Europe rating rumors brings down the Euro

The Euro weakened again following rumors of a possible down grade on Portugal’s and Greece’s rating.

USDJPY lead another quiet session as the currency traded in a range of 83.50/83.90.

Again today, we have very little data, so we may again see a fairly quiet market.

I’ve not really gotten any trading done; I’m already feeling the holiday mode.

Data Today

Italian December Consumer Confidence – 9am GMT

UK GDP – 9.30am GMT

US GDP – 1.30pm GMT

US November existing home sales – 3pm GMT

quiet session yesterday.

It was a quiet start to the holiday week yesterday. Dollar performance was quite mixed. The Euro and Sterling were pressured down from sovereign worries, whereas the Aussie strengthened a little.

Again today, there isn’t much data out today. It looks like we will be seeing a fairly quiet week.

Data Today

UK November Public Sector Net Borrowing – 9.30am GMT

USDJPY found its top?

Looks like USDJPY may have found its top on the 4-hour chart. 84.37 seems to be holding up strongly as a resistance level.

At the same time USDJPY also looks as though it may be ranging. 

A good level to sell USDJPY would be around the 84.37 levels. But keep a stoploss in case a breakout happens. It is after all the holiday season, which means thin markets!    

Focus on Europe today.

Developments in the Eurozone takes centre stage as markets shifted their attention from the mid-week FOMC. Moody’s announcement of a five-notch downgrade of Ireland’s credit rating.  The German IFO report on the other hand came in stronger than expected at a high of 109.9. 

The BoE's semi-annual financial stability report recommended that UK banks build up their resilience gradually, by using retained earnings rather than by resorting to tighter credit conditions

Aussie has been ranging between 0.9840 – 0.9930 for the past few sessions. If the events in Korea escalate, we may see some volatility coming into play here.

Data Today:

German November Producer Prices – 7am GMT

Eurozone December Consumer Confidence – 3pm GMT

Range play on the Euro?

Looks like Euro is in a range on the 4 hour chart (pink rectangle). 

green candles have just broken past the 23.6% fib level, and looks like we may just see the pair hit higher up again.

Now i overall still think Euro is bearish, so selling the pair at 1.3469 levels looks like a good level to sell.

But as always i'm going to keep a watch on this, because markets are thin at the moment and there's a chance we could see a breakout.  It's Friday as well, and i'm always extremely careful in opening a new position.

What's do you guys think?  

Dollar rockets up!

Overall good news came out of the US and bad news out of the UK yesterday.

Dollar and US yields benefitted yesterday from the stronger US empire state manufacturing index which came out at 10.57 from -11.14 last month.

US Industrial production and core CPI pushed back up to 0.8% y/y from 50-year lows of 0.6% y/y previously.

EURUSD was under pressure for most of the session after Moody's put Spain's Aa1 ratings on watch for a possible downgrade and S&P continued to be negative on Belgium.  The Irish government passed the EU/IMF bailout package of 85bln EUR as expected. However, fears persist as Portugal's finance minister said the government is taking additional measures so as not to resort to a bailout.

The pound was weaker overnight with rumoured sovereign buying of EURGBP. UK Nov. claimant count jobless came out worse at -1.2k vs consensus of +3.0k. 

Data Today:

German PMI Manufacturing – 8.30am GMT

German PMI Services – 8.30am GMT

Eurozone PMI Manufacturing – 9am GMT

Eurozone PMI Services – 9am GMT

Eurozone CPI – 9am GMT

UK November Retail Sales – 9.30am GMT

US Initial Claims -1.30pm GMT

US housing starts – 1.30pm GMT

US Philadelphia Fed – 3.00pm GMT

Cable heading lower - 4 hour chart trade

a red candle has closed completely below the 100 SMA on the 4- hour chart. And looks like the other indicators are also suggesting a downward trend for the sterling, with the Moving average crossover and MACD and stochastics heading lower.


I entered into the position as soon as the candle closed. Since this is a play on the 4 hour chart i'm going to hold this position a little longer than i normally do.

I'm going to use a risk-reward ratio of 1:2 on this trade.

I'm placing my stoploss at 1.5771which is 10 pips above the high of the last candle above the 100SMA. 

I'll place my target level at 1.5309, and if spot moves 100 pips below my entry level, i will move my stoploss to breakeven.

Trade:

Sell GBP/USD at 1.5617

Stoploss at 1.5771

Target at 1.5309

Euro trade - pretty big moves!

As i had written in my earlier post (A possible Euro trade in the making) , i was waiting for a trigger for me to enter a short position in the Euro. Last night i managed to find exactly that. 

On the 15 minutes chart a moving average crossover happened (pink square) around 1.45GMT. Which i picked up on. I decided to wait one more candle to see if the crossover holds which it did. I then entered in a short position at the market.


I decided to keep a stoploss at  1.3520 which is 20 pips higher than the previous high. I will keep my first target at 1.3335 ( S1 from today's pivot point analysis). I will move my stoploss to break even over here.


Trade:
Sell EUR/USD at 1.3413.
Stoploss at 1.3520
1st Target at 1.3335


Update on this trade:
yesterday spot moved below 1.3335, which is when i moved my stoploss to 1.3413.
today i moved my stoploss again now to 1.3280 which is just above the 23.6% fibonacci level, and i've moved my target price now to 1.3180.

No surprises from FOMC

FOMC keeps its fund targets the same, so there wasn’t much surprises in the FOMC statements as well. US retail sales came in better than expected as well at 0.8% vs 0.6%.

Dollar strengthened after the retail sales and the lack of concern at the FOMC over the rebound in US yields to accelerate its bonds purchases.

An early London morning sell off in the USDJPY was followed by a sharp reversal after huge strides in the US 10 year yield.

EURUSD touches 1.3500 for the first time in 3 weeks during Europe session before giving back its gains. EURUSD was undermined by news that Belgium outlook is revised to negative from stable by S&P. S&P says prolonged political uncertainty may hurt Belgium rating, Bloomberg reports. Meanwhile, Italy's Berlusconi wins no-confidence vote; government survives. PM won the confidence vote in the lower house by a majority of just 1; which means 314 MPs voted against it. So the government, while still in power, is held up by 1 MP.  Ahead, Ireland votes on whether to accept the EU/IMF package.

UK CPI numbers were higher than consensus at 3.3% y/y while the RPI numbers also beat expectations at 4.5%. Our UK economist notes that the main drivers were food and clothing, which posted the highest inflation rate since 1997. Sterling failed to react positively to the news, as although it reduces the prospect of further QE and gives the hawks more weight, the fears over stagflation also linger.

We have another fun-filled day of Data today, so we just may see some more volatility today.

Data Today:

UK Claimant count rate - 9.30am GMT

UK jobless claims change - 9.30am GMT

UK average weekly earnings - 9.30am GMT

UK ILO Unemployment rate - 9.30am GMT

US CPI - 1.30pm GMT

US Empire Manufacturing - 1.30pm GMT

US Totel Net TIC Flows - 2pm GMT

US Net Long term TIC Flows - 2pm GMT

US Industrial production - 2.30pm GMT

US Capacity Utilization - 2.30pm GMT

A possible Euro trade in the making.

Looking at the 4 hour chart we can see that Euro is holding up a resistance below the 38.2% fibonacci. Also looks like we have a double top being made.

To reconfirm, the daily chart also is showing the 100 SMA (pink line) to be holding up as a strong resistance. This looks like a good area to sell the Euro. 

However, Euro is stuck in a range at the moment on the 15minutes and 1 hour chart. So i'll only enter into a short trade if i get a confirmation of a moving average crossover, just in case Euro ends up breaking towards the upside.

China brings Dollar down

Dollar weakened last night thanks to China. risk sentiment was supported in the absence of China hiking rates while US sentiment was hurt by Moody's suggesting that the US may face a negative outlook on its debt over the next two years

EURUSD rose more than 2 big figures overnight, pushed higher by rumored fixing-related buying and sovereign demand interests. EUR led the pack as Moody's brought US into the fold, shifting some of the attention from the Eurozone to the American government.

Sterling did too but lagged compared to the Euro.

Today is a big data day, so keep a look out for some movement this evening.

Data today:

UK Nov CPI -9.30am GMT

German ZEW survey – 10am GMT

Eurozone ZEW survey – 10am GMT

Eurozone industrial production – 10am GMT

US PPI – 1.30pm GMT

US advance retail sales – 1.30pm GMT

US FOMC rate decision – 7.15pm GMT

no data out today.

China was the key driver of movement on Friday. Price action was primarily driven by PBOC decision to hike China’s reserve ratio requirement by 50bps.

This week market will be eyeing the US FOMC meeting on Tuesday and the Irish vote on EU/IMF package on Wednesday.

BoJ Governor Shirakawa again raised the possibility of further JGB purchases if the economy slows down faster than expected. Talks of heavy offers for USDJPY between 84.02/05.

Irish banks' borrowings from the ECB rise to EUR136.4 bn as of end-November, from EUR130 bn at end-October. Irish central bank offers EUR44.7 bn euros in special liquidity assistance to banks in Ireland.

GBPUSD likely to continue to stay quiet until UK CPI tomorrow.

No data out today, so we may just see a quiet market today.

Ireland downgraded by Fitch

It was a bit of a mixed session yesterday for the dollar, but it still managed to hold versus the Euro as a rating agency downgraded Ireland. Political uncertainty was reintroduced following the recent budget vote as the Irish government announced an upcoming vote in the EU/IMF package.

Among the US data, the initial jobless claims declined more than expected at 421k vs 425k.

USDJPY came off as US Treasury yields were slightly lower following a better than anticipated auction of $13bn 30y Treasurys, which prompted some short-covering as indirect bidders took down a higher than expected amount. Bank of Japan policy board member Morimoto said that one-sided dollar weakness seems to have subsided, although he warned that sharp FX volatility can have a large effect on the economy and so he is always watching FX moves carefully. He added that increasing the size of the BoJ's asset purchase facility is a strong policy option, and Bloomberg reported him saying that he hopes BoJ easing will have some effect on FX.

 BOE kept the rates unchanged last night, which was expected. UK trade deficit for October widened more than expected at 8.6bn versus 8.1bn.

Data Today

UK PPI – 9.30am GMT

US trade balance – 1.30pm GMT

University of Michigan confidence – 2.55pm GMT

US Monthly Budget statement – 7pm GMT     

quiet session yesterday.

We saw a pretty quiet market yesterday considering there was no data that came out yesterday.

USDJPY was range bound and quiet.  

We saw thin liquidity yesterday in the Euro. Initially there was Euro selling and stops were triggered 1.3300 onwards down to 1.3250. We saw the Euro recover back from 1.3250 to 1.3300. On the headliners front, Germany rejected calls to increase the EU’s EUR 750bn fund and Moody’s downgraded Hungary credit rating to just above junk grade. Today the Irish finance minister is expected to detail the budget measurements starting at 3.45pm GMT.

Aussie was under pressure this morning from reports that China may raise interest rates this weekend. The RBA maintained its rate and we saw Aussie drop down but recovered quickly back up.

We’ve got some data out today mainly on the Euro and UK front. So watch out for some possible moves later this evening when Europe and the U.S opens up.

Data today

Germany factory orders – 11am GMT

UK industrial production – 9.30am GMT

UK manufacturing production – 9.30am GMT

US consumer credit – 8pm GMT

NFP vs Euro debt. which one is going to take charge on the markets today.

It’s a new week and a lot of news came out on Friday. US NFP was the big boy of data that came out on Friday. Unfortunately it came out disappointing at 39K vs 150k consensus.  On the other hand the ISM came out better at 55.0 vs 54.8 consensus.

USD selling was high on Friday after the data, and increased after Bernanke stated that UST purchases beyond the $600bn currently marked for Q2 would not be ruled out.

We saw the Euro take out stops on the top clearing 1.3300 all the way to 1.3415. But sovereign bond spreads are tightening sharply and ECB is to release the value of ECB’s bond purchases today.

Aussie followed in-tail on the risk sentiment above 0.99.

No important data coming out today, so keep a watch on sentiment play.  Will the poor NFP data push markets even higher today or will the Euro debt issues come to the fore front again for another bear move.

non farm payroll day today!!

We saw some more pressure on the dollar yesterday despite a disappointing ECB press conference as rates were unchanged at 1% and little discussion on the securities market program. 

We saw risk assets perform very well yesterday as US data came in positive with the US initial claims coming in at 436k vs 425k, and US pending home sales at a 10.4% gain vs -0.5% dip.

We had a bit of a mixed session with the Euro. Euro came down as markets were disappointed with Trichet conference. But news of ECB buying Irish and Portuguese debt boosted the Euro up again.

Aussie got boosted up after equity markets performed well.

I still think this is a retracement and would look to sell the Euro and Aussie against the dollar.

Data Today:

UK PMI services – 9.28am GMT

German PMI services – 8.53am GMT

Euro zone PMI services – 8.58am GMT

Euro zone retail sales – 10am GMT

US change in nonfarm payrolls – 1.30pm GMT

US unemployment rate – 1.30pm GMT

US ISM non-manufacturing – 3pm GMT

US factory orders – 3pm GMT

Mid week retracement

Looks like we had a little bit of a retracement yesterday. Markets in general were in a bid tone yesterday, as US and European equity markets rallied quite a bit.

US data came in fairly good yesterday, with the US ADP estimate being slightly stronger at +93K and ISM manufacturing coming in at 56.6. The Beige book sounded more positive as well.

USDJPY surge up to 84.40 can be attributed to the US yields.

Euro jumped up on headlines about US willingness to back Europe via IMF funds. This shortly came down as a spokesperson from the US treasury department stated that there have not been any discussions on extra commitment of funds for the European stabilization fund.

Sterling was lifted by broad wave of risk assets recovery. Also the UK PMI came in at 58 which is the highest reading since 1994.

Aussie took another blow as retail sales came out worse than expected this morning at -1.1%.

Looks like there was a lot of data that kind of brought out a strong bid sentiment yesterday. However I still think the trend is still towards the downside due to some problems in the Eurozone, and also this morning reports of North Korea possibly attacking South Korea.

I would look at this rally as a possible opportunity to sell at a higher level.

Data Today

UK PMI construction – 9.30am GMT

Eurozone GDP – 10am GMT

Eurozone PPI – 10am GMT

ECB rate decision – 1.30pm GMT

US initial jobless claims – 1.30pm GMT

US pending home sales – 3pm GMT

Euro debt still a concern

Euro debt issue still remains to be the main concern for markets.

Euro closed lower for the 7^th consecutive session, on the back of rumored downgrade on French sovereign debt.

Sterling was quite resilient yesterday and didn’t push down as low. We see it trading back up to above 1.5550.

Aussie just got hammered down this morning after poor results of GDP. Looks like we may just see aussie fall further today.

Yen saw some correction as it pushed lower to below 83.50. I would still look to buy USDJPY. So we may just see some bids coming in.

Data Today

German PMI manufacturing – 9am GMT

Eurozone PMI manufacturing – 9am GMT

UK PMI Manufacturing – 9.30am GMT

US ADP employment change – 1.15pm GMT

US ISM manufacturing – 3pm GMT

Fed Beige Book – 7pm GMT

Eurozone unemployment out today

The dollar once again strengthened against the Euro and the yen as the Irish bailout announcement did not clear the concerns on the situation. US equities dropped lower as well.

The Euro traded to a high of 1.3302 before turning lower during the European session, taking out stops and option barriers at 1.3100.

Aussie and Sterling followed lower on the back of the Euro.

I guess the trend is still down with a dollar bull.

Data Today

German Unemployment rate – 8.55am GMT

Eurozone Unemployment rate – 10am GMT

US S&P/Case Shiller Home price index – 2pm GMT

US consumer confidence – 3pm GMT

Chicago PMI – 2.45pm GMT 

Ireland package finalized

Dollar bulls must be popping bottles of champagne at the moment considering what’s been happening since last week.

On Sunday, Eurozone finance ministers approved an 85bn pound financial rescue package for Ireland, although 17.5bn of it will come from Ireland’s sovereign wealth fund and other domestic cash resources.

The Euro got a boost this morning after the announcement and traded up to 1.3355, but this was short-lived and the Euro has come off since then.

The Aussie has been following the Euro lead, and has also released worse than expected data. The Q3 business inventories and company profits came in a lot worse.

Data Today:

UK net consumer credit – 7.30am GMT

UK mortgage approvals – 7.30am GMT

Eurozone consumer confidence – 10am GMT

Eurozone industrial confidence – 10am GMT

Eurozone service confidence – 10am GMT

Eurozone business climate indicator – 10am GMT

Looks like another quiet day. Happy Thanksgiving!

Extremely quiet markets because of the thanksgiving holiday. I don’t think there will be much happening today as well, considering not much data coming out today.

Dollar yen though looks like it’s touched a resistance level at 83.80. I would look into selling here.

Data today:

German Import Price index - 7am GMT

Eurozone M3 - 9am GMT

range trades perhaps?

Today we still seem to have risk aversion going on and a stronger dollar on the whole.

US new home sales dropped down to 283k. US durable goods came off worse, and the university of Michigan confidence index rose to 71.6.

S&P downgraded Ireland to A from AA-, we saw the Euro crash below 1.3300 yesterday.

UK GDP came in line to consensus at 2.8% y/y. looks like cable may be in a tight range.

Aussie bounced up after talks that Russia will be increasing Aussie in their reserves.

There isn’t any serious data out today, so looks like we’ll still be playing the trend. I do think markets will be quiet today, since it is thanksgiving and US is not going to be open.

Today may just be a good day to practice your range trading strategies.

Dollar bulls on a sprint!

Talk about dollar bulls sprinting!!

US GDP came out stronger at 2.5%. Seemed like lots went down yesterday. North Korea shelling South Korea saw the start of the movement down, for many of the currency pairs, especially dollar-yen.

Euro on the other end traded to a low of 1.3359, after S&P cut Ireland’s rating to A.

It just seemed like yesterday, that everything was going in favor for the USD. Irish troubles and the Korean troubles brought out more risk aversion and pushed the dollar higher. On top of that the US GDP came out better than expected.

I still think we’ll be seeing more risk aversion happening, so I would still look to sell on rallies on the Euro.

Data Today:

German IFO business climate – 9am GMT

German IFO expectations – 9am GMT

UK GDP – 9.30am GMT

US durable goods order – 1.30pm GMT

University of Michigan confidence – 2.55pm GMT

US new home sales – 3pm GMT

US house price purchase index – 3pm GMT

risk aversion game play

Looks like risk aversion is the game play for today.

Dollar, yen and the suissy seem to be the safe-haven currencies for the day.

Concerns of a possible Irish downgrade and uncertainty seems to still be the topic on the Eurofront. The PIGS are back into the main picture with possible risk in the other countries, that sum up the PIGS.

Today Japan is on a holiday, so looks like yen will be in a tight range today during tokyo session, and possibly aussie as well. I’d still today look into playing Euro and sterling. Sell Euro on rallies, and also sterling.

I would though be careful during the U.S session as we have some big data coming out later today.

Data Today:

German GDP – 7am GMT

German GFK consumer confidence survey – 7am GMT

German PMI manufacturing – 8am GMT

Eurozone PMI manufacturing – 9am GMT

US Q3 GDP – 1.30pm GMT

US existing home sales – 3pm GMT

US FOMC meeting minutes – 7pm GMT

Watch out for the Euro today

So much going on this morning. China central bank has raised their reserve requirement by 50bp effective on November 29^th.

At the same time, Irish PM Cowen has applied for a bailout plan of about 80 to 90 bn Euro. This gave a boost to the Euro which opened 40 pips higher.

Aussie recovered its Friday’s losses but may just get capped out due to fear of China raising rates.

Not much coming out today on the data front, so I would keep a close watch on the Euro and the Aussie today. Looking to Buy Euro, as I do think markets will push it higher today.

Data Today:

Eurozone consumer confidence - 8.30am GMT

Are we seeing a solution for the Irish problem?

It seems like the Irish story may be reaching a conclusion. Governor Honohan became the first Irish policymaker to declare that the country would apply for aid. The package will be in the form of a joint IMF/EU loan that will “run into the tens of billions of Euro with an interest rate of 5%”. We’ve been seeing a stronger Euro this morning.

The US jobless claims matched the consensus at 439K, whereas the US leading indicators increased by 0.5%. I think yesterday’s play was more towards the news coming from Europe than the data coming out of the U.S.  For today I think the dollar may just weaken a little especially compared to the Euro.

Data Today:

German PPI – 7am GMT

Irish story still the main focus!

It’s honestly that time of the year where the holiday mode and spirit kicks in. Sometimes, it’s just difficult to get into the market in-between work.

Euro I think there is definitely on a downward trend medium term (daily chart). But there is quite a bit of volatility in price-movement on an intra-day basis. We still need to watch for the Irish story to see where spot moves today.

Sterling on the other hand isn’t really moving as much as Euro, so I’m slightly neutral here and would like to see a clear trend before I enter trend oriented positions.

Aussie fundamentally should be bullish, but because of the dollar strength and risk aversion happening at the moment, it has definitely come down quite a bit. But I’d still look to buy on dips here.

Data Today

UK public finances – 8.30am GMT

US initial jobless claims – 1.30pm GMT

US leading indicators – 3pm GMT

Dollar bulls pushing against the Euro and Aussie

Whoa! Talk about some insane movements! Looks like dollar bulls have finally attacked the market!

Seems like all this talks between the US and China on foreign exchange policies is showing its effects on the markets.

According to Geithner, upward pressure on the yuan will end up in higher inflation and asset prices if the currency won’t move. He also states that China will be more confident in allowing the yuan to rise if competitor’s currencies rise too.

Euro continues its way down and breaks the strong support of 1.3650! Seems like all the concerns over the Eurozone sovereign risk is at hand. Yields on 10 year irish bonds continue to rise over comparable german debt.

On the otherhand Sterling still held up strong, due to the QE being priced out following BOE inflation report. But we have to watch how UK data comes out in the coming weak as it comes out worse, QE may end up being priced in again.

Data Today:

German GDP – 7am GMT

Eurozone GDP – 10am GMT

Eurozone industrial production – 10am GMT

University of Michigan confidence – 2.55pm GMT

is there a trend change in the Euro?

Euro seems to be in a bit of a fix at the moment. Rising credit spreads on Irish debt and German data coming in mixed last night with a fall in industrial production buy an increase in exports. We saw the Euro come off quite a bit down to just below 1.3850.

Some data out tonight that could bring some movement into the other pairs.

Data today:

UK manufacturing production – 9.30am GMT

UK industrial production – 9.30am GMT

UK trade balance – 9.30am GMT

German CPI – 7am GMT

US wholesale inventories – 3pm GMT

Some profit taking on the Euro this morning.

I was pretty much out of the market on Thursday and Friday as it was a public holiday, but wow markets did do quite some movement.

On Friday, NFP came in better than expected at 151K which saw a sell-off in the Euro and Yen against the USD. US unemployment rate remained at 9.6%.

It does seem as some profit taking is happening this morning as there is a sell-off happening on the Euro.

I’m not sure which direction markets going to head. It’s a little too high to be buying, and a little risky to be selling. I guess the best thing to do right now is just wait and watch until you see a trade coming.

Here’s the data to look out for today. It does seem to be another heavy data week, so high volatility potential this week as well.

Data Today

Euro Sentix index – 9.30am GMT

German industrial production – 11am GMT

still have ECB and BOE rates tonite

Finally the big FOMC meeting is over and the craziness of the markets last night have now consolidated.

So what exactly happened?

Fed announced the next round of QE2 of a purchase of $600 bn of long-term treasuries by the end of Q2 2011. There were no real changes of growth or inflation risk and it was this disappointment that drove the policy change.

US October ISM non-manufacturing came in better than expected at 54.3 vs consensus 53.5. The USD September factory orders were also above expectations at +2.1% vs consensus 1.6%.

We saw the Aussie, Euro and sterling climb up last night. Will have to watch out though for Europe open and today’s data to figure out where the market is heading.

Data today:

German PMI services – 9am GMT

Eurozone PPI – 10am GMT

European central bank rate decision – 12.45pm GMT

Bank of England Annouces rates and asset purchase rate – 12pm GMT

US initial jobless claims – 12.30pm

RBA increases rates!

Last night we saw the US October ISM manufacturing improve to 56.9 from 54.4 and the US September construction spending rose as well to 0.5%.

Concerns on the Irish front has investors worried and the UK manufacturing PMI was slightly better overnight which helped push the EURGBP lower.

Aussie awaits the RBA decision today, which is expected to remain the same. Ok Shocking!! RBA increased the rates by 25bps! In a span of 5 minutes AUD/USD rose 100 points!! Almost there to parity, keep a watch on this pair!

Data Today:

Reserve Bank of Australia cash target – 3.30 am GMT

German PMI Manufacturing – 9am GMT

Eurozone PMI Manufacturing – 9am GMT

UK PMI construction – 9.30am GMT

US mid term election

End of a Volatile month and lots of US data this week

It’s the first week of November and got to say October was an extremely volatile month. Are we going to see another volatile month?

Well let’s see first what went down at the end of last week.

US real GDP came out as expected and the Chicago PMI rise to 60.6 well above the consensus 58.0.

But we saw the dollar weaken against most of the currencies as investors looked ahead to the FOMC decision on November 3^rd. A lot of data coming out of the US this week, so keep a look out and play carefully on the dollar.

Sterling strengthened further on Friday with the markets covering back more shorts before the MPC meeting on Thursday.

Data Today:

UK PMI manufacturing – 930am GMT

US ISM manufacturing – 2pm GMT

US personal Income – 12.30pm GMT

US personal Spending – 12.30pm GMT

US construction Spending – 2pm GMT

keep a watch on the Euro today!

Doller yen couldn’t quite break through the 82.00 level with Japanese exporters seen capping upside. BOJ meeting suggests that the monetary policy will likely remain unchanged.

Euro broke through 1.3770 support all the way down to 1.3734 before recovering. Eurogroup Juncker says Europe is a “victim” of global FX policies.

Aussie fell to a low of 0.9651 following weaker than expected q3 Australia CPI.

Data Today:

UK nationwide house prices – 6am GMT

German Unemployment rate – 7.45am GMT

Eurozone consumer confidence – 9am GMT

Eurozone economic confidence – 9am GMT

Eurozone industrial confidence – 9am GMT

Eurozone services confidence – 9am GMT

US initial jobless claims – 12.30pm GMT

UK GDP - watch out for it!

US existing home sales came out better than expected last night at 10%, so we saw US bulls coming back into the market.

Euro initially traded up to 1.4080 during the Asian and European session before dropping down after the US home sales.

Sterling will be on high alert today, so watch out for the UK GDP.

Data today

UK GDP – 8.30am GMT

German GFK consumer confidence – 6am GMT

 US consumer confidence – 2pm GMT

US house price index – 2pm GMT

Not much from the G20

Ok so not much really went down at the G20 this weekend so looks like we’ll be still looking at the same range for now in the currencies.

USDJPY still trades in the tight range between 81.00 and 82.00.

Euro gained some support from better German IFO, but still looks range-bound.

UK growth has slowed sharply according to the FT in the third quarter. Some also believe that quantitative easing may happen in the coming months. Sterling looks more bearish than the Euro for now.

Aussie PPI came in better this morning at 1.3%, and pushed the Aussie up.

Data Today:

Euro zone Industrial orders – 9am GMT

US Chicago Fed national activity index

US existing home sales – 2pm GMT

Dollar regained some ground but RBA crushed it a little

Last night we saw the dollar regain some ground. US TIC data  came out better at 128.7bn and positive comments from Geithner helped boost the dollar.

The yen has come up a little but still remains heavy. Nikkei reports that Japanese car makers and electronic companies have changed their internal rates to 80-85 from 85-90.

Euro came down to 1.3937 after Geithner comments late in NY but jumped up with the aussie after the RBA minutes to 1.4005.

Aussie RBA minutes stated that the recent rise in currency would help ease inflation, which pushed the aussie up to 0.9960.

Data today:

US housing starts – 12.30pm GMT

German ZEW survey – 9am GMT

Been MIA but I am back

Hey guys, I know I’ve been MIA for the past week because I fell sick so was pretty much in bed all week.

But I’m much better and ready to go this week so lets see what we have.

We saw Euro surge to a high of 1.4161 on Friday as Bernanke made the for more monetary accommodation at the fed conference. But then we saw a lot of profit taking happening which then brought the Euro down below 1.4000 setting off more trailing stops.

The sterling too headed above 1.6100 after Bernanke and then slipped back down to 1.5985.

Aussie reached parity for a few minutes after bernanke’s speech but again this didn’t last too long.

Data today:

US net long term TIC flows – 1pm GMT

US industrial production - 1.15pm GMT

US capacity utilization – 1.15pm GMT

US NAHB housing market index - 2pm GMT

Quiet day with NY and Japan off.

Japan was closed yesterday and so was New York, so nothing went on really yesterday, and I kind of gave myself a break from the market as well.

So let us see what we have today in terms of data.

Data today:

German CPI – 6am GMT

UK CPI – 8.30am GMT

US minutes of FOMC meeting – 6pm GMT

lots of data out today!

One more day of weak news coming out of the US (US ADP September US employment change came down to -39k), pushed the dollar even lower. According to the IMF the Euro is valued fairly but the dollar is slightly undervalued, which I completely agree to.

The Euro pushing all the way up to 1.3930, and it definitely looks as though the trend is intact despite the Greece concerns and Ireland’s downgrade. We will have to see this afternoon what the ECB has to say. I’m hoping to see some retracement to the downside.

The yen as well pushed lower to 82.75 with no signs of BOJ intervention. Lets see how long it takes before the BOJ intervenes.

I’m thinking markets are going to be fairly quiet today considering all the data coming out later this afternoon, so let’s see how things go, I’m going to be wishing for some retracement to the downside, not sure if my wishes will come true.

Data today

German industrial production – 10am GMT

ECB rate decision – 11.45am GMT

ECB Trichet speech – 12.30pm GMT

UK industrial production – 8.30am GMT

UK manufacturing production – 8.30am GMT

BOE rate decision – 11am GMT

US initial jobless claims – 1.30pm GMT

US consumer credit – 7pm GMT

Euro and Sterling breaking its top

Aussie and the yen were extremely volatile during the beginning of the Asian session yesterday.

Yen saw the low of 82.96 last night before some buying pulled up the market to close above 83.00.  BOJ cut target for overnight rates to a range of 0.0%-0.1% from its previous target of 0.1%.

AUD dropped down to below 0.9550 but then recovered all its losses.

Euro trudged even higher up yesterday pushing up to 1.3850.

Sterling as well pushed up above 1.5900 and broke 1.5920 levels. Will be interesting to see if it can stay this high and push towards 1.6000.

Data today

Euro zone GDP – 9am GMT

German Factory Orders – 10am GMT

US ADP Employment change  - 12.15pm GMT

Hit the sterling!

Wow was today crazy or what!

so much movement that it actually got little confusing over whether to enter or not.

But I did see sterling hit the high of 1.5911 which I saw as a good entry level for a sell position as it has been a pretty strong resistance level.

So i sold at 1.5877, as soon as i felt that sterling was going to head lower.

here's the chart, and keeping a stoploss just above at 1.5930 which is the next resistance level.

happy trading!

RBA rate decision in 5 minutes!

Let's look at the data last night.

US factory orders fell down to 0.5% whereas the US pending home sales index rose up to 4.3%.

Euro stays under pressure this morning trading to a low of 1.3644. European debt worries seem to be holding up as Ireland’s central bank cuts growth forecasts for 2010 and 2011.

Australia retail sales came down to 0.3% and the trade balance increased to +2.346 bn. Aussie seems to have come off to a low of 0.9650. Will have to wait and see what happens at the RBA rate decision.

Data today

RBA rate decision 3.30am GMT

German PMI services – 7.53am GMT

Eurozone PMI composite – 7.58am GMT

Eurozone retail sales – 9am GMT

UK PMI services – 8.30am GMT

US ISM non-manufacturing composite – 2pm GMT

still waiting for a trend reversal

Sterling looks a little heavy this morning after the markets ran the barriers in EURGBP, taking it from 0.8720 to 0.8758 highs.

On the Aussie from markets are waiting it out for the RBA rate decision tomorrow.

Data today

Eurozone PPI – 9am GMT

UK PMI construction – 830am GMT

US factory orders – 2pm GMT

US pending home sales – 2pm GMT

weak US data brought dollar down

Yen came down to a low of 83.63 after the disappointing US data last night. The Tankan that was released this morning reported big Japanese manufacturers were looking at the dollar averaging at 89.66 JPY for 2010/2011.

After the UK GDP data, the sterling dealt up to 1.5896. But after BOE member Posen argued a case for further quantitative easing, we saw the pound drop to 1.5718.

Aussie is still pushing up to a high of 0.9687.

Data today

Euro-zone consumer confidence – 9am

UK net consumer/ mortgage credit – 8.30am

Morning Update

I’ve been MIA since Friday because it was an insane weekend with the Singapore F1 night race, which was of course fabulous! I needed some time to recover from the madness of the weekend, but I’m back so let’s see what happened last night on the markets.

It looks like the dollar has weakened further and doesn’t seem like rates will be hiked anytime soon by the feds.

Euro came under pressure after Moody’s downgrade on senior debt of a prominent Irish bank which highlights the uncertainty of banking strength in Ireland. Better keep an eye out on the Euro, I do think it’s slightly on the higher side at the moment.

Sterling rose to a high of 1.5867! I’m not sure whether it will last at these levels, but let’s see how the GDP turns out this evening.

Aussie ran all the way up to 0.9645!  The next high is at 0.9870 which occurred 13^th July 2008. I would be extremely cautious of buying around these levels!

Data today:

German GFK consumer confidence survey – 6am GMT

German CPI – 6am GMT

UK GDP – 8.30am GMT

US consumer confidence – 2pm GMT

US Richmond Fed Manufacturing index

Trade Ideas - 23/9/10

Euro

Looking at the weekly chart we see that the next resistance level is at 1.3491 which is also the Fibonacci level of 50%. We will have to see whether the resistance level holds. If it doesn’t I would look to selling around those levels.

GBP

The resistance of 1.5727 is still holding quite strong and on the bottom the support level 1.5624 is holding up. I would look to sell around 1.5727 if the resistance holds and to look at buying at 1.5624 if the support holds.

Aussie

Looks quite range bound, so I think I would play the range. I would look to sell around 96.00 (if not broken), and buy around 0.9525.