much of the beneficial side-effects.
With Friday’s Non-Farm Payroll (NFP) figure revealing surprise stagnation in the US employment sector, traders appear more reluctant to go into the greenback in order to stave off further losses in their portfolios. The euro zone has so far benefited from this shift as a weaker dollar versus the region’s main currency should give Europeans more buying power in the days ahead. The issue of interest rate differentials has generated market tension over the past two weeks and, indeed, the shift in value among the safe-havens and the EUR has made currency forecasting a much more difficult profession.
As for today, traders will focus more attention on Canada given the US economy is not scheduled to publish any significant news or data releases. The Canadian economy will be releasing its latest findings on building permits and its monthly Ivey PMI data. With increased USD aversion since last Friday, traders appear to be anticipating a continuation of the USD’s recent bearishness.
The euro rose versus the US dollar this morning, with the pair’s price reaching a one-month high near 1.4650. Soft data out of the American economy last week forced a reevaluation by many investors who went long on the USD following the European Central Bank’s (ECB) cloudy rate statement from a month back, and several grumblings about Greece’s debt woes.
Last Friday’s significantly weaker fundamentals out of the American economy were only one part of the story, however. The euro zone’s advantageous absence from the market last Thursday, and its low data output Friday, helped the regional currency appear more attractive amid the USD’s employment slag.
What little data was published out of the region also showed better growth than was expected. This combination of data from these two economic rivals generated a heightened intrigue in the comparative interest rates as risk sentiment got shifted. The result was for the interest rate bulls to outpace the debt woe bears in yesterday’s session, driving the EUR higher versus the USD.
As for today, the euro zone will be publish two less significant data sets, one concerning regional PPI, the other about investor confidence. Most investors are turning their attention on the American economy after last week’s dismal NFP reading and there appears to be a good chance that dollar bears will continue to push the EUR higher as the day wears on.
The Japanese yen (JPY) has been trading with largely positive results since Friday as investors turn their focus towards news out of the United States. After a week of ups and downs, the Japanese yen appears set to make gains today as investors largely flee riskier assets. The low interest rates of the Japanese economy have helped pull many investors into the safety of the yen, as opposed to the USD, following Friday’s American NFP data release.
The USD/JPY was seen trading somewhat lower this morning, holding steady near 80.20 and moving up towards 80.30 at today’s opening Asian sessions. Market news released out of Canada today will likely be the driving force behind forex market values and traders would be wise to watch the Ivey PMI figure scheduled for 15:00 GMT since it has a strong correlation with global economic growth.
The price of Crude Oil ended Friday flat as traders largely began to push back into their investments in physical assets while the US dollar made a rapid plummet. The result has been a steady price movement in oil prices these past several days with lows near $98 and highs of $103 a barrel.
Recent events have made speculating about oil prices more difficult. The plummeting value of the US dollar since Friday should have helped lift oil prices, but the commodity steady fall for the fourth consecutive day as of this morning. Rising stockpiles in the United States, reported Thursday, may have helped fuel the shift away from oil as rising inventory tends to suppress price hikes. As for the rest of today, oil prices also appear flat, with technical support targets near $99.50 a barrel possibly coming into view.
The current rally has helped the pair climb above the 61.8% Fibonacci retracement level from the May downtrend at 1.4570. While monthly stochastics are beginning to roll over, both the weekly and the daily stochastics are rising sharply higher. The pair could continue to rise where it may encounter resistance off of the previous trend line from the January to May rally which comes in at 1.4730. This level has further significance as it coincides with the late April/May lows. Further strength would test the May high at 1.4940 while any pullback could find support at 1.4450 from Friday’s low, followed by the 50-day moving average at 1.4390.
Sterling is showing a few signs of weakness versus the dollar as daily stochastics are declining and a failed attempt to close the week above the 1.6515 resistance level. A move higher would then test the April high at 1.6745 followed by the 2009 high at 1.0755. To the downside the 20-day moving average may prove to be supportive at 1.6310 as well as the trend line rising from the May 2010 low which comes in at 1.6150. A breach here would expose the May 2011 low at 1.6055.
Yen strength has reemerged and the pair looks to test its post-intervention lows from early May at 79.56. A break of this level exposes the pre-intervention low at 76.11 as the charts are absent of any significant support levels. To the upside, 81.75 should see some resistance followed by the May high at 82.15.
A new week and a new high for the Swiss franc as the USD/CHF traded as low as 0.8326. Falling stochastics on the weekly chart point to further potential declines in the pair. Traders may find opportunities to enter into the downtrend on a pullback in the pair. Support is located at the May low of 0.8550 followed by the falling trend line off of the February high at 0.8770.
After falling from its May high and retracing 61.8% of the February to May move the pair has risen sharply higher over the past five consecutive trading days. Momentum has shifted to the upside and as such forex traders may want to be long with a target at the May high of 0.9040. Support comes in at 0.8845.
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Euro zone PPI data may show continued inflationary pressures in the euro zone as the market shifts its attention from the Greek sovereign debt crisis to the upcoming ECB policy meeting.
Today’s Economic Data Releases:
EUR – PPI m/m – 09:00 GMT
Expectations: 0.8%. Previous: 0.7%.
A higher than expected increase in euro zone producer prices will underscore the market’s shift from focusing on the Greek debt crisis to policy differentials via Europe and the US. This is highlighted by the spread between 2-year German bunds and the 2-year US Treasury which has done a fairly good job of tracking the price movement of the EUR/USD. This morning the spread ballooned to 127.4 in favor of the bund. During Wednesday’s ECB press conference I expect Trichet will use the words, “strong vigilance” to signal a future ECB interest rate hike, a catalyst for the euro.
CAD – Ivey PMI – 14:00 GMT
Expectations: 59.1. Previous: 57.7.
Last week saw disappointing PMI numbers from the US, UK, EUR, with the lone exception coming from Switzerland. Lower than expected Ivey PMI numbers would likely weaken the Canadian dollar further as the USD/CAD continues to come off of its late April low. Initial resistance is found at Friday’s high of 0.9850 and the pair could have the scope to reach as high as the 200-day moving average which comes in today at 0.9950. The last time the USD/CAD traded at this level was in late November of 2010. Support is found at the 100-day moving average near 0.9750, followed by the rising trend line off of the May low which comes in today at 0.9690.
Read more forex trading news on our forex blog.
By CountingPips.com
June 6, 2011 – Economic News Releases – All Times GMT
00:30 Australia ANZ job advertisements
08:30 Eurozone Sentix Investor Confidence Release
09:00 Eurozone producer prices
12:30 Canada building permits
14:00 Canada Ivey purchasing managers index
23:30 Australia AIG construction index
AUDUSD has reached the upper border of the price channel on 4-hour chart. Pullback would likely be seen later today. Support is at 1.0587, a breakdown below this level will indicate that the downtrend from 1.1011 has resumed, then the following downward move could bring price to 1.0250-1.0300 area. However, a clear break above the upper border of the channel will suggest that lengthier consolidation of downtrend is underway, then further rally could be seen to 1.0850 zone.
Forex USD/CHF Intraday Analysis – June 6, 2011: Testing Level 0.8264
Yesterday: Open 0.8428 High 0.8448 Low 0.8331 Close 0.8337
Towards the beginning of the session yesterday America, Frank’s freefall to penetrate the 0.8383 support level and even reached the lowest level at 0.8331 daily.
Currently Frank still looks bearish movement. However, the occurrence of rebound if necessary diwaspada stochashastic main line ride.
There is no economic focus today for USD / CHF.
If an increase trend lines diagonally through the open opportunities to the 0.8414 resistance level.
We recommend that if the decline continues, opening opportunities to the support level at 0.8264.
Prices shown on the graph H1 line MA05 and MA10 bearish conditions.
While the Stochastic indicator is still likely to indicate a bullish limited.
See more at www.ForexTradingEVO.com
Forex USD/JPY Intraday Analysis – June 6, 2011: Testing Level 79.53
Yesterday: Open 80.95 High 81.03 Low 80.06 80.22 Close
Throughout yesterday, Yen bearish movement in the range of 90 pips daily with the highest levels at 81.03 and the daily lowest level in 80.06.
Currently looks bearish yen, supported by the line MA05 and MA10. If it turns out the main lines can penetrate the diagonal trend lines in the stochastic indicator, it can open the possibility for a rebound.
There is no focus on economic data today for USD / JPY.
If the rise continues a trend line through the diagonal, then the price likely to go to the 81.12 resistance level.
We recommend that if it declined the opportunity berkelanjut 79.53 support level.
Prices shown on the graph H1 line MA05 and MA10 in bearish conditions.
While the Stochastic indicator indicating a bearish opportunity is limited.
For more Analysis see ForexTradingEVO.com
Forex AUD / USD Intraday Analysis – June 6, 2011: Testing Level 1.0888
Yesterday: Open 1.0672 High 1.0775 Low 1.0596 Close 1.0723
Yesterday before the initial session the U.S., since the line break through the 1.0680 level, the movement of the Aussie range in the range of 180 pips from 1.0613 support level to nearly the level of the first resistance at 1.0777.
When the movement of the Aussie looks still bullish. When the main line still remains below the stochastic, then the probability for a small bullish.
The focus of economic data today for the Aussie currency is:
1. AUD MI Inflation Gauge m / m
2. AUD ANZ Job Advertisements m / m
If the price increases that continued the open opportunities to the 1.0888 resistance level.
We recommend that if a decline continues then the price can reach the support level of 1.0664.
Prices shown on the graph H1 line MA05 and MA10 in bullish conditions.
While the Stochastic indicator indicates still more likely bullish when moving in the area above the trend line diagonal.
See more at ForexTradingEVO.com
By CountingPips.com
The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators increased their short positions against the US dollar while raising bets for the euro for the first time in four weeks. Non-commercial futures positions, those taken by hedge funds and large speculators, were overall net short the US dollar by $15.73 billion against other major currencies as of May 31st. The data is a rise from the total short position of $13.02 billion on May 24th, according to the CFTC data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.
This week’s notable changes were Canadian dollar positions increasing for the first time in six weeks while Japanese yen positions fell back over to the short side for the first time in close to a month.
EuroFx: Currency speculators increased their net long positions for the euro against the U.S. dollar after three consecutive weeks of decline. Euro futures positions rose to a total of 21,970 long contracts following a total of 19,129 long positions on May 24th.
The COT report is published every Friday by the Commodity Futures Trading Commission (CFTC) and shows futures positions as of the previous Tuesday. It can be a useful tool for traders to gauge investor sentiment and to look for potential changes in the direction of a currency or commodity. Each currency contract is a quote for that currency directly against the U.S. dollar, where as a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and net long position expect that currency to rise versus the dollar. The graphs overlay the forex spot closing price of each Tuesday when COT trader positions are reported for each corresponding spot currency pair.
GBP: British pound sterling positions were higher following four straight weeks of decreases. Pound contracts edged up to a total of 1,829 net short positions as of May 31st following a decline the week before to a total of 14,143 short contracts on May 24th. The May 24th data marked the British pound’s lowest speculative positions since September 2010 when short positions numbered 16,060.
JPY: The Japanese yen net contracts dipped lower for the second straight week and over to the short side after increasing for four consecutive weeks through May 17th. Yen positions decreased to a total of 1,648 net short contracts reported on May 31st following a total of 8,006 net long contracts on May 24th.
CHF: Swiss franc long positions increased higher after three consecutive weeks of decreases. Franc positions rose to a total of 21,119 net long contracts following a net of 14,725 long contracts on May 24th.
CAD: The Canadian dollar positions rose for the first time in six weeks to a total of 26,402 contracts as of May 31st. CAD net contracts had fallen to a total of 21,277 net long contracts on May 24th.
AUD: The Australian dollar long positions edged higher for a second consecutive week. AUD contracts increased to a total net amount of 60,015 long contracts as of May 31st. AUD positions had totaled 53,043 net long contracts on May 24th.
NZD: New Zealand dollar futures positions rose to the highest level since early December and increased for a second straight week. NZD contracts advanced to a total of 15,724 long positions as of May 31st from a total of 13,876 long contracts on May 24th.
MXN: Mexican peso long contracts were virtually unchanged as of the May 31st data release. MXN contracts dipped just slightly to 108,268 net long contracts as of May 31st from a total of 108,681 long contracts as of May 24th.
COT Data Summary as of May 31, 2011
Large Speculators Net Positions vs. the US Dollar
EUR: +21,970
GBP: -1,829
JPY: -1,648
CHF: +21,119
CAD: +26,402
AUD: +60,015
NZD: +15,724
MXN: +108,268
