Forex Online Currency Analysis- This is EURO's Day | Increase in Unemployment in Britain | Bank of Japan’s Non-Move on Interest Rates

EUR

The Euro had an up day against the Dollar and Pound in advance of the US Federal Reserve’s decision on interest rates and in response to poor unemployment data coming out of Great Britain. In what could signal a change in sentiment the European equity markets have been doing better and the fortunes of the Euro have appeared to reverse.

At 5PM GMT, the Euro was trading above the psychological $1.30 mark against the USD at 1.3151; the Euro was also up strong against the British Pound to .9389 a 1.3% rise. The Euro also rose more than ½% to the Canadian Dollar to 1.6637, up ¼ to the Yen to 128.65 and up over1% to the Australian Dollar to 1.987.

GBP

The amount of unemployed in England rose at the fastest pace ever to a pre 1997 level of over 2 million. The numbers indicated that manufacturing jobs are being lost at alarming pace, sparking fears of an export slowdown. The British government’s assertion that a lower pound will support the export/manufacturing industry is being dismissed by investors that believe that only an increase in overseas demand can help the industry. Wednesday’s numbers have given credibility to this argument as Britons working in manufacturing, the staple of the export industry, have lost their jobs that at any other point since they began recording this data.

At 5:15 GMT, the Pound was down over 1/3% to the US Dollar to 1.3997, down ¼% tot the Aussie to 2.1153, down almost 2% to the Swiss Franc to 1.6283 and down 1% exactly to the Japanese Yen to 136.96.

JPY

Fallout from the Bank of Japan’s non-move on interest rates late Tuesday was muted as the aggressive moves of other Central Banks, notably the UK and Switzerland seemed to take precedence. The Yen slowed its decent, but still was weak in Wednesdays trading session even after the BOJ declared that they will be buying Japanese Government Bonds – which are now perceived to be a non-move considering that none of other major countries are buying Japanese Debt and the BOJ buying debt of their own country is considered to be a wash.

The Yen rose ¾% to the Dollar to 97.87, rose more than 1% to the Australian Dollar to 64.56, rose .8% to the New Zealand Dollar to 51.85 and fell ¾% to the Swiss Franc to 83.97 on top of its losses to the Euro and gains against the Pound mentioned above.

Get More Updates at: http://www.finexo.com/marketReview

Read more...

Watch out: Dollar in a very erratic trading session | The Euro ended the week with one of its best weeks since the end of 2008 | The Sterling gained

USD

The dollar gained against the Euro and a host of other currencies on Friday in a very erratic trading session. As the vibe in the stock markets turned negative, investors returned the greenback as a safe haven. The equity markets had been sharply positive all week long, with US markets gaining roughly 9%, Forex investors had taken the opportunity to test their risk appetite, however Friday seemed to indicate a migration back to the US Dollar.

The Dollar did erase early losses brought on by gains in stocks after decent economic data and hints that the US banks might not be as bad off as everyone thinks. Online Forex nalysts believe that the recent rally here for the USD against the Euro is all about the stock market. Investors are trying to gage whether or not the downslide in the economy is nearing a bottom – at this point, any good news can spur a rally. But the rallies are short lived because the sentiment is still quite negative.

At Friday’s close, the Dollar was up .15% to the Euro to 1.2926, up .3% to the Japanese Yen at 97.98, and unchanged versus the Swiss Franc at 1.185. The Dollar did fall to the Aussie and Kiwi, closing down ½% to the AUD to .6579 and down nearly 1% to the NZD at .5248.

EUR

The Euro ended the week with one of its best weeks since the end of 2008. Much of the gains the Euro made this week were based on investors testing their risk appetite, as stated above, however news from European Central Bank executives also played a part in the Euro’s rebound. Last week, several ECB board members declared that the crisis was being managed more aggressively and that a light at the end of the tunnel is in sight.

The Euro closed up ½% to the Yen to 126.68, up .16% to the Swiss Franc to 1.5321, down .4% to the Australian Dollar at 1.9641 and down .35% to the Canadian Dollar to 1.6441.

GBP

The Sterling gained widely on Friday as investors appeared to be giving the battered UK currency a break on Friday. Much hype of the UK’s bank bailout plan and overall negative sentiment about the state of the British economy has kept the Pound down in recent weeks. As investors retreated from more risky positions on Friday they appeared to find value in the Sterling.

The Pound closed up ½% to the dollar closing at 1.4 flat and up .3% to the Euro at .9231, up ¾% to the Yen at 137.18 and up ½% to the Swiss Franc to 1.6591. The Pound did fall slightly to the Canadian Dollar to 1.7803 and to the Australian Dollar to 2.1271.

ChartAnalysis: USDCAD

The recent inability of the USD/CAD to stay firm above the 1.30 level coupled with significant tension in the fundamentals has put pressure on the currency pair. The rising trend line looks like the next key support level below the 1.2675 line of support. Another way to play for a stronger CAD is with a CADCHF or EURCAD trade. USDCAD will need to see 1.2950 again to give bulls renewed hope here....

Read more...

Currency Market Updates & USDJPY Chart analysis

US Policy: Aggressive Spending

Brokers trading the dollar helped it climb on Wednesday to a new six week high against the Yen an a new 2 ½ week high against the Euro as US President Obama announced a new 80 Billion Dollar mortgage bailout bill. The new bill is expected to help close to 9 million families either restructure or refinance their mortgages in order to avoid foreclosure.

At 5PM GMT, the Dollar was up 1 ¼% to the Yen at 93.56 and ½ of a percent versus the Euro to 1.2523 after hitting 1.2557 – its lowest level since early December. The US is continuing its aggressive spending policy to shore up its economic situation, a tactic that might prove detrimental to the valuation of the Dollar down the road. For now, those Investing and trading the greenback see the US doing something and is banking on the possibility that it will work to help stave off a worsened situation.

GBP: Bank of England Might Consider a Further Interest Rate Cut in March

Forex traders took the Sterling down marginally against the Euro and Dollar as the Bank of England released minutes of this past month’s interest rate meetings. The record showed that the BOE members voted unanimously for the policy of “quantitive easing” by purchasing other securities and Gilts. The fear was that based on the minutes and the unanimity of the vote, the Bank of England might consider a further interest rate cut in March.

At 5:15 GMT, the Sterling was off .33 of a percent to the USD at 1.4189 and 1/10^th of a percent to the Euro at .8824.

Chart Analysis: More USD/JPY – this time a 5 month look

As we said yesterday, the deviation of Dollar/Yen with respect to its historical patterns in terms of its connection with the risk appetite of Forex traders is a problem that could mean additional weakness for the Japanese currency. Its break above 92.40 is significant technically. This is now the new support level and the JPY/USD is setting its sights on the moving average for the past 100 days, somewhere near 94.00 as well as the 2009 high up at 94.62.

Read more...

My Forex Analysis

I am certain you all noticed the vast opportunities in the FX markets so far. Take USD/JPY for example.

As you can see a double top (if you don't know what a double top is please drop a comment here) has formed when the graph tackled a solid resistance. I followed it, opened a short position and left it open for a couple of hours (approx):

I think those who paid attention to the moves noticed an attractive market, enriched with constant opportunities. The market will be extremely interesting tonight (CET) and throughout tomorrow's session due to the heavy releases.

Let's analyze them together and see why is tonight session (CET) and tomorrow are so attractive.

Let us first look at GBP

Nationwide HPI m/m:

It is simply the change in the selling price of homes with mortgages backed up by Nationwide. Rising house prices will appeal investors thus giving us a good picture of the housing market in The UK. So far so good, let's refresh ourselves with last November's Data:

The Graphs are available for all from The Nationwide official web site.

To summarize, the price in November fell to -0.4%, the pressure on the housing market may intensify due to poor economic conditions but big rate cuts may cushion the impact. So, we can see the high rate cut in November was supposed to cushion the impact. British mortgage approvals for house purchases fell to their lowest level in November since records began. Mortgage approvals are an important indicator for the housing market as it reflects housing demand. The Mortgage approvals fell to a shocking 27,000 in November as we discovered last Friday, which forced GBP down against a basket of currencies.

Therefore, the Nationwide HPI for December is very important. We are going to see whether the previous rate cut did the trick despite the grim expectations, which are not positive at all and have the strength to crush GBP.

Time of release: 07:00am GMT

Now lets see what is happening so far with The GBP?

One can easily note GBP is on the move, riding with the bulls. This trend may be reversed via the aid of the Nationwide HPI and Services PMI or they will not become an obstacle and ride with the GBP on the bullish trend, depending on the actual figures, worse or better then expected.

The new interest rate that will be released this Thursday may unleash a new reality to The GBP, which will definitely create a window of opportunities for us, the traders.

Now have a look at USD

ISM Non-Manufacturing PMI & Pending Home Sales m/m

If you followed the market today you would have noticed the sudden burst of USD, gaining against a basket of pairs until tackling solid resistance in some pairs, which forced the graph down although I believe those resistance levels may be to the test again.

Both financial indicators are expected to be negative; the new home sales are not expected to blossom and neither does the non-manufacturing PMI. These figures will be released simultaneously and are likely to impact all the major pairs, I will eye out JPY pairs as well such as GBP/JPY and EUR/JPY at time of release.

The Forex Broker I Recommend: http://www.finexo.com/

Read more...