Forex traders: January 2008

Thursday, January 31, 2008

Forex strategy : Risk Willingness Limited after US Rate Cut

Mixed figures ahead of the FOMC yesterday made it a bumpy ride to trade the USD. After the 50bp rate cut, the USD sold off. Markets now looking into more heavy data and eyeing Friday"s US job report. MAJOR HEADLINES – PREVIOUS SESSION NO Retail Sales MoM/YoY (DEC) out at -0.7%/5.6% vs. 0.3%/7.2% expected vs. 1.0%/7.5% prior read. UK Mortgage Approvals (DEC) out at 73K vs. 79K expected vs. 83K prior read (revised lower to 81K) SZ KOF Swiss Leading Indicator (JAN) out at 1.70 vs. 1.95 expected

Forex Education Trading Strategies : Greenback Falls after Fed Rate Cut

Greenback Falls after Fed Rate Cut The dollar fell against major currencies on Wednesday after the Federal Reserve, as forecast, cut the Fed funds rate by 50 basis points to 3.0%, to prevent the US economy from slipping into a recession. The Fed said downside risks remain, stressing that it will continue to assess financial markets and the economy and “act in a timely manner as needed.” The EUR/USD finally penetrated the 1.48-handle resistance on the increased European interest rate advantage.

Wednesday, January 30, 2008

Forex Education Trading Strategies : EURUSD: Continues To Target The 1.4967 Level.

EURUSD - EUR continues to head higher pushing to a high of 1.4817 in early trading today. While price action holds above key moving averages and its rising trendline originating from its Aug’07 low, risks are for a push towards its 2007 peak standing at 1.4967 with a loss of there triggering price extension aiming at the 1.5000 level, which is its psycho resistance level. Its daily studies remain positive and trending higher implying further gains could be seen towards its 1.272 Fib Ext at

Forex strategy : FOMC rate decision on tap with 50 bp cut expected

Continued US housing implosion likely to lead to a 50 bp cut today, but the market already expects this. MAJOR HEADLINES – PREVIOUS SESSION Overnight developments: New Zealand Dec. Building Permits fell -5.2% vs. 0.0% in Nov. US Weekly Consumer Confidence fell to -27 vs -24 expected and -23 the previous week Japan Dec. Industrial Production rose 2.0% vs. 1.4% expected THEMES TO WATCH – UPCOMING SESSION Key event risks today (all times GMT): Norway Dec. Retail Sales (0900) EuroZone Jan. Retail

Forex strategy : FX Market Awaits FOMC Rate Decision

FX Market Awaits FOMC Rate Decision The FX market traded in a narrow range on Tuesday ahead of the Federal Reserve’s interest-rate decision tomorrow. The greenback strengthened somewhat against most key currencies after US durable goods orders rose more than forecast, indicating the US economy may avoid a recession. Durable goods are volatile but still indicate US economic strength. Traders reduced bets for a 3.0% Fed funds rate slightly. We believe the Fed will cut the target lending rate 50

Tuesday, January 29, 2008

Forex strategy : FX Options trade alert

This week should be decisive for many investors who are waiting for the decision of the FOMC committee on Wednesday and the release of U.S. Non Farm Payrolls on Friday. However, the U.S. Dollar did not wait until the release of these figures to suffer some weakness. Therefore, our stop loss on our last Option Alert (BUY CALL JUN08 70.0 @ $1.20) has been reached at $0.80. For the coming weeks, we expect the U.S. Dollar to remain under pressure and we are still closely monitoring market

Forex Education Trading Strategies : EURUSD: Turns Back Above The 1.4751/52 Zone, Focuses On The 1.4967 Level

EURUSD - EUR rallied ahead of its MT rising trendline(1.4633) on Monday, returning back above its key resistance at the 1.4751/52 zone, its Nov 09’07/Dec 11’07 to close the session at 1.4785.A sustained hold above there is required to open the door for further upside targeting its Mid-Jan’07 high at 1.4921 initially and then its 2007 peak at 1.4967.Beyond the latter will resume its MT uptrend towards the 1.5000 level, its psycho level and possibly higher. The daily stochastics remains positive

Forex Education Trading Strategies : USD still on the defensive

USDCAD nearing crucial support level as commodity currencies continue to test stronger. MAJOR HEADLINES – PREVIOUS SESSION Overnight developments: Japan Dec. Jobless remained at 3.8% vs. a rise to 3.9% expected Japan Dec. Job to Appliant Ratio fell to 0.98 Japan Dec. Retail Trade rose 0.2% YoY, but Dec. MoM Retail Trade fell -0.8% Australia Dec. NAB Business Confidence fell to 5 from 6 in Nov. THEMES TO WATCH – UPCOMING SESSION Key event risks today (all times GMT): France Dec. Housing Starts

Forex strategy : Dollar Falls on Rate Cut Speculation

Dollar Falls on Rate Cut Speculation The dollar fell against most key currencies on Monday as investors increased bets the Federal Reserve will aggressively lower interest rates by 50 basis points at the Jan. 30 FOMC rate decision meeting to boost US economic growth. Larger-than-expected falls in US new home sales and home prices increased the chance of another large Fed rate cut, following the 75 basis-point emergency cut earlier this month. Interest rate futures showed nearly 90% chance of a

Monday, January 28, 2008

Forex Education Trading Strategies : Are NFP important?

Good morning from Montevideo, incredible how Asian stocks plummeted today, this is not good for today’s American open. I think we are going to have a triple digit loss in the Dow again today. Well actually I think volatility is going to remain in the markets at least until July, the second half of the year should bring calm to the markets, and we may actually have a trend to trade!. There are a lot of superstar’s traders out there that are in panic, yes guys, the easy money has gone. We are

Forex Education Trading Strategies : Are NFP important?

Forex Education Trading Strategies : EURUSD: Continues To Recover, Looks To Strengthen Further.

EURUSD-EUR EUR reversed part of its previous week losses to close higher at 1.4681 on Friday. This is coming on the heels of a turn ahead of the 1.4310 level, its Dec 20’07 low and subsequent break back above its earlier invalidated rising trendline.Although the said recovery saw a setback on Friday after the pair’s weakened below its Jan 01’08 low/.618 Ret (1.4310- 1.4921 rally) at 1.4577/45, as long as the it continues to hold above its rising trendline further attempts on the 1.4751/52 area

Forex strategy : AUDNZD Range Still Presenting A Strong Trade

This is our third recommendation for an AUDNZD range trade this week. The first setup played out nicely, though our restrictions on excess risk prevented us from participating in the profitable move. The second setup was stopped on a large upper wick on a false break. Through all of this though, the pair’s range has remained. Therefore, we will stick with this strong technical formation and will tailor our strategy to align our trade with the market’s direction. Trading Tip – This is our third

Friday, January 25, 2008

Forex Education Trading Strategies : EURUSD: The 1.4751/52 Zone To Give Way Before Further Upside Incursions

EURUSD - Although the recovery off the 1.4364 low posted on the Jan 22’08 has seen EUR break and close above its key resistance at the 1.4751/52 zone, its Nov 09’07/Dec 11’07 on Thursday, holding above that area is now needed to increase further strength towards its Mid- Jan’07 high at 1.4921.A turn above there will set the stage for an acceleration towards its 2007 high at 1.4967 ahead of the 1.5000 level, marking its psycho level. The daily studies remain in alignment with the above scenario

Forex Education Trading Strategies : Dollar and Yen Fall on Increased Risk Appetite

Dollar and Yen Fall on Increased Risk Appetite The dollar fell against most key currencies on Thursday as rising stock prices increased risk appetite and eroded the support the dollar had from risk aversion during the financial turmoil earlier in the week. The dollar is also pressured by the widening interest rate disadvantage after the Federal Reserve’s emergency interestrate cut and expected further rate cut at next meeting. The yen fell against all major currencies as investors reentered

Thursday, January 24, 2008

Forex strategy : AUDUSD Hedging Strategy Sees Considerable Risk And Profit Potential

Viable ranges are harder to come by given current market conditions. The threat of a recession in the world’s largest economy has stoked fears that global growth trends are flagging – a fear that is clearly reflected in prices. What’s more, sharp losses in equities markets sizable rate cuts from the FOMC this past Tuesday have generated considerable volatility in almost every pair that can claim a carry differential. While these conditions present generous risk, the AUDUSD range also offers

Wednesday, January 23, 2008

Forex strategy : Kneejerk sell-off in USD on big Fed cut. Will the sell-off last?

AUD buyers in a tizzy over Australian inflation data and renewed equity strength - but new market theme suggests big risk for the Aussie eventually. MAJOR HEADLINES – PREVIOUS SESSION Overnight developments: Asian markets recouped much of the previous day"s losses in their Wednesday session overnight. Australia Q4 Consumer Prices rose 0.9% QoQ vs. 1.0% expected, but core prices rose at 1.0% rate vs. 0.9% expected. France Dec. Consumer Spending rose 2.0% vs. 0.8% expected Sweden Dec. Consumer

Forex Education Trading Strategies : Dollar Falls on 75 Basis-Point Rate Cut

Dollar Falls on 75 Basis-Point Rate Cut The greenback plunged against most key currencies on Tuesday reversing Monday’s gains as the Federal Open Market Committee lowered its target for the federal funds rate 75 basis points to 3.5%. The yen fell against all major currencies as US equity prices stabilized after the Fed’s emergency move. US stocks pared their biggest decline since 2002 as the Fed’s rate cut helped mitigate concerns of a credit crunch and recession. The unscheduled cut increased

Tuesday, January 22, 2008

Forex Education Trading Strategies : EURUSD: Breaks through Its Rising Trendline, Targets The 1.4310 Key Support Level

EURUSD - EUR maintained its grip on the downside Monday breaking and trading below its rising trendline originating from Aug 16’07 low to close the session at 1.4410. The pair also saw the invalidation of its Jan 01’08 low/.618 Ret (1.4310-1.4921 rally) at 1.4577/45 and the 1.4446/45 zone, marking its .786 Ret/daily 100 ema.The loss of these important levels has now increased the vulnerability of the 1.4310 level, its Dec 20’07 low where a decisive break and hold below there will trigger the

Forex Education Trading Strategies : Carry Conditions Worsen As Equity Markets Print Worst Drop In Years

Since the broad sell off in risk-related assets back in July and August of last year, caution has dominated the market’s taste for risk. The change in sentiment has increased the danger of holding carry trades which rely on low volatility and steady infusions of capital into the financial markets to prevent dramatic fluctuations in the spot rates of currency pairs that lead to capital losses. Now at the start of a new trading week, it is hard to refute the pervasiveness of risk aversion. In

Monday, January 21, 2008

Forex Education Trading Strategies : EURUSD headed back toward 1.4590 support

EURUSD breaks first key support as US on holiday today. MAJOR HEADLINES – PREVIOUS SESSION Overnight developments: ECB"s Wellink said over the weekend that EuroZone growth may be closer to 1.5% than 2.5% UK Jan. Rightmove House Prices out at -0.8% MoM and +3.4% YoY Australia Q4 Producer Price Index rose 0.6% vs. 1.1% expected Germany Dec. Producer Prices fell -0.1% vs. +0.2% expected. THEMES TO WATCH – UPCOMING SESSION Key event risks today (all times GMT): US Markets Closed today for Martin

Forex Education Trading Strategies : EURUSD: Fails Ahead Of The 1.4967 Level, Risk Remains To The Downside

EURUSD-EUR EUR maintained its fourth day of downside weakness on Friday closing the week lower for the first time since rallying off the 1.4310 low registered in Dec’07.This is coming on the heels of a failure ahead of its 2007 peak at 1.4967.Althoough the pair held above its daily 50 ema on Thursday and Friday, with no signs of any strength on the part of price action and a continued bearish outlook from both the daily and weekly momentum indicators, risk continues to point to the downside

Sunday, January 20, 2008

Forex Education Trading Strategies : Dollar Little Changed

Dollar Little Changed The greenback was little changed on Friday with sterling the only big mover. Sterling fell after a report showed UK retail sales unexpectedly fell in December. The drop in sales revived speculation the Bank of England will cut interest rates in February. The theme in the FX market this week has been the increased risk aversion and carry-trade unwinding. The yen rose on increased risk aversion as the US equity market sold off again. The Australian dollar did not rally

Saturday, January 19, 2008

Forex strategy : NZDUSD Channel The Currency Market's Top Range

We recommended the NZDUSD’s rising trend channel as a range trade on Wednesday; and the strategy proved profitable today as we were entered and hit our first target before our second lot was stopped out at breakeven. Looking at the technicals after this trade, the setup for a range looks better today than it had two days ago. Our dominate technical formation remains the rising trend channel that found its start at the end of September. Trading Tip – We recommended the NZDUSD’s rising trend

Friday, January 18, 2008

Forex strategy : EURUSD: Extends Downside Weakness, Its Daily 50 Ema Provides Temporary Support

EURUSD - An extension of the pair’s decline off the 1.4921 high printed in Mid-Jan’08 continued on Thursday pushing the it to as low as 1.4588 before recovering briefly to close above its daily 50 ema located at 1.4619.An impending double top chart pattern is hanging in the throat of this pair suggesting a continued weakness through its Jan 01’08 low/.618 Ret (1.4310-1.4921 rally) at 1.4577/45 could accelerate downside losses towards the 1.4310 level, its Dec 20’07 low with a break through

Thursday, January 17, 2008

Forex Education Trading Strategies : Possible key reversal in USD yesterday on sudden dovish tone in ECB rhetoric

Dollar index poised at key levels - are the lows in for the USD? Bernanke set to testify. MAJOR HEADLINES – PREVIOUS SESSION Overnight developments: EuroZone ECB"s Mersch stated late yesterday that ECB may lower 2008 growth foorecasts US Fed"s Beige Book saw sluggish conditions in the US economy, but growth continues, according to the report US Jan. NAHB Housing Market Index was out at 19 as expected New Zealand Q4 CPI rose 1.2% QoQ vs. 1.0% expected Australia Dec. Employment Change out at +

Forex strategy : FX Charts Strategy

Today’s market developments are a textbook case of the unwinding of the carry trades whereby the Japanese yen rallies across the board, while higher yielding currencies (AUD, NZD and CAD) fall across the board versus their low yielding counterpart as global investor confidence takes a fresh blow from: 1) the unexpected decline in US retail sales; 2) Citigroup’s announcement to cut dividend by 50% and ; 3) and a collapse in the 6-month outlook of the Fed’s NY Empire manufacturing survey. The

Tuesday, January 15, 2008

Forex Education Trading Strategies : EURUSD: Turns Above The 1.4823 Level, Closes In On Its 2007 Peak

EURUSD - A break and close above the 1.4823 level, which marks the pair’s Jan 04’08 high on Monday has now opened up risk for further upmove towards the 1.4967 level, its 2007 peak. This development continues to support the pair’s medium term outlook and an eventual break above the 1.4967 level (2007 Peak) will trigger the continuation of that trend towards its psycho level at 1.5000 initially and then the 1.5155 level, its 1.618 Fib Ext.The weekly momentum indicators remain supportive of this

Forex Education Trading Strategies : Dollar Falls on Deteriorating Yield Differential

Dollar Falls on Deteriorating Yield Differential The dollar fell against most key currencies on Monday on speculations the Federal Reserve will lower rates at least 50 basis points and that it may even happen before the January 29-30 Fed meeting. New reports of possible larger-than-expected credit related write-downs at Citibank and Merrill-Lynch also weighted on the greenback. Despite higher US equity market, the USD/JPY fell possibly due to that Japanese markets were closed for a holiday

Monday, January 14, 2008

Forex Education Trading Strategies : Update

The U.S. Dollar is facing an increase in volatility and heavy weakness since the beginning of the New Year. Markets now pricing in the idea that new rate cuts are on the way after comments by the U.S. Federal Reserve last week. Moreover, Mr. Trichet – chairman of the ECB – has declared that inflation remains on the upside in the Euro area. The green back is now challenging very important levels against Canadian Dollar and Euro. Therefore, we will still watch closely these levels in the next

Forex Education Trading Strategies : USD on the defensive as intermeeting Fed cut speculation mounts

Key US Retail Sales report up tomorrow. A test of 1.5000 looks imminent, but how much further will the USD weaken? MAJOR HEADLINES – PREVIOUS SESSION Overnight developments: New Zealand Nov. Building Permits out at -0.1% vs. a revised -4.6% in Oct. Japan"s markets were closed for a public holiday THEMES TO WATCH – UPCOMING SESSION Key event risks today (all times GMT): Sweden Dec. CPI (0830) UK Dec. PPI Input/Outpu (0930) EuroZone Nov. Industrial Production (1000) UK Dec. RICS House Price

Forex Education Trading Strategies : EURUSD: Keeps Pressure On The 1.4823 Level Enroute To The 1.4967 Zone.

EURUSD-EUR Marginal gains were seen the past week pushing the pair to a high of 1.4818 before closing the week at 1.4777 on Friday. This is coming on the back of a similar performance the previous week. This development now leaves the pair targeting its Jan 04’08 high at 1.4823 and ultimately the 1.4967 level, which is the location of its 2007 peak. Overcoming the latter will resume its medium term uptrend and open up risk towards its psycho level at 1.5000 ahead of the 1.5155 level, marking

Sunday, January 13, 2008

Forex strategy : Trichet the Hawk struck again yesterday

Chronic US Subprime woes pushing CHF and JPY higher, punishing GBP and USD. MAJOR HEADLINES – PREVIOUS SESSION Overnight developments: Rumor of Bank of America acquisition of Countrywide pushed US stocks sharply higher briefly yesterday Merrill Lynch announces USD 15 billion writedown on subprime losses China Dec. Trade Surplus out at USD +22.69B vs. USD + 24.40 expected. Japan Dec. Eco Watchers survey out at 36.6 vs. 38.4 expected and 38.8 previously. Outlook out at 37.0 vs. 38.8 previously.

Wednesday, January 9, 2008

Forex strategy : Greenback Little Changed

Greenback Little Changed The dollar fell modestly against most key currencies on Tuesday on speculation the Federal Reserve will cut interest rates by 50 basis points at the January 30 FOMC meeting. The yen recouped overnight losses after the US equity market fell in afternoon trading. Sterling was supported by a surprise increase in Halifax house prices index. The Australian dollar rose in reaction to a report of a sharp rise in Australia’s building approvals. The Canadian dollar was

Monday, January 7, 2008

Forex Education Trading Strategies : EURUSD: Strengthens, Looks To Challenge The 1.4967 Zone

EURUSD-EUR continues to build on its recovery from the low 1,4310 printed on December 20'07 following declines due to its failure to 1,4967 at the end Dec'07. The pair still biased to the top in the medium and long term, but we need a break over the head resistance at 1.4751/52 zone, which is its 09'07 November / December 11'07. Breaking of the above and will pave the way for progress towards its 2007 peak at 1.4967 followed his psychological level at the beginning of 1.5155 to 1.5000

Friday, January 4, 2008

Forex Education Trading Strategies : NFP with no power

Good morning from Montevideo, so today it is the first Friday of the month, which means that, not farm payroll per day. The only thing is that in recent times the NFP does not have any power, traders are concerned about other things and employment is not a big star more, analysts are very hard time trying to guess what the number will actually be, and they maintain the missing and missing, and if that was not enough, you also keep the revision of every month! it is crazy how people can --

Forex strategy : Nonfarm Payrolls to follow the path laid out by the ADP Employment Change?

The United States surprised by the data from both ADP figures, as well as factory orders. It should, however, the first rate Nonfarm wage in the year that would have on the solid direction in the markets. MAJOR headlines - PREVIOUS SESSION key economic release: German Unemployment Change (December) was K-78-35 against expectations K. Do figure also revised lower from K-53 to 57K. German unemployment (December) to 8,4% was narrowly below the expected value and reflects greater-than-expected drop

Forex Education Trading Strategies : Dollar Mixed Ahead of Employment Report

Dollar Mixed Ahead of Employment Report dollar mixed trade on Thursday ahead of Friday employment report in the United States. In yen rose, supported by unwinding the carry trade. In USD / JPY was testing support at 109, as the increase in risk. EUR / USD boosted by the stronger-than-expected data and EMU ECB governor Athanasios Orphanides "hawkish remarks. Sterling fell to a new record low against the euro after the Bank of England said creditors would reduce the supply of credit to consumers and

Thursday, January 3, 2008

Forex Education Trading Strategies : Dollar Falls on Fed Rate Cut Speculations

Dollar Falls on Rate Cut Federal Reserve Speculations dollar fell on Wednesday pressure on the Fed policy easing speculation in the industry as the ISM PMI fell more than expected. In yen was the best performer today, as an increase in risk, as stock markets fell. Sterling fell against all major currencies, reaching its lowest level against the euro. Crude oil reached a record $ 100 a barrel, and gold soared to the highest ever. EUR / USD today grew up in December in the industry ISM report indicates

Wednesday, January 2, 2008

Forex Education Trading Strategies : Hedging Strategy for 2008 with 300 pips in Profit Potential

In 2007, CHF / JPY currency remains among couples with the lowest volatility in the Forex market. If the price of such conditions will continue in 2008, CHF / JPY my favorite pair of hedging for a week to clear framework rounds and the specific support and resistance levels. Entry Zone: Go both strategic and tactical in the market if the price at any level within 97.00-100.00 range Protective Stop: long stops below 103.00 and short stops above 94.00 Profit Target: Yes Purpose