Strong GDP Growth Rate Strengthened Canadian Dollar

Yesterday was the day of goodness for the Canadian Dollar since morning because after the release of GDP growth rate report in the market a drastic change is seen in the Canadian Dollar index chart that is it seems to be rises up after the past day lows of the Forex online trading market.

GDP growth rate rises up to six percent that is beyond the expectations of annualized rate. As we have noticed that it grows up to 0.6 percent in the month of March as compared to the Feb. growth rate that is of only 0.3 percent.

It was anticipated in the market that the Canadian Dollar is expected to rise up until the meet of BOC members that will be held today. The market is expecting that the BOC will be the first G7 Central bank that begin the tightening in the market.

Fed will hope to "maintain its accommodate policies of exit" as mentioned specifically by the Fed Chairman Bernanke in mid term of this year. But it is also correct that timing of exit may differ in the countries as their economic conditions may vary among different countries.

The major question that is still in the mind of the EU members are "how the euro zone debt crisis ends will affect the economy of the country that will persist the fact that how to respond" is specified by the Philly Fed Plosser. Since some members was expecting that the economic debt crisis will embed uncertainty in the outlook of the economy.

In May month there was a sudden growth seen in the PMI of Japan and it reaches to 54.7 percent. The industrial production in Japan leads to grow up at the rate of 1.3 percent mom where as it was 25.9 percent yoy in April month.

There was a drop also shown in terms of economic confidence and services confidence that is of 98.4 in the month of may and services dropped up to level three. While there was a drop down also noticed in the euro zone M3 money that is 0.1 percent yoy in the month of may.

Since October 2009 it is seen that the RBA has taken meeting up to 6 times and still it is seen that the RBA will keep their rate unchanged from 4.5 percent.

There are some factors hat suggests the hold of Central bank that is it includes recent development in macro-economic developments along with euro zone economic debt crisis and its impacts on the Global world economy outlook that ultimately heightens the risk aversion and also a mild impact on the moderation of the economic data of Australia.

he European debt crisis embedded uncertainty in the outlook of the Global economy- said by the Chicago Fed Evans and after this if the Fed government decides to keep the price rate low for some extent then it will not make any wonder among the minsters.

If we look at the commodity prices of japan then it seems that it was doing little bit good recovery as compared to other nations that its PMI growth rate is 54.7 percent in the month of May. While the increase is shown in the Industrial production and rises to 1.3 percent mom in May.

The relative strength of the currency pair of AUD and CAD will be determined after the decision of the BOC and RBA minutes that seems to crucial for this week. As we have seen that there is a recovery seen in the currency pair of AUD/CAD after a low of 0.8645.

There will be a further recovery expected in the currency pair of EUR/JPY which was at the tight range today for four hours but it gets recovered around 38.2 percent. It was anticipated in the market that further recovery seems as a correction in the huge down trend in the euro currency pairs.

At last it was only said that the further extent is seen in the Canadian Dollar after the stronger economic data release and now how long will it go to is still a doubtful case fo the investors. BOC minutes will decide in the today's meeting about the "pause" will continue or they will change the interest rate now for the June hike.

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Euro Debt Concerns Heightens Due To Stressed Spain's Bank Industry

In late US session it was seen that the stocks rebounds benefits the Dollar to hit a high of 87.46. In may month there was a rise of 63.3 percent is seen in the Conference board consumer confidence data. It was highest since March and now reached above the expectations of 59.0. The fall of Euro currency becomes a worldwide threat as said by Bullard. He also mentioned confidently about the economic recovery will remain on track and rise in GDP growth will remain continue in the coming quarter and it leads to a full year growth in national income.

In yesterday's Forex session Global stocks tumbles down and there is rise seen in the USD currency and Japanese Yen. The fall of Global stock market is due to the Spain's banking concerns and Korean currency drop-down. The investors are so much worried about the Spain concerns since it may rise the debt crisis in European countries. The four Spanish bank had submitted a proposal to the Central Bank of Spain to merge their business. This causes the major European index to fall that is FTSE is down to 2.21 percent where as DAX falls to 2.34 low and CAC drops down to 2.9 percent.

Yesterday there was a great fall shown in the Asian stock market due to the Korean fall impacts. While the Dow and S&P shows a rise in the last session of forex to maintain its rebound after breaching to the low of Feb month. The Dow index again rebounds to reach above the 10000 at 10043 and is now just down to only 22.9 percent only from the past high. Dow may be rebounds to Feb's low until it touches a high of 12000.

There is a sharp fall is seen in the Dollar index yesterday that is USD unable to break through the 87 level and drops down. There was a recovery seen in the currency pair of EUR/USD and reaches to level of 1.2671 where as GBP/USD rises to 1.4527 high along with the recovery of AUD/USD to 0.8363 level. Crude oil tumbles further to the level below 67 while Gold remains steady at 1190 level in the Asian market. US equities open at low level to provide an additional support to the USD currency and Japanese Yen.

EUR/JPY pair reaches to a low level at 109.32 point in the Forex online market along with the currency pair AUD/JPY that dives to 72.04 low level but this does not impact on the major currency of Japan that is Yen. As we have seen that Japan's currency Yen is still in upward position in the market and may rise to high level in the coming Forex session. The currency pair NWZ/JPY again drops this week as compared to the last week's session. Where as there is some rise shown by the CAD/JPY to regain the past high of 94.46 level. But, it can be said that the currency pair remains bearish although the resistance holds at 85.86 level.

As the banking problem in Spain is the highest priority concern among the market investors because this will lead the European currency to wide spread in the Global economic market which impacts the economic recovery of the market. IMF warned the Spain's bank about the consolidations remains low then the Spanish banks have to get prepared otherwise the financial trouble will lead the bank into an intervention.

BOE policy makers specified the fact about the Japanese economy that it faced the same condition as the UK and US economy is facing today and it may lead to the recessionary condition due to the small policy making mistakes. But the Posen also specified that one major problem that was not faced by the Japan's economy in their recession time was that the poor demand of external prospects along with the productive resource reallocation need.

The euro zone countries again facing the same problem as faced by the last two weeks since the EUR/JPY currency pair falls to 109 level had confirmed the resume of downtrend. The upside break in the currency pair leads to the bullish convergence condition. Although we are expecting a strong support at the level below 2000 in the major currency pair of Japan.

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Spain could not spoil the hope - Stocks and Euro are less affected in the storm

Yesterday a low was seen in the EURO currency due to the news that Bank of Spain is now lead by the government reconstruction funds. This makes the euro to tumble down after hitting the high of $ 1.25. Since we have seen some earlier gain in the euro currency. There is rebound shown in the DOW after getting low in the morning it reaches to 11000 level so early. The Gold also gets rebounds and reaches to 1190 level where as crude oil is still below the 70 level. In US home sales annualized rate turns to 5.77 level as it rises more than expected but the economic data results in some downside in the Forex online market. But, it can be said that the EURO loss is limited that is the currency pair EUR/USD is selling above 1.23 level.

Despite the announcement of GBP 6 billion spending cutting the Sterling currency is trading in mixed range. This includes the budget cost cutting along with the freezing of public sector services and civil services recruitment, cost cutting on expenses of technology, advertising and travel. The Chancellor Osborne said that- the 500 million pounds cost cutting will results in number of useful projects growth. It can be predicted that this year the savings will contribute to the cost cutting deficit. In overnight trading it is seen that the Stock market also results in a low although it is standing straight within 3 months dollar OIS spread results in 25 basis point after nine months high.

There is a sharp low line graph is seen in the chart of the currency pair EUR/AUD and reaches to a rift of 1.49 level. There is drop-down shown at the level of 1.5455 which is said as a correction and there is a also a strong support anticipated from 55 days of EMA to remain in the downside trend. It was anticipated that there will be a rise seen towards 50 percent retraced at 1.6013. Canadian Dollar is on recovery side today but crude oil is still breaching at below level 70. There is a consolidation shown by USD and Japanese Yen versus major currencies since stabilization is shown by currencies risk sentiments. USD/CAD's currency pair drop-down to 1.078 level that ultimately helps the Canadian dollar to sell-off in the downside. AUD/CAD currency pair is also shows drop-down although it is supporting Loonie in general terms. GBP/CAd is still trading below the medium trend falling trend line and 55 days of EMA.

There is a rise in the opening session of Forex in European stocks today. The stocks high will provide support to risks which will lead to forex market consolidations. We hear the news of the BoC market that it will announce the interest rate hike on first June as anticipated by the market. Now it can be said about the currencies growth rate is mainly dependent on the Boc hike. CAD/JPY is still weak although it recovers from the past week's sharp fall. The currency pair is still in the bearish trend even though the market holds a 86.26 minor resistance. In USD chart it is seen that some support is seen around 55 EMA in four hours. There was a break out shown by the currency pair EUR/GBP at 0.8618 level. If it break of at 0.8427 level then it will confirm the decline resumption.

In Asia there is a fall is shown in the EURO currency tumbles down to 1.2385 from 1.2370 level. This is due to the move in Bank of Spain also some austerity programs supported that has been launched in order to provide support to weaker euro zone's member countries to get recover from the debt crisis. There was a big fall in EURO currency pair that is EUR/JPY is shown that is of 110.10 points. AUD/JPY falls to 73.50 from the 74 level and also a drop down shown in the USD/JPY to 90 level.

Overall it can be said that market is still in the consolidation state and there is a risk shown in the Dollar and Yen sell-off. The euro fall is limited to some extent as predicted in the Forex market. Due to solid economic data out in the US the Dollar gets the safe side flow and there is a dynamic move shown by the Gold in Asian market. These are all the latest update about the Forex market till now.

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Forex today picking up heights on ECB and EU announcement

Today the sun has risen from opposite direction, its not funny, really this is because of the surprise shot of EU and ECB and their plans that have rushed the forex online market with the crowd of traders due to observing extremely higher moved up trends in EUR and the Asian market also surged up with flying colors.

Market trends signaling green to show that trends are moving higher and traders will surely redeem their investment that is time to sell off. EU policy makers sudden turned up attitude swerved up market of EUR in this morning.

The breeze of positive reaction blows all across the global Forex market and this is alluring to have some settle down of trades at EUR protecting the short-term trend. Although trends are moving in positive direction but it will take some more time to recuperate integrity at the forex trading platform.

In order to deal with the loosing consumer confidence and increasing crisis over the market at the weekend Fed, EU authorities and ECB combined took a strong decision that shook the entire currency pair market and forex session opening came up over with great precision at the pairs.
All this due to announcement of 750bln funding package allotment by EU and ECB promise to buy the government bonds at the market relieved the tensed market sentiments within a shot span of time.

Standard and Poor Index futures gathered at 4.1 percent while EUR cherished with 2.3 percent to share the incline of $1.3046. The victory of South Korea further drove the currency by 2% in front of USD whereas the protection cost of Asian bonds fell down once again while crude oil prices inclined higher at 3.8%.

This attempt of EU zone and approval of such a lump-sum aid package to soothe out the mushrooming debt crisis of sovereign that have sprouted in Greece but is threatening the other part of the forex market and their attempt put an end to the spreading of debts to other financial market.

US equities didn’t showed any positive response over this news and threw again for the fourth consecutive forex session on Friday. There is no exaggeration in saying that EU attempt of stabilizing the situation of market troubles and ceasing the crisis from spreading is appreciable.

The currency pair of EUR/USD is the only pair that have displayed some rise after intra-day trading session up to 1.2968 signifying miniature consolidation would likely to be observed along with the signs of recoil to the level of 1.2900. However, with the improvement in the buying and selling off the interests should come up, stay at the minor support level of 1.2809, and probably hold that position and stay at the minor support level of 1.2809 with the possibilities of additional rise.

The resistance would likely to expand from the last week’s trade lows level of 1.2510 to move towards the stronger recoiled level of current turn down towards 1.3000 but the trade didn’t achieved and finally stayed with 1.3038. According to the Fibonacci analysis, it is observed that the trade trends retraced from the level of 1.3365 to 1.2510 that would continue to hold from this level of trading.

The currency pair of GBP/USD is having short-term entry from the trade level of 92.50 and the target trade level at 90.80 and ceasing point of the trade is at 93.15.

Whereas USD managed to maintain the firm hold at the forex trading platform due to JPY’s winding down with upward trending risk is likely to test the resisting trends at 93.27/28. Nevertheless, there is a need to have a break in the trend that would signal the decline in the trading of the currency from the level 94.99 of the peak ended up at 87.95 in last week then again regained some pace in trading at 93.90 but changes would speed up or not this couldn’t be said now.

Overall, next forex session would undergo through vital trading session and there would be no precision in the trade of the market that could be affirmed for sometime lets see where the reaction of consumers and traders would probably rest that can be signaled from the lows and highs of market.

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Improvement in diversified sectors of market is full on in major economies

This afternoon, the ADP Non-Farm Employment Change will be released. Economists predict that the ADP will show that companies hired 29,000 workers last month, a substantial improvement over a 23,000 decline in March. This ADP figure is widely considered a predictive index for Friday’s high anticipated Non-Farm payrolls. Later in the US, The Institute for Supply Management Non-Manufacturing PMI measuring the Level of a diffusion index based on surveyed purchasing managers, excluding the manufacturing industry is expected to rise from 55.4 points to 56.2- another positive indicator for the U.S. market.

Yesterday, the U.S Dollar received a boost as reports showed an unexpected increase in both the housing and manufacturing sectors. A report, showing that more Americans signed contracts in March to buy previously owned homes before the expiration of a tax credit, has helped support the housing market. According the National Association of Realtors pending home sales increased an unexpected 5.3%, after rising 8.3% in February. The housing market, which triggered the worst recession since the Great Depression, has received a boost from a tax incentive of as much as $8,000 for buyers who signed the contracts by the end of April. Job gains are needed to help sustain demand and limit foreclosures in the absence of government aid, broadening the economic recovery.

Meanwhile orders placed with U.S. factories unexpectedly rose in March, propelled by demand for business equipment and petroleum, signaling the economic expansion gained speed at the end of the first quarter. The 1.3% increase in bookings matched the prior month’s gain, which was more than twice as large as previously estimated, the Commerce Department yesterday. Sales rose 2.2%, the most since November 2007.

In The U.K. the pound strengthened against its most-active counterparts as polls show David Cameron’s Conservative Party may come closest to winning tomorrow’s election. Yesterday in the forex online market the GBP/USD hit $1.51047, its lowest level since March 31st. The pair lost 0.79% yesterday to close at 1.52472, but has managed to rebound in this morning’s trading session to touch on a high of 1.51640.

The U.K.'s manufacturing sector expanded at the fastest pace in 15-and-a-half years in April, boosted by a record high level of new export orders due to continuing sterling weakness, data showed yesterday. Markit and the Chartered Institute of Purchasing and Supply reported that the PMI for the manufacturing rose to 58.0 from March's revised 57.3. Later today, the Markit will release the construction PMI. Last month, the construction sector posted unexpected figure of 53.1 - a jump above the all-important 50 point mark. Analysts expected that this construction figure to stay constant, increasing slightly to 53.5.

In Australia, home-building approvals rose in March at the fastest pace since 2002, a sign that housing demand hasn’t been damped by the central bank’s world- leading round of interest-rate increases. According the Bureau of Statistics the number of permits granted to build or renovate houses and apartments rose 15.3 %from February, when it previously dropped a revised 2.7%.
Yesterday, the RBA opted to increase the benchmark lending rate for the sixth time in seven meetings, pushing borrowing costs to what Governor Glenn Stevens referred to as “average” levels. The moves are partly aimed at preventing a property bubble after housing prices surged 20% in the 12 months through March. According to economists, this report is encouraging as it is a leading indicator for employment, particularly for workers in the construction industry.
After plunging 1.88% against the greenback yesterday, to close at 0.90930USD, the Aussie rose slightly this morning, toughing on a high of 0.91167USD.

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Forex News: Past Trading underpinning for Future

The Euro strengthened yesterday to its highest level in more than three weeks versus the U.S Dollar after news broke that Greece would be receiving an international rescue package worth as much as €45 billion ($61 billion) to help it avoid a default. Following the announcement of the of the “rescue plan” the single currency rose to $1.36906, appreciating as much as 1.4%, its biggest gain since last September. The Euro’s gain, which was its third increase in the past three days, sent the Dollar Index tumbling 1.3% to its lowest level since March 18th.

The 16-nation Euro-Zone finance ministers reported that they would offer Greece €30 billion in three-year loans in 2010 at about 5% interest. An additional €15 billion would come from the International Monetary Fund, resulting in what could possibly be the largest multilateral financial rescue ever attempted. The Greek official said the government would decide within a few days whether to ask for the aid, depending on whether market interest rates subside. For the time being, Athens will try and refinance its public debt on the bond market. This week, the Greek government will hold another bond auction that will surely be a test if the Euro Zone’s recent bailout plan has restored faith in the Greek bonds.

By yesterday’ close the single European currency has retreated from its near three week high against the USD as Greece prepares to sell €1.2Billion in 26 and 52 week bills. The Euro closed at $1.35924, down 0.71% from the day’s high in the forex online market.

The Japanese Yen rose, ending three days of losses versus the EUR, on speculation demand for Greece’s short-term debt will be weak at an auction today. Japan’s currency appreciated versus all 16 major counterparts after Asian stocks dropped, weakening demand for riskier investments. After closing yesterday at 126.119, the EUR/JPY continued to fall throughout this morning’s trading session, touching on a low of 125.690. Similarly, the USD/JPY fell during this morning’s Asian session- tumbling as much as 0.64% from yesterday’s closing price of 93.161, to hit a session low of 92.563.

Yesterday, the U.S posted a budget deficit for a record 18th straight month in March, reflecting gains in government spending to bolster the economy. The excess of spending over revenue declined to $65.4 billion last month, compared with the $220.9 billion reported last month, according to Treasury Department figures released yesterday in Washington. A deficit that’s forecast to reach a record $1.6 trillion this fiscal year illustrates the challenges facing President Barack Obama and Congress as they struggle to stimulate the recovery while keeping the budget gap manageable. Deterioration in the government’s balance sheet in coming years raises the risk of higher interest rates. Tonight, U.S Fed Chairman Ben Bernanke will speak. He will continue to speak tomorrow at the Joint Economic Committee where he will lay out his economic outlook.

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Aussie and US Dollars rally - One on good news and one for bad

USD

The Dollar recovered on Tuesday off its lowest level of the year against a basket of currencies, as a steep drop in US consumer confidence raised concerns over the pace of the economic recovery.

This brought back safe-haven flows into the USD and helped pick the Dollar up, after hitting new lows in the past week.

The ICE Futures US Dollar index, which measures the performance of the USD against six of the major currencies, rose to near 79. Earlier, the ICE had fallen to a low of 78.315, the lowest level it had seen since early December.

At 11:00PM GMT, the Dollar was up .43% to the Euro 1.4169, up .3% to the British Pound to 1.6437, up .15% to the Canadian Dollar to 1.0826, and up .5% to the Swiss Franc to .8284.

AUD

The Australian Dollar rallied in the Forex market, after Australia's Central Bank governor fuelled speculation that they might be raising interest rates in the coming months.

Reserve Bank Governor Glenn Stevens commented that the risks to the economy were more balanced and manageable, and that low interest rates could create a housing bubble crisis. This was the clearest sign that the ACB was through with its quantitative easing policy.

At 11:15PM GMT, the Aussie was up .7% to the USD to .8275 after hitting an 11 month high of .8338. The Aussie was also up 1.1% to the Euro to 1.7117, up .3% to the Japanese Yen to 78.38 and up .4% to the New Zealand Dollar to 1.256.

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